4T? What 4T?

[Mikebert]

Kinser Wrote:All of that assumes that representational money is an impossibility

My argument had to do with the relative rate of world GDP growth relative to money supply growth. This is a red herring. 

Quote:That being said by using sound money based on specie yes there would be deflation

That’s my point

Quote:..but there is likely not going to be a depression.

On what basis do you make such a grand pronouncement?  When the gold standard was in common use, world GDP growth was less than the rate of gold supply increase.  The system had no built-in deflation. Local deflation (such as that in late 19th century America) was the result of fiscal policy (the government ran surpluses to pay down Civil War debt).  If you actually work with the numbers you can see this quite clearly. If you look at a larger period, such as the century before 1932, the price level was approximately constant, the late 19th century deflation pretty closely offset Civil War inflation.  That is what a gold standard is for.
 
The idea that a gold standard prevent secular inflation  is simply wrong. What about the sixteenth century price revolution or the earlier Medieval price revolution, both of which occurred when specie was money.

Quote:There is such a thing as fractional banking.  If I deposit 1000 gold dollars into my bank then the bank should in theory be able to issue up to 5000 dollars in gold certificates because except where there is a run on the bank not everyone is going to demand their gold all at once.

Except they do occasionally. These times are called financial crises (or in gold-standard times, panics).  We had one in 2008, so they still happen.
 
Also, you ignore the issue that if one can obtain a return by not lending, why lend?  After all some gold owners will hoard their gold, which will remove it from the money supply, driving up the price of gold, and incenting speculators to acquire gold seeking a corner.  If gold is limited, the sky is the limit for the price of gold.  Look what happened with Nixon closed the gold window in 1971.  In just 9 years the price rose 20-fold.
 
The gold standard can only work when the rate of gold production exceeds the rate of world GDP growth, because only then can gold producers make a fortune by releasing their gold reserves on the market when the price spikes, reaping a nice profit at the speculators expense. That is, the market needs to be able to break corners.

Quote:I know this will as the other day I just received in the mail a 50 million rentenmark note, it was from the hyperinflation in 1923 in Weimar Germany.

And my dad had stamps from that time, 2 million, 4 million, 6 million, 10 million marks.  I am well aware of the German hyperinflation of 1923 (my German grandparents came here that year) and was acquainted with it as a child.  That is a meaningless comparison, which you would know if you understood these things.