Electronic Currency vs Gold
Hi Dave / Everybody,
There seems to be a lot of activity around the subject of electronic currency lately. As most here know, several countries have committed to going electric, and it's also become evident that the Fed is considering this route as well with "FedCoin" (source). The logic makes sense to me – create a secondary electronic currency and fix the exchange rate such that cash loses value so people/savers are forced into moving whereas debtors can keep debt in cash and have its value decreased.
Now I've also seen the following comment from Martin Armstrong:
Now out of real desperation, they claim gold will be reset at $5,000 to $100,000 and silver $400-$500. I really do not understand where they come up with this stuff, as if government will surrender all power and bow before them after laying down their weapons. Government would NEVER do such a thing, and in case they have not noticed, we are moving to electronic money; not bullion.
I know there are mixed opinions on him, but this has got me wondering: what really would likely happen to gold if we moved to digital dollars? Would it still rise vs the dollar because of its flight to safety characteristics during some transitional period? I think we would all like to see some gold-backed component to our money supply but what if this never happens? Just curious to get the thoughts of Dave and others.