They'd have to physically steal gold from people, and people would notice that. Or they could mine more gold, but that's hard. Or they could publicly and officially change the exchange rate (of dollars to gold), and people would notice that politicians make it go down, the same way that people notice when politicians make taxes go up (they notice way more than when prices other than taxes go up).

With the current system, they (the central bank) can just increase some people's numbers in some spreadsheets, and the effects are extremely indirect. Nominally this is in exchange for assets of equal value so the situation returns the normal after some time, but that hasn't been happening - the amount of money created this way has not been decreasing at any meaningful rate.

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habinero 2 days ago | parent | next [-]

Considering the amount of panics and depressions and general economic insanity that happened on the gold standard in the 1800, none of this is true.

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Dylan16807 2 days ago | parent | prev [-]

Just selling bonds would have raised more than enough money to give out corruptly.

And corporate bailouts are downright cheap compared to the federal budget.

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immibis 2 days ago | parent [-]

And it would be impossible to bail out those bonds when they defaulted, nor to reuse the bonds to back money.

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Dylan16807 2 days ago | parent [-]

> And it would be impossible to bail out those bonds when they defaulted

Well the US hasn't defaulted so changing how a default works wouldn't really affect the trajectory we took. And a default would be pretty catastrophic either way.

> nor to reuse the bonds to back money.

I don't know what you mean here.

	▲	immibis 10 hours ago \| parent [-]
		Well the US isn't on the gold standard. If it was on the gold standard then it would have defaulted. That's why it moved off the gold standard. Actually, by moving off the gold standard, it defaulted on dollars (at the time a kind of gold bond) rather than defaulting on dollar-denominated government bonds.