Money & Democracy opus 2

Introduction

It is more than a year since I wrote the first article “Money & Democracy - OPUS

#1 The Myths and Mysteries of Money Made Simple”. I had intended to follow

that first work fairly quickly with a second work evolving the study of money in to

the realms of credit and explaining the flaws of our current fiat currency system.

As I started to ponder this work I realized that the current system is a lot more

complex than its detractors would have us believe. The current system is often

referred to as “creating money out of thin air which is backed by nothing”. What

troubled me was that if this statement were true it would truly be surprising if

such a monetary system could still be functioning more than thirty years after the

last vestiges of any mechanism of gold convertibility had been removed. History

is full of examples of governments who have recklessly printed vast quantities of

pretty paper that by decree they have forced the populace to accept as payment

in exchange for goods and services. Such monetary systems rarely lasted more

than a few years before the buying power of the currency found its free market

equilibrium value…ZERO!

The men who met in secret on Jekyll Island in 1910 to draft the basic plan of the

Federal Reserve banking law were the shrewdest, smartest and richest men on

the planet. They were not despotic dictators of a Banana Republic who needed a

quick fix for their financial problems. Their motivation was not to save themselves

from financial crisis; it was quite the contrary, they wished to build upon their

enormous wealth and power to become even wealthier and more powerful. The

scam they laid out as their model for the future monetary system was, therefore,

a much more intricate and complex heist than what had been previously wrought

upon the public. The monetary fraud that was engineered by these men

intertwined for the first time the notion of money and debt. Alan Greenspan has

often referred to the Federal Reserve as the “lender of last resort” and we will

see that this is for a very critical reason. This work will study the interaction of

credit and money to develop an understanding of our debt based fiat currency

system, why it is doomed to collapse like many other fiat systems, but above all

why it is taking so long for it to do so.

Friends, Romans, Countrymen Lend Me Your Money!

In Opus #1 we established that we don’t need “money”, all we need is “wealth”.

We defined wealth as being comprised of the assets that are essential to living or

making the quality of living higher. So wealth is having a loaf of bread, a bottle of

water, a car, a house, a TV, a computer etc. I do not distinguish between a

consumable asset, such as a loaf of bread, and a durable asset such as a car.

You can call them all “goods” because they all make your life “good”. You could

trade your assets with other people in a barter system. However, money evolved

to facilitate commerce because the main drawback of bartering was that most

assets were not easily portable; it wasn’t easy to get a camel to fit into a purse

when going down to the market, and if something cost only half a camel you

were obliged to buy two of them!

Money is the medium for exchange of assets. It is a temporary store of wealth

that can be easily carried around and sub-divided into smaller units.

To store wealth money must have intrinsic value that it retains over a long period

of time. Over 6000 years gold and silver became the preferred money because

they were always in scarce supply with respect to the growth in economic activity

and so they were able to store wealth with out loss of purchasing power. A man

could sell a camel for a gold coin and twenty years later find someone who would

sell him another camel for one gold coin.

Commerce doesn’t have to involve the sale of an asset. It could be temporarily

loaned to someone whereby it can generate more wealth for both the borrower

and the lender.

Thought Experiment #1

Imagine Bob has a piece of land. The land is very dry and he can barely raise

enough cattle to barter in exchange for food to feed him and his family. If only he

could drill some water wells he could become an extremely rich farmer raising

over a 1000 head of cattle which would be enough cattle to provide for the whole

town. But he doesn’t have a drill to be able to drill water-wells. His friend Harry

has a drill. Bob asks Harry to make him a loan of his drill. He promises to return

the drill after drilling the wells and he promises to pay “interest” to Harry equal to

one cow per year until he returns the drill. Who benefits from this arrangement?

Results:

Both men become wealthier. Bob is able to develop his cattle ranching from

barely subsistence level to having surplus cattle that he can barter for other

‘goods” that he and his family desire. Harry has also benefited. Instead of his drill

lying idle, by loaning it to Bob he has been able to generate an income and have

his drill returned to him.

