IVIV (8): Nixonizing U.S. Currency

[Michael Bailey]

> Goldbugs that inhabit the WSJ editorial pages and neoclassical econ types
> have agonized over the '71 shock ever since.
>
>

FDR took the gold out of money for citizens, right?  He let us keep
our wedding rings and dental work though.

Bretton Woods said if you are a government you can redeem dollars for
gold at a fixed price.

Now over the course of time if the money supply inflates, the value of
gold will rise. (Let's not even get into why the money supply
inflates, it just does.  And let's not consider the fact that the
*gold supply* could in fact fluctuate, and does, which ought to
matter, shouldn't it?)

If you try to hold the line on a given price for gold, you will go
broke!  and the people you sell to will profit at your expense!

Nixon could have set a new price for gold, or let it float against
some standard, but he just said, hey we quit.

Which really, why should the US government be in the gold business anyway?



-- 
"Our only hope today lies in our ability to recapture the
revolutionary spirit and go out into a sometimes hostile world
declaring eternal hostility to poverty, racism, and militarism." -
Martin Luther King