Taylor: Absolutely, Michael. Because you know what's happening is we're having a debasing of the currency, not only in the United States but throughout the world. Governments are deficit spending, monetary policy is very loose. And when you increase the supply of something, the value goes down. So as much as anything, it’s not that I think gold is going up in value, it's that the dollar is being debased and is losing its value. Norman: The dollar’s going down. But look, here's a question. To the extent that this money printing – for lack of a better term – supports economic output … ends up creating jobs, or leading to the creation of jobs, productive output, why should that be a negative? I mean, to the degree that it adds to overall global output, isn’t it positive for other kinds of investments, like stocks, for example? Taylor: Well, I'm not so sure, Michael, that I agree that printing money does lead to productive jobs. What I think it does is leads to a concept that the Austrian economists know of as malinvestment. You can go back to the dot-coms. We pumped huge amounts of money into the system. Alan Greenspan did when he was the Federal Reserve chairman. Every time there was a crisis of one kind or another – the Asian crisis starting earlier, the Mexican crisis, the Russian crisis, Y2K was perceived to be a crisis – it was met with huge amounts of money that was pumped into the system. So what happened? We saw the stock market boom. We saw prices get ridiculously … to heights that made no sense whatsoever. Dot-com companies – if they had a dot-com in their name – they were a buy. And then we saw that all collapse in 2000. Then, of course, the granddaddy of all malinvestments was … Norman: Well, wait a minute. Didn't it collapse because the government started to run a surplus? I mean, Clinton ran a surplus in his last years. And by definition, you could say if the spending is all that money flowing in, as you point out, isn’t a surplus when they're really taking it out? Wasn't that the pin that pricked the bubble? Taylor: Well, I don't know that I would agree with that. I think what happens is you had a lot of enterprises that were not viable. You had lots of dot-com companies that didn't have any economic prospects. Norman: That's true. Taylor: And they were born because of this loose monetary policy. And then Greenspan started a tighter monetary policy, somewhat tighter. At least he took his foot off the gas pedal. And maybe that's what caused the market to collapse because I think somewhere he understood, as all central bankers ultimately do, that if you keep pushing money into the system, you're going to have a real inflationary problem. And so I think that was an example of malinvestment that is a result of loose monetary policy and fiscal stimulus. But then look at what happened after that. I mean, the granddaddy of all malinvestments was the housing bubble that we've seen. And that, again, if you look at the M3 or other monetary aggregates, you'll see huge amounts of money pumped into the system. It has to go somewhere. You know, I don’t blame the bankers at all. I think this notion of greed on the part of bankers is absolutely wrong, Michael. I think what happened is, if I'm a banker and I have all this money sitting in my vaults, I've got to put it to work. I've got to maximize my profits. I've got to keep my shareholders happy. And the problem is, as the bankers looked out into the economy, they couldn’t find good places to put their money because there just weren't any. There weren't enough good places to put their money and so they started lending in a very lax manner and you had this housing bubble. So I think that's where we're at. I think we're having a correction now of that housing bubble. And again, we are now trying to overcome one bubble with a new one, I'm afraid. | 
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