In response to:

Prophets and Losses

Harrison Bergeron Wrote: Feb 05, 2013 8:11 AM
Dr. Sowell left the solution as an exercise for the student, so here it is: Some would suggest reverting to the gold standard. But the value of money is not the price of some fixed commodity. Tying the dollar to gold is simply a recipe for deflation -- or inflation if some new deposit of gold ore is discovered (just ask the former Spanish Empire). A dollar represents a share of the ENTIRE economy. If the economy grows, more dollars must be created. If it shrinks, dollars must be destroyed. So the solution is simple -- remove the Fed's mandate to tie the money supply to unemployment (of all things!). Instead use a computer to AUTOMATICALLY tie the money supply to GDP.
Texas Chris Wrote: Feb 05, 2013 9:34 AM
No. GDP is a manipulated number. May as well tie M2 to unicorn farts.

Simply abolish legal tender laws, and let the free market determine what should be "money". If it's gold, then fine. If it's the paper dollar, well, okay then.

But lets be honest, it ain't gonna be the paper dollar.
Harrison Bergeron Wrote: Feb 05, 2013 9:55 AM
The point is to remove the manipulation by moving it out of human hands.

Yes, one alternative would be to revert to barter. I doubt that it would support a modern economy capable of producing the computer on which you typed that thought, though. Somebody would eventually re-invent money, and unless it accurately represented a true share of the sum of all things available to purchase, we would be right back where we are today.
Gordon110 Wrote: Feb 05, 2013 8:52 AM
An excellent suggestion. It is logical and would probably actually work. It will therefore never be considered.
Now that the federal government is playing an ever larger role in the economy, a look at Washington's track record seems to be long overdue.

The recent release of the Federal Reserve Board's transcripts of its deliberations back in 2007 shows that their economic prophecies were way off. How much faith should we put in their prophecies today -- or the policies based on those prophecies?

Even after the housing market began its collapse in 2006, Federal Reserve Chairman Ben Bernanke said in 2007, "The impact on the broader economy and financial markets of the problems in the subprime market seems likely to...