A Commodity Reserve Currency

“A Commodity Reserve Currency.” Economic Journal 53 (1943).


“The gold standard as we knew it undoubtedly have some grave defects. But there is some danger that the sweeping condemnation of it which is now the fashion may have secure the fact that it’s also had some important virtues which most of the alternatives lack. He wisely and him partially controlled system of managed currency for the whole world might, indeed, be superior to it in some respects. But this is not a practical proposition for a long while yet. Compared, however, with the various schemes for monetary management on a national scale, the gold standard had 3 very important advantages: it created in effect an international currency without submitting national monetary policy decisions to the whim of an arbitrary international authority; it made of monetary policy in a great measure automatic and thereby protectable; and the changes in the supply of basic money which its mechanism secured were on the whole in the right direction.”

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