Who Were the Sea Peoples?

Let us imagine a world economy entirely on the gold standard. In our imaginary world, gold is scarce, but with a difference: every once in a while, a meteor of pure gold hits the Earth -- and, we might even imagine that these meteors are sometimes of a great enough size that they represent a significant change in the world's gold supply, say, several percent. Furthermore, this is a "finders keepers" world, so whoever happens to discover this lump of gold first owns it. It is clearly true that these random events will effect relative prices. If Farmer Joe who finds one of these meteorites in his wheat field simply loves Picassos, his find might have a large impact on the price of Picasso's paintings. But would any economist who touts the efficacy of markets and market prices see any terrible difficulty hindering the working of the market process in these events? Isn't it simply the case that there has been a change in effective demand, and market prices will cha...

What he does is show that for every effect we supposedly generate through monetary policy, we can generate the exact same effect minus monetary policy, using taxation and expenditures alone. So it is the taxation and expenditures, and not the monetary policy, that is generating these effects. Now, he should do a similar post showing how all re-distributional effects in an Overlapping Generations Model are also due to taxation and expenditures, and not to the debt itself. Because the exact same technique he used for Cantillon effects demonstrates the exact same thing for an OLG model with government debt! UPDATE: As rob noted in the comments, my original posted was not worded as well as it could have been. Therefore, where I originally wrote "fiscal policy," the post now reads "taxation and expenditures."