If Harry didn’t have a drill but had 10 gold coins instead he could have loaned

these gold coins to Bob to enable him to buy a drill of his own with an agreement

that Bob would pay the gold coins back later but he would also pay one extra

gold coin as interest. Bob can use the gold to buy a drill. He can sell the drill back

after drilling the wells for his initial expenditure of 10 gold coins and barter some

of his surplus cattle to get one extra gold coin. He can then give 11 gold coins

back to Harry. Again both men become wealthier through this arrangement.

The fundamental basis of a capitalist system is that surplus capital from one

individual can be loaned to someone who is in need of capital to develop

commerce. Through a payment known as “interest” for the use of the capital both

parties can benefit. The money that Harry loaned was previously in “storage”. By

loaning it to Bob he put this gold into circulation and this had the effect of

stimulating economic activity because Bob was able to develop his ranch and

perhaps create jobs for ranch hands. But the money acts as a catalyst for

economic activity because as Bob’s ranch develops he is able to pay back the

principle of the loan and so the 10 gold coins are withdrawn from circulation and

are again stored at Harry’s house.

Imagine that the 10 gold coins that Bob borrowed were the only gold coins that

exist. How would Bob be able to pay back 11 gold coins? Bob could go out and

pan for gold, or find someone who mines for gold and arrange for an additional

gold coin to be fabricated.

Thought Experiment #2

Peter wants to buy a house from Fred, but Peter has no money or assets to

exchange for the house. Peter is a skilled gardener. He promises to work for

Fred for 10 years in exchange for the house. They decided that the working days

that Peter must fulfill are 3000 days in the 10 year period. This will be hard to

keep track of so they decide to print 3000 ‘tokens” as a way to count the work

days. At the end of each day Fred gives Peter one token. After 10 years Peter

has 3000 tokens and so he has completed his obligation of work for Fred and so

the house belongs to him. What is the value of the tokens?

Results

At the end of the 10 years the tokens are definitely worthless because they are

not needed. The house belongs to Peter and Fred has had 10 years of gardening

work in exchange. Did the tokens ever have an intrinsic value? The strict answer

is “no”. There are only two things that have value…the house and the work that

Peter renders to Fred. Three thousand days of work are equal to the value of the

house. The tokens are only used to keep track of the exchange of these two

things of value. Each token “represents” one day of work or one three thousandth

of the house but they are intrinsically worthless. This is because it does not take

one day of work to manufacture the token, but it is “representing” one day of

work. A gold coin would probably take a miner panning in a river a least a day to

find enough gold for a gold coin. It has intrinsic value because of the work

required to make another one.

If during the 10 years Peter had died the remaining tokens would have been of

no redeemable value.

Imagine that Fred agrees with a friend, Tom, to give him the 3000 tokens in

exchange for a car. Now Peter will have to provide gardening services to Tom for

10 years to extinguish his debt for the house, and Tom will give him a token for

each day worked.

The Thieves in the Pin-Stripe Suits

In Thought Experiment #2 imagine now that Fred and Peter do not want to print

the tokens themselves but instead get some bankers to create the Federal

Reserve. The newly formed Federal Reserve prints 3000 tokens called “dollars”.

Peter “borrows” the 3000 dollar tokens and gives them to Fred and he gets

Fred’s house. For each day of work Peter receives a dollar token which he then

gives back to the Federal Reserve until he has paid back his obligation. There

are now two major differences. First of all the Bank asks for the house to be

pledged to them as collateral in case the worthless tokens are not returned to

them! Secondly, they ask for interest to be paid. The Bank loans 3000 worthless

dollar counting tokens but asks for 5% interest rate so that Peter has to return

3150 dollar tokens! How is this possible because only 3000 were printed?! If this

transaction is the only transaction performed by the bank then Peter has agreed

to pay back 3150 dollar counting tokens when only 3000 have been created, and

he has pledged his house if he is unable to return 3150 dollar counting tokens! A

trip to the psychiatrist might be in order! Understanding this is the key to seeing

what a fraud the current fiat currency system really is. When ever a loan of the

dollar counting tokens is created there are never enough dollar counting tokens

to pay back the loan plus the interest. This allows the bankers to print 150 extra

dollar counting tokens and have Peter do 150 days of gardening work for them.

