Monetary Commentary@monetarycomm
9h

19th-century growth under gold standards proved that real expansion doesn’t require continuous monetary elasticity. Output surged through productivity, trade, and population growth while prices deflated gently as efficiency rose faster than the money stock.

What elasticity really changes is the distribution of pain and power: it cushions leveraged balance sheets and gives governments fiscal breathing room.

The problem is that in modern finance, credit itself is money. Once you shift from specie to a credit-based system, inelastic money becomes a self-defeating concept. A rigid supply in a world of maturity transformation guarantees panics.

The lesson of the gold standard is that unchecked elasticity decouples finance from production. The real art is designing elasticity that absorbs shocks without institutionalizing moral hazard.•
https://x.com/monetarycomm/status/1974338202136686651

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Mises Media@mises_media
•
17h
Does growth require “elastic” money? History says no. Real output can rise while prices fall: no printing press needed. Elasticity mostly aids debtors and the state. @NewmanJ_R and @RyanMcMaken explain why sound money scales. #RothPod