by Doug Casey, International Man:
Gold is the currency of kings, silver is the money of gentlemen, barter is the money of peasants, but debt is the money of slaves.
—Norm Franz, Money and Wealth in the New Millennium
We are nearing the end of the debt-as-currency era.
This is quite a broad statement and, of course, since debt is the foremost currency of our day, it would be quite understandable if the reader were to regard such a prognostication to be utter nonsense.
Indeed, many would say that, without debt, the world couldn’t function. Debt has always existed and always will. However, in eras past, debt often played a much smaller role, and those eras were marked by greater progress and productivity.
We’re now living in the era of the greatest level of debt mankind has ever created. In fact, we’ve come to regard it as “normal.” Most governments are far beyond broke. And they won’t be saved by confiscation or taxation, as their people and corporations are just as heavily in debt. For this reason, a collapse is inevitable. And, since the severity of a collapse is invariably directly proportional to the severity of the debt, when it arrives, it will be a collapse that eclipses all previous collapses.
The present uncontrolled level of debt is made possible through the ability of central governments to create more currency at will. And this is only possible through the existence of a currency that is fiat in nature—that has no inherent value.
Aristotle was right on the mark when he stated that for something to be appropriate as money, it must have intrinsic value—independent of any other object and contained in the money itself.
The great majority of what passes for money today is digital, although, for daily use, paper currency is still widely used. But it must be said that paper currency is also fiat, having a far lower intrinsic value than the denomination printed on it.
In 1971, the US dollar went off the gold standard—it ceased to be redeemable in precious metal. From that date on, it existed as a promise only—a promise from a government. (Promises from governments tend to be somewhat less redeemable than promises from, say, loan sharks or used-car salesmen.)
In time, the rest of the world followed. Today, no national currency is redeemable in anything that has intrinsic value.
Doug Casey has rightly called the dollar (since going off the gold standard) an “I owe you nothing.” Exactly correct. He also describes the euro as a “Who owes you nothing?” since no one country in the EU is responsible to redeem the euro with anything that possesses intrinsic value.
It’s hoped by many today that cryptocurrencies will be the salvation of the soon-to-collapse monetary system. Unfortunately, cryptos can accurately be described as “You have no idea who owes you nothing.”
Read More @ InternationalMan.com