Keynes celebrates the End of the Gold Standard

In this rare film of him from October 1931 after the UK abandoned the interwar gold exchange standard (on September 19, 1931):



The Eurozone and EU are the new “gold standard” and “gold cage” of today. If he were here today, I’d like to think Keynes would have been pro-Brexit.

There is also an amusing footnote to this 1930s piece of history.

Ludwig von Mises, prize buffoon of the Austrian school, made a prediction about what would happen after the UK abandoned the gold shackle:

“In September 1931, Ursula Hicks (wife of John Hicks) was attending Mises’ seminar in Vienna when England suddenly announced it was going off the gold exchange standard. Mises predicted the British pound would be worthless within a week, which never happened. Thereafter, Mises always expressed deep skepticism about the ability of economists to forecast.” (Skousen 2009: 286, n. 2).

Mises’ prediction was falsified. By contrast, Keynes was vindicated in predicting that British trade would benefit from abandoning the gold exchange standard and from the currency depreciation that resulted.

BIBLIOGRAPHY
Skousen, M. 2009. The Making of Modern Economics: The Lives and Ideas of the Great Thinkers (2nd edn.), M.E. Sharpe, Armonk, N.Y.