As detailed in a previous article on www.emergingmoney.com, Republic presidential contender Dr. Ron Paul wants to abolish the Federal Reserve. Rather than a central bank with a fiat currency, Dr. Paul would replace this with a gold standard.
Dr. Paul’s contention, as outlined in an op-ed in USA Today, is that paper money is always debased over time. In the op-ed in USA Today, “Fed causes booms and busts,” Dr. Paul wrote that, “Throughout its nearly 100-year history, the Federal Reserve has presided over the near-complete destruction of the United States dollar. Since 1913, the dollar has lost over 95% of its purchasing power, aided and abetted by the Fed’s loose monetary policy.”
To many, the fact that Dr. Paul has never received a single co-sponsor from any other member of Congress for this legislation is ample testimony to the wisdom of these ideas.
However, whatever is done to a fiat currency can be done to any replacement. If the US dollar were replaced by gold (GLD, quote) or a basket of commodities, that too could easily be manipulated by the public or private sectors.
The rest of the price reflects speculation.