The value that is imparted to these intrinsically worthless counting tokens is that

the debtors, whether they be individuals or companies, pledge a part of their

future productive capacity in order to earn back the dollar counting tokens. The

dollar counting tokens in our example should just be confined to determining

when Peter has done enough work for Fred to be equivalent to the value of

Fred’s house. However, the dollar counting tokens have been declared as “legal

tender” meaning that anyone in the economy must accept them in exchange for

goods and services. If Fred “spends” the 3000 dollar counting tokens in return for

goods then Peter must do work in the economy for anyone who now holds these

tokens in order to give them back to the Bank.

Because the Bank has an exclusive monopoly on producing the dollar counting

tokens only they can produce the extra dollar counting tokens that are required to

provide the system with enough to pay the “interest”. They can spend these extra

tokens and buy goods and services for themselves. This is why the Central

banks are determined to maintain the current fiat currency system. What

maintains the demand for the dollar counting tokens is that the debtor individuals

must work to earn them to pay back to the bank or in the case of debtor

companies; they must produce goods and services to earn them in order to pay

back to the bank.

Dollars are not “money created out of thin air backed by nothing”. They are in fact

counting tokens that represent a claim to future productive capacity of individuals

or companies. If individuals or companies do not feel confident about the future

they will not want to pledge collateral for the tokens in case they can not earn

them back. To encourage them to do so the bankers lower the interest rate and

so the bankers have less profit. If the economy is doing well they will increase

interest rates to temper the desire of the individuals and companies to take out

loans despite them feeling confident about being able to repay.

It seems like a perfect scam. The counting tokens are used to exchange actual

current goods or services against future productive capacity. The bankers take a

share in all the transactions in the economy by being able to spend the

equivalent of the interest rate in the economy. If they do not spend the equivalent

of the interest rate the system would lock up with a shortage of tokens because

more would be owed than have been created.

New dollar counting tokens are loaned into existence each day but old ones are

repaid. The fact that these tokens change hands for goods and services before

being retired back to the bank is what allows the economy to function.

Inflation? We Can’t Live Without it!

This debt based monetary system is intrinsically inflationary. Dollars are loaned

into existence backed by a pledge to earn them back in the future with future

productive capacity. Notice the emphasis on “future”. The currency is created but

the goods and services to spend it on have not been. So there must ALWAYS be

relatively more money chasing relatively fewer goods which is the definition of

inflation. In fact it is IMPOSSIBLE to have true deflation in such a system

because currency creation ALWAYS runs ahead of goods and services creation.

What actually causes inflation is how much currency IN CIRCULATION is

chasing how many goods and services that are AVAILABLE FOR PURCHASE. If

there are 300 million homes in the US why does the price of houses not plummet

to zero? The answer is because there is perhaps only 1% of them on the market

for sale. On the other hand not all the currency borrowed into existence is being

used to buy things. Some gets salted away under the mattress or in a family

safe, some is deposited in banks (although banks will loan up to 90% of your

deposit there is still 10% being taken out of circulation through the deposit), some

leaves the country and is held by foreigners, some is held by retail outlet as a

minimum float for their cashiers, etc. So the price of goods and services depends

on how much currency is being spent (currency in circulation) against the

quantity of goods and services available to buy.

The Inflation Watch

This is why the Federal Reserve monitors prices to be able to tweak the system.

