> Now, 50 years later, they appear to have lost the title of the world's major superpower.

And how is that causally related to the abandonment of the gold standard? Is the CNY somehow backed by gold, or the RUR?

The part I don't like is it confuses the situation to make it harder to tell if goods and services are getting cheaper or more expensive in real terms. But I don't know if I'd say it was causal. I'm more just pointing out that there isn't much evidence that the gold standard failed and there isn't a reason to think that all the economists reject it. They're more probably neutral to it.

The gold standard didn't fail: Fiat money just completely obliterated it with its success.

Being able to issue fiat money is a feature of high trust governments and societies, not a bug, and people yearning back to needing a gold standard scare me, because that inevitably implies dismantling that trust to get there.

>because that inevitably implies dismantling that trust to get there.

There is nothing to dismantle because it's already gone.

The society that elected Donald Trump on his current program is an exceedingly low trust society. The whole point backed by DOGE is that you can't trust government and must reduce it to the most basic, barebones function. A lot of the current silicon valley elite fell prey to the nonsense preached by people like Curtis Yarvin who preach forms of anarcho-capitalism and despise democracy.

The United States of America are no more.

The gold standard always fails. Whatever gold standard is established in history, it is inexorably debased.

The conceptual flaw with gold is that it is a desperate attempt to grasp at an absolute, because absolutes feel warm and fuzzy. Nothing is absolute in an economy. The relative value of everything changes constantly and trying to create an artificial peg to gold doesn't achieve anything useful.

In historical terms, by any measure you choose (monthly salary, purchasing power, etc.) gold is worth roughly 1/10th what it used to be worth a millennia ago and prior.

Adjusted for inflation, over the last 100 years or so, the value of gold has remained roughly constant in terms of salary and purchasing power.

This article is fundamentally good sounding bunk. Intellectual quicksand. Pretty much ideally skewered by someone with experience working with such things.

Anyone else who isn’t prepped will take far too long to get their heads around all the major errors, and by discussing it, propagate its ideas further.

Since people recall even incorrect things, repetition of it ends up creating the idea that it is true - the truth effect.

> Pretty much any empire ever founded was built on a gold standard

...because they didn't have the social and technological methods, as well as centralization of force, needed to make a fiat currency work.

The gold standard was never a great idea. It was just more functional and efficient than what came before it because the gold supply was usually inherently limited by how fast the mines could produce the stuff.

What is the gold standard 'effective' at? In the 19th century, the US had a more or less continual stream of panics and recessions. In 1932, everyone had to get off the gold standard because there was no mechanism to stop the deflationary death spiral otherwise. 'Bretton-Woods' failed to control inflation, and it became possible to arbitrage gold across markets.

> In the 19th century, the US had a more or less continual stream of panics and recessions. In 1932, everyone had to get off the gold standard because there was no mechanism to stop the deflationary death spiral otherwise.

Disabling the feedback mechanisms isn't a win. When it had the feedback from continuous minor panics the US built an economy capable of taking on the entire word and winning by a massive margin in the 1940s. And I bet there were alternative mechanisms to deal with the "deflationary debt spiral".

Now the US keeps telling itself it is OK while it is increasingly marginalised. There isn't much evidence is it can win a major war or compete economically against more serious Asian efforts. The election of Trump suggests that US citizens don't even feel particularly fat and comfortable in their own economy. At least all the economic indicators say the US is OK though! The money printing is sure to lead to prosperity.

> US citizens don't even feel particularly fat and comfortable in their own economy.

Do people ever? I know plenty of people who cry poverty, and being “crushed by taxes and inflation”, and about “being a “wage slave” from a boat.

When gold was money, most people were poor. Gold was mainly good for the aristocracy.

Wealth generation has been growing exponentially for 200, 300 years. Maybe longer. Noting that people in the past had less wealth than today is hardly a point. Anything but the most jaw-droppingly stupid economic systems would have todays population being very wealthy compared to those of yesteryear. Even the experiments in authoritarianism and communism have managed that although they killed a lot of people along the way.

