> The dollar, as a money, should be a constant unit. Then people could value it as they see fit, some choosing to hold more or less of it for the proverbial rainy day.
Define constant. Do you want the value to remain constant? If so, why? And more importantly, how? You have to adjust the supply to offset for increased productivity, to offset increased population, to offset decreased spending.
If you just want a certain quantity then it's not constant because its value will fluctuate inherently with the economy around it. As a result, it will tend towards deflationary, which is generally a death sentence economically. If something is worth more in the future why spend it? Just look at Bitcoin. Nobody spends it. Nobody. Why would they, number go up? If that were the case with a national currency nobody would have jobs, they'd just sit home and watch number go up lol. We've never tried this because even with a gold standard the supply increased over time.
The fluctuations in market value would make it borderline impossible to maintain as a unit of account.
This is why the current system is ideal - you get your medium of exchange and unit of account, and you get store value however you want. This is maximum economic freedom. If you want to back your personal economy with gold, go to town! Steve wants to back his with Bitcoin - more power to him. If I want to back it with productive assets, that's cool too!
Don't force everyone into your preferred store of value, certainly not because you don't trust them to allocate their value towards an optimal vehicle.
Define constant. Do you want the value to remain constant? If so, why? And more importantly, how? You have to adjust the supply to offset for increased productivity, to offset increased population, to offset decreased spending.
If you just want a certain quantity then it's not constant because its value will fluctuate inherently with the economy around it. As a result, it will tend towards deflationary, which is generally a death sentence economically. If something is worth more in the future why spend it? Just look at Bitcoin. Nobody spends it. Nobody. Why would they, number go up? If that were the case with a national currency nobody would have jobs, they'd just sit home and watch number go up lol. We've never tried this because even with a gold standard the supply increased over time.
The fluctuations in market value would make it borderline impossible to maintain as a unit of account.
This is why the current system is ideal - you get your medium of exchange and unit of account, and you get store value however you want. This is maximum economic freedom. If you want to back your personal economy with gold, go to town! Steve wants to back his with Bitcoin - more power to him. If I want to back it with productive assets, that's cool too!
Don't force everyone into your preferred store of value, certainly not because you don't trust them to allocate their value towards an optimal vehicle.
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