I almost spilt my gin and tonic this evening when I read on Reuters that the current Kansas City Federal Reserve President Thomas Hoenig was quoted yesterday as saying:
“A gold standard that forces countries to back their currency reserves with bullion is a “legitimate” monetary system”
Okay, as one who believes in human freedom rather than state coercion, I would hesitate to praise too highly the use of any sentence in which the words ‘force’ and ‘legitimate’ are linked together in a positive manner. However, Mr Hoenig’s phrase is still a quote in the right direction, for all that.
Googling “fed hoenig gold standard news”, I searched around furiously for the widespread coverage I was expecting, but then realised I had fallen once again for the old saw of believing that the mainstream media is not in the economic grip of a Keynesian orthodox cabal, which hates to see such stories break cover.
No doubt if the story does acquire legs then the Financial Times will be criticising Mr Hoenig soon, in the same interesting way that it criticised Robert Zoellick a couple of months back, but until then, let us applaud Mr Hoenig for fingernailing another visible crack into the once impregnable edifice of Keynesian indomitability.
Here’s the best that my Google search could pick up:
- Fed’s Hoenig says gold standard “legitimate” system (Reuters)
- Seeing growth, Fed’s Hoenig felt duty to dissent (Business Spectator)
- Jim Rickards – Gold Standard Coming, Fed’s Hoenig Correct (King World News)
I’m hoping that the story pops up for confirmation in the Daily Telegraph before England’s gold standard heroes in Australia are declared by Jonathan Agnew as worthy 3-1 winners of the latest Ashes series, on Test Match Special, at around 1am this morning.
That way, I’ll be able to believe it.