After 1910, Germany increasingly relied on fiat money to pay the bills. It wasn't just the Treaty of Versailles that eventually led to hyperinflation, but an all-too-common policy of turning to inflationary monetary policy.
The quasi-gold standard promoted by Steve Forbes and Elizabeth Ames in their new book has more in common with the Bretton Woods system than with the classical gold standard.
Efficient banks have many options for lenders and credit when banking crises hit. It's the inefficient and insolvent banks that must turn to a central bank. But do we really want central banks that reward insolvency and encourage inefficiency?
Once interest rates begin to rise — and rise they must, whether as a result of Fed policy or not — the end of the asset price inflation will be at hand. The result will be another financial crisis and accompanying recession.
This lecture by Philipp Bagus was presented at the 2012 Mises University in Auburn, Alabama. Includes an introduction by Mark Thornton.
How is socialism related to money? Money should be produced just like other goods through free markets. Central banks should not be controlling money, banking and credit.
In their new book Money, Steve Forbes and Elizabeth Ames write with insight about the dangers of inflation and easy money, but ultimately, they fail to follow through on their analysis and instead make peace with monetary expansionism.
This lecture by Roger Garrison was presented at the 2012 Mises University in Auburn, Alabama. Includes an introduction my Mark Thornton.
When all you can do is exchange one good for another, life will be inconvenient when nobody has what you really want. Enter money. You exchange your good for money. That money can now be exchanged for what you desired. These indirect exchanges satisfy everyone. That's the power of money.
