As many of us already know, the charter, which authorizes the privately owned Federal Reserve Bank and it's member banks to act as agents under the perview of the Dept. of The Treasury, expires in 2013. Or thereabouts.
The gold bonds issued by the Dept. of The Treasury to the Federal Reserve Banks as an asset on their balance sheet is officially valued at $42.40/oz or thereabouts and this would explain much of the systemic imbalances.
My question is not whether we should go back to a "gold standard" because I don't believe it is a workable solution given the complex nature of the societies we all live in with the extremely high level of the division of labor.
I believe that an official revaluation of the national asset will "balance the books" as they say and allow for a more orderly resolution to the credit and debt crisis and ongoing liabilities on national balance sheets.
My question is; if, and that's a big one, if the Federal Reserve Bank does get it's charter renewed, would that be when an official revaluation of gold would take place? If ever?
If so, I think at that point gold will remain at a high price for the foreseeable future, or length of the renewed charter, as currency backing for the massive liabilities said to be in excess of 100T.
After that the price may slowly recede but I doubt it considering the massive amount of reconstruction costs from wars and natural disasters the world over such as Fukushima and Australia with more to certainly come.
I think the next century will be one of less overall production and a great deal more of rebuilding and reconstruction. Just by virtue of this point of view, it necessitates a high national asset valuation to balance the costs and current liabilities. Revaluing national natural resources that are consumed will not work because the enormous price increases would instantly kill all economic activity. Oil is an example of this.
Truly, this gold bull is a once in a lifetime event and will set the standard for generations to come. But when will gold's revaluation become official?
When will the gold bonds be reissued, if at all, and what will be their official valuation as we head further into the next millenium?
It looks like that the market is forcing the choice for an official higher valuation of the national asset but will they, when, and at what price?
I also think the structural nature of banking will have to change from one of % intrest on loans to a flat fee based on loan value. This would allow all loans to be paid back faster and overall more loans to be generated increasing the flow of funds and economic activity. The banks would keep a small percentage of this fee to cover operating expenses but the larger share would be due the nation thereby eliminating the need for individual income taxes which would also increase the flow of funds and generate stronger and more sustainable economic activity.
I'm sure that many people smarter and brighter than I am have thought of these questions and I would like some thoughts on this but I see them more as questions of national asset valuation and personal/national values.