If prices start to rise interest rates need to be increased. This has the effect of

increasing savings (better return on deposit) and reducing new loans. The

reduction in currency in circulation should then moderate inflation. If prices start

to go down then interest rates need to be decreased to encourage new loans and

discourage saving such that the currency in circulation can be increased to

prevent prices from falling.

Falling prices should not be confused with deflation. Just like in a bull market for

stocks prices can periodically fall, but the overall trend is up. Prices may

temporarily fall due to less currency being in circulation compared to available

goods and services BUT the system is fundamentally capable of ONLY

producing inflation in the long term. I haven’t come across a single economist

who has stated this categorically, but you can see it has to be true because

currency is created yet the productive capacity to earn the currency is only

realized later, and when lending standards are dropped, as we have seen

recently, the productive capacity never materializes.

If another country will manufacture goods for less dollars per unit this means that

for the same quantity of dollars more goods can be produced. This will tend to

moderate inflation or even create disinflation (falling prices) but it can never

create true deflation.

Doomed to Fail

In a debt based monetary system currency and productive capacity (which

ultimately leads to the production of goods and services) are linked together. In a

gold based monetary system they are entirely INDEPENDENT. There could be a

world wide strike of all miners and no gold would be produced. There would be

relatively less gold in circulation than goods and services to spend it on, which

would be deflationary.

If the debt based monetary system is well managed it can survive for many

years, as the current dollar system has. This does not mean that I condone the

system. I do not. It is fraudulent and eventually destined to fail. The reason that it

will eventually fail is that the system will never be properly managed over time

because bankers and politicians are greedy and do not have the discipline to

avoid the inherent flaws of the system. The flaws in the system are:

1) The system can ONLY produce inflation. The bankers must manage this

to be gradual so that the general public does not complain about loss of

purchasing power. To properly manage interest rates to control the

currency in circulation the bankers must accurately measure price

variations. In recent years the government has chosen to hedonically

adjust price variation monitors such as PPI and CPI in order to hoodwink

the people. In doing so they have deprived the central bank of the

requisite data to appropriately adjust interest rates

2) There must be very tightly controlled lending standards. If borrowing

entities are pledging future productive capacity then banks must verify

very carefully that there is a low risk that the entity can not deliver

productive capacity to the economy in order to earn back the currency. We

have seen in recent years that loans have been made to anybody. The

slogan “bad credit, no credit, no problem” should ring in the bankers’ ears

for many years to come! Rating agencies have over-rated the credit rating

of companies. These companies are not as low risk as previously thought.

They do not have a good chance of generating enough profit dollars in the

future to pay back the currency they have borrowed. Home owners have

second, third, fourth mortgages etc which they have acquired based on

the inflationary effects on home prices which are consequence of already

slack lending standards.

3) Governments want to get free money from the system. Under a debtbased

monetary system Governments should not be allowed to borrow.

Period. Why? Because the borrower needs to pledge future productive

capacity against the loan. A government has ZERO productive capacity.

They do not produce wealth. A farmer takes seed, water and sun light and

produces a highly valuable food source, a car manufacturer takes raw

materials a makes a highly valuable means of transport. A government

produces nothing. It has no collateral to offer for a loan. A government

might perform some highly useful services such as paying for building

roads, schools and hospitals; however, their only source of revenue is

from taxes which have come from the people’s productive capacity. All the

government does is collect it and spend it on behalf of the people. That is

NOT wealth creation. If a government intends to repay a loan from future

taxes it means it will have to either raise taxes or default on the loan at

sometime in the future. So the government should be forced to raise taxes

and not be allowed to borrow currency. But a privately owned central bank

needs a friendly government to allow it to continue to defraud the people,

so it would never tell the government it has zero credit rating due to it

having zero future productive capacity to borrow against! The government

will always be the biggest borrower and as excessive tax increases will

never be welcome their borrowing will in some way be defaulted upon.

The government is always the largest destructive element for the

monetary system. Their borrowing is essentially introducing “counterfeit”

currency into the economy but they are perfect forgeries!

