Wednesday, August 17, 2016

Paper Money: The Barbarous Relic

April 30, 2012 by · Leave a Comment 

By Jeff Nielson, Bullion Bulls Canada

Gold is a barbarous relic.

Even most ordinary people who rarely pay any attention to topics in the realm of economics will be familiar with this expression. Like most of the Big Lies from the media propaganda machine, our governments have made sure that most of us have heard this one enough times to have it burned into our psyches.

As with most of these Big Lies, this too is a blatant perversion of the truth. It will come as no surprise to gold-bugs and that dwindling minority who advocate sound monetary policies that the reference to gold as a “barbarous relic” was made by the one-and-only John Maynard Keynes. It was from Monetary Reform, a book Keynes published in 1924 – and it was a reference not to gold itself – but to the gold standard:

In truth, the gold standard is already a barbarous relic…

Thus the original reference was made by the most infamous paper-printer in all of history, desperately searching for some insult he could hurl at the gold standard in order to attempt to make his monetary nonsense sound appealing to the Sheep – i.e. the global economics community.

For those not familiar with the mechanics of national economies, the gold standard has often been referred to over history as “the Golden Handcuffs”. How did it acquire this intimidating nickname? Because it absolutely limits our governments from any extreme/insane fiscal or monetary policies without the consequences of those policies being immediately known to the general public.

A government trying to run huge deficits (like the U.S. government was doing during the Vietnam War), would quickly see its “bank account” (i.e. the national gold reserves) quickly evaporate as paying for those deficits emptied the government’s Treasury. Thus ultimately the primary reason that a gold standard is despised (or rather feared) by all the charlatan money-printers like Keynes and the deadbeat governments of modern Western economies is that a gold standard forces governments to pay their bills.

However, the fear/hatred of the Money-Printers and Deadbeats toward the gold standard doesn’t end there, it only begins. By definition, a gold standard bases all new currency creation on one’s national gold reserves. Thus these Handcuffs also prevent Keynes and all his central-banking ilk from allowing the printing presses to run wild with new money-printing – quickly destroying the value of any currency with dilution. So in addition to forcing governments to pay their bills it also forcibly prevents them from excessive money-printing. Two strikes against the gold standard.

There is yet a third category of social miscreants who fear/despise a gold standard even more than the charlatan economists and deadbeat politicians – the thieving bankers.  The bankers use excessive money-printing as their primary means of stealing all of the wealth of an entire society. Three strikes against the gold standard!

The mechanics are simple arithmetic and thus totally incontrovertible. When you recklessly dilute the nation’s currency at a rate of more than 10% per year (i.e. the 10+% “inflation rate” for the U.S. as calculated by John Williams of Shadowstats.com), but you only pay people near-zero interest rates on their savings then these people are effectively becoming 10% poorer each year with respect to those savings.

Into whose pocket does all that money disappear? The pockets of the Thieving Bankers, who are legally allowed to print-up all this “money” for themselves absolutely for free. This act of theft; the largest, most blatant, and most pervasive form of theft in the history of the human race has been given an innocuous euphemism by the bankers, and their minions in the media propaganda machine: “fractional-reserve banking”.

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