[tolbiny]

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why are you purposefully misquoting me?

in my initial post i asked under a "true gold standard" and above you took out the word "true." sneaky buy i caught it. i asked because i want to see how we could get to a true gold standard (where nobody has the authority to change the value of the X: gold) and what we could expect to see in times of trouble.


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I quoted the first line of your post, chillax. But I do see the misunderstanding between us. The posts I made were supposed to be about the gold standard under healthy (or normal or whatever) economic conditions. This was in response to adanthar posting things like this

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You'd certainly get your wish in a deflationary economy, because one of the first and surest outcomes of a prolonged period of deflation is that the entire lending cycle would completely collapse. Forget the wave of both personal and business bankruptcies crashing into everyone above the consumer on the food chain and let's just focus on the basic economics. If the future value of money becomes *greater* than the present value of money, why would you ever make a loan - especially at a low interest rate - when you could hang onto the cash instead? Even if you were willing to make that loan, what kind of sucker would it take to accept it?


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Which makes it sound like under normal gold standard deflation you would expect market crashes and perpetual depression, and he was using examples of deflation under fiat systems to support his point.


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so studying what happened during those periods could be instructive (even though they did as you mentioned fall apart). did those govt's or authorities ever change the value of the currency to the commodity? if so then it fails that test.

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I'm not looking for perfection in historical comparisons, you can't ever find perfect ones.

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the depression was obviously not caused by deflation. the economy during the 20s clearly had an impact and created environment which led, in many ways, to the depression and deflation.

i think though that these are trivial observations.


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I was just trying to get across why using the GD, or Japan during the 90s as comparisons to deflation under a gold standard.