Prabhupada the Economics Guru

The Fannie and Freddie situation was a result of their unique roles in the economy. They had been set up to support the housing market. They helped guarantee mortgages (provided they met certain standards), and were able to fund these guarantees by issuing their own debt, which was in turn tacitly backed by the government. The government guarantees allowed Fannie and Freddie to take on far more debt than a normal company.

- Diamond and Kashyap on the Recent Financial Upheavals, New York Times

And from His Divine Grace:

Unfortunately, on earth there is such a scarcity of gold that the governments of the world try to keep it in reserve and issue paper currency. Because that currency is not backed up by gold, the paper they distribute as money is worthless...

- Srimad Bhagavatam 5.16.20-21 purport

Gold-standard currency is based on falsehood because the currency is not on a par with the reserved gold. The basic principle is falsity because currency notes are issued in value beyond that of the actual reserved gold. This artificial inflation of currency by the authorities encourages prostitution of the state economy. The price of commodities becomes artificially inflated because of bad money, or artificial currency notes.

- Srimad Bhagavatam 1.17.39 purport