No Phony Gold Standards

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When you hear talk about returning to the “gold standard,” be sure you know what the speaker means by the term.  There are plenty of phony gold standards out there.  The supply-sider/neocon version, which is touted as “the gold standard,” is just a gold price rule, whereby the monetary authorities use the price of gold to help them manage the supply of fiat currency.  This approach, therefore, has no necessary connection to the use of gold as money.  It actually bears a family resemblance to the quantity rule advocated by monetarists.

Robert Blumen sorts all this out in a good, easy-to-understand article today.  If you want to understand the basics of money, from beginner level to strong intermediate, here are the titles I recommend (and I suggest reading them in this order):

What Has Government Done to Our Money? by Murray N. Rothbard;
The Mystery of Banking by Murray N. Rothbard;
The Ethics of Money Production by Jörg Guido Hülsmann;
Money: Sound and Unsound by Joseph T. Salerno.

Chapter 13 of the Salerno book specifically discusses what a real gold standard is and how it compares to the impostors.

(N.b.: Of course, full monetary freedom is better than any kind of gold standard, but that point notwithstanding, it remains important to clarify terms and not let the establishment get away with anything.)