The Gold Standard vs. Fiat Money

An extensive essay on the gold standard on The Encyclopedia of Economics and Liberty defines it as: ...a commitment by participating countries to fix the prices of their domestic currencies in terms of a specified amount of gold. National money and other forms of money (bank deposits and notes) were freely converted into gold at the fixed price. A county under the gold standard would set a price for gold, say $100 an ounce and would buy and sell gold at that price. This effectively sets a value for the currency; in our fictional example, $1 would be worth 1/100th of an ounce of gold. Other precious metals could be used to set a monetary standard; silver standards were common in the 1800s. A combination of the gold and silver standard is known as bimetallism. A Brief History of the Gold Standard If you would like to learn about the history of money in detail, there is an excellent site called A Comparative Chronology of Money which details the important places and dates in monetary history. During most of the 1800s, the United States had a bimetallic system of money;  however, it was essentially on a gold standard as very little silver was traded. A true gold standard came to fruition in 1900 with the passage of the Gold Standard Act. The gold standard effectively came to an end in 1933 when President Franklin D. Roosevelt outlawed private gold ownership. The Bretton Woods System, enacted in 1946 created a system of fixed exchange rates that allowed governments to sell their gold to the United States treasury at the price of $35/ounce: The Bretton Woods system ended on August 15, 1971, when President Richard Nixon ended trading of gold at the fixed price of $35/ounce. At that point for the first time in history, formal links between the major world currencies and real commodities were severed. The gold standard has not been used in any major economy since that time. What system of money do we use today? Almost every country, including the United States, is on a system of fiat money, which the glossary defines as money that is intrinsically useless; is used only as a medium of exchange. The value of money is set by the supply and demand for money and the supply and demand for other goods and services in the economy. The prices for those goods and services, including gold and silver, are allowed to fluctuate based on market forces.   The Benefits and Costs of a Gold Standard The main benefit of a gold standard is that it  ensures  a relatively low level of inflation. In articles such as What Is the Demand for Money? weve seen that inflation is caused by a combination of four factors: The supply of money goes up.The supply of goods goes down.Demand for money goes down.Demand for goods goes up. So long as the supply of gold does not change too quickly, then the supply of money will stay relatively stable. The gold standard prevents a country from printing too much money. If the supply of money rises too fast, then people will exchange money (which has become less scarce) for gold (which has not). If this goes on too long, then the treasury will eventually run out of gold. A gold standard restricts the  Federal Reserve  from enacting policies which significantly alter the growth of the money supply which in turn limits the  inflation rate  of a country. The gold standard also changes the face of the foreign exchange market. If Canada is on the gold standard and has set the price of gold at $100 an ounce, and Mexico is also on the gold standard and set the price of gold at 5000 pesos an ounce, then 1 Canadian Dollar must be worth 50 pesos. The extensive use of gold standards implies a system of fixed exchange rates. If all countries are on a gold standard, there is  then  only one real currency, gold, from which all others derive their value. The stability of the gold standard cause in the foreign exchange market is often cited as one of the benefits of the system. The stability caused by the gold standard is also the biggest drawback in having one.  Exchange rates  are not allowed to respond to changing circumstances in countries. A gold standard severely limits the stabilization policies the Federal Reserve can use. Because of these factors, countries with gold standards tend to have severe economic shocks. Economist  Michael D. Bordo  explains: Because economies under the gold standard were so vulnerable to real and monetary shocks, prices were highly unstable in the short run. A measure of short-term price instability is the coefficient of variation, which is the ratio of the standard deviation of annual percentage changes in the price level to the average annual percentage change. The higher the coefficient of variation, the greater the short-term instability. For the United States between 1879 and 1913, the coefficient was 17.0, which is quite high. Between 1946 and 1990 it was only 0.8. Moreover, because the gold standard gives the government little discretion to use monetary policy, economies on the gold standard are less able to avoid or offset either monetary or real shocks. Real output, therefore, is more variable under the gold standard. The coefficient of variation for real output was 3.5 between 1879 and 1913, and only 1.5 between 1946 and 1990. Not coincidentally, since the government could not have discretion over monetary policy, unemployment was higher during the gold standard. It averaged 6.8 percent in the United States between 1879 and 1913 versus 5.6 percent between 1946 and 1990. So it would appear that the major benefit to the gold standard is that it can prevent long-term inflation in a country. However, as  Brad DeLong  points out: ...if you do not trust a central bank to keep inflation low, why should you trust it to remain on the gold standard for generations? It does not look like the gold standard will make a return to the United States anytime in the foreseeable future.

