Category Archives: Money

The Great Gold Robbery of 1933, by Thomas Woods

Nothing demonstrated Franklin Roosevelt’s ruthless immorality better than his 1933 gold heist. From Thomas Woods at mises.org:

[Originally published August 13, 2008]

It’s been 75 years since the federal government, on the spurious grounds of fighting the Great Depression, ordered the confiscation of all monetary gold from Americans, permitting trivial amounts for ornamental or industrial use. This happens to be one of the episodes Kevin Gutzman and I describe in detail in our new book, Who Killed the Constitution? The Fate of American Liberty from World War I to George W. Bush. From the point of view of the typical American classroom, on the other hand, the incident may as well not have occurred.

A key piece of legislation in this story is the Emergency Banking Act of 1933, which Congress passed on March 9 without having read it and after only the most trivial debate. House Minority Leader Bertrand H. Snell (R-NY) generously conceded that it was “entirely out of the ordinary” to pass legislation that “is not even in print at the time it is offered.” He urged his colleagues to pass it all the same: “The house is burning down, and the President of the United States says this is the way to put out the fire. [Applause.] And to me at this time there is only one answer to this question, and that is to give the President what he demands and says is necessary to meet the situation.”

Among other things, the act retroactively approved the president’s closing of private banks throughout the country for several days the previous week, an act for which he had not bothered to provide a legal justification. It gave the secretary of the Treasury the power to require all individuals and corporations to hand over all their gold coin, gold bullion, or gold certificates if in his judgment “such action is necessary to protect the currency system of the United States.”

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The Bitcoin Revolution & How Fiat Money Ruins Civilization, by Jimmy Song

Any currency whose quantity and value can be adjusted at the whim of a government is inherently immoral and will eventually be tossed into the garbage bin of history. From Jimmy Song at bitcoinmagazine.com:

Fiat money leads to a degradation of incentives, creating a society motivated only by the consumption of resources and zero value production.

This is an opinion editorial by Jimmy Song, a Bitcoin developer, educator and entrepreneur and programmer with over 20 years of experience.

We want nice things. We want to live in a nice house, eat good food and have fulfilling relationships. We want to travel to exotic places, listen to great music and experience fun. We want to build something that lasts, achieve something great and leave a better world for tomorrow.

These are all part of being human, of participating in society and of progressing humanity. Unfortunately, all these things and more get ruined by fiat money. We want nice things, but we can’t have them, and the reason is because of fiat money.

Governments want the power to decree prosperity, fulfillment and progress into existence. They’re like the alchemists of yesteryear, who wanted to turn lead into gold through some formula. Actually — they’re worse. They’re like a five-year-old that thinks by wishing hard enough, that she can fly.

Being the delusional power-drunk politicians that they are, the elites think that by decreeing something to be so, it magically happens. That’s indeed where the word “fiat” comes from. The word literally means “Let there be,” — in Latin and in English, it’s become an adjective to describe creation by decree. This can be most easily seen in Genesis 1:3 in Latin. The phrase there is “fiat lux” which means “let there be light.”

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The upside-down world of currency, by Alasdair Macleod

Gold is money; everything else is credit. Get that one wrong and the next few years are going to be a whole lot of misery. From Alasdair Macleod at goldmoney.com:

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The gap between fiat currency values and that of legal money, which is gold, has widened so that dollars retain only 2% of their pre-1970s value, and for sterling it is as little as 1%. Yet it is commonly averred that currency is money, and gold is irrelevant.

As the product of statist propaganda, this is incorrect. Originally established in Roman law, legally gold is still money and the states’ debauched currencies are not — only a form of credit. As I demonstrate in this article, the major western central banks will be forced to embark on a new round of currency debasement, likely to put an end to the matter.

Central to my thesis is that commercial bank credit will contract sharply in response to rising interest rates and bond yields. This retrenchment is already ending the everything bubble in financial asset values, is beginning to undermine GDP, and given record levels of balance sheet leverage makes a major banking crisis virtually impossible to avoid. Central banks which are already in a parlous state of their own will be tasked with underwriting the entire credit system.

In discharging their responsibilities to the status quo, central banks will end up destroying their own currencies.

So, why do we persist in pricing everything in failing currencies, when that will almost certainly change? When the difference between legal money and declining currencies is finally realised, the public will discard currencies entirely reverting to legal money. That time is being brought forward rapidly by current events. 

Why do we impart value to currency and not money?

A question that is not satisfactorily answered today is why is it that an unbacked fiat currency has value as a medium of exchange. Some say that it reflects faith in and the credit standing of the issuer. Others say that by requiring a nation’s subjects to pay taxes and to account for them guarantees its demand. But these replies ignore the consequences of its massive expansion while the state pretends it to be real money. Sometimes, the consequences can seem benign and at others catastrophic. As explanations for the public’s tolerance of repeated failures of currencies, these answers are insufficient.

