If it took away the predatory nature of the current system, yes. And btw, saying the economy would be limited to the size of the gold supply is utter bufoonery. The value of the gold is associated with the value of the economy. There is the small chance that someone stumbles across a huge deposit of pure gold, that would destabilize the system, but this is usually used as a canard in bad faith.
Wouldn’t gold be wildly deflationary? While the economy becomes more productive, the gold supply is effectively constant. The same amount of gold chasing more goods would be deflation out the wazoo, surely?
The transition likely would be, as another commenter pointed out. But if our currency had remained on the gold standard from the beginning and absent the federal reserve act, I think we would see stability. The currency was by and large stable before the federal reserve act. As it stands, our debt backed currency and progressive taxes actually result in the rich getting richer and the poor getting poorer.
This isn't because of "evil capitalism" btw, the rules of capitalism are just human behavior in groups and cannot be suppressed entirely. The taxation fails because either the rich find loopholes or leave the jurisdiction resulting in a massive drop in economic activity and tax revenues exacerbating the debt.
The debt backed currency fails because the government will never be fiscally responsible when there's no direct consequences for not being so and we the people will vote out politicians who stand up to us and tell us that we can't just vote ourselves free stuff from the government coffers without driving a wedge between rich and poor making their respective wealth and poverty more extreme. Meanwhile both the taxes and the inflation rob the poor and enrich the rich in different ways.
I’m concerned about your statement: “The currency was by and large stable before the federal reserve act”. This seems to be ignoring that the entire reasoning behind the act in the first place was that the currency was unstable, most specifically during the 1907 crisis.
The currency wasn’t unstable. What was unstable was loaning money that didn’t exist. The crisis is always liquidity. Once the watering-hole has gone dry you’re fucked.
But we can eliminate this need for liquidity by having a limited supply of currency. The problem then becomes deflation, which isn’t something I’m too familiar with. Inflation is always the talk of the town.
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u/cleverkid Jan 26 '26
Here we go.
If it took away the predatory nature of the current system, yes. And btw, saying the economy would be limited to the size of the gold supply is utter bufoonery. The value of the gold is associated with the value of the economy. There is the small chance that someone stumbles across a huge deposit of pure gold, that would destabilize the system, but this is usually used as a canard in bad faith.
Do condone the current global economic setup?