Creature From Jekyll Island by G. Edward полностью

The law of supply and demand is not to be conned. As the supply of money (of claims) increases relative to the supply of tangible assets in the economy, prices must eventually rise. Thus the earnings saved by the productive members of the society lose value in terms of goods-When the economy's books are finally balanced, one finds that this loss in value represents the goods purchased by the government for welfare or other purposes....

In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold.... The financial policy of the THE BARBARIC METAL

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welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the " h i d d e n "

confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights.

Unfortunately, when Greenspan was appointed as Chairman of the Federal Reserve System, he became silent on the issue of gold.

Once he was seated at the control panel which holds the levers of power, he served the statists well as they continued to confiscate the people's wealth through the hidden tax of inflation. Even the wisest of men can be corrupted by power and wealth.

REAL COMMODITY MONEY IN HISTORY

Returning to the topic of debasing the currency in ancient times, it must be stated that such practices were by no means universal. There are many examples throughout history of regents and kingdoms which used great restraint in money creation.

Ancient Greece, where coinage was first developed, is one of them.

The drachma became the defacto monetary unit of the civilized world because of the dependability of its gold content. Within its borders, cities flourished and trade abounded. Even after the fall of Athens in the Peloponnesian War, her coinage remained, for centuries, as the standard by which all others were measured.2

Perhaps the greatest example of a nation with sound money, however, was the Byzantine Empire. Building on the sound monetary tradition of Greece, the emperor Constantine ordered the creation of a new gold piece called the solidus and a silver piece called the miliarense. The gold weight of the solidus soon became fixed at 65 grains and was minted at that standard for the next eight-hundred years. Its quality was so dependable that it was freely accepted, under the name bezant, from China to Brittany, from the Baltic Sea to Ethiopia.

Byzantine laws regarding money were strict. Before being

admitted to the profession of banking, the candidate had to have sponsors who would attest to his character, that he would not file 1. Alan Greenspan, "Gold and Economic Freedom," in Capitalism: The Unknown Ideal, ed. Ayn Rand (New York: Signet Books, 1967), p. 101.

2. Even the Greeks under Solon had one, brief experience with a debased currency. But it was short lived and never repeated - See Groseclose, Money and Man, pp. 14, 20, 54.

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THE CREATURE FROM JEKYLL ISLAND

or chip either the solidi or the miliarensia, and that he would not issue false coin. Violation of these rules called for cutting off a hand.1

It is an amazing fact of history that the Byzantine Empire flourished as the center of world commerce for eight-hundred years without falling into bankruptcy nor, for that matter, even into debt. Not once during this period did it devalue its money.

"Neither the ancient nor the modern world," says Heinrich Gelzer,

"can offer a complete parallel to this phenomenon. This prodigious stability...secured the bezant as universal currency. On account of its full weight, it passed with all the neighboring nations as a valid medium of exchange. By her money, Byzantium controlled both the civilized and the barbarian worlds."2

BAD COMMODITY MONEY IN HISTORY

The experience of the Romans was quite different. Basically a militaristic people, they had little patience for the niceties of monetary restraint. Especially in the later Empire, debasement of the coinage became a deliberate state policy. Every imaginable means for plundering the people was devised. In addition to taxation, coins were clipped, reduced, diluted, and plated. Favored groups were given franchises for state-endorsed monopolies, the origin of our present-day corporation. And, amidst constantly rising prices in terms of constantly expanding money, speculation and dishonesty became rampant.

By the year 301 A.D., mutiny was developing in the army,