Originally Posted by
GeorgeParker
That argument is and always has been baloney.
When the dollar was backed by gold or silver, the relationship between the "official" price of gold/silver in dollars had nothing to do with the market price you would have to pay if you bought that metal or something made from that metal. And as far as the paper money and coins being "backed by" gold or silver, it has never been possible to walk into a government office and demand that they give you gold or silver in exchange for your dollars. So the whole thing was a hoax.
The only reason the gold standard existed was because governments all over the world needed to have something tangible backing up the foreign currency they allowed their currency to be exchanged for. It had nothing at all to do with ordinary citizens. It didn't make the money any more secure. And it didn't prevent inflation or deflation.