The German Central Bank’s Inflation-Deflation Game
  • 13 years ago
Watch all the videos at http://www.goldmoney.com/money-history. Marion Mueller (AEMP), in collaboration with the GoldMoney Foundation, visits the Bundesbank's Geldmuseum (Money Museum) in Frankfurt and plays with the central bank "inflation-deflation game" which is supposed to reflect a control panel for money supply and shows the dangers of excess, or lack of, money. Hayek would argue that any mechanistic model of the market, essentially a human and social institution, should be used with care. In any case, however indirect the relationship, the fact is that the value of money, like that of any other good, is determined by supply and demand. This means that allowing the central bank manipulation of the money supply is extremely dangerous and so is trusting a central agency to attempt to "manage" or plan monetary policy, instead of allowing the market to do so.
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