Gold standard represents a problem form some people for one reason or another. What they have to realize is that bringing the gold standard back could be a good thing.

One cannot characterize a monetary system based on gold as being rigid just because it imposes some rules. If we think long and hard we will realize that the only rule that is imposed by the gold standard in the one on the central’s bank printing press. What the government has to do is to maintain a fixed dollar/gold exchange rate and this is not a bad rule after all.

By bringing the gold standard back, the purchasing power of the dollar does not fall, it might actually increase over time. Economists all over the world have reached the conclusion that a long-term predictability in the monetary policy has many advantages. Furthermore, the best thing that the monetary authorities can do is to make sure that the currency has a stable purchasing power.

History does not support the affirmation that the dollar-price of gold is stable only under a gold standard. An actual advantage of using gold as money is that the annual output represents only a small fraction of the total world stockpile. What we don’t have to worry about is that if the prices are expressed in gold they will never reach astronomic heights. The only bad thing that could happen is if the gold producers would stop doing their jobs in order to punish the US. This could only happen if all the countries would cut off all their buyers but why would they want to do this?

Defending gold standard is like defending the Bill of Rights and there is absolutely no reason to do that. Everybody ought to know that bringing gold standard back is a good thing. What we could do in the mean time is to start investing in gold, as this commodity will never fail us.

Learn from professionals how buying gold can help you in times of recession.