a.ashfield <[email protected]> wrote:
> The only thing in its favor is that the central bank can't then screw
> things up.
>
I am not aware that a central bank is screwing things up now. There has
been no inflation in the US in many years so obviously they are not
printing or circulating too much money. There has been no inflation in
Japan since 1972 when I first went there. Things like food, a 100-yen Kirin
Lemon softdrink, books and automobiles cost about the same now as they did
then. However the economy is not doing well. It has been in the doldrums
since the 1980s so I suppose inflation might be a good thing for them. P.M.
Abe's economic policy ("Abenomics") aims for 2% inflation.
> That being the case surely it would be better to have it based on a
> basket of other currencies . . .
>
That would be an imaginary standard. The other currencies are not limited
by anything other than policy.
> or at least write some laws to limit money expansion to match some measure
> of actual economic expansion.
>
I gather that economic expansion sometimes depends on expanding the money
supply first. First you issue money, then the economy expands in response
to that. That's what P.M. Abe is hoping for, and it seems to be working. It
would be a mistake to prevent that from happening. It would have been a
disaster after the 2008 crash, and it was a disaster after 1929.
- Jed
