But it very clearly isn't. I have found nothing anywhere in the Austrian corpus about the baneful effects of improvements in gold mining technology, and how they invariably lead to an Austrian boom-bust cycle--how a gold discovery distorts market signals and creates the illusion of artificial wealth just as any other monetary expansion does."
This is all quite true, and as I and a few others in his comment section noted, I probably should have just said "relatively stable measure" in the first place, because clearly gold is not a perfectly stable measure. In an email, Brad says:
"I know that von Mises explicitly holds a subjective utility theory of value [note well, all Austrians who have been accusing Brad of never reading a word of Mises]. But an immediate consequence of such a subjective utility theory is that a given quantity of money is equally good no matter where it comes from--it has the same subjective value, after all. And it seems very clear to me that for von Mises a given quantity of gold money is much better than that same quantity of paper money."
I disagree with that last sentence. If paper money increased at the same rate that the gold supply increased, I don't think you'd have nearly as much complaints about it from Mises.
But these paper/gold comparisons seem to be getting a little off track to me. I enjoy rubbernecking at the horrific train wreck that is gold-buggism as much as anyone, but the real concern seems to me to be the artificiality of money creation in general. I hope Brad can accept the argument that Bill Woolsey and I make, that gold was acceptable because its rate of increase was small and relatively unrelated to political meddling - and that if the rate of increase in the gold supply had been as rapid and manipulable as that of the paper money supply, Mises would have more concerns.
That having been said, I think the real question is "why does Mises consider an increase in the supply of money in response to a recession 'artificial', given that what we are responding to is an increase in the subjective valuation of liquid money - i.e., an increase in the demand for money?" That's the real question for Mises. And the answer, I think, is that he doesn't see an increase in the subjective valuation of liquid money as the cause of recessions. He sees the cause of recessions as a rearrangement of the capital structure after an "artificial" boom. If Keynesians really want to offer a critique of Mises in a language he understands, they would say "Mises is suggesting that in the face of changes in individual subjective valuations of money, the state, by fiat, ought to keep the money supply fixed." Because that's really what Mises and any Austrian who wants a gold standard (::cough::Ron Paul::cough::) is proposing.