... Oil prices are up because the value of the dollar is down. Our common sense hides this source of higher prices because we view the dollar as fixed and prices as moving. Changes in the relative prices of goods and services occur because of shifts in supply and demand. But the value of the paper dollar also changes, usually in ways that are imperceptible over short periods of time. To see how the falling dollar has increased the price of oil, it helps to view price changes over a ten-year period. Since 2002 the price of a barrel of oil has increased nearly fourfold, to $103 on Apr. 20 from $26 in 2002.
... What you’re supposed to do, when on gold, and there’s a crisis, is monetize it so that the crisis passes. “Lend freely at high rates” and all that from the good old gold standard days. The opposite happened in the Great Contraction—again lending more dubiousness to Eichengreen’s claim of having “written the book.”
Fiat money coupled with gold hoarding—the characteristics of 1929-1933. This was a world on the gold standard? Professor Eichengreen keeps saying so, but that doesn’t make it correct. As we grope toward a better monetary system in our own day, it’s time to get right about what worked and didn’t work in the past, and this means improving our rhetoric about the gold standard.
... Article I, Section 8 of the Constitution grants power to Congress "to coin Money, [and] regulate the Value thereof." But for the last 40 years in Washington, regulate has meant manipulate, with the Federal Reserve raising and lowering interest rates and buying and selling assets at its own discretion. All of this manipulates the value of the dollar. We regulate time by making sure an hour is always a fixed quantity of minutes and a foot is always a fixed quantity of inches. The more complex a society, the more it depends on fixed and rigorously reliable standards. A dollar should be defined—as it was prior to 1971 under the postwar Bretton Woods system—as a fixed quantity of gold.
... McKinley sided with the Silverites early in his political career, voting against his party for the Bland-Allison Act of 1878, which mandated the U.S. government purchase silver. Later McKinley would reverse his position to become an advocate of the gold standard, a change that his friend and presidential campaign manager, Mark Hanna, famously explained: “He did not pretend to be a doctor of finance and followed the popular trend of that time.”
Although he changed his position on the gold standard, McKinley was consistent in his career about protective tariffs to allow American manufacturers to develop against foreign competitors.
Europe appears to be moving toward a crisis. The London Telegraph summarized the situation succinctly when it headlined: “Merkozy era is over.” With French President Nicolas Sarkozy headed for the...
Almost all industrial countries today are suffering from permanent unemployment, and most are suffering from currency instability. The two problems are related: an expansive economic policy which leads to a currency crisis is usually intended to reduce...
Sean Fieler, James Grant, John D. Mueller, Judy Shelton
Senior European Advisor Paul Fabra
Advisors Jeffrey Bell, Ralph J. Benko, Andresen Blom, Frank Cannon, Rich Danker, Brian Domitrovic, Charles Kadlec, Christopher K. Potter, John Tamny and Frank Trotta
In Memoriam Professor Jacques Rueff (1896-1978)
The Gold Standard Now Statement of Purpose
We support a 21st century international gold standard. America should lead by unilateral resumption of the gold standard. Unilateral resumption means that the U.S. dollar should be defined in federal statute as a certain weight unit of gold. The Treasury will be responsible for maintaining this guaranteed value of the U.S. dollar.
The United States once again can establish a stable dollar worth its weight in gold.
After almost a century of manipulated paper- and credit-based currencies, how do nations--which need the benefits of free trade in order to prosper--terminate the anarchy of volatile, depreciating, floating exchange rates?
Lewis E. Lehrman endeavors to answer this and more with The True Gold Standard.
... Oil prices are up because the value of the dollar is down. Our common sense hides this source of higher prices because we view the dollar as fixed and prices as moving. Changes in the relative prices of goods and services occur because of shifts in supply and demand. But the value of the paper dollar also changes, usually in ways that are imperceptible over short periods of time. To see how the falling dollar has increased the price of oil, it helps to view price changes over a ten-year period. Since 2002 the price of a barrel of oil has increased nearly fourfold, to $103 on Apr. 20 from $26 in 2002.
... What you’re supposed to do, when on gold, and there’s a crisis, is monetize it so that the crisis passes. “Lend freely at high rates” and all that from the good old gold standard days. The opposite happened in the Great Contraction—again lending more dubiousness to Eichengreen’s claim of having “written the book.”