Atheism Nietzsche and Palahniuk Illustration of God

The dispute of God extends past just who He is. It extends into what He values, what He believes, and even to what He loves. However, these seemingly complex questions are redundant. The answers to all these questions revolve around one thing: us. We create who He is. We determine what He values. We determine what He believes. We determine whom He loves. We created God. What we should truly be asking is: Does one need God? The necessity of God is discussed at length in Friedrich Nietzsche’s book, â€Å"On the Genealogy of Morals,† wherein he states that since we create morals our own morals, God is too a social construct, who is different for every person. Because standards for morality vary by person, the enforcement of a single, divinely ordained law or code or set of values over all humans generalizes and subsequently overlooks individual experiences. Subsequently, we do not need Him, because we are using God as a figurehead to pass judgment upon ourselves. Nietzsche claims that we use God as a social crutch in order to give ourselves purpose in this world because we fear having a meaningless life. Nietzsche’s ideas are a constant theme throughout Chuck Palahniuk’s novel, â€Å"Fight Club,† wherein we witness the transition of God from being one’s father to the character Tyler Durden. This anthropomorphized God causes destruction and discontent and illustrates the struggle people have with living a meaningless life. Both Nietzsche and Palahniuk argue and illustrate that since God

Arctic Power Essay Example For Students

Arctic Power Essay The Canadian laundry detergent market is mature, very competitive and dominatedby three major consumer packaged goods companies, one of which isColgate-Palmolive Canada (CPC). Arctic Power is CPCs top-of-the-line offeringin its laundry detergent line. Arctic Power is specially formulated for washingin cold water. The detergent has risen in market share from 4% in 1981 to 6.5%in 1986, and the Senior Product Manager has established a goal of reaching 12%market share by 1996. Problem Definition Linda Barton and Gary Parsons face twoproblems. First, they must determine whether to continue developing the brand intheir already strong regional markets of Quebec, the Maritimes and BritishColombia, or go national with marketing efforts. Second, they must decidewhether to use a single positioning strategy (as was successfully implemented inQuebec) or continue to use a dual positioning strategy. The dual strategyconsisted of highlighting Arctic Power as a superior detergent in areas withstrong sales, and focusing on encouraging Canadians to use cold water washing inareas with relatively weak sales. Analysis When it comes to laundry detergents,Canadians primarily think of one name, Tide. Procter and Gambles Tide detergenthas captured over one-third of the market and is twenty percentage points aheadof its closest competitor in market share. While Tide and Arctic Power areequivalent brands in terms of cleaning power, Tide outsold Arctic Power by a 5to 1 ratio in 1986. The market share for Tide has remained level (atapproximately 34%) during the same time that Arctic Power has enjoyed a marketshare increase from 4% to 6.5%. Due to Tides dominance in the detergent market,it will play an important role in any major change in Arctic Powers strategy. Costs and profit structures for leading detergent brands were similar. Abreak-even analysis for the market (see Appendix A) indicates that a detergentmust capture approximately 8% 8.5% of the market in order to break evennationally. Detergents with small portions of market share have experienceddiminishing sales (see Appendix B). Of the twelve offerings (or group ofofferings) that held 10% or less of the market share, only two experienced salesgrowth from 1983 to 1986 Wisk and Arctic Power. To keep its market share, Wiskspent disproportionately high amounts of money on advertising (see Appendix B). In such a competitive market with a high break-even threshold and increasingprices for materials, it is reasonable to believe that the offerings with lowermarket shares will continue to decline. This decline will provide opportunityfor Arctic Power (although CPCs economy detergent offering, called ABC, hasconsumed much of the market share that was lost by the smaller competitors). Arctic Power holds a strong share of the market in three regions: Quebec(17.5%), Maritimes (6.3%) and British Columbia (5.5%). These three regionscomprise 44% of the total volume of detergent sales for the country. Otherregional