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It comes down to a fundamental dispute over whether money should function as a long-term store of value. The gold bugs believe that money should store value long-term, and so see the failure of paper currency to do so as evidence that it is a poor form of money.

I believe - and you seem to agree - that money should store value only long enough that its depreciation is not an inconvenience in ordinary transactions, because money is an instrument for organising transactions. In this picture, the failure to store value over years or decades says nothing about the suitability of currency to function as money, because money only needs to store value on the order of weeks and months.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Jan 1st, 2012 at 06:23:42 PM EST
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