The monetary policy we have coerces people into passive investing, creating bubbles. When rates are low, you see bogus "tech" plays like wifi water dispensers, that's the scam the author means. Also makes taxes weird, e.g. why capital gains aren't the same as income (today USD ≠ past USD). Gold standard is wasteful though; Fed could just keep a steady money supply instead.
But it's our scam. The Fed isn't only diluting Americans' money; USD is a world currency, and the US tries to keep it that way by whatever means. So we kinda benefit from that.
I think it's probably worth learning a little bit about economic history before talking about the benefits of the gold standard. Before the fed was created, the US economy was constantly booming and busting. There were recessions every few years in the 19th century [0].
Why folks are so eager to return to that era is beyond me.
The economy is still booming and busting, we just paper over it with debt like good Keynesians.
The macro world is extremely nuanced. I’m someone who likes experiments. If we could give every American instant access to convert savings to gold (or bitcoin), directly in their savings accounts, it would certainly be an interesting experiment.
If you have significant assets, inflation isn’t a big deal. If you are like most peasants, instant access to an asset easily protected from inflation would remove the tendency to fuck the peasants in the ass the moment the macro world gets shaky
Other centuries must have been remarkably peaceful, since by your assertion they did not have bubbles, pandemics, wars, or geopolitical schisms...?
It's enough to say that fiat currency, fiscal and monetary policy have papered over the worst of the excesses and explosions, you don't need to pretend like we live in unique times. Every time is unique, but history rhymes.
??? The previous argument was on the pace of boom and bust cycles. This argument is on their existence.
We don't even have the same kinds of boom and bust cycles. There is no dustbowl, and we've recovered from incredible calamites well compared to the disasters in the past. Spain hasn't ended up destroying its entire wealth by finding too much wealth for example.
I'm making the mistake of getting into detail with a point that is so out of bounds, its in "not even wrong" territory.
Yes, inflation incentivizes spending and/or investments, and (in moderation) that's generally a very good thing.
The only other alternative that doesn't create incredibly bleak incentives for anyone that doesn't inherit wealth would be wealth and estate taxes, but good luck getting either passed or reformed.
I don't see why the economy benefits long-term from people spending/investing only to get the money off their hands. Especially when it gets parked in things like gold and real estate just cause those supplies are sorta fixed.
But it's our scam. The Fed isn't only diluting Americans' money; USD is a world currency, and the US tries to keep it that way by whatever means. So we kinda benefit from that.