And I find it a bit of an eye roll that the minute the gold standard comes up all the "inequality is out of control now!" people fade into the background and the "back then, everyone was poor except the wealthy" arguments come to the fore. There is an inconsistency in the hive mind. This is a system where we print money and give it to the asset owners. It is visibly stupid.

but that doesn't really answer the question of why a gold stabndard is better. The gold standard didn't make the industrial revolution happen. And the gold 'standard' was arbitrary itself, and the government could alter it at will. It was just as 'fiat' as anything.

I agree with the thrust of your argument but the idea that you need to have a really really large pile of gold sitting in a warehouse to fix it seems silly to me.

Can't they just not print so much?

That was more or less what Paul Volcker did in the early 1980s. Banks were smaller and more closely regulated, so he was able to put some constraint on the money supply, and raised interest rates. And it worked, it crushed inflation, but it was a very bitter pill--a hard recession followed. Volcker got yelled at by Congress, a lot. In the long run, he was vindicated--inflation remained fairly low until the pandemic.

But the idea that you should manage your economy according to how much of some metal you can dig out of the ground is ridiculous.

Have to find a way to measure long term quality of life. Digging in the ground should be part of it. If you can forge quality long term mutually beneficial relationships with others who agree to do the digging for you it might score more points than digging yourself.

America marginalized itself after January. And as the world major superpower, the level of marginalization is something India, China, Russia, Uk, and even Europe - would aspire to.

Good lord, why are these malformed talking points being engaged with here. I see these things being shared amongst my hoaxer and antivax groups.

At least the vast majority of sane economist rejected it long ago. That's why people who preach it are called goldbugs.

The US and *every other country jumped from it because it didn't work well and caused frequent instability*. The countries who dumped it quickest recovered from the great depression the fastest

The gold standard works until it doesn't. Then the only option is to bail from it. That's why no one is on it anymore. It's not a sufficiently flexible currency.

That's revisionist nonsense.

The "issue" with gold standard is that you cannot compete with countries that can print money at will, which gives them the advantage NOW, even though they'll suffer massive inflation later down the line. How will you ever win a war when your enemy has infinite money? I guess people forgot what happened to Germany's economy after WWI. Your only hope is to be the one that wins the war, and gets all the booty and reparations.

Fiat economics is basically an infinite money glitch, indirectly paid by your very own tax-payers 30 years down the line. Of course no government wants to get rid of it. All I hear is the same Keynesian party line that keeps being parroted by modern economists and taxpayers alike.

Seems like maybe you forgot what happened to Germany’s economy after WWII, which they also lost?

What do you mean? From a quick search, they had to pay in reparations:

* for WW1, $12.5 BILLION

* for WW2, $413 million

Even Allies figured out that the ridiculous demands of WW1, with the double whammy of 1929, were a direct cause of hyperinflation in Germany trying to pay for it (which already had borrowed incredible amounts of money as they were the first country to abandon the gold standard to finance the Great War) and the second time around they allowed the country to have a chance to actually rebuild itself.

If you had spent the time writing this and other comments googling/chatgpting you could have learned why returning to the gold standard is a joke.

Typically when someone says "I think A" the onus is not on them to do the legwork trying to prove A false. Although I agree that ChatGPT is generally better at putting together an argument than the HN average.

Well, no, when someone says "I think A", the onus is on them to try to prove A true. And in trying to do so, you might have found out why A is false.

Fair enough. In the spirit of the idea I'll leave it up to you to lay out why that is false.

> Pretty much any empire ever founded was built on a gold standard.

Ahistorical bullshit.

Gold coinage was never really a big thing, because gold was too rare to make gold coins for everyday usage feasible. Pretty much all historical empires used primarily silver coins. The UK pound used to be a literal pound of silver.