tag:blogger.com,1999:blog-5713178645208582139.post2486180588383586703..comments2024-03-22T02:37:15.030-05:00Comments on Macro Musings Blog: More on the SDRs as a Reserve CurrencyDavid Beckworthhttp://www.blogger.com/profile/04577612979801459194noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-5713178645208582139.post-11326526702862918942009-04-23T13:39:00.000-05:002009-04-23T13:39:00.000-05:00David,
I should clarify that there is short run f...David,<br /><br />I should clarify that there is short run flexibility under a <I>fractional</I> gold standard, in which the amount of monetary gold is only a fraction of the money supply. This does not apply under a pure gold standard. I don't know how well this fits with the interwar period, but it certainly fits the postwar era up to the collapse of Bretton Woods.<br /><br />Also, you write,Joshhttp://www.everydayecon.comnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-45467313135747082852009-04-23T09:51:00.000-05:002009-04-23T09:51:00.000-05:00Thanks for the tip on Jurg Niehans' The Theory of ...Thanks for the tip on Jurg Niehans' The Theory of Money. I am interested in learning how there can be short-run maneuverability of a gold standard.<br /><br />Here is my question: are bad economic policies themselves partly the product of the political pressures inherent in a democracy. I am not saying it is impossible to have good policies with full enfranchisement, but on the margin it got to David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-55525367094106278522009-04-22T22:14:00.000-05:002009-04-22T22:14:00.000-05:00David,
I simply do not think that Eichengreen is ...David,<br /><br />I simply do not think that Eichengreen is correct. Okay, maybe that is a little too harsh, but if he is correct, he is only half correct. Allow me to explain.<br /><br />Under a fractional gold standard there is sufficient room for maneuverability for monetary policy in the short run. However, monetary policy is severely constrained in the long run. Thus, the fractional goldJoshhttp://www.everydayecon.comnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-31298052273616896292009-04-22T10:45:00.000-05:002009-04-22T10:45:00.000-05:00Josh:
Just went over with my class the difference...Josh:<br /><br />Just went over with my class the differences between the pre-WWI classical gold standard and the interwar gold standard. Among other things, we discussed B.Eichengreen's point that as more people became enfranchised it becomes incredibly difficult to follow the rules of the game with an international gold standard. Short-term domestic economic concerns trump any external David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-66135728665289044572009-04-21T21:15:00.000-05:002009-04-21T21:15:00.000-05:00David,
Larry White says what I should have said i...David,<br /><br />Larry White says what I should have said in the comments of your previous post, but instead muddled around discussing the SDR in the context of multi-metallic standards and scaring off other commenters. Here is Larry's quote:<br /><br />"Unlike gold, the SDR is not anchored to anything but a basket of unanchored national fiat monies (what Zhou calls “credit-based national Joshhttp://www.everydayecon.comnoreply@blogger.com