Why the Money Supply Should Stay Fixed

Much of the current regime is predicated on the notion that ivory tower intellectuals are capable of determining and controlling the “optimal money supply.” In reality, this is preposterous. All the Fed’s tinkering accomplishes is cultural decline, rising prices, and misplaced anger at the private businesses that serve the economy.

The following article was originally published by the Mises Institute. The opinions expressed do not necessarily reflect those of Peter Schiff or SchiffGold.

As an economist, I am often asked how fast the money supply should grow. The answer is simple: it shouldn’t. In fact, once an economy has a money supply, any amount is optimal. This answer is often met with confusion because it is so far outside of their expectations. To build my case, let us make a simple argument.