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overtheedge
Member since May 2012
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When Even the Fed Is Confused, We Still Have Some Work To Do - Nathan Lewis - New World Economics

Good article.
I find it interesting that annual gold production runs about 1.5-3%
Now consider the CB's desire to maintain an annual 2% inflation rate.

On your calling a spade a spade issue, consider the difference between elasticities under a gold-tied policy and fiat.
As you pointed out, elasticity existed prior to 1971 under the gold-tied system.
The problem I see was under the gold-tied system, the system tells on itself. The evidence is hard to hide. In effect, there were limits to expansion.
Under fiat, the metrics can be bent to suit the policy.
Also under a fiat system, the shear complexity overwhelms the ability for Joe Average to comprehend.
This is no reflection on Joe Average. Just consider the number of PhD Economists on the payroll of government and Central Banks.
Obviously there must be a problem comprehending it there too.

Oh and this current economic condition is the best that the PhDs and politicians could pull off.

Thanks.

Commented 3573 days ago

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Beginning of the headline :I sometimes read things like college textbooks because, when the author is presenting basic ideas to a general audience, their most foundational misconceptions are on clear display. Recently, the Federal Reserve put out a brief description of a gold standard system – the policy used, in principle, by the United States from 1789 to 1971, and also by the Federal Reserve itself from its founding in 1913 to 1971. It’s a nice way to understand today’s conventional wisdo... Read More

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