Episode 252: The Gold Standard
Note: Today's show is a rerun. It originally ran in February 2011.
It's gold standard week on Planet Money!
On today's show, we visit the charming curmudgeon and respected finance writer James Grant. He says we should go back on the gold standard.
His basic argument: Under the gold standard, money holds its value. Central banks can't create (or destroy) money at a whim. He says that under the gold standard, "the value was fixed. We adjusted our affairs to this North Star of value." He continues:
Today, the North Star is like a comet. Ben Bernanke testifies one day, he thinks he wants to impart a little zest into our shopping by injecting more green, paper dollars into the world. He thinks that more of them will be more better. Why? Because it will cause prices to go up just enough. Not too much, but just enough. Do you believe that? It's risible. Laughable.
On Friday, we'll explain why most economist think going back on the gold standard would be a terrible idea.
For more on Grant, read our post from last week and see his op-ed from the New York Times.
This week's podcasts are part of Planet Money's latest adventure in investment journalism: We bought a tiny gold coin, and we're using it to think about bubbles, value and the meaning of money. Here's the whole series.
Music: Led Zeppelin's "When the Levee Breaks" and Prince's "Gold." Find us: Twitter/ Facebook/ Spotify/ Tumblr.