This is a July 28 2012 Wall Street Journal OpEd with a few of their cuts restored.
Read it at The Grumpy Economist | John Cochrane's blog
Myths and Facts About the Gold StandardJohn H. Cochrane | professor at the University of Chicago Booth School of Business
3 comments:
It is interesting to observe the subtle seductive activity and powers of gold on WEAK minds...
This statement is 100% bullshit:
"Imagine a government with $15 trillion of debt, $2 trillion of money outstanding, and $2 trillion of gold reserves. Then its debt comes due. If the government can't raise tax revenues, cut spending, or persuade investors to lend against credible future budget surpluses, it must print $15 trillion of cash not backed by gold, devalue the currency, or default on the debt. "
"It's debt comes due" ?????
Hey Cochrane, Mike has continuously chronicled here this year how now $60T has "come due" this year (SO FAR) and we've just re-issued the USD balances into new Treasury Securities at 0%!
$Ts "come due" ALL THE TIME!
Sober up Cochrane!
Matt -- I knew Cochrane's post was going to get you to rant, I just wasn't sure which piece of BS you would pick.
Has Cochrane done any work that's useful? Is he any good on asset pricing?
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