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Doug Casey on How Inflation Destroys Civilization… and What You Can Do About It

Inflation is a hidden tax, and as such, it’s a lie by the currency’s issuer. Since monetary value is at the core of a productive economy, and money of no set value robs producers, inflation does indeed destroy civilization. From Doug Casey at internationalman.com:

International Man: According to a recent Newsweek poll, 63% of Americans “strongly support” new government stimulus checks to combat inflation.

In other words, let’s fight the effects of money printing by doing even more money printing.

What’s your take on this?

Doug Casey: The nature of the US has been transformed. Americans have come to see the government as a cornucopia that can kiss everything and make it better—especially since the bailouts of the Biden Administration.

That attitude has become a cultural value and very hard to change. “Panem et circenses,” as the Romans said, has become necessary for both the government and its subjects. Remember that the prime directive of any entity—whether it’s an amoeba, an individual, a corporation, or a government—is to survive. The present government can’t survive without supporting more than half the population, which has become parasites. But the government itself is the biggest parasite of all. Can parasites live on each other forever? No. To use an overly fashionable word, it’s “unsustainable.”

Where will the US government get the money it needs to survive? It can no longer even remotely survive on its tax receipts; deficits of one to two trillion per year lie ahead for the indefinite future. It can no longer borrow adequate amounts from either American citizens or foreign governments—just rolling over the $32 trillion of existing debt, forget about trillions of new debt, at anything near current interest rates is hard enough. So there’s no alternative left for them but to print more money. And print they will (electronically, of course). The thousands of “economists” at the Federal Reserve and the Treasury Department have no more of a grip on sound economics than government economists in Argentina or Zimbabwe.

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One Veteran’s story: An Orange-Pilled Green Beret

He thought he was fighting for freedom as a Green Beret. Now’s he fighting for freedom with Bitcoin. From Adam R. Gebner at bitcoinmagazine.com:

This is an opinion editorial by Adam R. Gebner, a Green Beret and West Point graduate.

The opinions expressed throughout this piece are mine alone, and in no way reflect official policy or opinions of the U.S. Army or the U.S. Department of Defense. Though I am by no means a writer, I hope that by publishing this, more service members consider working in the Bitcoin industry and Bitcoin companies consider expanding their efforts to hire Veterans. Additionally, I am always learning more about Bitcoin, how it works, and the potential value it may bring to our world. Please let me know where I am off base, thanks!

Early in my life, I knew I wanted to be a Green Beret officer. Fighting to liberate oppressed people by working by, with, and through local populations was at the core of my motivations to choose this path. I saw the Special Forces’ mission as a cost and risk-efficient way to prevent large-scale conflict while enabling people to defend themselves and secure their own freedom. After graduating from West Point in 2014 and serving with the 173rd Infantry Brigade Combat Team (Airborne) for three years, I ultimately earned my Green Beret and an opportunity to lead a detachment of America’s Chosen Soldiers. Now that I’ve accomplished what I set out to do with my military career by commanding an “A-team” for two years, I am looking forward to the next mission in my professional life: contributing to the adoption and integration of the best freedom-protecting innovation in modern history — Bitcoin.

Like so many others, I had a few touch points with Bitcoin before seriously considering the validity of the technology. In 2010, during my first year at West Point, I overheard a few Computer Science majors discussing this “internet money” and I foolishly dismissed it without trying to learn anything else. Then in 2013, when I started learning about investing and economics, I stumbled across bitcoin again. I read a little bit more into it, but not enough to understand how it could replace gold as a sound money system (thanks Peter Schiff…).

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Legal definitions of money and credit, by Alasdair Macleod

The title is dry but the article is not. If you don’t know the difference between money and credit, what’s happening in the world’s financial system and what’s about to happen will be incomprehensible. This is a great tutorial, from Alasdair Macleod at goldmoney.com:

At these times of growing confusion over the future of currencies’ purchasing power, it is time to remove all doubt in the definitions of the differences between money, currency, and credit. This article traces the history and legal background to these relationships.

Despite the failure of the Bretton Woods agreement in 1971 and the state propaganda that followed, the position is clear. Both historically and legally money is and remains metallic coin — principally gold — and the rest is credit. 

As a result of statist puffery of their fiat currencies, the public now wrongly believes it is fiat currencies that are money and that currencies have no price, except against each other. I show that this is factually incorrect. However, in financial markets legal money is always priced in legal tender, usually US dollar currency, when it should be the other way round. This inversion of the truth will turn out to be a costly error for those making this mistake.

In this article, I also show that the adverse consequences for prices from changes in the level of total commercial bank credit are significantly less than they are for changes in the level of central bank credit. Now that we are on the verge of a severe contraction of commercial bank credit, governments and their central banks are sure to respond by ramping up inflation of their currencies in a vain attempt to avoid deflation.

The consequences for fiat currencies are likely to be calamitous for them. 

That will be the penalty we all face for ignoring the wisdom and findings of the Roman jurors, thinking that we know better with our economic models, macroeconomic policies, and statist control of markets.

