20 comments

• Comment Link Thursday, 13 June 2013 14:31 posted by Jeff

  I listened today on Minnesota Public Radio. These are intelligent scholarly people. Good points were made, but I think the statement and response was not consistent. I think the issue they missed for the most part was the change in dollar policy. Fast change causes instability. Whether the dollar is low or high produces long term effects, but change causes immediate instability. Long run inflation is destructive even at 3%. In dollar terms, it looses half it's value in a "stable' 14 years. 14 years isn't much when one is saving for retirement. Not only is the dollar shrinking in value, but interest payments on savings is practically nil. I long for the time when I could put a dollar in a savings account and get a simple 4% interest. Now, all we get are fee after fee and banks get record profits.

• Comment Link Saturday, 13 April 2013 11:01 posted by Yusuf

  This isnt a news flash but KEY info in the barter trade world duinrg SHTF. It only works if the person youre trading w/ wants what you have. If you dont need gold/silver why would I even care to trade w/ you.Whats worthless 2 you may not be 4 someone else that is why Im glad I dont follow the crowd nor do I care what they think. Leaders make their own way blaze a trail for others. So while you eat your rice drink your water I'll be doing the same but w/ gold silver Just N Case

• Comment Link Friday, 12 April 2013 18:12 posted by Jason McPhee

  One of the biggest moral questions that wasn't gone into in any depth was that of war. The side for government manipulation of the currency used this example as a time when governments need flexibility. It is exactly the opposite for a democracy.
  
  People need to understand the true cost of war prior to entering into it, not have the government ease them into those costs. If people see the true opportunity cost, most rational people will do what they can to avoid violent conflict.

• Comment Link Sunday, 31 March 2013 08:10 posted by mark

  "Elide" - that word does not mean what you think it means.
  
  The Podcast was severely edited, and to it's detriment. Why do that? Lucky I came to the website to review parts again!

• Comment Link Sunday, 31 March 2013 04:40 posted by mark

  Arguing past each other, one side on an intellectual soap box, and the other with catchy sound bites. Sound familiar?
  
  Re: fixed standard, why gold? Why not the labor hour? I was hoping for more macroeconomic elucidation.
  
  re: gold, if you like it so much, you can easily keep you savings in gold.

• Comment Link Thursday, 21 March 2013 13:28 posted by Christopher Rushlau

  It may interest the proprietors to know that I turned off the radio (re-)broadcast of this debate here in Maine today, 21 March, 2013, when Mr. Forbes began his opening remarks.
  He had just finished depositing a cow in an ATM and withdrawing a pig.
  This raises the question of whether an entirely unregulated market can exist. It answers the question in the negative: when there is no regulation, there is no transaction. Smashing and grabbing is not a transaction.

• Comment Link Monday, 18 March 2013 18:55 posted by Miles K

  It's unfortunate that Forbes' quality of debate was so low. Where he could have clarified the implications of their views further, he stuck with taglines, simplistic analogies, and bare assertions. It might be that his view is supported by more nuance, detail, and nuts & bolts facts. But instead, he chose to continue talking about that vaunted stable metric, as if that were enough to win the argument. It was most certainly not.

• Comment Link Monday, 18 March 2013 14:16 posted by john stark

  The question is whether we can return to the gold standard when the economic system has been so deformed by extreme and irresponsible monetary policy to the extent that we are beyond the point where we can step away from those policies without causing total collapse. We are caught in the web engineered by those who knew it was impossible to escape its trap without fatal consequence. The classic concept which makes those trapped within its walls dependent upon those very walls for their continued survival.

• Comment Link Sunday, 17 March 2013 09:07 posted by Diane

  The debate was confusing. The arguments for returning to the gold standard sounded logical but there must be some reason why it's not done, and yet, the other side didn't really explain it. I assume that's because they were there to talk about what the policy should be under the present system. The debate should have been about one thing or the other.

• Comment Link Friday, 15 March 2013 13:51 posted by Mark Moore

  I find it surprising neither Mishkin nor Taylor pointed out that using a gold standard doesn't eliminate the floating value of a common measure of value exchange. It only pushes the debate from what is the intrinsic value of a single US dollar to a debate of what is the intrinsic value of an ounce of gold. I'm hoping that is self-evident, but I'd be happy to elaborate if it's not.
  
  I believe I heard all four panelists argue that the *best* situation is a stable dollar. So, depending on how one parses the stated proposition, they were either all for the proposition, or unanimously against it. If you read it as "America doesn't need a policy that makes the dollar stronger (more valuable than the currency of our major trading partners)," then all four panelists were for the proposition. If you read it as "America doesn't need a dollar policy that is strongly enacted/enforced," then I believe all four panelists are adamantly against the proposition. Forbes and Grant would like the dollar policy to be strictly enforced with gold held in reserve. Mishkin and Taylor seem to argue for a dollar policy actively and aggressively pursuing a low inflation target.
  
  Assuming all four panelists believe it is in America's best interest to have a stable dollar, the real debate is about how best to achieve that goal. Forbes and Grant seem to believe that pining the dollar to gold achieves this. But, that only follows if the value of gold is stable. Unless the intrinsic value of gold is inherently stable, that would then demand a federal policy to stabilize the exchange value of gold. It seems to me a far simpler task to manage the value of a commodity one can create and destroy at will rather than a commodity that must be mined (to create more supply) or locked away (to diminish supply). It seems evident to me that the intrinsic value of gold is *not* stable since it rises and falls with the strength or weakness of the economy. Pegging the value of the US dollar to a fixed amount of gold seems indistinguishable from Argentina's failed policy of pegging their peso to the US dollar.[1]
  
  If the goal is a stable dollar, it seems most efficient to manipulate that commodity directly (the supply of US dollars) to counteract market forces that would increase or decrease the stable value.
  
  [1] en.wikipedia.org/wiki/Argentine_Currency_Board#Abandonment_of_the_peg