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From: jlg@lanl.ARPA
Newsgroups: net.politics.theory
Subject: Re: The gold standard.
Message-ID: <21296@lanl.ARPA>
Date: Fri, 8-Feb-85 17:44:15 EST
Article-I.D.: lanl.21296
Posted: Fri Feb  8 17:44:15 1985
Date-Received: Tue, 12-Feb-85 04:42:41 EST
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Organization: Los Alamos National Laboratory
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> The gold standard is not as tolerant of the Fed tampering with the money
> supply as the fed wanted would have liked.  It is easy to dupe the citizens
> into a false sense of security with fiscal tricks.  This sort of thing is
> encouraged by our political system, because it allows the politicians to
> look good while in office whilst passing off serious problems to the next
> guy.  Take a look at the national debt for an example of the sort of fiscal
> buck passing that goes on...
> 
> 
> 				--Cliff

Wait a minute Cliff!  You're the one that just finished saying that the
government ir real rich and can only get richer.  How is it that you now
claim that it has a debt problem?

The Fed gave up the gold standard in 1933 due to rapid deflation causing
a run on the gold reserves.  The proper course (to maintain the gold
standard) would have been to cut back on the money supply.  The liberal
politicians then in office didn't think this would be good, and they
wanted a quicker, more responsive, solution.  Once off the gold standard,
it's hard to return.

J. Giles