I'm not sure how much of what you're describing was limited to the USA for the span of 42 years, and how far it can be extended to the rest of the world, and a longer time frame?
Ralston-Saul's book 'The End of Globalism' is a heavy read, but does dive into this with a significantly more serious tone. There's doubtless many other works on the subject, from myriad angles.
Certainly it's difficult to argue that since 1973 everywhere that's abandoned the gold standard, toeing the line as it were, has not suffered a sinusoidal cycle.
EDIT: Apologies, I failed to properly respond to your assertion:
> The boom bust cycle was much worse on the gold standard because when it busted, there was no way to stop it, and it could be manipulated by anyone with enough gold.
Is there a way to stop a bust in the a post-Bretton Woods? Are there some examples that you could cite where this has been done? (Australia's relative success through- and post-GFC I think is often held up as an example of something -- however it was, as is often the case, some accounting shenanigans whereby the selling of assets was shuffled into the revenue column.)
Follow-up -- do you consider the point of TFA to be that anyone with 'enough money (gold)' can manipulate the system to ensure legislative, and therefore legally binding, retention of that wealth (gold) is better, worse, or much the same?
> Certainly it's difficult to argue that since 1973 everywhere that's abandoned the gold standard, toeing the line as it were, has not suffered a sinusoidal cycle.
The same ups and downs existed on the gold standard, but much worse. From June 1919 to March 1933, when the US was on it, headline inflation started off at >15%, dropped to -15%, gyrated between 4% and 0%, was negative for a while in the 1920s, and dropped to -10% once the Great Depression started.
As a comparison, during the post-2008 period, it dipped to for a short period to -1% and then stayed positive but below 4%. 23 times less variance.
> Is there a way to stop a bust in the a post-Bretton Woods?
The busts in the post-BW era are a lot less worse than the busts under the gold standard AFAICT. And as we saw in 2020, large busts can be buffered by dropping rates and increases liquidity on the monetary side, and stimulus spending on the fiscal side.
This is standard Keynes:
> I would summarize the Keynesian view in terms of four points:
> 1. Economies sometimes produce much less than they could, and employ many fewer workers than they should, because there just isn’t enough spending. Such episodes can happen for a variety of reasons; the question is how to respond.
> 2. There are normally forces that tend to push the economy back toward full employment. But they work slowly; a hands-off policy toward depressed economies means accepting a long, unnecessary period of pain.
> 3. It is often possible to drastically shorten this period of pain and greatly reduce the human and financial losses by “printing money”, using the central bank’s power of currency creation to push interest rates down.
> 4. Sometimes, however, monetary policy loses its effectiveness, especially when rates are close to zero. In that case temporary deficit spending can provide a useful boost. And conversely, fiscal austerity in a depressed economy imposes large economic losses.
Your argument feels compelling, but I'm hesitant to embrace it fully given we're talking about ~50 years (post-BW) and a single country as an example (most western, and many other, countries embraced a floating currency as a response to this Nixon-change).
Depending how you measure it, the gold standard existed for a half century - so about as long as it's been gone, now - or perhaps much longer, at least de jure if not de facto.
(Economics still feels to be a lot of bluthering about in the dark.)
I'm wary about ascribing too much weight to the (exclusively) US experience since the 1970's, as the culture there skews both assessments and comparisons - which is basically what TFA is all about.
Comparisons to early 20th century elite are doubtless valid from a purely quantitative perspective, but perhaps less convincing in the abstract (coming back to TFA) of gross inequality (income & wealth).
For economic cycles, see point 5: Gold recessions could last for years.
The gold standard made the Great Depression worse; see Bernanke† and James (1991):
> However, Temin (1989) argues that, once these destabilizing policy measures had been taken, little could be done to avert deflation and depression, given the commitment of central banks to maintenance of the gold standard. Once the deflationary process had begun, central banks engaged in competitive deflation and a scramble for gold, hoping by raising cover ratios to protect their currencies against speculative attack. Attempts by any individual central bank to reflate were met by immediate gold outflows, which forced the central bank to raise its discount rate and deflate once again. According to Temin, even the United States, with its large gold reserves, faced this constraint. Thus Temin disagrees with the suggestion of Friedman and Schwartz (1963) that the Federal Reserve's failure to protect the U.S. money supply was due to misunderstanding of the problem or a lack of leadership; instead, he claims, given the commitment to the gold standard (and, presumably, the absence of effective central bank cooperation), the Fed had little choice but to let the banks fail and the money supply fall.
> For our purposes here it does not matter much to what extent central bank choices could have been other than what they were. For the positive question of what caused the Depression, we need only note that a monetary contraction began in the United States and France, and was propagated throughout the world by the international monetary standard.
I recommend Money: The True Story of a Made-Up Thing by Jacob Goldstein, which goes over some situations where various countries have switched to and from 'fiat regimes' over the course of history before the modern age.
As for economic cycles, in the GS/pre-BW regime US economic growth was 2.81% with a variation of 4.46%, while in the non-GS/post-BW world the numbers are 2.75 ±2.06%:
And the later years are also including inflation from the Vietnam War and the oil shock: hardly regular events. Take those out and the variation would probably be even lower. Once Volcker tamed the oil shock, the Fed has managed to run a pretty tight ship when it comes to inflation:
I'm not sure how much of what you're describing was limited to the USA for the span of 42 years, and how far it can be extended to the rest of the world, and a longer time frame?
Ralston-Saul's book 'The End of Globalism' is a heavy read, but does dive into this with a significantly more serious tone. There's doubtless many other works on the subject, from myriad angles.
Certainly it's difficult to argue that since 1973 everywhere that's abandoned the gold standard, toeing the line as it were, has not suffered a sinusoidal cycle.
EDIT: Apologies, I failed to properly respond to your assertion:
> The boom bust cycle was much worse on the gold standard because when it busted, there was no way to stop it, and it could be manipulated by anyone with enough gold.
Is there a way to stop a bust in the a post-Bretton Woods? Are there some examples that you could cite where this has been done? (Australia's relative success through- and post-GFC I think is often held up as an example of something -- however it was, as is often the case, some accounting shenanigans whereby the selling of assets was shuffled into the revenue column.)
Follow-up -- do you consider the point of TFA to be that anyone with 'enough money (gold)' can manipulate the system to ensure legislative, and therefore legally binding, retention of that wealth (gold) is better, worse, or much the same?