market sizes are displayed in Appendix C. For Arctic Power to capture12% of market share, it must look beyond these three regions (see Appendix C). Thirty-nine percent of the Canadian market is held in Ontario. Arctic Powerspenetration into this large region is a meager 0.8%. For Arctic Power to reachits goal of 12% market share, Ontario must be considered a major part of thestrategy. Ontario has the highest return on media expenditure of any region (seeAppendix D). Ontario is also changing the way that it washes clothes. Theproportion of households in Ontario that use cold water washing has increasedfrom 14% in 1981 to 17% in 1986. Hence, a marketing strategy that will providefurther penetration into Ontario is quite desirable. Arctic Powers positioningstrategy has been twofold. First, Arctic Power has been positioned in easternCanada as a superior laundry detergent, especially formulated for cold waterwashing. In the western market, Arctic Power has attempted to develop the coldwater market. In either case, Arctic Powers position is connected to coldwater. The good news is that regular cold water washing has increased national lyfrom 20% in 1981 to 29% in 1986. Another 25% of consumers could be described asoccasional users of cold water for washing. Hence, 54% of Canadians wash in coldwater. When people were asked about the benefits of washing in cold water, theresults were astounding. The eight most common answers could be easily dividedinto two categories those that were money saving in nature (saves energy,cheaper, saves hot water, saves electricity) and those that related to thequality of

Los Angeles Police Department Essay Research Paper free essay sample

Los Angeles Police Department Essay, Research Paper Polices: Dislocations that allowed corruptness are still uncorrected, analyze discoveries. The main concedes that averageness became a manner of life at all degrees of the section. The Los Angeles Police Department failed clip and once more to take stairss that might hold headed off the worst corruptness dirt in its history, harmonizing to a sweeping self-indictment prepared by the section # 8217 ; s ain leaders. In a missive attach toing the long-awaited Board of Inquiry study into the corruptness centered in the section # 8217 ; s Rampart Division, Police Chief Bernard C. Parks called the dirt a # 8220 ; life-altering experience for the Los Angeles Police Department # 8221 ; in which corrupt officers took advantage of slack supervising to transport out condemnable Acts of the Apostless. # 8220 ; We as an organisation provided the chance, # 8221 ; Parks wrote. The 362-page study was given to Mayor Richard Riordan and members of the Police Commission on Tuesday eventide and will be released to the populace and the remainder of the metropolis # 8217 ; s elected leaders today. We will write a custom essay sample on Los Angeles Police Department Essay Research Paper or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page It was provided to The Times on Tuesday by top functionaries of the LAPD. Harmonizing to the study, many of the dislocations that allowed the Rampart constabularies dirt to suppurating sore and spread # 8211 ; including failures to look into the backgrounds of constabulary recruits, to supervise officer misconduct and to oversee officers in the field # 8211 ; stay uncorrected despite mounting public and political unfavorable judgment of the LAPD and the metropolis leading. Those revelations efficaciously put the metropolis # 8217 ; s full political leading on the topographic point. Most straight, they demonstrate that the LAPD ignored some calls for reform and created an atmosphere ripe for corruptness. At the same clip, they besides suggest that Riordan and City Council members backed policies that eroded the Police Department # 8217 ; s ability to command contrary officers. The consequences, by the LAPD # 8217 ; s ain admittance, have been dearly-won # 8211 ; and tragic. # 8220 ; This dirt has devastated our relationship with the populace we serve and threatened the unity of our full condemnable justness system, # 8221 ; the Board of Inquiry study concludes. # 8220 ; Distrust, cynicism, fright of the constabulary, and an eroding of community jurisprudence and order are the inevitable consequence of a jurisprudence enforcement bureau whose moralss and unity have become suspect. # 8221 ; While the study admits dislocations at every degree of the section # 8211 ; and in the procedure chalk outing a broader, more damnatory image even than the 1991 Christopher Commission did in