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If gold coins replaced the paper currency do u think inflation aworld round phenomenon will be contained?

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If gold coins replaced the paper currency do u think inflation aworld round phenomenon will be contained?

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  1. No, over periods of twenty to fifty years you would tend to a trended value, but you would have deflation/inflation cycles in between that would be very large.  Also since money would be inelastic in supply no fiscal or monetary policy could be used to protect the economy.  As such, if there were positive increases in productivity in the world there would be a perpetual deflation, which would permanently reduce welfare since firms would under produce to protect themselves to profit losses from deflation.  

    Money per capita should grow at the rate of productivity changes per capita, other things constant such as exchange rates, to guarantee zero inflation.  Since money would be fixed, but productivity would not, money would be more valuable held than used for consumption so consumption would fall permanently.


  2. not really

  3. No.

    The only way to contain inflation is to pass a law. The law should say that you can't raise the price of goods no more then 10% every 10 years. Meanwhile the law should also say wages MUST go up 50 cents every 2 years with a cap of $10.

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