The True Gold Standard (Second Edition)
"[The gold-exchange standard] was the outcome of an unbelievable collective mistake which, when people become aware of it, will be viewed by history as an object of astonishment and scandal." -- Rueff
In The Monetary Sin of the West (The Macmillan Company, 1972, 1971, pp. 23-24), Jacques Rueff addressed the "original sin" that stands behind the monetary disorders of his, and our, era. He begins, prophetically, in words written shortly before President Nixon ended, rather than mended, the disordered remnants of gold convertibility:
"The problem of Western currency is more topical than ever. For ten years now, the international monetary system has been patched up by many expedients that were intended to extend its assured life. It cannot endure very long in the present state."
Rueff forcefully addresses, on pages 23 - 24, the nature of the original sin that caused the world's expulsion from the monetary relative Eden that was the classical gold standard:
[T]he gold-exchange standard brought about an immense revolution and produced the secret of a deficit without tears. It allowed the countries in possession of a currency benefiting from international prestige to give without taking, to lend without borrowing, and to acquire without paying.
Rueff's prologue concludes:
The art of monetary expedients has been refined to such a point over the last ten years that no one can predict what artificial devices can be generated by the fertile minds of experts. One thing is certain, however: while additional innovations may stave off the gradual deterioration of the system for a while, they cannot change the outcome. As far as prognostication is concerned, events can never be wrong. But unfortunately, events have already passed judgment.
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Key Monetary Writings
A free people can have a nominal paper dollar; or they can have a real dollar, defined by its...
Why the Gold Standard?