No………not about Stucky’s python or the lovely and intelligent ladies of TBP.
Let’s fantasize about a fairy tale land where there is NO central banking. A magical land where the value of your money is not devalued, against your will, every second of every day.
Yeah, I know. Never. Gonna. Happen. So just pretend……
The reality is that money is nothing more than a representation or stand in for your labor, or, if you really want to get down to the nitty gritty, money is a stand in for the hours, days and years of your life.
In the before time of cavemen you or your family had to work together to provide everything essential for life. Food, clothing, shelter. As we evolved and figured out how to farm and raise animals we could afford to specialize but specialization meant that while one focused on raising food another had to focus on making clothes, tools etc. So, money was invented to be a stand in for labor you could not or did not want to perform yourself.
It was actually a decent idea until the the money changers recognized they could co-opt this system to enrich themselves and enslave the rest of humanity in perpetuity.
So what would things be like without central banking? How would it change your lives? How would it change your investment mentality? Would you even need investments? If your money wasn’t being devalued every second of every day that would mean that one unit of value today would still have that same value next year or next decade and even next century right?
What does a world without central banking look like to you?
I can’t recall the exact numbers from Rothbard but the last half of the 19th century the value of money actually increased. So if you started with $100 stuffed under your mattress in 10 years time it would buy $106. Imagine. Money that appreciates.
Explanation please.
The PURCHASING POWER of the money increased because of the increase in productivity that brought down prices throughout the economy. Yes, DEFLATION IS A GOOD THING…despite the lies the mainstream economists keep telling everyone.
Exactly right MR. L. Deflation (lower prices) helps average people. Inflation benefits all the thieving ones; banksters- govt, globalists.
Also, at the time the US was on a Gold / Silver standard. It is nye on impossible to devalue real money. Unlike fiat currency that is devalued nonstop until it is worthless.
Exactly, so MONEY was NO LONGER A VARIABLE in the equation, so productivity gains were ABLE to increase purchasing power. When there is PLANNED inflation (as there always is with the Fed), any and ALL gains in productivity are consumed and transferred to the Fed, the banking cartel, and the first recipients of the newly created/inflated money – rather than to the people that actually DESERVE IT.
No need to fantasize. Just look at what Hitler did for Germany around 1935(this will probably go off the rails but…). He took the country from 50% unemployment to 2% using Reichbanknotes (Rothschild was arrested). Historically, has anyone been more maligned? Oh, that’s right, he killed Trillions of Jews for absolutely nothing-never mind…move on…
https://youtu.be/OkJmhxGDd50 start at 9:45 a fabulous video series BTW
It would be the same as it is now. Even in a 100% private and independent banking system, unbacked emission of credit would come in waves, frothing up far beyond sustainable levels, resulting in bad loans and an inevitable credit collapse. And the problem really isnt the Fed. There is an argument to be made for a steady 2% inflation rate. The problem(s) are with the government:
1) The definition of CPI is completely broken. This is not the fault of the Fed.
2) The government borrows money and sells bonds. This is not the fault of the Fed. If the government didnt run a deficit, the Fed couldnt buy government debt at a premium, giving the rich extra cash which they can use to pump up huge asset bubbles.
3) If the Fed didnt exist it would immediately be created by the captured congress. Again the issue lies in government. Which means the issue ultimately comes down to voters who vote poorly.
Blame to victim. That’s rich.
Our Government has the right and obligation to issue money. Inflation didn’t happen with competitive banking. Central control of issue perverts the process and removes incentives for competition. If it were competitive, they couldn’t manipulate interest at a whim-rates would be determined by the market for loans.
In 1913 when the privately owned Federal Reserve was formed, you could buy an ounce of gold for about $20. Today, an ounce of gold costs about $1320, and this price is highly suppressed by central banks but let’s assume it is a fair market price. This is a clear measure of how the US dollar has been devalued by the Federal Reserve over the past 100 years or so. Put another way, around 98.5% of a dollar earned in 1913 if it was stored under your mattress or in a safety deposit box has in effect been stolen by the dilution of the value of the dollar by money printing by the Federal Reserve and fractional-reserve banks. This has to be the greatest fraud of the 20th and 21th centuries and yet not one person in a thousand understands that they have been robbed and plundered. This stolen wealth has been transferred from honest workers who produce products and services at fair market value to a gangster ruling class who has devised this diabolical system of theft. Honest money, not the counterfeit dollars created out of thin air by the Fed, is at the core of a free and moral society and a government of, by and for the people. The current banking and financial system must be bulldozed to the ground and honest money restored before such a nation can reemerge from this dark period of control and decline of just about all our institutions of government, commerce, media and society.
“The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert by secret agreements arrived at in frequent private meetings and conferences.”