the aftermath of the Rodney G. King crushing # 8211 ; its 108 recommendations basically focus on internal redresss. A figure high spot ways to beef up the constabulary head # 8217 ; s power to look into, subject and even coerce the retirement of officers. They pointedly do non back creative activity of outside systems for subjecting the LAPD to extra examination. Unlike the Christopher Commission, which subtly but unmistakably called on Chief Daryl F. Gates to retire, the Board of Inquiry is by and large, and non surprisingly, complimentary of moves by Parks, who supervises the members of the board and has repeatedly pledged to root out corruptness in the section. Parks # 8217 ; ain function in the events at issue is slightly bleary: Although he was named head after the incidents at the centre of the Rampart investigation occurred, he served as the LAPD # 8217 ; s second-ranking functionary from 1992 to 1994. He was demoted that twelvemonth and set in charge of particular probes, including internal personal businesss, but from that point on, he was kept at arm # 8217 ; s length from many section determinations by so Chief Willie L. Williams. The LAPD # 8217 ; s scathing self-appraisal could bolster both sides of the statement over whether outside reappraisal of the section is needed. On one manus, the study says the jobs it paperss are widespread and serious, on the other manus, the metropolis # 8217 ; s constabulary leading is showing unprecedented fairness in publically acknowledging those defects. In fact, the LAPD # 8217 ; s analysis of itself cites country after country in which constabulary officers and their supervisors failed the section and the populace. A few illustrations from the study: * # 8220 ; A dislocation in front-line supervising was surely evident in Rampart. # 8221 ; * # 8220 ; Time and once more, the board found clear forms of misconduct that went undetected. . .. Regardless of the beginning, plaintiffs all seemed to be viewed as recalcitrant, and their allegations were non taken seriously. # 8221 ; * # 8220 ; Peoples are doing forces and promotional determinations unaware of affairs that surely would impact their decisions. # 8221 ; * # 8220 ; Our forces ratings have small or no credibleness at any degree in the organization. # 8221 ; * # 8220 ; The bid squad at Rampart during most of this five-year period lacked cohesive direction. # 8221 ; * # 8220 ; As painful as it may be, we must acknowledge that this job [ failure to execute equal background probes on new hires ] has non been solved, but it must be if we are to supply the people of this metropolis with the quality of jurisprudence enforcement it deserves. # 8221 ; Some of those issues, every bit good as others identified in the study, are barely new. Police critics have been kicking for more than a decennary that the LAPD ignores civilian ailments about officer misconduct. Under Parks, the section late revamped its processs for measuring citizen ailments, but the study makes it clear that the section # 8217 ; s unwillingness to take officer misconduct earnestly continued good into the 1990s, long after the Christopher Commission, the American Civil Liberties Union and others had pointed to the Pr oblem. In 1998, the LAPD # 8217 ; s leading announced that it had fulfilled about all the recommendations of the Christopher Commission. The new study provides dramatic grounds to the contrary, doing it clear that a figure of cardinal recommendations remain unsolved. Among those is the long-standing inquiry of whether the LAPD does adequate to place and track alleged job officers. For old ages after the Christopher study, the section resisted efforts to fit it with a computerized system for entering ailments against constabulary officers and other public presentation steps. Finally, under force per unit area from the civilian Police Commission and the U.S. Department of Justice, the LAPD adopted a system known as TEAMS # 8211 ; an acronym for Training, Evaluation and Management System. In the new study, nevertheless, section leaders concede that the system has fallen far short of outlooks. One key job, harmonizing to the study, is that indispensable informations are being left out of the TEAMS profiles of officers. # 8220 ; Several major forces probes were found that did non look on the officers # 8217 ; TEAMS history even though the affair had been adjudicated for some clip, # 8221 ; the study provinces. The consequence is that a supervisor, in make up ones minding whether a peculiar officer was suited for a sensitive assignment, would non