Today we demand that the price of computers and bandwidth fall month by month but we oddly expect the prices of many other goods to constantly rise (houses, education, health care, taxes). And so we adjust our expectations accordingly. It takes some imagination to see how the system would work if we were guaranteed our right to deflation.
In recent years an increasing number of economists have understandably become disillusioned by the inflationary record of fiat currencies. They have therefore concluded that leaving the government and its central bank power to fine tune the money supply, but abjuring them to use that power wisely in accordance with various rules, is simply leaving the fox in charge of the proverbial henhouse.
Proposals for monetary reform are ubiquitous, but Murray N. Rothbard argued for the 100% gold coin standard.
Presented at the Mises Institute’s first conference, November 16-17, 1983; in Washington, DC.
This debate on the Gold Standard features Congressman Ron Paul and Charles Partee, member of the Federal Reserve Board of Governors.
Presented at the Mises Institute’s first conference, November 16-17, 1983; in Washington, DC. Includes commentary by Dr. Richard H.
There is a fly in the ointment of economic recovery: a dollar that just won’t seem to stop its fall. The impression that this trend portends something ominous is bolstered by the inverse relationship of the dollar’s value on international exchange and the price of gold. As the dollar has fallen in the last year, gold has risen.
The current international monetary system is based on floating fiat currencies and is constantly subject to unsustainable distortions. This much has been known to Austrians for some time, and Robert Blumen provides the background from Bretton Woods to the current day. Awareness of the problem is now starting to spread to mainstream economists, as suggested by Richard Duncan's new book. He tells the story of how the dollar unsupported by gold has gotten led the world into a terrible mess.
Gold is the best money, because for centuries, as a result of countless individual choices, it has evolved as such. It was not imposed on the market by force, but was cultivated in the soil of the market itself. Christopher Mayer explains.
Since the early 17th century, American governments (colonial, state, and federal) have tried and failed to restart business expansions by reflation, writes Scott Trask. But new money in the system is no substitute for genuine production. It is too early to see the long-run consequences of the Bush-Greenspan reflation, but if the past is any guide we can expect the next decade to more resemble the 1970s than the 1990s.
