What Is Money?

SilverEye wrote:Douglas Adams in 'Life, the Universe and Everything' one of the books in his wonderful 'Hitchhiker's Guide to the Galaxy' series describes a society that elected to make leaves legal tender, imagining that with this choice they would immediately all be rich, and without effort! Eventually, they are forced to burn down all the trees, in order to curb inflation.

In 1966, the world (not just USA) had gone through a massive demonetization of silver from every legal tender coin worldwide by 1965 (except for a few vestiges such as 40% Kennedy halves in USA until 1971).

Also since 1933, gold was illegal for Americans to hold (except in overpriced nuismatic form) and a pure paper currency for Americans with no backing, while dollar was redeemable in Gold by foreigners, until 1971 when Nixon was forced to declare dollar a paper currency for the world as well.

Scientology's Hubbard's mistake is to state that money can be anything (is only "symbols" idolized or agreed upon by society). It is a fundamnental (fundamental+damned) misunderstanding of what money is. Wikipedia on money, and you will see it has numerous properties. One of them is liquidity, and for that money can be anything that society agrees on. But another property of money is "a store of value" and this means to store the labor value of past work, i.e. capital. If this "store of value" can be produced at will cheaply, then it is no longer able to store the value and instead value is diluted away. Due to Gresham's Law, "stores of value" can not remain liquid. Thus money is inherently unable to be both a "store of value" and "liquid" at same time, because society refuses to consume after it produces (prefers debt). Gresham's Law is basically a statement that mankind can not discipline itself to consume after production, and to invest some production in expanding production, instead mankind prefers a credit system where a few bankers parasite on the enslaved borrowers. Since the majority prefer a credit money (fiat), then the majority do not provide broad demand (liquidity) for, and thus the minority take out-of-circulation. the "store of value" money. Thus the minority set the rules for investment ("he has the gold makes the rules", Rothschild).

Gold & silver are the best stores of value throughout history for numerous reasons:

fungible
do not deteriorate/spoil
compact (rare)
not cheap to overproduce

It is also a fallacy to say that GDP can not grow faster than the supply of tangible (e.g. gold) money increase, because value of money can increase as fast as necessary. This is called deflation, and is great for savers and for maximizing production over the long term, because it takes real capital to produce real (not nominally inflated debt) growth in GDP.

Remember credit (intangible promises) != capital (real goods or stored labor):

https://goldwetrust.forumotion.com/economics-f4/inflation-or-deflation-t9.htm#304

!= means "does not equal"


Every so often, fiat (credit) money systems return to their intrinsic value of 0, then gold&silver go to the moon. Then society resets and starts anew to gradually debase (Gresham's Law), the money until they get back to another peak in fiat. The cycle repeats over and over through history, except each time the core bankers get more and more control over humanity. In past episodes, there was still virgin new colonies to go start anew, outside the tentacles of the bankers, but it appears we are probably on this cycle (or the next) to the point of 100% world govt (Tribulations?), with no more virgin/uncontrolled territory to start outside their control.

However, there is a form of internal virgin terroritory and it is known as "permanent chaos" (anarchy). This is will be the release value where resistance to world govt will manifest.

http://sandiego.indymedia.org/media/2006/10/119974.pdf
pg.372

...The world's deepest secrets all lead back to Sumer in Mesopotamia, the
first known great civilization, located between the Tigris and Euphrates
Rivers at the headwaters of the Persian Gulf. In biblical times, it was
called Chaldea or Shinar. Today, it is known as Iraq.
The Sumerian culture seemed to appear from nowhere more than six
thousand years ago, and, before it strangely vanished...

pg.374

...Despite our superficial knowledge of the Sumerians, we have already
been able to credit them with many world "firsts." Professor Samuel
Noah Kramer, author of History Begins at Sumer and The Sumerians,
noted that these people developed the first writing system (cuneiform), the
wheel, schools, medical science, the first written proverbs, history, the first
bicameral congress, taxation, laws, social reforms, the first cosmogony
and cosmology, and the first coined money (a weighed silver shekel)...

Shelby wrote:

SilverEye wrote:...describes a society that elected to make leaves legal tender...they are forced to burn down all the trees, in order to curb inflation.