— Quote from Caroll Quigley’s Tragedy and Hope, Chapter 20
Money is NOT a measure of your labor, productivity, or anything else. MONEY is nothing more than a medium of exchange that everyone agrees on. When everyone produced their own “goods” or services, systems of barter required one to find someone willing to exchange what they had for what you had. The cumbersomeness of this brought about the rise of “universal” items of exchange that everyone “agreed” to use. In some cases these were shells, colorful rocks, etc. but in most cases (especially after once the metal ages came about) were metals like copper, bronze, silver, and gold. And the “money changers” truly ONLY gained real power over everyone because they employed the power and violence of GOVERNMENT to mandate the use of specific monies for specific purposes, thus FORCING trade among mediums of exchange. They stepped in to skim off the top of that exchange. An ounce of gold/silver/copper/platinum/palladium/bronze, etc. does NOT require a moneychanger or any other intermediary other than a SCALE (and maybe a purity test – now incorporated into purity stamps on the coins) to facilitate exchange. Everyone prices their goods or services in the common money (or in multiple types) and exchanges are facilitated.
Without a central bank (or allowing Congress to run the criminal enterprise of the Fed), 327,000,000+ people in the US and overall 7 billion+ citizens around the globe, would all be players in determining the “value” (truly the purchasing power) of the monies (likely gold/silver/precious metals) that would rise up according to Gresham’s Law and be used for exchange. It would be a WONDERFUL day!!!
Using coinage itself as the transaction medium in a “modern” economy isn’t really feasible and hasn’t been since the rise of large-scale “international” trade @1400. You had to have paper and now digital analogues in order to process the ever-growing volume of economic market transactions and said processing was and is most efficiently handled by “banks”. The key point is that the analogues must remain convertible into the “real” money, into the physical metal, usually gold or silver, itself.
Unless there is 100% convertability (and the crime of FRAUD is prosecuted), there can be no true barrier to endless money printing. Indeed, gold certificates and silver certificates circulated freely and digital gold/silver could exist as well, but must be 100% or they are not honest money…..just more fraud.
@IndenturedServant, It may be incorrect to say “Its never going to happen”. Humanity is already at the beginning of, “A magical land where the value of your money is not devalued, against your will, every second of every day.”
The computer developer’s behind bitcoin are making it happen now. They have created a medium of exchange that does hold and increase its value by design and has proven throughout it’s 10 year history to have increased its value quite dramatically. Even if bitcoin should ultimately fail, it has provided sufficient proof of concept that other decentralized, peer to peer, block chain driven, online mediums of exchange will ultimately prevail over corrupt, government manipulated and government controlled currencies.
The magical land where the value of your money is not devalued, against your will, every second of every day is now already being implanted. I highly recommend that you get some.
Hey Davido,
Talk to me about the value of crypto currencies and the magical blockchain after the lights go out…oh wait…you won’t be able to will you. Any “medium of exchange” that is absolutely and ultimately dependent on the artificial production of electricity is a digital disaster waiting to happen.
My will has nada to do with this, or that, magical land. But a world w\o institutionalized centralities of all the different ones & kinds would look like something other than human. Pogo possum is hardwired & spring-loaded to bounce on tiptoes thru the tulip bulbs, chinashop bull the bitcoin, & madness-methodically shoot his own toes off, one by one.
As for money unit value, absent rigging\propping\diluting\manipulating, it tends to rise, while prices of goods tends to fall.
Deflation is good, puts the engine fore & aft o’ the cart.
Inflation steals the engines – your time\effort – idles the cart\you to rust.
Deflation anneals, tempers, hardens\strengthens value of your time\effort – your life. Savings – that reward\pay usable interest → Capital formation – equity, instead of figments of fevered debt imagination. More investment, less malinvestment. More, rather than less, skin in the game. Metrics that actually meter, & so matter.
Inflation just burns it down – so the arsonists can take match & lighter money, accelerant money, insurance premium money, from the citizen-serfs – and never pay off the policy. Heads they win, tails you lose.
Creative destruction is too hard, outcomes too uncertain. The magicians therefore go in for destructive destruction. You work in exchange for magicians’ makework. That’s entertainment…& entrainment.
Federalist, mercantilist, whig, republican\democrat – all the same magicians, supported by all the same gaping, seat-warming, audiences. From before day one, too.
Schemers scheme before, during, after their schemes have been scaffolded, & the nooses slung. They’ve been trumping the bumpkins forever…talk about two uglies bumping…& fugly offspring all over the place. Not only in murky ‘murica.
https://en.wikipedia.org/wiki/The_Quiet_American
https://en.wikipedia.org/wiki/The_Ugly_American
+100 i forget.
Danke, BL.