Scott Sumner: evaluation

Transcript context

…When FDR abrogates the gold clause, what was the typical response? I think there were different responses, depending on — if you were a conservative finance type in New York, you probably would regard that as an outrageous abuse of power. Roosevelt was pretty popular at the time, so he was doing a lot of things. I think, overall, his actions were widely popular in the United States, partly just because of the difference from what had happened right before. We’d had four very bleak years under Herbert Hoover. The public was ready for, I think it was called, bold and persistent experimentation. Even though some of the actions would have been perhaps regarded as abuse of power in previous period of American history, the public was ready for those kind of decisive actions. Overall, I think his decisions were relatively popular. Now, Sweden at that time, as you well know, had fiat currency and floating exchange rates, and they had a much milder Great Depression. When is it, in economic history, do you think that it was possible for relatively developed countries to actually just do fiat currency? It didn’t work during the French Revolution. There was a monitoring problem, a hyperinflation problem. When did it become the better thing to do?…

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