How We Ended Up In This Economic Purgatory

 
The answer is simple: fiat paper money that is not grounded in any objective standard can be manipulated at the whim of the issuer. Without the requirement to exchange fiat money for gold or some other commodity, the central bank can issue unlimited amounts, thus making its value subject to extreme volatility and, as we have seen, perpetual debasement.

http://www.zerohedge.com/news/41-years-after-death-gold-standard-look-how-we-ended-economic-purgatory

Does Easy Monetary Policy Enrich the Financial Sector?

Yesterday, I strongly insinuated that easy monetary policy enriches the financial sector at the expense of the wider society. I realise that I need to illustrate this more fully than just to say that when the central bank engages in monetary policy, the financial sector gets the new money first and so receives an ex nihilo transfer of purchasing power (the Cantillon Effect).
The first inkling I had that this could be the case was looking at the effects of quantitative easing (monetary base expansion) on equities (S&P500 Index), corporate profits and employment.

http://azizonomics.com/2012/08/08/does-easy-monetary-policy-enrich-the-financial-sector/