Money talk

Insider

Banned
After researching on economic matters in WWI I've lost a little sanity and gained a headache. So perhaps I would ask you.
1) What were advantages and disadvantages of bimetallism?
2) How come fiat money are better in crisis times (for governments)? Was it so when the coast is clear?
3) Was there some reason behind gold standard supremacy in XXth century or was just a result of a tangle of believes, interests and wants of a few people in charge
4) Is there any difference whatever you peg your money to gold, or to silver? Why not platinum and palladium? They are useful as well and share most of physical properties.
 
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advantage of bimetallism is the ability to use either metals to value your currency, so when 1 metal drops in value or when rarerity causes the minting to stop you got another metal to fall back on.

The disadvantage is the 2 metals fluxuate costantly in value and thus high to maintain the standard with both. The physical shift in values would just be too much to be able to maintain nowadays.

Gold and silver were simply used as hey already were used as currency and the mining and minting of the metals were common practice. Its different with Palladium, as that is way rarer. Platinum has been used i think, though that is much rarer as well.

In the early 20th century the importance of the central banks was so high the gold standard automatically increased as well. The main cause was the crisis in the 1880's and 1890's causing a scare in the banking world and fast centralisation. The following welfare, relative peace and industrial growth resulted in a boom. That ended in the 1920's for obvious reasons.

I hope i answered some questions, my knowledge of this is limited but i am interested in this kind of thing. The gold standard is a tough nut to crack though.
 

Insider

Banned
In the early 20th century the importance of the central banks was so high the gold standard automatically increased as well. The main cause was the crisis in the 1880's and 1890's causing a scare in the banking world and fast centralisation. The following welfare, relative peace and industrial growth resulted in a boom. That ended in the 1920's for obvious reasons.
From blurry explanation why this gold standard was better I found in books, it now seems that yours makes sense. It was somebody scratching his head and saying "Hey guys remember what we did last time shit went over the top?" :D
Thank you for your input!
 
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