Quotes from “What Is Monetary Economics About?”

By Perry Mehrling (2000)

• Although the exchange rate and the price level are both prices of money, they are very different kinds of prices. Central banks could and did try to fix exchange rates by standing ready to buy and sell gold, but never could they or did they try to fix the price level by standing reading to buy and sell the relevant basket of commodities. #
  MoneyEconomics
• Even though in principle the gold standard central banker stood ready to buy and sell gold at a fixed price, swelling or depleting his gold reserve depending on the balance of demand and supply, in practice he operated by manipulating the discount rate in order to obviate the need for substantial gold flows.#
  MoneyHistoryEconomics