I can see how government bonds might replace gold but it requires a depositor. Do they mean what modern-day Austrian economists mean i.e. I doubt it because at the time the UK was on a gold standard which tends to be anti-inflationary [notwithstanding comments I have made about how there was some inflation at the time]. And where, if anywhere, is the link with gold which, as I understand it, was one of the main issues in the 1896 presidential election?
And surely, once a depositor has deposited his bond the bank can issue its own receipts/notes rather than having anything to do with the government. Or maybe depositors would prefer to use government notes as they are accepted in more places. Whatever the case may be it seems clear that the US monetary system was far from being a free market before the Fed came along.
) that brought us to the verge of collapse in the Second Great Depression in 2008, which had nothing to do with the gold standard.
And as usual there is always an other side to the story.
There have been so many Trumps on display in the past few days that it’s anyone’s guess who will actually turn up for the first 100 days.
The first few days have been extraordinary and kind of scary in terms of the president’s grasp on economic reality. The no-nonsense, straight-talking, waste-cutting, four-times bankrupt, business genius who will slash taxes and get corporate America purring again? You know the pussy-grabbing, dodgy-dealing, locker-room Trump, who is one scandal away from impeachment? Or what about Town Hall Trump — the gold-plated, KFC-chewing, class-warrior capitalist who’s gonna stick it to the Man for the little guy? The wall-building, hombre-watching, China-bashing, alt-right flirting, bring ‘em all back home Donald, who will make America great again by cutting it off from the rest of the world.
That we have lost the facility to reduce the world's total indebtedness without resorting to default or monetary depreciation becomes clear at once if we consider the fact that a debt of x dollars can no longer be liquidated.
If it is paid off by a check, the debt is merely transferred to the bank on which the check is drawn. Treasury, the ultimate guarantor of these liabilities.He is a proponent of the gold standard and critic of the current monetary system.His theories fall into the school of economic thought led by Carl Menger.Faced with the supreme necessity of sustaining the national credit and providing a market for Government securities, the Secretary of the Treasury in 1863 passed a National Bank Act basing the issue of currency by the banks upon the purchase of an equal amount of Government bonds.That was a cardinal error which still remains uncorrected. I can understand how notes work in a goldsmith system.Presenting that here today, is Antal Fekete with "The Gold Problem Revisited." THE GOLD PROBLEM REVISITED (pdf) Antal E.