The gold standard played a central role in US. monetary policy during this time from "summary" of A Monetary History of the United States, 1867-1960 by Milton Friedman,Anna Jacobson Schwartz
The gold standard was a cornerstone of US monetary policy during the period covered in the book. It was a system in which the value of a country's currency was directly linked to a specific amount of gold. This meant that the US dollar was convertible into gold at a fixed rate. The gold standard provided stability to the monetary system by limiting the ability of governments to print money at will. Under the gold standard, the supply of money was tied to the amount of gold held by the government. This meant that the money supply could only increase in line with the growth of the gold reserves. As a result, inflation was kept in check and the value of the currency remained relatively stable. The gold standard also played a central role in shaping the behavior of central banks. Central banks were responsible for maintaining the gold reserves and ensuring that the currency re...
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