The American Dream

[sasguru]

And you're just throwing out the rich examples aren't you. So far after much enquiring your only argument against the gold standard is "they had it during the depression".

Stimulus spending (hoover dam), price-fixing, wage-fixing the government went crazy thinking it could control the market.

Edit: They even burnt grain to keep the prices high - madness.

Your sense of logic seems to be rather poor.
Yes they tried various stuff out of sheer desperation - after all the economy had collapsed by up to 25%.
But the reason they tried all this stuff was that the economy was depressed. It wasn't the cause of the depression.

[Robinho]

Yes it was because it prolonged the recession, turning it into a depression.

Which is ironically what we are doing again today.

[SueEllen]

And you're just throwing out the rich examples aren't you. So far after much enquiring your only argument against the gold standard is "they had it during the depression".

I think Sas is pointing out you can have any standard you like but if governments do stupid things i.e. don't regulate financial markets, then it won't make a blind bit of difference.

Stimulus spending (hoover dam), price-fixing, wage-fixing the government went crazy thinking it could control the market.

That's what governments do.

If governments leave everything to the free market then sh*t happens i.e. you and I wouldn't have clean drinking water, wouldn't have clean(ish) air, would have a more corrupt Police force, a Fire Service who wouldn't bother to put your house fire out unless you paid them enough while it was burning down. In other words we would end up like Somalia.

Edit: They even burnt grain to keep the prices high - madness.

As mad as the Common Agricultural Policy.....

[sasguru]

Yes it was because it prolonged the recession, turning it into a depression.

Which is ironically what we are doing again today.

I'm afraid you're deliberately missing the point. The depression (i.e. the collapse in the US economy) was in full flow when these stimulus measures were tried.
One of the major reasons that recession turned into a depression is the fact that people tried to trade in gold reserves. To avoid depleting the gold reserves the FED had to raise interest rates, since that is what you must do when you're on a fixed measure like the gold standard (remember when Briatin shadowed the ERM ) and rasing rates is exactly what you must not do in a recession.

I find it interesting that there's someone on this forum who's more ignorant of economics than AtW.
I wouldn't have thunk it. I suggest you abandon your ideology, educate yourself a bit more, then come back - you might have something marginally interesting to say.

[sasguru]

Yes it was because it prolonged the recession, turning it into a depression.

Which is ironically what we are doing again today.

Oh just one other point - would you rather be in the UK that is doing everything you think is wrong or Greece where they're doing everything right by your book - sticking to the Gold standard (to them) that is the Euro.
It's economic suicide when you cut drastically in a recession.

[Robinho]

I'm afraid you're deliberately missing the point. The depression (i.e. the collapse in the US economy) was in full flow when these stimulus measures were tried.
One of the major reasons that recession turned into a depression is the fact that people tried to trade in gold reserves. To avoid depleting the gold reserves the FED had to raise interest rates, since that is what you must do when you're on a fixed measure like the gold standard (remember when Briatin shadowed the ERM ) and rasing rates is exactly what you must not do in a recession.

Ok, so you're blaming fractional reserve banking, and not the gold standard.

And you're wrong about the timing of the stimuli.

[sasguru]

Ok, so you're blaming fractional reserve banking, and not the gold standard.

It's not that difficult even if you have a binary IT brain

Is The Euro Today The Gold Standard Of The 1930s For EU Economies? | ZeroHedge

[sasguru]

This explains it even better:

The Euro: As Good (and Bad) as Gold - Businessweek

[Robinho]

Please clarify whether you are blaming fractional reserve banking or the gold standard? It sounds as if you are blaming fractional reserve banking.

[sasguru]

Please clarify whether you are blaming fractional reserve banking or the gold standard? It sounds as if you are blaming fractional reserve banking.

Where have I mention fractional reserve banking and why do you think I am blaming it?