|
| quote: | Originally posted by Groundhog Boy
 |
| quote: | January 31 & February 2, 2000
An excerpt from:
A Republic, If You Can Keep It
------------
Statement of
HON. RON PAUL
OF TEXAS
------------
Although many claim the 1990s have been great economic years, Federal Reserve board action of the past decade has caused problems yet to manifest themselves. The inevitable correction will come as the new century begins and is likely to be quite serious.
The stage has been set. Rampant monetary growth has led to historic high asset inflation, massive speculation, over-capacity, malinvestment, excessive debt, negative savings rate, and a current account deficit of huge proportions. These conditions dictate a painful adjustment, something that would have never occurred under a gold standard. The special benefits of foreigners taking our inflated dollars for low-priced goods and then loaning them back to us will eventually end. The dollar must fall, interest rates must rise, price inflation will accelerate, the financial asset bubble will burst, and a dangerous downturn in the economy will follow. There are many reasons to believe the economic slowdown will be worldwide since the dollar is the reserve currency of the world. An illusion about our dollar's value has allowed us to prop up Europe and Japan in this past decade during a period of weak growth for them, but when reality sets in, economic conditions will deteriorate. Greater computer speed, which has helped to stimulate the boom of the 1990s, will work in the opposite direction as all the speculative positions unwind, and that includes the tens of trillion of dollars in derivatives. There was a good reason the Federal Reserve rushed in to rescue Long-Term Capital Management with a multi-billion dollar bailout. It was unadulterated fear that the big correction was about to begin. Up until now, feeding the credit bubble with even more credit has worked and is the only tool they have to fight the business cycle, but eventually control will be lost.
A paper money system is dangerous economically and not constitutionally authorized. It's also immoral for government to "counterfeit" money, which dilutes the value of the currency and steals value from those who hold the currency and those who did not necessarily benefit from its early circulation. Not everyone benefits from the largesse of government spending programs or a systematic debasement of the currency. The middle class, those not on welfare and not in the military industrial complex, suffer the most from rising prices and job losses in the correction phase of the business cycle. Congress must someday restore sound money to America. It's mandated in the Constitution; it's economically sound to do so; and it's morally right to guarantee a standard of value for the money. Our oath of office obligates all Members of Congress to pay attention to this and participate in this needed reform.
http://www.house.gov/paul/congrec/c...00/cr020200.htm
|
|
