That's not the point I'd get from the article. The point I'd get is that the US government might not default on the debt, but what will those dollars be worth at the end of this?

The 1933 resolution can be seen as a default or the government saying that they'll only deal in dollars from now on - which might not be as good for investors and therefore rob them of some of their value. Since the government today doesn't have debts in non dollar form, why would they default? They can just print money. The idea that any government would default on a debt denominated in their own currency that they can readily print is ridiculous.

The only problem is that the money you get from them might not be worth much if we see a decent rate of inflation. That's where the article strikes at our current situation. The gold debt was protected against inflation (assuming that the supply of gold didn't increase much). Those investors were then subjected to inflation as the US renounced gold denominated bonds.

Since the US doesn't have bonds in anything other than dollars, this situation wouldn't happen today.

> Since the US doesn't have bonds in anything other than dollars, this situation wouldn't happen today.

Not so fast. While one can pay off a bond with inflation as well as revenue, both have costs that a govt might choose to avoid by defaulting instead. (Yes, default also has costs - my point is TANSTAAFL applies to bond payoffs.)

Also, some bonds have "inflation protection", which makes inflation less useful in paying them off. If bond-holders become concerned about inflation, they're more likely to demand such protection or higher returns to give them real return over expected inflation. Both responses make default a more attractive option.

This roundabout argument is ignoring the most basic facts. Nowadays, bonds repay in dollars, so we can always just print more money. In 1933 that was not the case, so it doesn't make much sense to say that since we had to default in 1933, we may have to default again today.