Reply #3: notes [View All]

[rapier]

"The liberalism of the 1970s ran aground on stagflation, the nasty stew of inflation and malaise."

I take issue. First 'liberalsim' is not an ideology.

Second the stagflation, or rather the inflation of the 70's, was primarily a monetary phenomenon. When the dollar was unhinged from gold and currencies went on the float, and the dollar tanked, inflation was the inevitable consequense. I say this as a non gold bug.

Adding to the inflation was increased demand for stuff, oil, food etc. that were due to economic growth in the rest of the world. That was given a boost by the tangetal results of the currency float and the trend in the financial world to electronic transactions which sped money flows and liquidity around the globe seeking hot markets to pile into and inflate.

Liberalsim might be seen as the author of the dollar problem and the rejection of Bretton Woods but that liberalism isn't a political liberalism. It's the liberalism of credit. America increasingly was sending its dollar offshore to buy stuff, on credit to a huge degree, and those dollars collected in such amounts that the gold convertability had to be ended. There were more dollars than gold, something had to give. It was those dreaded French by the was who started suggesting they might want some of that gold for their dollars who really got the ball rolling.