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BTW, a ponzi scheme is where you take money from people and tell them that you will pay them back with interest later on. Then with money you receive from the new people you pay back the earlier people. Social Security is one example of such a scheme. As long as there are more contributers than people you need to pay back, it works, but unfortunately, such a system can't logically exit in perpetuity.
Abandoning the gold standard is not a Ponzi scheme.
Another factor that contributed to the massive growth of the economy back then was the fractional reserve system. Basically, this allows the banks to print money out of thin air, legally. The way it works is that for every dollar the bank holds in deposits, they are allowed to loan out to others several times more. Just how much more is dependent on the currency regulations. They don't need to actually have the money to loan out, they just invent the money. This causes an increase in the money supply and thus inflation. Once those loans are paid back, the deposits increase by that much more and so the banks can loan out even more.
Compared to a fixed currency that is backed by some kind of scarce resource, the fractional reserve system can cause a massive spike in standard of living for a temporary time. This banking system allowed the US to become the superpower it became. Unfortunately, it comes at the cost of massive debt as well, and when the debt becomes too much of a burden it can cripple an economy. This is what the US is seeing right now.
The other thing to note is that the Federal Reserve is not actually Federal at all and that it is a private banking cartel. The founders lobbied to be allowed to be the ones to print money for the US. Why the US can't be in charge of printing its own money is beyond me but I suppose the people in power applied forces to prevent it. When the Fed prints money the US receives the money and in exchange gives the Fed bonds with interest. So for every dollar printed into existence, there is more than a dollar owed back to the Fed. This means the US as a whole can never be debt free. It is mathematically impossible. You can only pay back the loan with other loans.
Think this all sounds far fetched? Look it up. You will find it is all true.
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