4) The major flaw in the system is its vulnerability to default. If individuals

and companies are allowed to borrow more dollar counting tokens than

they can possibly earn back from future work or productive output then at

some stage they will default. The situation that produces this comes from

the flaws of (1), (2) & (3) above.

The system is intrinsically inflationary. As demonstrated above true deflation is

impossible. If entities default on a massive scale on their repayments, then

otherwise viable entities who are expecting payments will fail and defaults will

domino through the economy. Imagine a company who was rated AAA but

should really have been rated “junk” borrows currency to buy new plant. But the

business outlook for the company is poor. It will not be able to earn back the

dollars borrowed. It defaults. The loan company is then in trouble. The perhaps

one thousand employees do not receive pay checks, they default on their house

payments, putting their mortgage company in trouble. Before the employees

default on their mortgages they go to their bank to withdraw all their cash. The

bank only holds 10% of their currency (the rest has been loaned out). Now the

bank is in trouble. And so the daisy chain of defaults continues. In this

environment banks will not and cannot make new loans so less currency is

entering the system. As the currency in circulation dries up the system goes into

catastrophic seizure. If no currency circulates then there is no economic activity.

This is NOT deflation; this is system lock-up and system failure. Innocent people

who are owed money, owed pay checks would be forced to default through no

fault of their own. The result would be revolt and perhaps civil war.

Once widespread default sets in the debt-based monetary system can no longer

be “tweaked”. The result of the flaws of (1), (2) & (3) are that massive amounts of

currency are created that will never be earned back. Just because there is a

credit crisis doesn’t mean that suddenly these entities will be any more able to

pay back. Once a significant amount of currency has been introduced into the

system that is unbacked by future productive capacity it is equivalent to having

circulated counterfeit notes. The damage is already done because the system is

no longer purely a debt based monetary system as it is infiltrated with counterfeit

notes unbacked by productive capacity, but they are indistinguishable from any

other note. When this gets to the stage of massive default the only way forward is

to continue to pump more “counterfeit notes” into the system. Allowing the

system to lock-up and collapse would be instantly catastrophic. Pumping

counterfeit notes into the system will lead to system failure but only at sometime

in the future. It is a way to delay the day of reckoning.

Inflate or Die

In the week of August 13, 2007 the central banks of the world sensed that the

default daisy chain was starting to propagate. The dollars in circulation were

drying up. System seizure was close at hand. Collectively the banks injected 300

billion dollars into the financial system. This new currency is not backed by new

future productive capacity. This is more counterfeit currency that no one is going

to earn back. The FED on Friday August 17 reduced its discount rate. This is a

prelude to lowering the FED funds rate. Lowering interest rates will encourage

more borrowing and bring dollars into circulation from savings. As major

institutions get close to bankruptcy more new currency will be issued to bail them

out. This is inflationary and on a large scale, hyper-inflationary. As the currency

loses purchasing power consumers are obliged to spend it quickly or risk getting

less in exchange for their currency in the future. This increased impetus to spend

has the perverse effect of giving the impression that the economy is doing well

because “economic activity” (the exchange of goods and services for currency)

goes at a faster and faster pace. As prices increase the people will demand more

currency to be able to maintain their lifestyle. The bankers will lower rates further

and more cash injections will be made and this will be “welcomed” by the general

public as helping to relieve their perception that there is not enough currency in

circulation to pay for the goods they need when in fact the opposite is what they

need…lower prices, which can only be achieved by supplying less currency.

Once started the spiraling out of control is almost impossible to stop. The most

extreme hyper-inflation was in Hungary after World War II when prices doubled

every 15 hours equating to 4000,000,000,000,000% per month (that is 4

quadrillion percent per month)! As recently as 1994 Yugoslavia saw prices

double every 16 hours.

Damn the Torpedoes, Full Steam Ahead!

