Thanks again Adwebster - it's a fine rebuttal...There's actually...

Thanks again Adwebster - it's a fine rebuttal...

There's actually not much here that I disagree with - although quite a lot I still need to work to understand.

Particularly - I need to understand the motivation aspect in greater detail. I get the gist about the desire of the US to protect the bond market - hiding the inflation that would make the bonds worthless - but need to wrap my head around the details of how this would work. Will have another go at that Summer paper. (not officially trained in economics unfortunately so it's hard work).

It's to your credit that you can revise the data regarding that RBA paper. This speaks volumes that you're not just spouting ideologically on something you've come to believe - which is why those in this forum should indeed read your posts carefully.

Now - I certainly agree that it is unquestionable that there is intervention in the markets. Not JUST intervention - but constant mass intervention on the part of governments. As you rightly say - there is a fine line between manipulation and intervention. Perhaps there is none at all.

This speaks to the issue of to what extent can the ideal of a free market realistically be applied to something like a currency market? Even if you adopt a gold standard - for instance - the government still has to set the price. And the same problems of expanding and contracting the money supply exist in the form of moving the peg up and down.

With respect to trading of fiat currencies - you can't reasonably expect countries NOT to intervene in cases where speculators cause massive price fluctuations which in turn cause harmful effects to an economy. Yet governments are players in the market with an inordinate amount of power and so their perception of what a currency should be distorts the whole market. Sometimes they get overwhelmed - even relatively big players, like Russia at the moment. But if you're the US - it's hard to take you on.

So I just don't know if the ideal of a free market that in the long run properly values currencies even makes sense conceptually. And if it doesn't - then we might be shaking our fists at a reality that simply can't be changed. But everything I'm saying here is very wishy washy and not really thought out.

But suffice to say - gold is perceived by many to be a currency. And governments no doubt wish to have some sort of control over it in order to protect their interests. It could be argued that they have a mandate to so intervene given to them by the people who voted them in - insofar as they are acting to preserve the wealth of their citizens. However - I know this won't fly with you because of your belief that the people manipulating gold are doing it to further their own power at the expense of the people. And I guess that's the claim of the conspiracy theorist that interests me the most.

Intervention is par the course - but for the benefit of the few? That's the key of their criminality and the essence of this debate. Now if the US is just doing it to protect the bond market and thereby protect the status quo that provides such wealth to its citizens - then you might argue the US government has a democratic mandate to pursue that course. So THIS particular motive isn't the one that can provide much comfort to the conspiracy theorists. What we need to focus on - and what I'll direct my own efforts toward - is the claim that it's done for the benefit not of the american citizen - but for the elite rich. Because they certainly don't have a mandate to pursue that.

I'm starting to ramble - so I'll stop. Thanks again for your posts.