Then it aint justice, it aint true Capitalism, its aint the real deal. And though people will see that on paper the policies are pretty right, in their hearts they will know that something is terribly wrong. They will know that it can never be Australia City. And though the banners and the neon signs will SAY Australia city, the more thoughtful amongst us will always have this sense that they are living in Poo-Town.
This one cribbed from Gold Is Money:
Truthsearcher. In order to decide on what you think the best monetary policy would be you might want to check out a book by the historian David Hackett Fischer:
‘The Great Wave’ (Price Revolutions And The Rythm Of History)
My own view is that the optimal setup is for nominal GDP to be rock solid and for prices to be falling pretty much all the time. Although I wouldn’t want to presuppose a government-run system.
In ‘The Great Wave’ Fischer studies periods in Western history where prices were rising over many decades. And other periods when they weren’t. When prices were generally dropping.
The specific time periods of inflation he looks at are:
1. The medieval price revolution 1180-1350
average inflation about .5%
2. The Price Revolution of the Sixteenth Century. And the crisis of the 17th. About 1470-1660
3. The Price Revolution of the 18th century: About 1720-1820
1. The Equilibrium of the Renaissance 1400-1470
2.The Equilibrium of the Enlightenment 1660-1730
3. The Victorian Equilibrium. 1820-1896
Now what we see is that it is the time periods of rising prices where you wind up with horrid social conditions, falling real wages, social unrest and relatively more violence. Whereas in the era’s of falling prices we get great cultural acheivements, less war and violence and after a time increasing real wages, and a more even distribution of wealth.
To my mind the Victorian era was a little different then the other two. Since fractional reserve banking was in full swing so that therefore you will get a boom bust cycle going which is not a good thing and entirely unnecessary.
But in any case here we see that 0.5% price inflation is still unheathy. No matter how benign we may seem to think of it these days. My own view is that nominal GDP ought to be held stable. And prices should be falling all the time. Then after a time we would likely get all the benefits that you might expect. Social stability, increasing real wages and general culural health.