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From Loose Money To The Destruction Of Civilization

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when will the voices of reason be heard


Finally, the publisher of the New York Times had had enough. Arthur Sulzberger came to him and said "when 43 governments sign an agreement, I don't see how the Times can any longer combat this." :ph34r:

Hazlitt began to pack his bags. After he left, his revenge was a massive article on the subject in the American Scholar, published later that year. Then he wrote the book that would become the biggest selling economics book of all time: Economics in One Lesson. His goal with this book was to propagate the core principles of economics, so that anyone could do what he had done, which was see the fallacies of the logic behind crazy government schemes. He wrote the book in record time, and got it out the door as soon as possible. Of course it was a blockbuster. It remains to this day our best-selling book.

In 1967, Hazliltt also had a last laugh, if it is a laughing matter to see your worst predictions come true. Hazlitt was now a syndicated columnist with the Los Angeles Times. He wrote about the unraveling of the system, which finally happened in 1969. By 1971, the entire world was on a fiat money paper standard and the result has been nothing short of catastrophic for societies and economies, which have been thrown into unrelenting chaos.

To be sure, Hazlitt was not, as he said, the "seventh son of the seventh son." He wasn't born with some amazing prophetic power. What Hazlitt did was read Mises and come to understand monetary economics. It sounds easy until you realize just how rare these talents were in his day and in ours.

There is another aspect to what Hazlitt did. He could have very easily relented or just stayed silent. It took moral courage and incredible intellectual stamina to tell the truth as he did when the whole world seemed to be against him. But so far as he was concerned, this was why he was put on the earth and why he got into writing in the first place: to tell the truth. He wasn't threatened with jail or violence. The only thing he had to fear was the derision of his colleagues. What truth teller in the history of the world hasn't faced that?

We might ask ourselves: why is it important to revisit this history now? As regards the details of Bretton Woods, it is extremely important to understand that this was not a genuine gold standard. It was a fake gold standard managed by an unworkable plan cobbled together by governments. It is the height of absurdity that supply-siders and others have for years been pining for a return to Bretton Woods and calling it a return to the gold standard. A new Bretton Woods would fail as surely as the first one did. It would certainly not be a step in the right direction to re-institute Bretton Woods.

That Bretton Woods was called a gold standard was an exercise in obfuscation. It happened for the same reason that NAFTA was called free trade or the FTC is said to protect competition. The state has long used the language of liberalism and the market economy as a plow to push through its opposite. The gold standard was an early victim in this war over words.

A genuine gold standard is implemented currency by currency. It provides for domestic, on-demand convertibility. It allows for banks to fail on their own. It has no central banks. It surely has no international monetary institutions for lending bankrupt governments money. This is the only way toward real stability. Hazlitt said it in the New York Times and it remains true today.

If we want to go further with an impenetrable system of money and banking, we would follow Rothbard (Hazlitt once told me that the greatest achievement of the Mises Institute was to give Murray a "suitable platform") and completely privatize the system, permitting private coinage of any money. This would be all the more viable in our own times, with digital payment systems and global communication. In fact, I'm quite sure that had the state not intervened, the internet would have already put together a competitive system of currency and banking that would exist completely outside the state's purview. A very viable means of reform we could undertake right now is for the state to simply do nothing. The dollar might be beyond salvation at this point, but money itself is not, of course. Money is an essential part of the market economy, so therefore let us let the market make it and manage it.

The stakes are impossible to overstate. Fiat paper money is destroying civilization right now. It has fueled the predator state. It has destabilized markets. It has wrecked balance sheets and distorted financial markets. It has wrecked the culture by leading the whole world to believe that prosperity can come as if by magic, that stones can be turned into bread. It might yet unleash a ravaging inflation that will be welcomed by dictators, despots, and cruel tyrants.

How important is sound money? The whole of civilization depends on it. We must accept no compromise. Down with government plans. Down with international commissions. Down with attempts to manipulate and control that always end in robbing us and making us poorer than we would otherwise be. We should embrace no more and no less than what the old liberals of the 18th and 19th centuries championed. All we ask is laissez-faire.

Edited by lowrentyieldmakessense(honest!)
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Looks like a stable system, even if it isn't going anywhere.

you forget the interest...and the defaults.

And even more important...who thinks the ENGERLAAAAAAND goalie has been paid by Obama to throw the game!

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A stable currency will never be achieved all the time we allow a cartel of land owners to demand payment for providing nothing.

Once people realise the landowners' trick, it will get used to the point of destruction which ensures a banking system collapse. This happens every 18 years or so - 2010, 1992, 1974, and is not something that is dependent on a fiat paper currency means of exchange.

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you forget the interest...and the defaults.

even when interest wasn't charged back in roman times,the method of debasement was coin-clipping.

the instruction manual on how to make and break empires is not exactly new.

At least now,with the advent of modern media,we have the opportunity to study these phenomena(and possibly rectify it)

no wonder NuLabour were so keen on eliminating all the juicy bits of history from the school curriculum.

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