Great response

Whilst reading the Telegraph piece below, I noticed this fantastic comment in response:

Re the gold standard, Edmund claims “most catastrophically, it would mean governments could no longer adjust interest rates depending on the health or otherwise of their economy”.

It certainly would mean the markets rather than governments or central banks would determine interest rates. How could anyone believe the past 100 years has demonstrated any competence by government in this regard?

Hindsight reveals that virtually everything the monetary authorities have done over the last century has been a disaster. And Edmund, like the politicians and central bankers, wants us to believe it would be a “catastrophe” if governments lost the power to fiddle with interest rates.

In the US, there was no central bank before 1913. Yet the country and its economy grew dramatically before then. By 1913, it produced 32% of world manufacturing output, more than twice that of Germany or Britain at the time.

Since then, it has had the Great Depression and the current Great Recession, which is heading down the path to become the Great Depression II, all brought to you courtesy of central banks and interventionist governments.

All claims of benefit from having government “manage” interest rates is simply a smokescreen for a crony-statist philosophy that totally disregards centuries of experience.

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