"The ongoing financial crisis has catalyzed the genesis of a crisis of confidence in at least two important world currencies: the euro and the United States’ dollar. Low interest rates, desperate attempts to balloon the supply of base money, general price inflation, and a stagnating economy are all playing their part in revealing the true nature of the monopolized fiat paper money regime that is our current international monetary system. A growing number of people are realizing that their purchasing power and the value of their savings are slowly depreciating as a result of the inherent instability in the fiat money they hold. These people are looking for alternatives, and the argument in favor of a return of the gold standard is gathering steam.
Yet, the gold money is feared for the very reasons it is a better monetary system: it is more resistant to inflation and the economic evils it brings (impoverishment, the business cycle, et cetera). In fact, one of the most common arguments against the gold standard is that it cannot be easily manipulated and that it handicaps the government when monetary expansion is needed the most. These arguments are true, but they are not marks against the gold standard; rather, these qualities are what make gold currency superior to fiat paper money. A true, free market (competitive) gold-based currency system would do the most towards ridding our economy of the issues related to wanton inflation and currency debasement, because it would remove from government the ability to do as much. More likely than not (assuming a growing economy), people’s monetary savings would increase in purchasing power (rather than slowly depreciate) — like they did between 1879 and 1893 —, making life more affordable and increasing the general welfare of society..."
at http://www.mises.ca/posts/articles/in-defense-of-the-gold-standard/
Yet, the gold money is feared for the very reasons it is a better monetary system: it is more resistant to inflation and the economic evils it brings (impoverishment, the business cycle, et cetera). In fact, one of the most common arguments against the gold standard is that it cannot be easily manipulated and that it handicaps the government when monetary expansion is needed the most. These arguments are true, but they are not marks against the gold standard; rather, these qualities are what make gold currency superior to fiat paper money. A true, free market (competitive) gold-based currency system would do the most towards ridding our economy of the issues related to wanton inflation and currency debasement, because it would remove from government the ability to do as much. More likely than not (assuming a growing economy), people’s monetary savings would increase in purchasing power (rather than slowly depreciate) — like they did between 1879 and 1893 —, making life more affordable and increasing the general welfare of society..."
at http://www.mises.ca/posts/articles/in-defense-of-the-gold-standard/
