05-22-2016, 05:49 AM
(05-22-2016, 05:10 AM)Kinser79 Wrote: Probably not entirely. A drastic drop in the price of gold or silver would flush the other out of circulation relatively quickly. That said the fixed system was somewhat unwieldy and did not respond quickly to market forces or such things as finds of mineral deposits.
It would entirely eliminate the problems of the fixed ratio bi-metallic standard because markets respond to changes very quickly. Remember that Gresham's Law does not apply unless coercion, usually supplied by the state, overvalues one metal relative to the other. In a market this state of affairs never lasts very long.
Democracy is the theory that the common people know what they want, and deserve to get it good and hard. -- H.L. Mencken
If one rejects laissez faire on account of man's fallibility and moral weakness, one must for the same reason also reject every kind of government action. -- Ludwig von Mises
If one rejects laissez faire on account of man's fallibility and moral weakness, one must for the same reason also reject every kind of government action. -- Ludwig von Mises