Statist Intervention – The Consequences

April 28, 2023

by Alasdair MacLeod Gold Money

This article looks at our current economic condition from the viewpoint of classical economics. It is now 87 years since classical economics were dismissed by John Maynard Keynes in his “General Theory of Employment, Interest, and Money”.

Central to Keynes’s opus was a desire to create a role for the state, intervening in economic affairs. In searching for this objective, he had to traduce the law of the markets — Say’s law. We show why this was mistaken. The error has been at the root of the accumulated errors of monetary policies ever since.

It has led to the destruction of the dollar’s purchasing power, reflected in a gold price which has risen from $35 to $2000 — a depreciation of the dollar’s value as a medium of exchange relative to legal, sound money of over 98%.