Bernanke is aware of the possible catastrophic effects of seizure of a debt based

monetary system. He famously spoke of avoiding deflation (which is not

technically possible, he means system failure, but that is not an expression he

would want to use!!) by dropping dollars from helicopters. He was serious

because when the system is on the verge of collapse this is the only viable

course of action, while still trying to maintain a fiat monetary system. The Federal

Reserve calls itself the “lender of last resort”. As Bernanke has mooted that “last

resort” is not lending at all, but purely handing out fiat paper.

Under a gold backed monetary system the money has intrinsic value so the

money has equal stature to real assets. The majority of the money in circulation

is not related to anyone’s obligation to deliver future productive capacity. Credit

can be extended in a gold backed system. For example a company could borrow

gold to build additional plant. The expected future profits of the company are

expected to be able to pay back the money. The intrinsic value of gold would

prevent all but the insane from lending gold under a slogan of “Bad credit, no

credit, no problem”! The risk of not getting valuable gold paid back makes

lenders ultra conservative. The possibility of widespread defaults that could lead

to systemic failure of the economy is eliminated.

Some Currencies May Survive?

A debt-based money system can work despite it being usurious. Debt-counting

tokens are issued at almost zero cost of production to the bank as a way to

account for the extinguishment of a promise to perform productive work in the

economy in the future for the privilege of spending today. The debt counting

tokens must continually enter the system as new credit as old credit is retired.

Interest rates are the mechanism by which this is achieved. The fact that any

loan does not create enough debt counting tokens to pay for the interest on the

loan means that the bankers can spend the equivalent of the interest rate into the

economy. As interest rates have averaged around 5% over the years the bankers

earn approximately 5% of the entire currency creation for themselves! An

exorbitant privilege indeed. The fact that all currency is created in advance of the

corresponding future productive capacity means that the system is inherently

inflationary, but it can be managed by attracting surplus currency into savings

and reserves to reduce the amount circulating.

As the dollar system collapses it is not a foregone conclusion that all fiat

currencies will collapse. If other countries have been more prudent in their

currency creation such that creditors are capable of continuing to make

repayments it is possible that their currency survives.

Symptoms of a Terminally-ill Patient

Massive debt default can not be swept under the carpet or spun by the media as

irrelevant. It is symptomatic of a debt-based monetary system close to collapse.

The current conditions in the US of more than 110 mortgage companies having

gone bankrupt, the highest foreclosure rates in history, even the largest

mortgage company in the US (Countrywide) in trouble, many hedge fund

collapses, funds refusing redemptions etc is proof of the crisis. Observers who

say this will not spill over into the general economy are either lying or have no

clue about the subject. The fact that so many entities were extended fiat currency

that they would never be able to repay is undoubtedly due to the lax standards

set under the tenure of Chairman Greenspan. The Maestro is responsible for the

near systemic failure, but was heralded as a guru!

The ultimate protection from the inevitable inflation that will be instigated to keep

something circulating in the economy is gold. Other precious metals will offer

safe havens as well as the companies that dig it out of the ground because those

companies are the producers of “real money”. If real money is highly valuable

then entities that generate it must become valuable too compared to a

depreciating fiat currency.

Gold Price Suppression – A No Brainer!

We have concluded that a debt-based monetary system can only be inflationary,

or seize up and collapse. Deflation is not possible.

How can the inflationary side-effects be hidden from the general public? The

classic indicator of inflation is gold. The suppression of the price of gold is a

necessary function of Central Banks. Central Banks are the architects of an

inherently inflationary monetary system that nets them 5% of the entire money

supply in profits. They also have legacy stashes of gold. Anyone who thinks that

the Central Banks would not use their gold to prolong their monetary scam

should not go out in public on their own! Selling something that is intrinsically

valuable in return for something that is intrinsically worthless (which they

themselves can print at any time!) MUST have an ulterior motive!! Sherlock

Holmes would conclude that this is “elementary, my dear Watson!”.

