The Gold Standard  

… from some one who straddles both the policy world and the investing world [Mohamed El-Erian in a guestpost in FT Alphaville:

Inevitably, “first best” policy solutions are elusive; and even in the world of second and third best, what is economically desirable is increasingly becoming politically infeasible; and what is politically feasible may well turn out to be economically undesirable

... the possibility of maintaining loose monetary policy for a very long time (as a way to stimulate aggregate demand while, simultaneously, starting to restore fiscal sustainability) could eventually contaminate both inflationary expectations, as well as the global status and value of the US dollar.

Instead, the economy will continue to struggle, navigating both the adverse implications of last year’s financial crisis and the unintended consequences of the experimental policy responses. Given the inevitable socio-political dimensions, this story will play out well beyond the realm of the economy, policymaking and markets. [More here]