Is the gold standard a way to prevent crisis in the future?
Right now, I want to talk about ways to prevent a future crisis. While we are all talking about taxing the financial service industry, regulating or some other way of controlling animal spirits, there is also the issue of fiat currencies. A lot of people think a gold standard is the cure to all that ails us. You can point to fiat currencies as inflationary as I did in my post “The Age of the Fiat Currency: A 38-year experiment in inflation,” but that doesn’t mean a gold standard is any better. As a response to that Post, I got a thoughtful response from Rob Parenteau, author of the newsletter started by the late Austrian economist Kurt Richebächer. Richebächer, incidentally, called the housing bubble and predicted its collapse. Rob’s comment is below. As an investor, you should look at his comments as evidence that the only source of consumer price inflation we are likely to see any time soon is via commodities and oil. Probably best to remember it is not just fiat currency systems tha
