Ron Paul Wants Fort Knox To Sell Gold? Meredith Whitney Adjusts, Goldman Downgrades Dollar, and Timeline of Reserve Currencies

Controversy on the blogosphere this morning as the New York Sun is claiming that Representative Ron Paul wants the U.S. to sell off gold in Fort Knox in order to pay down some of the debt.  Bob Murphy, Robert Wenzel, and Mish have all weighed in.  Mish claims that the Sun most likely mistook Ron Paul for Ron Utt of the Heritage Foundation.  Murphy wants the gold sold, while Wenzel is against it.  Murphy and Wenzel even made rebuttal posts about each other.  I don't know if Ron Paul really advocated for the selling of the gold, but having the Treasury sell it would reveal if we actually have any, which would be great.  Wenzel is right in that the gold in Knox was literally stolen, but that argument can be made about practically anything the government touches.  Wenzel isn't wrong and that we should return to a gold standard, but under that particular view, privatizing things becomes incredibly difficult if you have to divide it evenly between taxpayers.

Speaking of Ron Paul, here he is on Morning Joe (probably the best political show in the morning) predicting we will be occupying Pakistan next:

Paul admits he is only predicting without any concrete evidence, but I don't doubt what he says.  We probably already have boots on the grounds in Pakistan.  Expect to hear about Pakistan in Obama's speech tomorrow along with Syria:

(Reuters) - The United States imposed sanctions on Syrian President Bashar al-Assad and six other top aides for human rights abuses on Wednesday in a dramatic escalation of pressure on Syria to cease its brutal crackdown on protesters.

Maybe that is why the CIA is going on a hiring spree:

Meredith Whitney is out again calling for a financial crisis in state and local governments in a Wall Street Journal editorial today:

The rapid deterioration of state finances must be addressed immediately. Some dismiss these concerns, because they believe states will be able to grow their way out of these challenges. The reality is that while state revenues have improved, they have done so in part from tax hikes. However, state tax revenues still remain at roughly 2006 levels.

Expenses are near the highest they have ever been due to built-in annual cost escalators that have no correlation to revenue growth (or decline, as has been the case recently). Even as states have made deep cuts in some social programs, their fixed expenses of debt service and the actuarially recommended minimum pension and other retirement payments have skyrocketed. While over the past 10 years state and local government spending has grown by 65%, tax receipts have grown only by 32%.
Off balance sheet debt is the legal obligation of the state to its current and past employees in the form of pension and other retirement benefits. Today, off balance sheet debt totals over $1.3 trillion, as measured by current accounting standards, and it accounts for almost 75% of taxpayer-supported state debt obligations. Only recently have states been under pressure to disclose more information about these liabilities, because it is clear that their debt burdens are grossly understated.

Goldman Sachs is changing its dollar forecast and is downgrading it:

From Goldman:

• We have changed our forecasts to project more Dollar weakness.
• Since the last revisions to our forecasts, the Dollar decline has roughly tracked the expected path.
• Large structural imbalances in the US are highlighted by weakness in the tradable goods sector.
• The outlook for monetary policy differentials and BBoP trends remains USD-negative.
• Dollar weakness is common during periods with slowing GLI momentum.
• We now see EUR/$ at 1.45, 1.50 and 1.55 in 3, 6 and 12 months, and $/JPY at 82, 82 and 86.

As the days keep ticking away on the dollar's reserve currency status, Zerohedge has this awesome graph highlighting the reserve currencies through the years:

Also be sure to check out Steve Malanga's great RealClearMarkets article on new medical studies citing that less sodium isn't necessarily great for reducing the risk of hear attacks:

Barely a week later the Journal of the American Medical Association published new research which suggested that lowering sodium consumption not only doesn't benefit most people, it may actually increase risk of heart attacks for some. The research was apparently so disturbing to government regulators that some felt the need to step out and criticize the results in the media, something that they rarely do.
If you've been following the latest research on diet in the scientific journals, you would understand why the regulators appeared so defensive. Increasingly, some of the basic assumptions about nutrition that have formed the core of the government's recommendations on what Americans should eat are being questioned by studies which suggest the advice is not merely ineffective but may be counterproductive, contributing among other things to the rise in obesity which the White House decries. Rather than be humbled and made cautious by such research, however, government regulators are simply plowing ahead with a conviction that their ideas about nutrition are correct. Businesses are expected to fall into line, regardless of the implications for their products.