Nothing Wrong With Gold Versus Bitcoin Talk Says Ron Paul
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(Kitco News) - With the run-ups of both gold and bitcoin this summer, the asset-classes drew comparisons and heated debates of which is the ultimate, but for former Congressman Ron Paul, the rivalry and competition is a good thing.
“I don’t think it hurts anything. I think it’s fine,” he said in an exclusive interview with Kitco News.
A longtime gold bull who lobbied for an audit of U.S. gold reserves, Paul said that he likes cryptocurrencies and is in favor of competing currencies. He added that governments should only step in to regulate the space to prevent fraud.
“I think the cryptocurrencies offer some competition,” but the former congressman added he’s not so sure who's behind it.
“When you look at some of the social networks and the governments involved in everything, they're certainly in control of the monopoly of the dollar. I even believe the dollar should be denationalized. Let the market decide this because you can't have the Federal Reserve designing and interfering with interest rates on a daily or hourly basis,” he said.
For the former presidential candidate, interest rates are the real underlying problem: “When you regulate interest rates and they're lower than the market, you build bubbles, and then you have to have corrections. And right now as the corrections are trying to come about and fix what we have done. It's not politically popular, so what do they do? They keep printing more money and talking about negative interest rate. It makes no sense.”
But the talk of negative interest rates is working in gold's favor. On Thursday overnight trading, gold lost some gains due to stronger-than-expected U.S. economic reports. Gold is still well above the key psychological mark of $1400. August gold futures were last up $0.10 at $1,424.00.
“I think that obviously there's a different atmosphere right now, but I see it as a devaluation of the dollar,” Paul said on the reason behind gold’s run-up. “And right now I think that it's just a little bit delayed of what was inevitable. The QEs are what we're dealing with - the tremendous increase in the money supply.”
“So it's catch up. The price of gold is going up, but I still argue in reality it is the dollar going down and that of course pushes prices up.”
On the topic of a return to a possible gold standard, Paul said he does not see it happening anytime soon. “But I think in reality when countries destroy money, they always go back to using the metals again. So that will happen.”