...Scientology's Hubbard's mistake is to state that money can be anything (is only "symbols" idolized or agreed upon by society). It is a fundamnental (fundamental+damned) misunderstanding of what money is...

...It is also a fallacy to say that GDP can not grow faster than the supply of tangible (e.g. gold) money increase, because value of money can increase as fast as necessary. This is called deflation, and is great for savers and for maximizing production over the long term, because it takes real capital to produce real (not nominally inflated debt) growth in GDP.

Remember credit (intangible promises) != capital (real goods or stored labor):

https://goldwetrust.forumotion.com/economics-f4/inflation-or-deflation-t9.htm#304

!= means "does not equal"


Every so often, fiat (credit) money systems return to their intrinsic value of 0, then gold&silver go to the moon. Then society resets and starts anew to gradually debase (Gresham's Law), the money until they get back to another peak in fiat. The cycle repeats over and over through history...

When I try to explain the importance of precious metals as money, many people say that they are not concerned with materialism, thus even if they lose everything, they can come out on top spiritually. And many people see money as just symbols and necessary abstraction that even if were in some other form would not affect their daily outcome significantly-- meaning people are focused on the short-term and see money as too abstract to impact their short-term. People tend to myopically see only their own small world, with themselves at center, i.e. their own personal struggle to prosper on a daily basis spiritually (with material issues wrapped up in their emotions about their spirituality, e.g. "purpose in life"). Our "sin" (a mistake where one reaps what they sow) is in thinking the world revolves around each of us, using spiritual salvation as an excuse for myopia, and this makes us easy cattle for the controllers.

It is not "me" that may be the problem. It is that as long as society uses non-tangible credit for money (i.e. limitless promises instead of real things of intrinsic production and value), then society can be coaxed into consuming more than it produces. See links above for detailed explanation.

Common sense will tell you how (consuming more than you produce) works out-- parasitizing on yourself is an economic cancer, ending in economic slavery when the Ponzi scheme is pin-pricked. And when they majority suffer, they impose their will on the rest of us/you. That is called Socialism, which always degenerates into totalitarianism/statism/fascism. We are watching this social-fascist implosion unfold in the western world right now. Ironically, and as a fitting reap for what was sowed, it is such selfishness (myopic focus on self as center of world) that causes a forced (totalitarian-fascism) sharing (social-statism).

As I explained in the study of secret societies:

https://goldwetrust.forumotion.com/economics-f4/who-really-controls-the-govt-conspiracy-theories-thread-t48.htm#412

It is not so important that we know the identity of who is controlling us, but rather the mechanism by which we are being controlled.

https://goldwetrust.forumotion.com/economics-f4/market-comments-news-t7-15.htm#432

jack wrote:I propose something that I have always forgot to mention. I have often thought the gold market has been utilized as a balance sheet exchange device for entities. Whether, it be currency or other. This idea might be trackable through daily currency values, bonds, trrasuries. It would take a little time to match any correlation especially during times of world duress. But, it might be there. I don't know if anyone has brought this to attention.

Hasn't it always been the dollar as the unit of account, and isn't that the problem? I think precisely what we need is for world use gold as their balancing unit of account. However, maybe your point is that to the extent gold is used already as a unit of account, the controllers are able to funnel this usage into the spot price, which is just an intangible (paper/electronic) "casino volatility house" modulating on an "inversely correlated proxy for the dollar" (inversely correlated just enough to release pressure without killing the dollar). Meaning the spot price is not correlated to physical gold. The "casino volatility house" is as I have described else in this forum about how hedging ends up in the hands of the house owners because they set the odds. The "inversely correlated proxy for the dollar" has afaik been proved, just go correlate the spot price for gold to the dollar over the years. Please appreciate the controllers have astute mathematicians working for them. The controllers are apparently much more mathematically sophisticated than some people may appreciate. Just because the dollar will die eventually, does NOT mean the dollar controllers are not mathematically astute, as they have planned for this eventuall outcome and they have modeled mathematically how they will handle the transistion to the next world financial order. What can go wrong for the controllers is what is impossible to model, ie. the "Butterfly Effect" (aka chaos), which is what I am working on.

So I think the point is that clearing must be done in 100% physical reserve backing, in order for the dollar to die, and for the world's current economic problem to be solved.

