The True Gold Standard (Second Edition)
On Friday, a gray-haired group of Jack Kemp acolytes, along with his son Jimmy, will hold forth in the U.S. Capitol's visitors center to honor the 30th anniversary of the Gold Standard Act of 1984.
Kemp's political legacy has been revivified of late, with praising pieces in The New York Times and Economist. Those articles, and others, have pointed out that a number of Kemp's policy concerns dating to the 1980s—including immigration reform and urban enterprise zones—have been taken up by a new crop of national Republican leaders, including Sens. Marco Rubio and Rand Paul.
Despite all this Kempian goodwill, one of the congressman's key legislative priorities—returning the U.S. to the gold standard—has gone almost completely ignored.
Steve H. Hanke, professor of applied economics at The Johns Hopkins University and a scholar at the libertarian Cato Institute, pointed to bitcoin's volatility and lack of security. He called it "the speculative asset of the century."
Hanke, who directs the Troubled Currencies Project for Johns Hopkins and Cato, views the virtual currency's popularity as more computer science than economic theory. He said supporters were "computer geek" dilettantes with little appreciation for the historical evolution of currency.
"The ignorance of money is phenomenal," Hanke said, adding that bitcoin's biggest champions are "Silicon Valley kind of guys. None of this crowd has a clue about money and banking."
Although he considers himself bullish on electronic money, Hanke thinks bitcoin is too volatile—and its open-source code too insecure—to function as a challenger to fiat currencies.
"The wave of the future is virtual currencies, but as a means of transaction" like PayPal, credit and debit cards, said Hanke, who argued that a stable currency must be linked to a physical commodity to ward off hyperinflation.
"Stability is everything when it comes to currency ... and bitcoin is very unstable, and very volatile."
Discussing the impact of the crisis in Syria on stocks, with Danielle Hughes, Divine Capital Markets; Scott Nations of NationsShares; and Lewis E. Lehrman, The Lehrman Institute.
Discussing the state of home prices, and the economy's next step, with David Blitzer, S&P 500 Index, and Lewis E. Lehrman, The Lehrman Institute.
Is 2 percent growth the new normal in our economy? Lewis E. Lehrman, author of "Money, Gold and History," says he thinks the President and the administration is "not optimistic on America."