Ron Paul: Fiat Money Experiment Will End Badly




Transcript

Chairman: At this time, Mr. Paul is recognized for three minutes; your thorn in the flesh.

Ron Paul: Thank you, Mr. Chairman, and welcome, Chairman Bernanke. You know, I guess over the past 30 or 40 years, I have criticized the Fed on occasion, but the Congress deserves some criticism, too. The Federal Reserve is a creature of the Congress, and if we don’t know what the Fed is doing, we have the authority and we certainly have the authority to pursue a lot more oversight, which I would like to see. So although the Fed is on the receiving end, and I think rightfully so when you look at the record; I mean, the Fed has been around for 99 years, almost a few years before you took it over, and 99%, 98% of the dollar value is gone from the 1913 dollar. So that’s not really a very good record, and I think what we’re witnessing today is the end-stages of a grand experiment, a philosophic experiment on total fiat money. Yes, they’ve been debasing currencies for hundreds, if not thousands, of years, and they always end badly, they always return to market-based money, which is commodity money, gold and silver.

But this experiment is something different than we’ve ever had before, and it started in 1971 when we were actually given an opportunity in many ways to be the issuer of the fiat currency, and we had way too many benefits from that than people realized. But it’s gone on for 40 years and people keep arguing from the other side of this argument that it’s working, it’s doing well. And yet, from my viewpoint, and the viewpoint of the free market economist, all it’s doing is building a bigger and bigger bubble. And the free market economist are the ones who predicted the NASDAQ bubbles, the housing bubbles, but we never hear from the Keynesian liberal economist and the central bankers saying, “Watch out, there’s a bubble out there, there’s too much credit, too many problems there. There’s a housing bubble, we have to deal with it.” Usually we get reassurances from the Fed on that. But I believe there’s a logical reason for this, because the Federal Reserve is given responsibility to protect the value of the dollar, that’s what stable prices are all about. But we don’t even have a definition of a dollar.

You know, we ask about the definition of a dollar, and they say, “It’s whatever it buys”. Well, every single day, it buys less than the previous day. To me, it’s sort of like building the economy and having economic planning like a builder has a yardstick that changes value every single day, just think of the kind of the building we would have. This is why we have this imbalance in our economic system. But it was a system designed to permit debt, we have a debt-based system. The more debt we have, and the more they debt the Federal Reserve buys, the more currency they can print. And they monetize this debt, and no wonder we’re in a debt crisis. It’s worldwide, I think it’s something that we’ve never experienced before. And I think the conclusion will be a vindication either for sound money, or you win the argument and say, “Yes, we are great managers, we know how to do it, we want the credit for the good times and we want the credit for getting us out of the bad times.” I think within a few years we’re going to know. Of course, I’m betting that the market is smarter, commodity money is smarter, nobody is smart enough to have central economic planning. So I’m anxiously waiting for the conclusion, because reforms have to come. When you see Robert Zoellick talking about monetary reforms and talking about gold, our time has come for serious discussion on monetary reform. Thank you, Mr. Chairman.

This is a rush transcript. If you notice any errors please report them using the “Help improve this post” link at the bottom of this post.



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213 Comments:

  1. I dont like this experiment, no one knows about it and how bad it is. It dominates everything

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  2. Bernanke made 4 accounts.

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  3. Back in the 50’s, we convinced the world to use the US dollar as a universal reserve currency. We also convinced the world to trade oil exclusively in US dollars. But that was when the US dollar was still backed by gold. The gold standard ended in 71, and after the financial collapse of 08, the world is preparing to replace the US dollar with gold and silver. If that happens, the value of the US dollar will plummet, the price of imported oil will rise sky high, and the US economy will collapse.

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  4. i love ron paul, but he’s too soft, say your mind man! say who rules the world, say what they’re doing and what they’re planing, be a man, you’re not gonna accomplish anything, even if they kill you, you’ve potentially saved humanity

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  5. Ben SHALOM Bernanke is the terrorist. He is the boogeyman who at a few keystrokes can add a few more 1’s and 0’s into his magical computer and create money out of thin air or just print some more currency. Last year the Federal Reserve (as Federal as Federal Express) printed more 100’s than 1’s. They are the people causing the inflation. They must be stopped. I am glad I left the USSA and bought metals.

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  6. Ron Paul needs to study the economic solutions of Bill Sill (The Money Masters). And why doesn’t he support H.R. 2990, a Bill in the House that will End the FED?

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  7. I went to the super market across the street this week and one box of pasta was $1.75 almost double from a couple of years ago when it was $0.99, Oh dear! When will the fit hit the shan???

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  8. Because of the very short memory that American culture, with its endless drive towards the new, aggressively encourages, it is difficult to have a national conversation about an issue that has its roots almost 100 years ago. Yet from all I have studied, and there are millions more like me, Dr. Paul appears to be correct about the history, and probably right in his diagnosis of the problem and the long-term prognosis.

    I wonder if Bernanke responded to this.

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  9. Why won’t people support him? The man speaks the TRUTH! Everyone complains about how politicians are crooked and how they only say what we want to hear. Ron Paul speaks the TRUTH and people call him a loon. It makes me so angry that i almost want to give up hope. But we can’t give up The good fight and we must press on.

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  10. Somebody get this country a DOCTOR!! Tell your friends! Try to change a mind! Wake up everyone you can! Seek out those who don’t get their information from the internet. Find people who believe the lies the media tell them and use your charm and FACTS to set them straight. Be ACTIVE in your duty to reinstate and protect your freedom and save your country! Be a patriot! Use your social media and your voice. We need everyone together on this. Ron Paul 2012!

    Eternal vigilance to all!

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  11. Dr. Paul’s wisdom fell on deaf ears.

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  12. You see that girl in the back ? Yeah he hit that.

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  13. the republican party messed up big time. If they take Dr. Paul’s delegates, he will run third party, yet if they don’t, he will make sure there will be a brokered convention. :)

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  14. The sniper is getting into place, not long now JFK… Sorry, Ron Paul

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  15. ben bernanke hillery clinton and president obama thumbed this video down.

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  16. Do you really think that socialist China is better? ? ?I am Chinese, Chinese society is more degenerate, the greater the gap between rich and poor, with the collusion of bureaucracy, the power of interest groups grow, the same 99% of the wealth of one percent of the forces of monopoly sectors of society, political considerable corruption, tyranny, the peoplesimply not to mention human rights and freedoms of democracy, socialism, communism, the product of political brainwashing! ! !

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  17. Do you really think that socialist China is better? ? ?I am Chinese, Chinese society is more degenerate, the greater the gap between the rich and the poor, the power of interest groups powerful collusion with the bureaucracy, the same 99% of the wealth of one percent of the forces of monopoly sectors of society, political considerable corruption, tyranny, the peoplesimply not to mention human rights and freedoms of democracy, socialism, communism, the product of political brainwashing! ! ! ! !

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