A gold standard that forces countries to back their currency reserves with bullion is a legitimate monetary system, though it would not prevent financial crises, Kansas City Federal Reserve President Thomas Hoenig said on Wednesday.

The gold standard is a very legitimate monetary system, Hoenig said, adding: We're not going to have fewer crises necessarily. You will have a longer of period of price stability or price level stability, but I don't know that you'll have lower unemployment, I don't know that you'll have fewer bank failures.

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