Last week I finally finished reading “Gold – The Once and Future Money” by Nathan Lewis and I thought I’d do a super quick book review.
The author Nathan Lewis is somebody that I was already familiar with and I bought the book thinking it was essentially an argument for a return to the Gold Standard. However contrary to what I expected it does not offer much argument for why a gold standard would work or why it would be superior in theoretical terms. Instead it bases it’s argument almost entirely on empirical evidence. Firstly it looks at the gold standard through the ages and at the times when governments moved onto or off a gold standard and the impact that it had. Secondly it looks in detail at the post gold standard modern era and the effect of movements in the value of currencies and subsequent economic events. The book spans most of human history and for a modern book on this topic it is refreshingly international.
One of the things that the book really brought home for me was the cyclical nature of political fashion. It is sometimes easy to believe that the past had a gold standard and low taxes and the present has floating fiat currencies and high taxes. However Nathan Lewis did a pretty good job of shreding that outlook. There have been high taxes and unstable currencies in many, many places during many times, from ancient civilisations to more modern times. In fact the golden ages, when taxes were low and currency was stable seem rare (although often very long lived) compared to the times of policy failure and decay. In essence the book isn’t really at all an argument for why we should go back to the gold standard (although the author clearly thinks it would be a good thing), but rather a forcast that a return to the gold standard is an all but inevitable part of long political cycles.
The book spends a little bit of time exploring how a gold standard may return. Whether through an initiative in the USA or via Europe or in Asia. Whether it will be via one country or via some form of currency block. This is one area of the book that I thought was too short and where I felt that the author could have offered a lot more detail.
Contrary to the books marketing it does seem to assume a fair bit of prior knowledge on the part of the reader. However overall I enjoyed the book and I do recommend it to anybody with an interest in economics. Steve H. Hanke, Professor of Applied Economics from the Johns Hopkins University had this to say about the book;
“When it comes to international monetary economics, most economists fail to connect the dots. In many cases, they fail to even see them. Gold doesn’t suffer these problems. Nathan Lewis’s book is a readable account of the present in light of the past for purposes of the future.”
If you want a copy of the book then make a case for why you want the book in the comments. I’ll buy a copy of the book for the two people that enter the best plea (judges decision is final even if arbitrary). Of course they must promise to actually read it.