Posted by Adam Sharp - Wednesday, May 11th, 2011

Mr. Forbes (founder of Forbes Magazine) says although it may seem crazy today, a return to the gold standard is likely in America.

From NewsRoomAmerica.com:

Steve Forbes, the founder of one of the nation's premier economic magazines and onetime GOP presidential contender, says he believes the nation will return to the gold standard within five years because doing so would solve a number of economic, fiscal and monetary issues.

"What seems astonishing today could become conventional wisdom in a short period of time," Forbes said in an interview with Human Events magazine, a conservative publication.

Returning to the gold standard would mean stabilizing the U.S. dollar, restoring foreign confidence among foreign investors in U.S. government bonds and dissuade lawmakers from engaging in reckless spending habits, Forbes told the magazine.

If the standard had remained in place, Forbes said, the dollar would not be under assault now and federal spending would have been curbed.

"When it comes to exchange rates and monetary policy, people often don’t grasp” what is at stake for the economy, he said. "If the dollar was as good as gold, other countries would want to buy it."

I like his sentiment on conventional wisdom. I've talked with a number of smart people about the gold standard, and they simply believe it is impossible. Trying to explain that paper money has always failed throughout history typically does no good. They have it beaten into their brain that the gold standard is "crazy".

I think Mr. Forbes is correct. Conventional wisdom will have to change.

More from the article at Human Events:

Politicians need to “get over” the notion that the Fed can guide the economy with monetary policy. The Fed is like a “bull in a China shop," Forbes said. “It can’t help but knock things down.”

“People know that something is wrong with the dollar," Forbes concluded. "You cannot trash your money without repercussions.”