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I see. The issue with this line of argument is that the gold standard is not good for several of the things we want currencies to do, including the ability to c

by spupe 4y ago

I see. The issue with this line of argument is that the gold standard is not good for several of the things we want currencies to do, including the ability to control their supply. It might seem like simply debasing gold coins as you say, but it's not quite. We just went through two very weird years in which the economy went sideways, but we had no massive unemployment, no bread lines and no revolutions. There is a price for it, both in inflation and in unequal access to benefits, with richer people and companies having access to very cheap money. But it's a trade-off either way, not simply theft as you imply.

Geee 4y ago
There's an argument to be made, that the relative stability here is bought from volatility and economic suffering in poorer countries, because the US dollar is the global reserve currency. In addition, there's a few other relatively strong currencies, which are used as reserves for weaker currencies. It seems that globally, the success in these countries is bought from weakening the currencies in poorer countries. There's also a lot of historical inaccuracies and rewriting of history to defend this system. For example, the great depression is partly blamed on the gold standard, but in reality it happened exactly because the gold standard was already broken (since 1914), which resulted in wildly wrong speculative monetary practices and policies.[0] As you said there's plausible rational arguments from both sides. But then again, are the central banks even following practices based on economics, or did they become politicized and corrupted, because of their central position in the economy? We see blatant monetary corruption happening in autocracies, but is it happening in western economies too, but it's just less obvious? I have used years to study these issues and I'm becoming more convinced every day, that it's time for a hard money standard, i.e. Bitcoin. And, I think it's inevitable, because historically, people always vote for harder money in a free market. [0] From this perspective, the Austrian School of economics has the correct explanation for the Great Depression. https://en.wikipedia.org/wiki/Great_Depression#Austrian_School https://en.wikipedia.org/wiki/Great_Depression#Austrian_Scho...
- spupe 4y ago
  > It seems that globally, the success in these countries is bought from weakening the currencies in poorer countries. Perhaps, but the period since 1914 saw the rise of many peripherical countries, notably China, who also have a tight control over their monetary policy, and use it all the time for their economic plans. For your counterfactual to make sense, you would have to present an example of a country that developed using the gold standard. > But then again, are the central banks even following practices based on economics, or did they become politicized and corrupted, because of their central position in the economy? We see blatant monetary corruption happening in autocracies, but is it happening in western economies too, but it's just less obvious? There is corruption and inefficiency at every level, but I fail to see how that would change by going back to the gold standard or cryptocurrencies for that matter. I am familiar with the Austrian line of argument, and I'm sure in your years of study you have come across many criticisms of it, so I won't bother, but let's just say I don't think this perspective has brought us tangible benefits at all. Meanwhile, the imperfect system we have has shown itself to be at least robust to major hiccups recently.
  - Geee 4y ago
    I'm not saying that economic development isn't possible with fiat currency. What I'm saying is that fiat currency is immoral; it's a form of slavery. It disincentivizes people from saving and taking responsibility, and accelerates consumption and throwaway culture. Because of this, people are overworked and the climate and the planet suffers. Meanwhile, wealth is siphoned to the elite. If people are denied the use of gold as money, then they can't. There are many regions, where citizens are basically prisoned by their central bank, and can't use gold or US dollars. Also, Switzerland used gold backed currency until 1999, and they are one of the richest countries per capita. There's no reason to believe that they would have done better with a fiat currency. > There is corruption and inefficiency at every level, but I fail to see how that would change by going back to the gold standard or cryptocurrencies for that matter. Self-custodied Bitcoin is impossible to inflate. > Meanwhile, the imperfect system we have has shown itself to be at least robust to major hiccups recently. Disagree. We are now entering a long period of depression.
    - 4y ago

by spupe 4y ago

Geee 4y ago

There's an argument to be made, that the relative stability here is bought from volatility and economic suffering in poorer countries, because the US dollar is the global reserve currency. In addition, there's a few other relatively strong currencies, which are used as reserves for weaker currencies. It seems that globally, the success in these countries is bought from weakening the currencies in poorer countries. There's also a lot of historical inaccuracies and rewriting of history to defend this system. For example, the great depression is partly blamed on the gold standard, but in reality it happened exactly because the gold standard was already broken (since 1914), which resulted in wildly wrong speculative monetary practices and policies.[0] As you said there's plausible rational arguments from both sides. But then again, are the central banks even following practices based on economics, or did they become politicized and corrupted, because of their central position in the economy? We see blatant monetary corruption happening in autocracies, but is it happening in western economies too, but it's just less obvious? I have used years to study these issues and I'm becoming more convinced every day, that it's time for a hard money standard, i.e. Bitcoin. And, I think it's inevitable, because historically, people always vote for harder money in a free market. [0] From this perspective, the Austrian School of economics has the correct explanation for the Great Depression. https://en.wikipedia.org/wiki/Great_Depression#Austrian_School https://en.wikipedia.org/wiki/Great_Depression#Austrian_Scho...

spupe 4y ago
> It seems that globally, the success in these countries is bought from weakening the currencies in poorer countries. Perhaps, but the period since 1914 saw the rise of many peripherical countries, notably China, who also have a tight control over their monetary policy, and use it all the time for their economic plans. For your counterfactual to make sense, you would have to present an example of a country that developed using the gold standard. > But then again, are the central banks even following practices based on economics, or did they become politicized and corrupted, because of their central position in the economy? We see blatant monetary corruption happening in autocracies, but is it happening in western economies too, but it's just less obvious? There is corruption and inefficiency at every level, but I fail to see how that would change by going back to the gold standard or cryptocurrencies for that matter. I am familiar with the Austrian line of argument, and I'm sure in your years of study you have come across many criticisms of it, so I won't bother, but let's just say I don't think this perspective has brought us tangible benefits at all. Meanwhile, the imperfect system we have has shown itself to be at least robust to major hiccups recently.
- Geee 4y ago
  I'm not saying that economic development isn't possible with fiat currency. What I'm saying is that fiat currency is immoral; it's a form of slavery. It disincentivizes people from saving and taking responsibility, and accelerates consumption and throwaway culture. Because of this, people are overworked and the climate and the planet suffers. Meanwhile, wealth is siphoned to the elite. If people are denied the use of gold as money, then they can't. There are many regions, where citizens are basically prisoned by their central bank, and can't use gold or US dollars. Also, Switzerland used gold backed currency until 1999, and they are one of the richest countries per capita. There's no reason to believe that they would have done better with a fiat currency. > There is corruption and inefficiency at every level, but I fail to see how that would change by going back to the gold standard or cryptocurrencies for that matter. Self-custodied Bitcoin is impossible to inflate. > Meanwhile, the imperfect system we have has shown itself to be at least robust to major hiccups recently. Disagree. We are now entering a long period of depression.
  - 4y ago