Only gold standard can revive economy
Regarding “More Fed help available” (Page A-1, Sept. 1):
The last thing the U.S. economy needs is another round of dollar debasement. To prevent a greater economic catastrophe that is already baked into the cake because of its previous quantitative easing, the Federal Reserve should not create any more money out of thin air.
The Fed’s dual mandate, stable prices and low unemployment, is unachievable because a market economy relies on savings and investment, not artificially low interest rates, to create goods and services the people want. In a free-market economy, prices are not “stable” but decline slowly as the supply of goods increases over time. Massive unemployment is the result of the bubble bursting and subsequent repeated attempts to “stimulate” the economy with more government spending and quantitative easing, the very policies that are responsible for the current sluggish economy.
Federal Reserve Chairman Ben Bernanke should have learned the foremost principle of monetary economics from Ludwig von Mises: “The gold standard alone makes the determination of money’s purchasing power independent of the ambitions and machinations of governments, dictators, political parties and pressure groups.”
Fiat money has failed to create sustainable prosperity with low unemployment. It is time to make the dollar as good as gold once again.
Fort Lee, Sept. 1
The writer, professor of finance at Ramapo College of New Jersey in Mahwah, has been a Libertarian and Republican Party candidate for statewide public offices.