Whenever I talk to guys in the financial industry, they tell me that it is impossible for us to return to a gold standard. Is this true? If not, what is a good way to make the transition from fiat to gold? Thanks, Egon

Data somewhat relevance would be “how much gold existed in the United States before it went off the gold standard?” But anyway, it’s irrelevant. Stocks circulate with a fixed value as money even though certain types of stocks don’t give you any representation without a certain number and only do so…

Whether a gold standard would or wouldn’t work is immaterial, although some libertarians make of the gold standard a sort of make-or-break point. What matters is that there should be full competition in money, and all the monetary reform that is needed is for legal tender laws, implicit or explicit,…

The problem with gold standards in the past was that their value was fixed to silver and/or foreign coins were not legal and/or fractional reserve banking. That’s what I think at least. Jackson’s specie circular was brilliant, but he should not have came up with a gold to silver ratio. If you have …

Merlin, Why do you think gold won’t work?

I buy Hayek’s reasoning in “The Denationalization of Money”: deflation is pernicious too, and it’s not just inflation we must guard ourselves against. In a world where money was neutral, neither would hurt, but as things are, deflation too distorts the true price structure and the signals in a mark…

I’m a bit confused by your reply. Do you mean by deflation “a decrease in the money supply” or do you mean “a general lowering of prices”? If the former, how is gold inherently deflationary? Does it melt away in the hot summer sun? If the latter, how does a gold standard cause a general lowering o…

I use ‘deflation’ in the ‘general lowering of the price level’ sense (yes, yes, I know, that cannot be measured, and so what?). And in that sense, we can foresee that the production of gold will, due to its natural rarity, be always lower than the supposed growth of a free economy. Historical expe…

Judged by whom and against what exactly? Perhaps against “something” whose quantity must be engineered (by whom?) with the goal of “keeping aggregate prices constant”? I, like Dave, am confused by your questions. Wasn’t expecting them knowing how long you’ve been around here.

If it can’t be measured, then how does one tell whether it exists?

The Feasibility of Gold as Money

Economics Economics Questions

John_James January 12, 2012, 7:47pm 2

See here.

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The Feasibility of Gold as Money

See here.

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