I had written about this in this forum (forget which thread):

http://www.financialsense.com/fsu/editorials/dollardaze/2009/0107.html

The Fate of Paper Money
By Mike Hewitt

The following table below groups the fates of these currencies.

Currency was... No. Of Currencies Description
Ended through monetary unions, dissolution or other reforms 184 Voluntary
monetary unions such as the Euro in 1999, or creation of the US dollar in
1792.
Ended through acts of independence 94 Acts of former colonial entities
renaming or reforming their currency
Destroyed by hyperinflation 156 Currency destroyed through over-issuance by
the government.
Destroyed by acts of war 165 Currency deemed no longer valid through military
occupation or liberation.

Very interesting. You see yuo really must keep your net worth out of paper and out of a single jurisdiction. WE NEED TO ACT NOW!

The beauty of your metal, having it all in one place, etc.. These are not going to save you against the fate of paper money.

Excellent overview of currencies. It would be interesting to go even further in depth and reseach longevity and inflation for currencies backed up by precious metals compared to papercurrencies.

Read what I wrote prior about the fish story and usury:

https://goldwetrust.forumotion.com/economics-f4/inflation-or-deflation-t9.htm#279

Perhaps Hommel is getting stressed about his auctions going "no bid" (his premiums are too high), as he is lashing out at people again:

http://silverstockreport.com/2009/turn-around-time.html

Hommel wrote:...By the way, philosophically speaking, this also explains why Fekete's "Real Bills Doctrine" is hogwash. There is no need for real bills to finance any business. Business can, and should, be financed by capitalists, not debtors, and certainly not the customers...

Hommel is conflating fractional reserve banking (usury), with non-usurious debt and investment in general.

Fekete never postulated that customers finance the business, rather that capitalists make short-term bridge loans to pay employees while waiting for payment from customers. I have proven mathematically in my forum, that this is not usury as long as the interest rate is below the growth rate of production. The capitalist could alternatively invest in the business to provide the revolving capital for the brigde loan, and they are essentially the same from a usury perspective. From the fish story (written by that famous tax protester Irwin Schiff), we see that whether the capitalist earns x% on the loan or earns x% on his capital, these are equivalent as long as x is not so large that the production growth rate can't keep up. On a gold and silver standard, that problem can never occur. The problem has nothing to do with debt in general, instead when money is created out of thin air (fractional reserve banking or fiat), then wealth can be misapproriated causing runaway concentration of growth which then implodes. In short, wealth can not be created out of thin air. This has nothing to do with debt in general. Debt is just another form of investment. The problem is the creation of money out of thin air, not with debt itself.

http://www.bibleprophesy.org/goldsilver.htm

Hommel wrote:3. Charging interest when lending money was forbidden, unless to a foreigner. (Lev 25:36-37, Deut 23:19-20, Psalms 15:5, Prov 28:8, Ezek 18:12-13, Neh 5)

Apparently it is charging of usury (not interest in general) which was forbidden:

Lev 25:36 thou takest no usury from him, or increase; and thou hast been afraid of thy God; and thy brother hath lived with thee; 37thy money thou givest not to him in usury, and for increase thou givest not thy food;

Deut 23:19`Thou dost not lend in usury to thy brother; usury of money, usury of food, usury of anything which is lent on usury. 20To a stranger thou mayest lend in usury, and to thy brother thou dost not lend in usury, so that Jehovah thy God doth bless thee in every putting forth of thy hand on the land whither thou goest in to possess it.

Psalms 15:5 who lends his money without usury and does not accept a bribe against the innocent. He who does these things will never be shaken.

Prov 28:8 He who increases his wealth by exorbitant interest amasses it for another, who will be kind to the poor.

Ezek 18:13 He lends at usury and takes excessive interest. Will such a man live? He will not! Because he has done all these detestable things, he will surely be put to death and his blood will be on his own head.

Someone might want to email this to Hommel and let us know if he replies to you or ignores it.

Shelby wrote:Read what I wrote prior about the fish story and usury:

https://goldwetrust.forumotion.com/economics-f4/inflation-or-deflation-t9.htm#279

...[see prior post]...