Fear-mongers will maintain that the CB’s and the Cartel of Bullion Banks can

suppress the price of gold forever because they have unlimited supplies of fiat

currency with which to short the futures market. This is just not true because

typically at least 10% of the futures contracts stand for delivery. The CB’s must

be able to back their bear raids with at least 10% in physical gold. Do you

recognize the structure of the futures market?...issuing a contract today for

delivery of something of value in the future? This is a variation on the theme of

the debt based monetary system. Just like the debt based monetary system the

thing it can not tolerate is default. If a futures market defaults the game is over.

The CB’s suppression of the gold price is limited by how much real gold they can

supply, and not unlimited by the unlimited amount of fiat they can produce, as is

commonly postulated.

Democracy and the Control of the Monetary System

Over the last fifty years we have seen electricity generation and distribution,

water supplies and distribution, garbage collection amongst other services move

from being government owned and run to being owned and run by the private

sector. The monetary system should NOT be run by the government. They have

ALWAYS throughout history demonstrated that by their very nature such

institutions can not be trusted to run a monetary system because they have

ALWAYS resorted to putting their fingers in the till. It is a conflict of interest. It is

putting the fox in-charge of the hen-house. The wealth of the people belongs to

the people. The system which is created and maintained to allow wealth to be

stored or traded between people should be the responsibility of the people.

People have mistakenly come to believe that “democracy” is a system where the

people choose someone to run the country from typically a choice of only two

candidates! A true democracy is where society is run by the people, for the

people. Essential services are now provided by the private sector. What most

people have missed is that to truly effect democracy the people MUST control

the monetary system. Elected officials would then have the power to facilitate the

running of society but not to misappropriate the wealth of its citizens. The

embodiment of this revolutionary empowerment of the people is goldmoney.com.

If the monetary system is controlled by the people and not by the government a

new era of peace and prosperity will be ushered in. True freedom will be enjoyed

by all.

The definition of insanity is doing the same thing over again and expecting a

different outcome. Time and time again monetary systems have collapsed. The

government has been changed and/or a new fiat money has been introduced.

The result has always been the same. The system fails again! The framers of the

Constitution worried about the separation of Church and State. They should also

have made provisions for the separation of the monetary system and the State.

The framers were brilliant men and they came up with a brilliant document.

However, they underestimated the ingenuity of men to undermine a system if it is

their interest to do so. They thought that by insisting on an honest money system

based on gold or silver that even in the hands of dishonest men it would endure.

The time is ripe for a change. Governments in EVERY country in the world are

now derelict in their duty to run a monetary system. Goldmoney.com is a proven

system that can effect this change. Governments would be required to manage

the affairs of government keeping a balanced account. The governments’

accounts would be no different from the accounts of any corporation or individual.

Spending beyond its means would simply not be possible.

Wars have usually had their roots in economic failure which can always be traced

in one way or another to a failed monetary system. A sound monetary system

that is run by the people for the people could significantly reduce the inducement

for making war and the ability to fund it.

It has always been recognized that “he who has the money has the power”. But

peoples in history have always been ready to delegate the monetary system and,

therefore, the absolute power to their elected representatives. By retaining the

monetary system in private hands the people retain the absolute power; they

remain free, they become prosperous and they remain peaceful.

Delegation of the monetary system has in the past been necessary due to a lack

of technology to do otherwise. Communications technology now enables the

people to no longer have to delegate the control of the monetary system to their

elected representatives.

Rapid Dollar Debasement is Here

This visionary thinking is for sometime in the future. Today, as the clear signs of

systemic failure of the dollar debt based monetary system manifest themselves,

precious metals and quality mining equities are the way to protect from the

ravages of inflation, because inflation is the only option left to the Central Banks

who, through greed, have allowed the system to be pushed to the limit of default

driven seizure.

Adrian Douglas

Marketforceanalys.com

Adrian Douglas writes many articles on his observations and analysis on financial markets, gold and silver markets, and some selected company stocks. The articles were all initially published at www.lemetropolecafe.com.