Bob Fraser argues gold can't anchor modern economies because its supply doesn't grow with population or economic output. A money supply must expand with economic activity to avoid inflation and deflation, something gold cannot do. Hard-money advocates pushing a return to the gold standard are working with an outdated model.
The gold is not ready for modern economic systems to be the foundation of all trade and economic activity. It just isn't. There's not enough of it, not enough of it. And it doesn't expand with population and with economies, which we need it to do. You know, if you want to have zero inflation and zero deflation, you've got to have a money supply that exactly equals economic activity. And gold certainly doesn't.
Right. And it kind of goes back to an earlier episode that we did talking about the fate of the US dollar. Right. Because a lot of these hard money economists say that we should go back to the gold standard, right? Or they've been kind of waiting for however many years for the dollar to crash just because it's not backed by gold, hence fiat, right? It's not backed by anything hard. But to your point, that's, it's all an old way of thinking. It has not kept up with the modern economy and the modern needs. There's no way we could, we couldn't go back to a true gold standard.
