Originally posted on Thursday, July 18th, 2013
The downward movement in the gold price brings to mind the old miner’s ballad, Oh My Darling Clementine.
In a cavern, in a canyon,
Excavating for a mine
Dwelt a miner forty niner,
And his daughter Clementine
Oh my darling, oh my darling,
Oh my darling, Clementine!
Thou art lost and gone forever
Dreadful sorry, Clementine
Light she was and like a fairy,
And her shoes were number nine
Herring boxes, without topses,
Sandals were for Clementine.
Drove she ducklings to the water
Ev’ry morning just at nine,
Hit her foot against a splinter,
Fell into the foaming brine.
Ruby lips above the water,
Blowing bubbles, soft and fine,
But, alas, I was no swimmer,
So I lost my Clementine.
Of course, demonetized gold merely is a commodity, and a nonindustrial one at that, with all of the speculative aspects this implies. Under the classical gold standard, the value of the dollar is meticulously defined by a fixed weight of gold and the problems associated with a fiduciary monetary policy are resolved. Meaning, no more “Ruby lips above the water, Blowing bubbles, soft and fine….” Whether dotcom, real estate, or any other manifestation of the bubbles, and boom and bust cycle, associated with fiduciary paper money.
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