...Someone might want to email this to Hommel and let us know if he replies to you or ignores it.

http://silverstockreport.com/2009/information.html

Hommel wrote:...Usury is not "excessive" interest. Usury is not "excessive" profits. Usury is any interest on a loan. Any interest on a loan is excessive because of the mathmatical insanity of compounding interest, or exponential growth of even 1% per year.

If you invested an ounce of gold at 1/3 of 1%, 6000 years ago, you'd own all 5 billion ounces of gold in the world, and if you invested it at just over 2%, you'd own about all the atoms in the entire universe, it would all be gold, and it would all belong to you.

That's why usury systems are mathmatically unsustainable...

Jason Hommel is wrong, because if the annual rate of production of gold is 1% of the existing above ground supply, then 1% interest for loaning gold is mathematically sustainable. Jason is saying that 1.01 (x^y key) 1000, means that 1 tonne of loaned gold would grow to 20959 tonnes of gold debt in 1000 years. But he isn't factoring in the growth rate of gold produced. If the annual production rate is 1%, then a 1% interest rate means that the growth in gold debt will be matched by a growth in gold produced. That is sustainable. The only way for the interest rate to be higher than the production of gold, is when fractional reserve money instead of gold is not being loaned. If gold (100% reserve) is money, then it naturally constrains the interest rate.

I explained what is usury, and what is not sustainable, in great detail in another set of posts a few months ago:

https://goldwetrust.forumotion.com/economics-f4/inflation-or-deflation-t9.htm#304

In the fish story (see link at top of this post), it was explained how debt and capital investment are synonomous. The problem is not with debt itself, but with the type of money that is being loaned. When the money is fractional reserve, then the interest rates become meaningless and manipulated, because there is no constraint on the supply of money.

Perhaps someone can help Jason out and email him this. Btw, the rest of Jason's article was good and correct. It is correct that fractional reserve banking allows the manipulation of interest rates (prices) and thus distorts the priorities of people (mis-allocation of capital). Jason just has the wrong demon. The demon is fractional reserve money, not debt itself. 100% reserve backing gold debt is not a demon. Jason is also correct that gold&silver is information and I had created some custom charts to prove that gold was telling the truth (back in 1990) before any other metric did:

https://goldwetrust.forumotion.com/precious-metals-f6/gold-as-an-investment-t60.htm#870

This is so important, I think I will write about it on FinancialSense.com

I have two comments.

The first one is so obvious (I quickly thought of it when I read Jason's email) that it defies interest. Who gives a rat's tail what an investment in gold 6000 years ago would give you today??? No one lives 6000 years, LOL!!!

Okay kidding aside...

On the usury concept. I had never even heard usury widely discussed until I came to the Hommel forum 2-3 years ago. I did a little reading in the Bible about it but was not really interested in the topic. I resolved that what a person agrees to in an interest rate from a banker is what they need to live by but I began to realize that it IS in fact a form of slavery, over time.

I read you link/post above on usury. I agree somewhat but while reading it I though of the various scriptures and came up with what I think is the Biblical formula, just not expressed in a formula in the Bible. It's just common sense, really.

Here is my thinking. If we forgive debt every 7 years strictly following that rule then, then ultimately if there is anything to forgive at the end of the 6th year then we have made a usurious loan. In simple, to follow God is to make a loan that can be paid off in 6 years leaving the borrower with no debt. If we judge the loan risks, just like a bank should do today, and see it is a risky loan then there is nothing to say we have to make the loan. The banker deserves to make an interest rate off his money because it is his business just like Jacob's where God blessed his cow/sheep business with a high % of births of livestock so his herd's increased. And when Jesus told the servant with one talent he should have given it to the lender's and returned the interest gained to Him then he was not accusing the lenders of doing anything wrong.

So, simple logic follows that Jason is totally wrong about any interest on a loan being usury. What is usurious is when the interest rate charged is known by the lender to cause the borrower not to be able to pay the loan off at the end of the 6th year.

Simple.

Yellowcaked wrote:...Who gives a rat's tail what an investment in gold 6000 years ago would give you today??? No one lives 6000 years, LOL!!!

Okay kidding aside...

...What is usurious is when the interest rate charged is known by the lender to cause the borrower not to be able to pay the loan off at the end of the 6th year.

