Authors Forum | Philipp Bagus

Philipp Bagus discusses his recent books: 'The Tragedy of the Euro' and 'Deep Freeze: Iceland's Economic Collapse.' Recorded at the Austrian Scholars Conference, 10 March 2011 at the Ludwig von Mises Institute in Auburn, Alabama.

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[rhubarbcheese]

@FreeGoldObserver

how do you know this?

[FreeGoldObserver]

@rhubarbcheese

This is my new channel BTW... Anyway, the EU is China's biggest trading partner for what that is worth. Not the US but the EU is China's #1 trading partner.

[rhubarbcheese]

@Harshjones

could you give me a hint for a not so complicated material, where the connection between china and EU are obvious, except the fact that barosso was a marxist and is unelected. ?

[Harshjones]

@zentonil

Because anyone with savings is buying gold, not consumer goods. Money velocity will not skyrocket. You need money velocity to have real hyperinflation. So a regular person that gets a paycheck in the meantime can still just go to the store and buy goods with that medium of exchange (fiat Euro) (because the savers will not have emptied the store shelves)

It will still be volatile, it will still be a rough time but the Euro will not hyperinflate.

[zentonil]

@Harshjones "stretching the supply of gold measured in weight. In other words, you'll get less and less gold the further back you are in the line at the bank"

Could you elaborate on this? From what you are saying, it is as if the man infront of me may exchange his $1000 euro and get 1 ounce of gold, but when I exchange my $1000 I only get, let's say, 0.75oz of gold? I don't see how this model with prevent hyperinflation.

[Harshjones]

@zbigniewzapora

No, you and Bagus are confused on the future of gold, the Euro and the dollar. The future is freegold with oil priced in Euro's. The Euro is the first non nation state currency, it is the first currency who's CB floats gold, marked to market on the asset side of its balance sheet. The Euro zone is a net creditor, it has more gold(10,000 tons) then the US and is also China's biggest trading partner.

Get with it. The Euro was designed to take over the Fed/dollar

[zbigniewzapora]

@Harshjones

You are confused about how current banking and monetary system work and this is not the place to discuss this. There are some excellent books available online for free from mises . org by economists from austrian school of thought. Please read them or ask you questions on forums.

[Harshjones]

@zbigniewzapora

And to your secondf point.

As this proceeds, the price of gold (rather than the price of consumer goods) will skyrocket in euro, stretching the supply of gold measured in weight. In other words, you'll get less and less gold the further back you are in the line at the bank. So the bank won't run out like it does in a bank run during a fixed gold standard.

[Harshjones]

@zbigniewzapora

First of all, you cannot do that in any currency because they don't sell physical. Most banks in north America are only authorized participants of the GLD ETF and can only sell certificates. Plus they have goods and services tax on gold in NA. Not so in Europe.

[zbigniewzapora]

@Harshjones

You can do this in any currency even in USD. Granted you can not do this in every country in banks, but you can do this in any business that deals in precious metals, but I fail to see why place of exchange matters. Key statement is - "floating market price". What do you think will happen to the "floating market price" of gold when people will start converting their money en masse into gold?