Nov 09, 2010 (LBO) – World Bank chief Robert Zoellick has fired a debate on a return to gold as a monetary anchor with the United States engaging in new money printing, threatening to send food and other commodity prices higher. Federal Reserve chief Ben Bernanke dubbed ‘Bubble Ben’ by his detractors who are critical of his ‘anti-deflation’ loose policies that fired a massive housing and commodity bubble and triggered a global economic crisis has raised fresh questions about the use of money.
Ahead of a summit by the Group of 20 nations Zoellick called for discussions on a “co-operative monetary system that reflects emerging economic conditions.”
“The system should also consider employing gold as an international reference point of market expectations about inflation, deflation and future currency values,” Zoellick wrote in UK-based Financial Times newspaper.
“Although textbooks may view gold as the old money, markets are using gold as an alternative monetary asset today.”
An ounce of gold has shot up over 1,400 US dollars on Monday. At the creation of Federal Reserve in 1913 gold was only 20 dollars an ounce.
After triggering the Great Depression through loose monetary poli