Gold Standard

Re “Forbes’ Writings Map Out Evolution of His Positions,” Jan. 23:

Has anyone asked presidential candidate Steve Forbes what it would mean for the U.S. to return to the gold standard? The old gold standard was a system of fixed exchange rates. All major world currencies were fixed in value to gold, and therefore fixed relative to one another. The advantage was argued to be elimination of volatile exchange rates and, therefore, promotion of world trade and investment.

Today, no other country has any interest in returning to the gold standard. Thus, if only the U.S. returned to the gold standard, the dollar’s value would be tied to the erratic gold market and not to other currencies. Instead of reduced dollar-exchange-rate fluctuations, we could have more.

DANIEL J.B. MITCHELL

Professor, Anderson Graduate

School of Management, UCLA