Episode 262: David Friedman on the Gold Standard
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The Ideal Commodity System Doesn't Use Gold
There is a way of maintaining a gold standard that doesn't require that much gold. Adam Smith: The ideal monetary system is competing private issuers agreeing on a common standard. He says if you bring in one Friedman dollar, I will give you 10 to an ounce of gold. That's basically the Scottish system of the 18th century and it gives you reasonably stable money.
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