Re: Greenspan says we need a goldstandard.
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"I think we did well with the international gold standard around the turn of the century."
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But can the US reinstate the gold standard when other countries are not using it? How would that affect trade, economic growth, money supply and the value of the gold backed dollar compared to other currencies with varying value?
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It would be no different than it is now is one way, if we switched and they didn't. Countries already have different currencies.
Not that there wouldn't be effects, but it's not like we are constrained to have paper money because everyone else does too.
In fact, if we had gold backed non-inflated dollars, world prices would continue climb in the inflationary fiat currencies like the Euro and Yuan, but fall in dollars, i.e. the other currencies would be obviously being devalued against the gold dollar. I think if 1/4 of the world's economy remonetized gold, the rest would follow in short order.
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