Prof. Lawrence H. White: The Gold Standard, Explained

Before 1974, U.S. dollars were backed by a gold standard. This meant that the federal government could not print more money than it could redeem for gold. While this constrained the federal government, it also provided citizens with a relatively stable purchasing power for goods and services. Today's paper currency has no intrinsic value. It is not based on the value of gold or anything else. Under a gold standard, inflation was really limited. With floating value, or fiat, currency, however, some countries have seen inflation reach extremely high levels-sometimes enough to lead to economic collapse. Gold standards have historically provided more stable currencies with lower inflation than fiat currency. Should the United States return to a gold standard?
SUBSCRIBE:
bit.ly/1HVAtKP
FOLLOW US:
Website: www.learnliber...
Facebook: / learnliberty
Twitter: / learnliberty
Google +: bit.ly/1hi66Zz
LEARN LIBERTY
Your resource for exploring the ideas of a free society. We tackle big questions about what makes a society free or prosperous and how we can improve the world we live in. Watch more at bit.ly/1UleLbP