4 ms·
Inflation inflation inflation, gold proponents always want to talk about inflation, never about the steering wheel that fiat currencies provide: Steering that a
by SubiculumCode 6y ago
Inflation inflation inflation, gold proponents always want to talk about inflation, never about the steering wheel that fiat currencies provide: Steering that allows us to right the course of our economic ships. When you link to gold, you go where the wind blows you. No control. No steering.
Moreover your historical argument is weak. By analogy, we should also not have government, because every society that has formed a government has failed to keep it: Every government falls, eventually, be it Rome or the Aztecs.
- tastyfreeze 6y agoThat steering wheel is driving us off a cliff. If the result of having a steering wheel is a loss of trust in the currency and ultimately the collapse of that currency I would rather be blown by the wind.
- SubiculumCode 6y agoBut it hasn't happened to our currency. The only thing that's happening to our currency right now is our political instability, which frankly is a little unsettling at the moment with all the talk of secession martial law, suspension of the Constitution, and religious fervor for Trump that we are seeing on the far right at this moment in time.
- tastyfreeze 6y agoYet... 1970 $1 is equal in purchasing power to $6.71 today. There is no indication from the Fed that this is going to turn around. With the rate the Fed is pumping out dollars, runnaway inflation is a near certainty.
- SubiculumCode 6y agoThis argument fails. Dollars are to be used, not hoarded. Modest inflation encourages use of the currency. This is good. As far as an argument from authority, I'll take the Fed than random HN commenter. In any case, inflation is well controlled, perhaps over controlled, except for certain products with very real limits to production and supply (i.e. housing).
- tastyfreeze 6y agoIn any other field we see the same thing happen exactly the same way 20 time we assume it to be a hard rule until proven otherwise. For some reason with economics every government comes along and thinks they can guide the beast when no one has ever done so in history. I refuse to believe that a currency having 1/6 the buying power over 50 years is a good thing. Yet, under 150 years of gold standard the dollar maintained the same purchasing power. Inflation does encourage spending. But, it also discourages saving. Everybody wants to get rid of their paper before it becomes worth less. Saving is a healthy part of an economy.
- SubiculumCode 6y agoHistory is not a controlled experiment. The context changes with each iteration. We understand more about how currencies work than ever before. If you want a long term store of value, choose a commodity, or gold I guess.
- tastyfreeze 6y agoAll I hear with your argument is "its different this time" and "we know better than everybody before". Anyway, I have been divesting my savings from USD to prepare for the coming dollar collapse.