What exactly does the gold standard have to do with economic troubles around the world? All the gold standard would do is subject any country that adheres to it to crippling deflation whenever the economy grows and crippling inflation whenever it contracts.
> All the gold standard would do is subject any country that adheres to it to crippling deflation whenever the economy grows and crippling inflation whenever it contracts.
If that was true, then why US, that of course had a recessions and booms at the time, still had prices mostly stable for more than a hundred years, while its population was expanding very quickly?
Or the same, for several other countries.
Gold, doesn't mean the money supply is completely static and constant. You can still have fractional reserve, can still debase your coins physically to cause inflation (Roman Empire in its last throes did that for example), Gold is still mined, and used to non-monetary products.
But Gold Standard also means you can't "inflate your way" out of problems 100% of the time, as is the default right now, we are seeing central banks all over the world with balooning balance sheets, while if you look the numbers for individual income since 1970s in advanced countries, you see the individual income is falling, meanwhile various financial items that are out of reach of the "average" person are balooning in value, and making the wealthy look even more wealthy (only "look" more wealthy, most of that wealth is purely theoretical, mostly money tied up in stocks, bonds, derivatives...)
From my point of view, all the lack of gold standard did was increase overall inflation, and create the most gigantic debt bubble in history, where all countries are accumulating ever increasing amounts of debt, not only from the governments, but individuals being more and more indebted.
I fully expect that the entire debt house of cards will collapse some time soon (ie: in decades scale at most, not centuries scale as most other major social change), and that people will realize how stupid it was to create an entire civilization based on debt and trust, something that breaks down when serious war show its head (I mean, why country A, would honor debts to country B during a war? Those are only numbers and derivatives, there is no "real" assets there!)
What exactly does the gold standard have to do with economic troubles around the world? All the gold standard would do is subject any country that adheres to it to crippling deflation whenever the economy grows and crippling inflation whenever it contracts.