Quote:
Originally Posted by Ethersync
It was flat because it we were on a gold standard. The dollar was "as good as gold". Roosevelt forced everyone to sell their gold and then devalued the dollar (making gold more valuable) re-pegging it to gold at a lower valuation.
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Let me rephrase that... before the gold take over (stale gold value), most of us were dirt poor. Me exchanging gold for a chicken, produces no wealth. If you went to the bank to exchange your gold, you got a note from that bank, a tiny bit of money flow is created and wealth is produced. The take over changed that to a central system that all banks would recognize.
Once the take over happened, gold could be exchanged for money that everyone saw at the same value, they both increased in value (now look at today), some type of money market was able to finally start moving - and wealth was created and exploded.
If you kept us today gold equal to money, none of us would have any money.