Money Does Matter: The End of the Gold Standard Led to a Lower Standard of Living, by André Marques

Fake money is not without costs, and those costs invariably lower living standards. From André Marques at mises.org:

On August 15, 1971, Richard Nixon announced that the US dollar (USD) would no longer be redeemable in gold. This was supposed to be temporary. And yet, fifty-one years later, here we are. The gold standard was gradually destroyed in the twentieth century. Now people are experiencing the consequences: less purchasing power, more economic cycles, and a weaker economy.

In the chapter 4 of his book What Has Government Done to Our Money?, Murray Rothbard goes over the steps the government took to end the gold standard over the twentieth century, from the end of the classical gold standard to the closing of the gold window in 1971.

The Classical Gold Standard (1815–1914)

The classical gold standard tended to prevent the government from running budget deficits and going into debt, as it could not easily create inflation. In 1913, the Federal Reserve (Fed) was born. When the US entered the World War I, US dollars were printed at an excess of the gold reserves. At this point, the US got off the classical gold standard and this money printing contributed to the depression of 1920–21.

Continue reading→

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.