Ludwig von Mises on Money and Inflation.pdf - The Ludwig von ...

more, you know. And the higher prices will withdraw commodities and
services from the other nations which did not get this new money or not
a sufficient quantity of it.
It is very easy to write in a textbook saying that the money should be
increased every year by 5% or 10% and so on. Nobody talks of decreasing
the quantity of money; they want only to increase it. People say: “As
economic production—or the population—is increasing, one needs more
and more money, more liquidity.” I want to repeat what I said which is very
important; there is no way of increasing—or of decreasing—the quantity
of money in a neutral way. is is one of the great mistakes that is very
popular. And this will bring about a struggle between all countries, or
groups of countries, for whatever the units of this system will be.
But one doesn’t need more and more money generally. And if one
increases the money, one can never increase the quantity in a neutral way,
in such a way that it does not further the economic conditions of one group
at the expense of other groups. is is, for instance, something that wasn’t
realized in this great error—I don’t find a nice word to describe it—in
starting the International Monetary Fund. Even that dreadful ignoramus
who was called Lord Keynes had not the slightest idea of it. Neither did
the other people. It was not all his fault—why did they permit him to
do this
It is impossible to have a money that is only government-made, made by
the world government, if it is not once and for all limited in its quantity. And
limiting the quantity of money is not something which those who are suggesting
these things want to happen. Such a state of affairs cannot prevail.
In regard to a money, which unlike the gold standard is not increased except
as it is increased by the given situation of gold mining, increasing its
quantity is not only a quantitative problem; it is, first of all, a problem of
to whom this increase should be given. erefore, all those ideas that one
could bring about a world currency completely produced and operated by
some world institution is simply based upon a complete misunderstanding,
ignorance of the problem of the non-neutrality of money, of the fact
that increases or additions to the money cannot be dealt with in a way
which will be acknowledged by all people as a “just” distribution.
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