“The Golden Rule”=he who has all the Gold makes all the Rules–or so the social evolutionists would have us to believe…
…how much of an antithesis is this to the true Golden Rule!?!
…nonetheless, a currency backed by Gold/Silver (i.e. precious metals) alone is by all means preferable to a fiat (paper only) currency–which is essentially just a “promise to pay back promises with promises” and there it ends [but herein there is an ulterior motive]…
The notion of a fiat currency is in itself somewhat spurious, if not blasphemous–and, as Ron Paul explained, it enables Government to commit Fraud (and for thoroughly informed self-interests to enrich themselves at the expense of others).
A currency backed by precious metals is almost just as easily manipulated as is a fiat currency. A precious metals' standard has not prevented multiple “economic crisises”/recessions/depressions/collapses in a long historical record of such in the past.
To illustrate both the ridiculousness and the confusion of the totally abstract form of economics and finance we have superimposed upon us today, I present this personally paraphrased version of a satire which first appeared in Lloyd's Bank Monthly Review, May 1939. It is presented as a conversation between a Socrates sort of character from another planet and an economist of the time from this planet, and it quite well illustrates the comical nature of what so many today have been deceived into regarding as being “valuable.”
“SOCRATES: I see that your chief piece of money carries a legend affirming that it is a promise to pay the bearer the sum of one dollar. What is this thing, a dollar, of which payment is thus promised?
ECONOMIST: A dollar is the American unit of account.
SOCRATES: So there is, I suppose, some concrete object which embodies more firmly that abstract unit of account than this paper promise?
ECONOMIST: No, there is no such object, Socrates.
SOCRATES: Indeed? Then what your Bank promises is to give the holder of this promise another promise stamped with a different number in case he regards the number stamped on his promise in some way ill-omened or to be bad luck?
ECONOMIST: It would seem to be promising something of that kind.
SOCRATES: So that in order to be in a position to keep its promises all the Bank has to do is keep a supply of such paper promises stamped with all sorts of different numbers?
ECONOMIST: By no means, Socrates, that would make its balance-sheet a mockery, and in the eyes of our people there is held a certain awe and holiness in a balance-sheet. The Bank has to keep a store of Government Securities and *a store of Gold.
* [Since the removal of the gold standard (Nixon, 1971), our money is only a promise backed by promises to pay back promises with promises…a thing of real and enduring VALUE!!!]
SOCRATES: What are Government Securities?
ECONOMIST: Promises by the Government to pay certain sums of money at certain dates.
SOCRATES: What are sums of money? Do you mean such promisory notes as dollars?
ECONOMIST: I suppose that I do.
SOCRATES: So these promises to pay promises are considered to be in some way more solid and more sacred than the promises themselves?
ECONOMIST: It would appear that they are considered to be so.
SOCRATES: I see. Now tell me about the gold. It has to be of a certain weight, I suppose?
ECONOMIST: Not of a certain weight, but of certain value in terms of promises.
SOCRATES: So that the less each of its promises are worth, the more promises the Bank can lawfully make?
ECONOMIST: There are complications, Socrates, but it seems to amount to something of that sort.
SOCRATES : Do you find that your monetary system works well?
ECONOMIST: Pretty well, thank you, Socrates, on the whole.
SOCRATES: That would have to be then, I suppose, not because of the rather strange rules which you have told me about, but because it is administered by men of ability and wisdom?
ECONOMIST: It would seem that such must be the reason, rather than the rules themselves.”
So as it turns out, historically, if the value of the store of precious metals reserve is allowed to be manipulated by the same unit of account/currency that it represents, it is no more stable than a fiat currency.
As Ron Paul has stated, a return to a sound system of currency would include that it be backed by commodities=plural, i.e. precious metals and other commodities…
…but in order to ensure that the currency/unit of account could not be used to inordinately manipulate the value of the reserve of commodities that backs it something quite a bit more radical would also have to occur…
The mechanisms whereby money/currency can reproduce itself (exponentially), apart and divorced from any actual increase in the amount of the production of the Physical Wealth that it represents, must be removed–I speak here of the credit/debt/interest/compound interest based systems–these are, after all, only just contrivances, however ingenious and complex they might be, that allow the Parasites to have a claim on what the Producers have labored to produce…
Conversely, mechanisms must be put into place whereby any expansion in the amount of money/currency put into circulation can be verified by an equivalent expansion of Physical Production. The production of money/currency must occur in tandem with the production of the real, Physical Wealth that it represents…
This would be the only degree of regulation; i.e. safeguard mechanisms that prevent money/currency from outrunning the actual production of the Physical Wealth that it represents and those that keep it from unduly influencing the value of the Physical Wealth that it represents…
…in determining these factors, the Congress of the US should exercise its Constitutionally defined obligation to issue currency and determine the value thereof…
A Dollar is Worth a Dozen Eggs
Somehow we have almost all come to believe that money is Wealth, but it is not! Money simply represents Wealth. Money is a financial system whereby True Wealth is monetized in order to facilitate its distribution. It is in this Monetization and Distribution of True Wealth that things have gone awry.
There is nothing inherently wrong with money. It serves a necessary and useful function in that it represents a unit of value in terms of True Wealth. But somehow we have come to place the value upon the abstract rather than upon the tangible!
Ask yourself this: “Is a dozen eggs worth a dollar or is a dollar worth a dozen eggs?”
The vast majority would answer that the dozen eggs is worth a dollar…but is this so? In this view the dollar is given the value when it has no inherent value of its own, other than those things of real value which it represents.
The dollar is abstract in its conception and application…it is really nothing more than just a piece of paper…but the dozen eggs is tangible and of a degree of real value in terms of nutrition. So a dollar is worth a dozen eggs.
Somehow we have had the greatest scam of all times pulled over on us–effectively “…making the ephah [bushel] small [insignificant] and the shekel [money] great…” (Amos 8:5).
But it is such a total reversal in our thinking which must take place in order to establish and function within an Alternative Economic realm!
Under the current system and application of economics and finance it is such that the question, “How much is a dozen eggs worth [in terms of a dollar]?” would be considered normal. In light of Alternative Economic Theory the question might be rephrased, “How much is a dollar worth in terms of a dozen eggs?”
If a dozen eggs is priced at 80 cents then the relative value, or representative value, of the dollar is increased because more eggs can be bought for the dollar…but the value of the eggs remains unchanged in terms of nutritional value.
If a dozen eggs is priced at $1.20 then the relative value of the dollar is decreased because fewer eggs can be bought for the dollar…but the value of the eggs remains constant.
When the prices of commodities goes up or down it is in reality the relative value, or purchasing power, of the dollar that is fluctuating, not the value of the commodities.
Now the price of a pound of butter or of a dozen eggs or of a pound of meat or of a ton of grain might, and indeed does, fluctuate a great deal…but the value thereof remains constant in terms of nutrition and calories. So then why does the price vary so wildly?
“Expert” economists might point out that the volume of the commodity which is produced might cause the price to change; the price being low when there is a surplus and an abundance or high when there is a scarcity or high demand…but if it is said that the price which the producer receives is low because of a surplus, then why is it so often unchanged or higher at the consumer level? If the price is low because of abundance, then I must also ask, “Does this mean that there are fewer malnourished and starving people in the world during this time of abundance?”
Perhaps it is time that we consider the ends to the means employed in economics and finance as seen in practice today.”
…a very good friend and brother in Christ once asked me, quite a few years ago, during a previous Recession, if I had ever considered investing in Gold as a security against hard times–I replied to him, no, I'd only thought about investing in a piece of land and growing Food on it–then, if hard times hit, I'd have his Gold…
In His Love,
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