The gold standard is an evergreen in monetary-policy debates. The current expansionist stance adopted by central banks has provoked its return to centre stage (see e.g. Harrison 2013): Admirers of the gold standard depict it as a self-regulating and transparent system, credibly anchoring the value of money to the price of an inherently sound asset (see e.g. Bordo and Redish 2013). Thus, the recent substantial drop in gold prices has appeared somewhat shocking to many. The gold market today At a time of massive liquidity injections by central banks, gold should be a one-way bet. Yet that hasn’t been the case in recent ... (full story)