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Now, tell me he doesn’t understand what he’s talking about with respect to monetary policy (do you know what you’re talking about?). I’m extremely gratified to know that he’s a step ahead of me. Of all his policy proposals, I’m least existed about the "goldbugism." I’ve previously explained why I don’t think creating money to extend credit (to legitimate, credit worthy entities) is a problem, and indeed, I believe it’s a profoundly important financial innovation.

That said, looks like he wants gold and silver-backed currency to compete. So let the competition begin. That, in itself, might make the thing more responsible. It’s true that the dollar already competes against many other currencies on a 24/7 world market that trades in volumes hundreds of times greater than our stock exchanges. But it’s fiat, credit currencies competing against other fiat, credit currencies. It would be interesting to see how a non inflatable currency would fair.

My guess is that not too well, provided the credit currencies print responsibly. As a trader, I can tell you: there’ nothing like flexible liquidity, if yo know how to use it (I do: but only because of badly misusing it, once).

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