[expat_panama]

—and forget silver; that can be done. Of course, the price of silver will be even more erratic so we’d have to forget about using silver in coins. The big problem though is that the price of copper, oil, food, everything else would also swing wildly. That was the problem with the gold peg, crazy prices.

[arthurus]

It swung no more wildly than its value in the economy. Silver and gold would be valued by weight but the dollar value of gold would remain unchanged if the government were to freely buy and sell gold at a single unchanging price. The government, of course would have to maintain its own house in financial order. Alternatively the government could maintain an unchanging stock of dollars and prices would trend down as the economy expands. Keynesians fear "deflation" utterly as Keynesians tend to believe in a totally zero sum system where no actual value can be created. To Ks, thus, expansion of the economy and inflation are the same thing and inflation is, in fact, the stealing of value from the rest of the world by theoretically increasing the proportion of "money" owned by the home government.

That goes hand in hand with the liberal belief that America has grown rich by impoverishing the rest of the world and that America's impoverishment is necessary to make things right with the world. They are accomplishing that goal perversely by increasing inflation but that new money accrues to the government and steals value from the citizenry by increasing the number of dollars into which the measure of the total value of the economy is divided and keeping the new dollars for itself. That money is to be used and is used to "equalize" and compensate the poor of the world who have been ripped off by previous inflation in America. Actually there are a couple of contradictory fantasies here but liberals and intellectuals are quite capable of believing two or more utterly contradictory things simultaneously and acting on their beliefs.