Comment by throw0101d

"Gold Standard era there were many periods of deflation" - yes but that's not so much about inequality.

I think there's a lot merit to Gold is a bit better for equality - but it probably holds us all back in the aggregate.

Elon Musk could not be a Trillionaire in the highly speculative cash-flush situation we have today.

The 2008 crash and the current boom are happening only because of alot of extrea money in the system, and it's going to one group, not the others.

The 2008 bailout was to the 'open secret upper class' aka home owners.

If we 'let the cards fall' in 2008 the banking system would have crashed but it's home prices that would have crashed harder.

A 'stricture monetary system' would have forced people to pay the price. Though it would have had devastating consequences as well - it's possible that with stricter lending, the 2008 crisis would have never happened.

FED sets rates that generally favour the GDP, the growth of which is mostly captured by people with more equity. The more loose money for equity etc the more likely it is to be concentraed.

This is all 100% solvable.

There is no ideological debate needed.

A 'relatively strict' Fed, with rules that favour consumer surplus and that is not fully oriented around equities or some 'outside cause' - that's really truly like 'Gold but with some expansion' ... aka a very small-c conservative approach would be a solution that should be acceptable by pretty much everyone except for the MMT people.

I think it would bode better for 'equality' because money means something known, and large enterprise, financiers can't leverage their influence and scale into making it mean something more for them.

Two points I'd hit on:

1) Deflation causes debt to become more expensive. Inflation causes your money to become worth less. There's a simple solution to debt becoming more expensive, but no practical solution to you getting a pay-cut every year, especially when a sizable chunk of people don't even realize they're getting a pay-cut and don't want to be unthankful for a "raise." That issue alone already causally explains much of the rise in inequality. Cut people's wages in a stable or deflationary system and there will be hell to pay. Cut them in an inflationary system and they say thank you.

2) Changes in the past are exaggerated. The Fed did a study some time back estimating CPI levels since 1800. [1] They found that from 1800 to 1950 the CPI never shifted more than 25 points from the starting base of 51, so it always stayed within +/- ~50% of that baseline. That's through the Civil War, both World Wars, Spanish Flu, and much more.

It's even more interesting to contrast this from 1971 onward. 1971 is when Bretton Woods ended and the government was given a free hand to start 'printing money' so to speak, and inflation became the new policy. Since then the CPI has increased by more than 800 points, 1600% more than our baseline. So if the 'Gilded Age' saw deflation of ~30% over some decades, what will historians in the future call an era of thousands of percents of inflation over some decades?

[1] - https://www.minneapolisfed.org/about-us/monetary-policy/infl...

> Is there evidence for this?

A simple and logical pattern.

1) Unconstrained spending without commensurate taxation leads to a required inflation of the money supply

2) An inflation of the money supply with increase the price of assets relative to the value of the currency.

3) Asset owners thus become "more valuable" by measure of currency.

4) Renters / non-asset-owners have to eat the costs of inflation while benefiting by none of the inflationary pressure on assets.

ergo - a gold standard is just a proxy for "constraints on debt" is a force that acts against inequality between asset owners and non-asset owners.