Episode 262: David Friedman on the Gold Standard
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The Argument for a Commodity Standard
David Frum: Why have a gold standard at all? And given that there is some reason, why did we leave it? He says the argument for a commodity standard is to maintain the value of your money such that there is nobody who can easily change it. But with a fiat system, he says, institutions may lead to inflation or conceivable even a fall in prices. That's fine if you are a lender, but it's a problem if you're a debtor and didn't anticipate what would happen after 18th century.
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