On Introduction of Sound Money
AbstractWorld financial crisis unveiled the precarious position of modern monetary system based on a centralized fiat money supply and fractional-reserve banking. The scale of the crisis and the threat of major price inflation, which has already become a reality on commodities markets, confirm the instability of the monetary system. In order to define weak spots of the system and consider possible solutions on how to address them it is necessary to revise the nature of its elements, and in particular of money. The paper is devoted to the issues of money with commodity backing and approaches of its introduction. Model of self-adjusting money creation/redemption based on ETF technology and respective stock and commodity exchange infrastructure is proposed as an incentive to stimulate discussion about potential improvement of the modern monetary system.
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Date of creation: 27 Mar 2012
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money; commodities; exchange-traded funds; monetary system regulation;
Find related papers by JEL classification:
- E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
- E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
- G1 - Financial Economics - - General Financial Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-04-17 (All new papers)
- NEP-MAC-2012-04-17 (Macroeconomics)
- NEP-MON-2012-04-17 (Monetary Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Laurent Deville, 2008. "Exchange Traded Funds: History, Trading and Research," Post-Print halshs-00162223, HAL.
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