Milton Friedman on The Gold Standard

Dr. Friedman (born July 15, 1912), a 1976 Nobel Prize winner for excellence in economics, was one of the most effective advocates of economic freedoms and free enterprise. A Senior Research Fellow at the Hoover Institution. At the age of 94, Dr. Friedman passed away on November 16, 2006 in San Francisco, California.

"When government -- in pursuit of good intentions -- tries to rearrange the economy, legislate morality, or help special interests, the costs come in inefficiency, lack of innovation, and loss of freedom. Government should be a referee, not an active player. In the United States, government has gone far beyond the basics."

Source:
http://home.att.net/~mwhodges/friedma...

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  News & Politics

[Mucky Pup]

Republicans are not "laissez-faire" marketers. That is a blatant lie. They believe in big government as much as any Democrat. Just different cronies benefit.

[mrtaxi072]

The housing bubble was caused by the sub-prime mortgage crisis. And that was caused by the DEMOCRAT enforcement of the CRA. More specifically, forcing banks to give home loans to people who were not credit worthy (could not afford). The banks would have never willingly lent sup-prime loans on this scale otherwise. Because they would have feared the very predictable results that happened. Bush actually fought against the risky practices of Fannie & Freddie.

[Saga Gemini]

I agree with this. The point is Friedman wanted to get rid of the fractional reserve banking, and any solution is better that the current system.

On a side note, most libertarians propose the gold standard, and Friedman and other libertarians proposed a free market for currencies, basically by reintroducing greenbacks. I don't know of any other solutions...

[mtime6]

" I regard a return to a gold standard as neither desirable nor feasible—with the one exception that it might become feasible if the doomsday predictions of hyperinflation under our present system should prove correct."-Milton Friedman

source :Richard M. Ebeling.Monetary Central Planning and the State, Part 27: Milton Friedman's Second Thoughts on the Costs of Paper Money

[Saga Gemini]

Friedman explains that the depression was manufactured by the government and the federal reserve to destroy the gold standard, not that the depression was caused by the gold standard.

[mtime6]

Pay Attention Ron Paul retards, this is why ALL, yes ALL economists disapprove of the gold standard.

[proessorcurly]

If money is linked to gold, then if money moves from one place to another gold has to move with it. If imports and exports are balanced, then the gold effectively goes nowhere. However, during the depression England was importing more than it was exporting - ie more money was leaving the country than was coming in. Buy the rules of the gold standard, that meant gold had to physically leave England and go to the seller - which was the United States.

[mrdalvey]

4:17 can someone explain exactly why England had to "make up the difference in gold"?

[luvcheney1]

If the Federal Reserve had not been allowing the money supply to grow, the huge amount of new money going into mortgages would not have existed. So, with the very low standards you mentioned, the harm would have been minor, because the size of the problem far smaller. You overstate the standards argument, omit the monetary side. Left, and right omit monetary. Left says Wall Sreet did it, the right says CRA, Fannie, etc. Both are following consequences, not cause.

[mrtaxi072]

Ripoff? Seriously? Allowing people to keep more of what they earn, and create legally? Why does simply being rich somehow make it nefarious to be the manager of one's money versus a corrupt, self serving government? Why shouldn't a tax cut mainly benefit the wealthy? They pay most of the revenue collected in income taxes. They provide most of the revenue payed to the middle class. Do you blame skinny people for causing obesity in the fat ones?

[jannmutube]

While it's true that Gramm-Leach-Bliley only repealed a portion the Act, Glass-Steagall is not law as it was originally passed today.  BTW, "McConnell Brue Flynn macroeconomics 19e is a 2012 college text and I made a A in the class. What's your source that 85% went to the middle-class?