In 1971, Nixon used a fiscal crisis to justify severing the dollar's last connection to gold. It was the same old story: "we must vastly expand government power because of a 'crisis.'" The government never gives up these new powers.
Bob gives a brief history of money in the United States, explaining that the dollar was much “harder” in, say, 1810 than it was in 1910.
The collapse of the monetary order in 1971 reflected the massive dislocations and malinvestment of resources that ultimately turned the decade into one crisis after another. Keynesians are doing something similar today.
How, and to what extent, would fiduciary media emerge in a pure market economy? Hansen argues that holding fiduciary media instead of money is an entrepreneurial error.
Even at a "mere" two-percent level, cumulative price increases over time are nothing to scoff at. Even worse, if we look at what people really spend money on, price inflation doesn't much reflect the conclusions of "official" stats.
Fifty years after Nixon closed the gold window, prices are heading toward 1970s-era increases. Yet the Fed cannot increase interest rates as long as the politicians keep creating billions of new debts.
There won't be a taper tantrum if the Fed seriously moves toward tapering. Investors now understand how the game works. Tapering doesn't actually mean the end of monetary inflation, and everyone knows it.
In 1971, David Rockefeller favored a “new international monetary system with greater flexibility” and “less reliance on gold.” Seeing an opportunity to expand his own power, Richard Nixon enthusiastically embraced the scheme.
Fifty years after Nixon closed the gold window, prices are heading toward 1970s-era increases. Yet the Fed cannot increase interest rates as long as the politicians keep creating billions of new debts.
Even at a "mere" two-percent level, cumulative price increases over time are nothing to scoff at. Even worse, if we look at what people really spend money on, price inflation doesn't much reflect the conclusions of "official" stats.