needfully hold the benefit of cognizing that officer # 8217 ; s full work and complaint history. That revelation is certain to make political radioactive dust. It raises inquiries, for case, of why the Riordan disposal has allowed such a key Christopher Commission reform to pine away, despite its public pledges to implement those alterations and after old ages of publically clamouring for the execution of the trailing system . It besides could rag federal functionaries, who have monitored the officer tracking system and insisted that the LAPD adopt strong controls. Another subdivision of the LAPD study that revives long-standing concerns is its analysis of the function that constabulary buildups have played in leting corrupt recruits to happen topographic points in the section. Specifically, the study references, without calling, four officers who were hired despite condemnable records that should hold precluded them from being employed. Three of those recruits were hired before the 1991 Christopher study, which documented some of the dislocations in background cheques. But the 4th, harmonizing to the study, was hired in 1994 despite the fact that he sold drugs as a juvenile and was involved in a # 8220 ; vehicle fiddling incident # 8221 ; as an grownup. That officer was hired after the reforms allegedly had been implemented and after Riordan had become city manager, elected mostly on his pledge to add 3,000 constabularies officers to the ranks in four old ages. As such, the hiring of that officer makes it clear that the reforms intended to work out the showing issues identified in 1991 were non foolproof in 1994. And the study indicates that the jobs continue to this twenty-four hours, partially because of struggles between the constabulary and forces sections over officer hiring. # 8220 ; This job, # 8221 ; it states categorically, # 8220 ; has non been solved. # 8221 ; Other recommendations and observations contained in the study will antagonise different involvements. Police brotherhood leaders, for case, are likely to oppose recommendations for expanded usage of polygraphs, broadened powers to look into officers # 8217 ; fiscal records, and expanded authorization to coerce the retirements of certain officers. The Board of Inquiry besides recommended widening the annual legislative act of restrictions on enforcing serious subject on officers found guilty of misconduct. Military officers and their brotherhood have long fought to protect that bound and will doubtless go on to make so in the face of the survey. In each instance, the board recommendations suggest that Parks, who is passionately disliked by the brotherhood, needs more authorization over the officers beneath him. That excessively is destined to annoy the brotherhood leading. Another recommendation, naming for compulsory rotary motions in certain sensitive units, will besides be controversial within the LAPD, where assignment to some operations is coveted and relinquished merely reluctantly. Meanwhile, some province and local functionaries may oppugn the alterations in province and local jurisprudence needed to give Parks and his top staff those powers # 8211 ; proposals that in some instances besides will be money but that the study argues will pay for themselves in reduced metropolis liability and disciplinary disbursals. Despite the tonss of recommendations and unfavorable judgments, the LAPD study for the most portion endorses the section # 8217 ; s current policies and processs. The fact that corruptness took such deep root in Rampart # 8211 ; and possibly elsewhere # 8211 ; is an indictment of the officers who failed to transport out those processs, non of the processs themselves, harmonizing to the Board of Inquiry. Although that gives the study a sometimes uneven tone, supporting a system that it admits failed severely, it besides provides for some of the papers # 8217 ; s most apparent self-analysis. One transition in peculiar warns of the effects when constabulary let down their guard. # 8220 ; Essentially, many of the jobs found by this [ Board of Inquiry ] boil down to people neglecting to make their occupations with a high degree of consistence and unity, # 8221 ; the study provinces. # 8220 ; Unfortunately, we found this to be true at all degrees of the organisation, including top directors, first-line supervisors and line forces. Clearly, pride in one # 8217 ; s work and a committedness to make things right the first clip seems to hold # 8220 ; Clearly, # 8221 ; he said, # 8220 ; we have to halt accepting second-rate work. # 8221 ;