2 ms·
I think you could just lower the exchange rate for how much gold the central bank will give for dollars then print more money. This devalues the currency, but t
by slaymaker1907 5y ago
I think you could just lower the exchange rate for how much gold the central bank will give for dollars then print more money. This devalues the currency, but that's precisely what you want in the case you gave.
- zarzavat 5y agoThis is likely to lead to a run on the bank as everybody rushes to exchange their money for gold. Eventually the peg collapses and we are back to non-exchangeable currency. Gold standard only works as long as everybody believes that the exchange rate will not change.