i aksed this on Yahoo ANswers and this is one response
'no
not a single serious economist would consider returning the gold standard
Fiat money works well, no credible economist would suggest that going off the gold standard is “mistake”
the gold standard suggestion is only entertained any where in the world by a few american wing nuts’
what’s so dumb about a gold standard?
and i have been hearing in the media that China might do this? do you think it is rumor or could be true?
The ideas of sound/commodity/real money were Austrian, Not American, Mises among others fled the National Socialists and came to the USA.
The answer is No. I find it unlikely that the Chinese would abandon their Mercantilist policies that help favored exporters over the citizenry. I think it much more likely that some of the other lender nations: Dubai, foremost among them would adopt a commodity money standard as they are trying to improve the lives of their citizens. These other lenders import tons of stuff and the more sound the money system is the more they can import.
China is currently trying hard to get rid of at least part of the mountains of US dollars denominated assets they hold. For past few years they’ve tried to differentiate their enormous reserves by buying Euro denominated assets. As economic datas from the Old Continent are becoming more alarming by the day Chinese have slowed this process down to a trickle. They’ve started looking around for alternatives and so they are now buying commodities using their US denominated assets: these are physical commodities, not the usual paper sold on Wall Street, and they are commodities much needed in the modern technological world. Copper, rhodium, palladium, rare earths like neodymium… they aren’t exactly cornering the market but they are building up considerable stockpiles. I’ve also heard they have entered into negotiations with Latin American countries to insure large and constant supplies of lithium-bearing minerals. While some claim that China is moving towards a “copper standard” my personal bet is that these commodities will be stockpiled and will be sold to Chinese enterprises at “political prices” should the need arise, for example in a hyperinflationary scenario which is now becoming more likely by the day. Relatively cheap commodities will result in cheaper goods strengthening China’s aggressive mercantilist stance even further. The Chinese aren’t stupid and are looking to the US and Europe with increasing uneasiness. Just like week their financial authorities expressed “serious worries” over the situation in the US and warned their fellow countrymen that the depression will be long and will bring about “surprising” changes. In short they know that the mountain of US dollars denominated assets they are holding is potentially toxic and are trying to limit damages. They do not want to hold the bag in the end and how can we blame them?
As far as the issue of a return to a gold standard is concerned my guess (which is as good as everybody else) is that right now it’s too early. As soon as hyperinflation will kick in and people will be treated to even more lies than usual it will become once again a hot topic. Expect Socialists and Keynesians to fight to (their political) death over it.
Nothing dumb about it. On the contrary, it makes it harder for politicians to steal by inflating the money supply. The comment “not a single serious economist” is a stupid joke. It actually means : no member of the establishment will confess they are just gov’t stooges who lie about basic economic principles, for instance, with respect to sound money (gold).