February 20, 2012 § Leave a comment
‘You are aware that the gold standard has been the ruin of the States which adopted it, for it has not been able to satisfy the demands for money, the more so that we have removed gold from circulation as far as possible.’
One of the key problems with Gold as currency is that it is strongly deflationary. Austrian Economics both denies deflation is disastrous and that Gold is deflationary and this is one of its major weaknesses.
The fact that Gold is strongly deflationary has always been one of the key issues in the debate, even in the late 1800’s.
Populists throughout the 19th and early 20th century have always fought for more plentiful money. The famous Bryant exclamation ‘you shall not crucify labor on a cross of Gold’ was not in the context of debt free money, but to allow Silver to circulate besides Gold…
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