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Greenspan gets it?

In his autobiography, former Randian Alan Greenspan says he has, "always harbored a nostalgia for the gold standard's inherent price stability--a stable currency was its primary goal." A stable currency implies that its purchasing power would remain the same. But under a gold standard, there would be a trend for prices to fall as production and innovation would not be set off by increases in the money supply (or very minor increases). If this fact was explained to the American people, maybe they would not "have tolerated the inflation bias as an acceptable cost of the modern welfare state." If Greenspan went before the American people to explain that, "there is no inherent anchor in a fiat-money regime," maybe there would be a change of opinion. People are done with the "wisdom" of the policymakers. They want to return to the Constitution where power is decentralized in the market among individuals. Greenspan says, "There is no support for the gold standard today and I see no likelihood of its return." But he does predict, "We could...see a return of populist, anti-Fed rhetoric, which has lain dormant since 1991." Contradictions do not exist. [All quotes from The Age of Turbulence]

Max Raskin is a journalist living in New York City.

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