Gold standard

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Much of the world relied on the gold standard for currencies before the Great Depression. This system derived out of the tradition of using gold as a currency, but fell out of favor after the great depression when most countries switched to fiat currencies. Some groups are pushing for a return to the gold standard. The "gold standard" is a basket of tangibles, of which gold is one of many.

Countries should return to the gold standard

  • Countries should return to the gold standard
  1. The gold standard resists manipulation by special interests, unlike fiat currencies.
  2. Countries should adopt currency systems that are resistant to mainipulation by special interests.
  • Countries should return to the gold standard
  1. The gold standard is a stable store of wealth.
  2. Countries should adopt currencies that can be used to store wealth.
  • Countries should return to the gold standard
  1. Gold backed currencies are relatively resistant to hyperinflation
  2. Hyperinflation undermines the effectiveness of a currency.
  3. Countries should adopt currency systems that are likely to remain useful.

Additional propositions:

  • The gold standard is a unified global currency, allowing efficient international trade.
  • The "gold standard" has the greatest geographical range in terms of equitable barter.
  • Reducing the flexibility of currency, reduces both frequency and magnitude of economic downturns.
  • The gold standard reduces waste, exponentially.
  • The gold standard improves the desire for long term planning.

Implications

  • "Monetary" policy, is returned to the honorable calibration of weights and measures.

Countries should avoid the gold standard

  • Countries should avoid the gold standard
  1. The gold standard is prone to deflation--a gain in the purchasing power of money[1].
  2. When a currency is deflating, people are unwilling to exchange it for goods because its value is increasing relative to those goods.
    • Counter: Deflation acts as an automatic market correction system to an economic downturn.
  3. The purpose of a currency is to facilitate the exchange of goods.
    • Counter: Just because there is deflation does not mean that all economic exchanges will come to a halt.
  4. Countries should use currency systems that serve the purpose of currencies.
  • Countries should avoid the gold standard
  1. The gold standard does not allow inflationary policies.
    • Counter:Be more specific, and list these inflationary policies (deficit spending, printing?).
  2. Inflationary policies help countries deal with economic downturns.
    • Counter: The business cycle can be alleviated by full reserve banking, which is compatiable with a gold standard. (more information about the Austrian Theory of the business cycle here: [2])
  3. Countries should use currency systems that help them to deal with economic downturns.
    • Counter: Countries should use currency systems that allow their citizens to store their wealth in the form of currency.

Other arguments

  • The pursuit of tangible goods leads to conflict.
    1. Counter: Sometimes.
    2. Counter: The pursuit of anything sometimes leads to conflict.
  • Disparity in geological distribution/recovery leads to inequity. Conflict again.
    • Counter:There has nearly always been economic reasons for conflict, saying that more demand for a resource causes more conflict is inevitable; but this would happen as the demand for gold would rise naturally wihtout enacting the gold standard anyways. Also, what is meant by inequity (Gold price inequity, wealth inequity...)?