Over two millennia of their careful deliberations, it was the Roman jurors who thoroughly examined and properly defined the difference between money and credit, upon which all economics and modern banking depend. Current monetary and economic fashions are mere ephemera in that context.

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U.S. Selection Autopsy 2022, by Good Citizen

Per Stalin: the vote doesn’t matter, only who counts the votes. From Good Citizen at thegoodcitizen.com:

All hail pussy hat voters, noble gynopatriots of the Soy Republic and Karentocracy.

The demographic that consistently vote for tyranny over any other?

College-educated women.

The new election theft cover to emerge in the past twenty-four hours?

Baby killing.

Forget the lockdowns, masks, toxic injection mandates, state-ordered child abuse, chemical castration, child grooming through gender confusion, the highest inflation in forty-five years, and total economic planned demolition, it was the pussy hat brigade that was the real silent majority in this election.

If you accept this official story that abortion spared the nation a dangerous red wave, I have a gold-plated pussy hat to sell you from my days protesting Trump’s inauguration at the Capitol.

Maybe the founders were on to something with only property-owning tax-payers being allowed to vote. They advised that the tyranny of a state-dependent majority could one day overrule the property owners subsidizing the republic.

They probably never imagined a Global Technocracy overseeing an Oligopoly overseeing a Corporatocracy overseeing a Managerial Kakistocracy overseeing an Idiocracy of obese beta males and their pussy hat wearing “partners.”

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$2 Quadrillion Debt Precariously Resting On $2 Trillion Gold, by Egon von Grayerz

A small pile of real money (gold) supports a towering edifice of debt. From Egon von Grayerz at goldswitzerland.com:

A Lehman squared moment is approaching with Swiss banks and UK pension funds under severe pressure.

But let’s first look at another circus – 

The global travelling circus is now reaching ever more nations just as expected. This is right on cue at the end of the most extraordinary financial bubble era in history.

It is obviously debt creation, money printing and the resulting currency debasement which creates the inevitable fall of yet another monetary system. This has been the norm throughout history so the more it changes, the more it stays the same”.

It started this time with the closing of the gold window in August 1971.  That was the beginning of a financial and political circus which continuously added more risk and more lethal acts to keep the circus going.

An economic upheaval always causes political chaos with a revolving door of leaders and political parties going and coming. Remember, a government is never voted in but invariably voted out.

What was always clear to a few of us was that the circus would end with all of the acts crashing virtually simultaneously.

And this is what is starting to happen now.

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Gold as Natural Money, by James Turk

Gold has stood the test of time as money. It has a number of qualities that make it ideal money, including the fact that it is not a promise or a debt. From James Turk at mises.org:

“The Earth speaks to us through the elements of nature. In every natural thing, we can find a hidden, powerful message.”
—Ralph Waldo Emerson

Every natural element with which the earth has been endowed has a usefulness—a purpose. If we listen to gold, its message is loud and clear—gold is money. To serve as natural money is gold’s highest purpose.

The advance of civilization demonstrates that nature throughout the ages, to our good fortune, has provided everything humanity needs to progress, including money. Few today, however, understand money as it has existed from prehistory and as it was perceived up until the dawn of the twentieth century. Since the commencement of the First World War in 1914, time-honored principles have been abandoned. Humanity has become enthralled with money substitutes like national currencies and, more recently, cryptocurrencies circulating in place of money, and people have subsequently lost sight of natural money itself.

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Doug Casey on Why Gold Has Stagnated… and What Investors Can Expect Next

What investors in gold, as opposed to speculators, can expect next from gold is that will continue to be the reliable storehouse of value that it’s been for many centuries. From Doug Casey at internationalman.com:

International Man: Doug, you’ve been a strong proponent of gold for many years—specifically physical gold as a savings vehicle.

How do you view physical gold today?

Doug Casey: I continue to view gold mainly as a vehicle for savings. It’s money in its most basic form. Banks and governments fail, paper currency has always been a joke, and the forthcoming Central Bank Digital Currencies (CBDCs) are criminally dangerous, possibly the worst innovation of all time. Anyone who doesn’t have a significant part of his assets in gold coins will be an unhappy camper.

But, first of all, gold is not an investment. An investment is an allocation of capital that produces new wealth. That’s not the nature of gold or any commodity.

Occasionally, gold can also be an excellent speculation. Since it was disconnected from the dollar in 1971, it’s had some spectacular runs. But it’s primarily a vehicle for savings. I’ve been buying it since it was about $40 an ounce. I’ve just accumulated more and never liquidated. It’s treated me quite well, having run from $40 to, at the moment, $1,650.

It’s a good speculation during monetary and economic crises. That’s because it’s the only financial asset that’s not simultaneously somebody else’s liability. You don’t have to trust in the goodwill of your rulers. Indeed, it allows you to automatically profit from the fact that they’re usually incompetent and dishonest.

In a world that’s head over heels in debt, where governments and central banks are bankrupt and printing up their national currencies by the trillion, owning gold is more important than ever.

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