Trump Fed Nominee Wants Return to Gold Standard

Herman Cain

UPDATE: Trump has officially announced Cain Federal Reserve nomination.

As I reported earlier today, President Trump has told confidants he wants Herman Cain on the Federal Reserve Board.

It turns out that Cain apparently wants the country to return to a peculiar type of gold standard that he has outlined in his book, 9-9-9: An Army of Davids.

Here are his six principles to return to a gold standard:

  (via Justin Wolfers)

I am fine with all of the above except number 4 where he writes, "It will not restrict the number of dollars available for the economy to grow."

This is in direct contradiction to a gold standard. The idea behind a gold standard is to prevent a central bank from manipulating the economy by printing dollars "for the economy to grow."

 Cain's position appears to be some kind of very peculiar hybrid Keynesian-monetary/gold standard.

A gold standard is a positive thing but this call to combine it with making dollars available for growth is unnecessary, and a possibly dangerous provision, depending upon what Cain really means. But there is a lot positive about Cain's call for a gold standard if we can get the peculiarity in part 4 knocked out.

-RW