In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.
If there were, the government would have to make its holding illegal, as was done in the case of gold.
If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods.
The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. […] This is the shabby secret of the welfare statists’ tirades against gold.
Deficit spending is simply a scheme for the confiscation of wealth.
Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.
– Alan Greenspan, former Chairman of the Federal Reserve (1966)
NOTE: U.S. Federal Reserve Chairman Alan Greenspan received an honorary knighthood from Britain’s Queen Elizabeth II. Greenspan cannot call himself “Sir” since he is not a UK citizen, however, he will be able to add the letters KBE — which stand for Knight Commander of the British Empire — after his name.
It is an honor shared by former U.S. President Ronald Reagan, former U.S. President George Bush, former New York Mayor Rudy Giuliani, entertainer Bob Hope and U.S. Gen. Norman Schwarzkopf.