Under the gold standard, discipline was automatic.

The euro shares important features with versions of the old gold standard, under which countries fixed their exchange rates relative to each other by setting the price at which domestic currency could be redeemed in gold.

The era of floating exchange rates that followed the end of the gold standard required the development of products that could protect international trade from price volatility.

In an attempt to resume stability, a variation on the gold standard was reintroduced in 1925, under which the currency was fixed to gold at its pre war peg, although people were only able to exchange their currency for gold bullion, rather than for coins.

LONDON The European Monetary Union, as many of its critics maintain, looks a lot like the pre 1913 gold standard, which imposed fixed exchange rates on extremely diverse economies.

Until that point, America s pledge to maintain the gold standard was the basis for the global fixed exchange rate system, which was the heart of the Bretton Woods framework.

I wrote the book on Europe and the gold standard.

One after another, they abandoned the gold standard, depreciating their currencies.

Pessimists are especially worried by the unpleasant gold standard analogies and lessons.

But critics of the euro should take the gold standard analogy more seriously.

Rather than trying to mount a last ditch defense of the fixed exchange rate, the government, at the suggestion of the Bank of England, agreed to abandon the gold standard and devalue the pound.

For example, in most countries that used the gold standard, the standard coin was kept up to a uniform point of fineness.

Finally, abandoning the gold standard was less disruptive than abandoning the euro would be.

Second, financial markets have become huge relative to anything seen under the gold standard.

In the 1930 s, the countries that raised their tariffs and tightened their quotas the most were those with the least ability to manage their exchange rates namely, countries that remained on the gold standard.

The gold and the crystal cannot equal it and the exchange of it shall not be for jewels of fine gold.

The appeal of the historic gold standard lay in an institutional capacity to build confidence.

Under the classical Gold Standard that prevailed until 1914, free capital mobility had been sacrosanct.

Thurman was also less wedded to the gold standard than some Northeastern delegates would tolerate.

Fear that the US would abandon the gold standard sent the dollar plummeting on world markets.

Right ventricular angiography Right ventricular angiography is considered the gold standard for the diagnosis of ARVD.

This became the central feature of the gold standard world a country that was losing gold reserves would tighten interest rates in order to attract money.

As a consequence, silver flowed out of the country and gold flowed in, leading to a situation where Great Britain was effectively on a gold standard.

But the history of the gold standard, and of other large common currency areas, was more complex.

Today, the United States is in the position of the gold standard countries in the 1930 s.

By contrast, when countries started abandoning the gold standard in 1931, tariff barriers had already gone up.

The proper functioning of the gold standard required a high degree of flexibility in wages and prices.

Then, too, central banks were blamed when their policy framework (at that time the gold standard) disintegrated.

Six years later, in April 1925, Britain confirmed its monetary credibility and returned to the gold standard.

Literally. In Golden Fetters The Gold Standard and the Great Depression, published in 1992, I argued that the deflationary engine that was the gold standard was a key cause of the 1930 s depression, and that abandoning it opened the door to recovery.

These policies could then be entirely subjugated to the demands of the gold standard and free capital mobility.

Bernanke s research also stressed that the sooner a country abandoned the gold standard, the better off it was.

Ecuador was on a de facto silver standard and did not coin any gold between 1884 and 1892.

After the war, bondholders and other creditors (especially in the North) wanted to return to a gold standard.

In short, there are better ways than gold to hedge inflation risk and exchange rate risk.

In the US, the Tea Party has made a return to the gold standard a part of its platform, and Utah is debating making gold and silver coins legal tender.

It is as if German political elites think that they are back in the era of the gold standard.

The second lesson to be learned from the gold standard concerns the extent and limits of capital market integration.

If internal devaluation were the solution, the gold standard would not have been a problem in the Great Depression.

Today, some people espouse the view often loudly that the gold standard was synonymous with economic and financial stability.

It happened in the 1930 s, when one country after another abandoned the gold standard, trying to export its unemployment.

Yet, even without the gold standard, America s economic might, together with the recycling of petrodollars, kept the dollar on top.

The United States did something similar in 1933, when it depreciated the dollar by 69 and abandoned the gold standard.

ROME Increasingly, one hears predictions that the euro will go the way of the gold standard in the 1930 s.

Each of these differences casts doubt on the notion that the euro will go the way of the gold standard.