Private currencies
It has long been an article of faith of libertarians and other assorted folk that private currencies, as many countries enjoyed pre-20th century (and of course there are isolated examples today), would be more stable than government-issued currencies. The idea, which is not wholly without merit, naturally gained a lot of credence in the inflation-plagued 1970s and 1980s, before rather fading away as central banks got a grip on inflation in the 1990s. The emergence of electronic-money has led to a resurgence in the idea in the last few years, but not much as come of it.An insight into whether or not advocates were right comes from this week's Economist, which reports that there are now 16 trillion air miles in existence, a figure which unsurprisingly is leading to inflation (by making you require more air miles to go a certain distance) and non-acceptability (fewer flights are now available). The Economist also covered it two years ago, when only 8 trillion were in circulation. See here.
posted by Matthew @ 1/10/2005 01:57:00 PM
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