Say it ain't so!

I guess you can’t slip one by those wily folks at the WGC. What really should be said though is that the price of a fiat currency (an item with finite demand and infinite supply) is simply a function of its organic/downward sloping demand curve and its administered/vertical supply curve. People supposedly far less-learned than the WGC have figured that one out (certainly the cadre of global central bankers has). So, what truly is the price of money? Is it the inverse of the gold price or the term structure of risk-free interest rates? Of course, this might be construed as an inconvenient distinction amongst our fiat currency administrators who seemingly dictate that credit itself is money. I guess that's the lunatic domain of those crazy gold bugs?

Posted by: Lee Quaintance

03 Feb 2010 | 13:09