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What is the gold standard? Alright people well it's a kind

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of value number line that everyone trusts gold gold gold gold yeah like [hand draws line against ruler, fills with gold]

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that an ounce of gold in India is generally worth the same as an ounce of [map of world]

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gold in China the US Argentina even Somalia assuming it's an actually real

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gold and not fake gold or pyrite yeah yeah we know what you did [Somalian with gun in village]

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alright well because gold is so universally or planet airily trusted it [gold ingot floating in space]

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kind of comprises a monetary system unto itself [gold ingot orbiting earth]

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its economic unit is the heart of most modern economies or at least their [skeleton with golden heart]

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history and like a tub of Neapolitan ice cream it comes in three flavors species [tub of ice cream]

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bullion and exchange alright so let's start with gold species with Vichy but

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it's way better it is the standard monetary unit associated with gold coins

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well obviously in a world where gold is being exchanged for things of value like [crate of good and bag of gold ]

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mining picks Levi's jeans and food gold itself or the store of value has to be

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modularized in the standardized units and that's what gold species is all

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about alright next up the gold bullion standard alright well that's a system

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where gold coins are stored in the coffers of governments as a kind of

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collateral or guarantee against a usually paper circulating currency like

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the US government has a whole bunch of gold in Fort Knox in Kentucky there yeah [US government building]

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and they guarantee the paper value of a dollar in theory based on that gold

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reserve in Kentucky even though today it's a small tiny rounding error of all

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the paper that's out there alright well finally we have the Gold Exchange

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standard which is usually simply a government backing or guarantee of a

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fixed exchange rate for what the government will do in return for them [Uncle Sam holding cardboard sign]

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being given an ounce of gold well the real gold standard however kind

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of faded away through the 20th century as so many countries drew irresponsible [highway sign saying "now leaving Gold Standard]

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financial practices as the norm norm the quote honesty unquote of a fixed rate

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gold exchange simply put too much pressure on the desire for countries to

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have internationally weak currencies hoping to stimulate

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exports from their own hard-working citizens the big advantage here well in [Fidget Spinner boat in Atlantic ocean]

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essence the gold standard limits the power of government to make too many [Uncle Sam holding knife]

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stupid moves and the foundation of that control is that if a government's

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currency or ability to buy stuff is limited by the amount of gold they have

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in their coffers well then they have to live within their set budget and I like

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the rest of us right unlike a paper backed currency like what we have in the

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US governments then can't just run a printing press anytime they want [dollars getting printed]

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printing money out of thin air making more gold to pay for I don't know

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congressman pickpockets private shuttle from Virginia to DC or a new five [congressman getting out of taxi]

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hundred thousand dollar after-school program for kids who are addicted to [kid biting pencil in class]

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biting pencils anyway the biggest disadvantage here is that governments

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are actually then culpable for the money they spend ie their budgets that's the

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problem with a real full gold standard it forces people to act financially

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responsible yeah that would be terrible well when you look around that would not [wheel of fortune landing on Greece/Somalia]

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be such a terrible thing at all

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