Simple.

I think you are missing the mathematical point. Just because one person can pay off their loan in 6 years, doesn't mean the interest rate is not usurious, because it doesn't stop other people in society from taking on new loans that run another 6 years, and so on...

So the point is that if the aggregate interest rate being shouldered by society continuously, is higher than the creation rate of money, then eventually society runs out of money to pay the debts and the economy implodes.

With a *PHYSICAL* (no paper certificates) gold money system, the interest rates can never get too high, because society would run out of gold to loan. The mining (creation) rate of gold constrains the interest rate. This is why people hate a gold standard, because it eliminates easy (high interest) loans, i.e. eliminates laziness, greed, etc... and instead prioritizes against mal-investment (good investments then get low interest rates because they don't have to compete for capital with all the mal-investment debt).

On the other hand, with a fractional reserve system where money can be created at will, then there is no limit to the interest rate that can be charged, because more money can be printed to keep feeding the growth (interest) rate of the total society debt. Normally this would not dilutes savers because they can in theory earn the same interest rate as the growth in the money supply (that feeds that interest rate), but it doesn't work out that way because of all corruption of official statistics and all the middle men (WallStreet) that rob all the value, thus in effect causes people to spend when they wouldn't have wanted to (because their savings is always losing value), thus causing mal-investment. The only protection savers have is gold and silver, but the powers-that-be, have been able to even control the exchange rate between precious metals and fiat, thus controlling the value of gold and silver...at least for the short-term by manipulating...but this "house of cards" manipulation is crashing down now and gold and silver will re-assert themselves.

So usury is precisely the loaning of God's money (at interest rates) in excess of the creation (mining) rate of God's money. Measuring the usury interest rate of fiat is much more complicated, because all the statisics are manipulated, that we need to use to determine the exchange rate to gold, and thus to apply the rule above. So I suppose it is nearly accurate to say that loaning any fiat is usurious, because the intent/design of the fiat system is to rob from society.

God's money is Gold & Silver, as it states in the Bible, because they can't be created out-of-thin-air and thus are "honest weights and measures" because the "dishonest weights and measures are an abomination to the Lord".

Bottom line is that the root aspect of usury is fiat fractional reserve banking. A physical gold and silver money system can not be usurious. But enough lazy people hate non-usurious systems, because they love to get something before working for it.

Of course I agree with everything you say about fiat and the fractional reserve system.

But, during the Biblical times, I don't think they thought about usury in terms of:

"usury is precisely the loaning of God's money (at interest rates) in excess of the creation (mining) rate of God's money"

Back then, the guy with one talent could have gone and bought 10 sheep, bred them, gotten 5 more and returned to the Lord with 15 sheep... Could he have sold them on the market for the original talent and some shekels to return to the Lord, in precious metals the way the Bible suggests? Dunno.

But if a banker loaned a guy a talent and expected too many shekels (increase) in return (because he already knew the probability of the agreed to terms were that the guy would not be able to pay the banker back) then that would certainly be usury.

Usury, by definition:

http://www.merriam-webster.com/dictionary/usury

" an unconscionable or exorbitant rate or amount of interest"

Check out the following link as well from a book called the "History Of Usury", read pages 13-15:

http://books.google.com/books?id=hUcuAAAAYAAJ&pg=PA13&lpg=PA13&dq=history+of+the+word+usury+etymology&source=bl&ots=7gsxMP8-kC&sig=7Azc4AYJV0Ls5Q04TiXJQ6zGno0&hl=en&ei=hnSgSae8KoT8NJXj5MkL&sa=X&oi=book_result&resnum=1&ct=result#PPA13,M1

And check out Deuteronomy 23:19-20

19 Do not charge your brother interest, whether on money or food or anything else that may earn interest. 20 You may charge a foreigner interest, but not a brother Israelite, so that the LORD your God may bless you in everything you put your hand to in the land you are entering to possess.

Yellowcaked wrote:Of course I agree with everything you say about fiat and the fractional reserve system.

But, during the Biblical times, I don't think they thought about usury in terms of:

"usury is precisely the loaning of God's money (at interest rates) in excess of the creation (mining) rate of God's money"

Back then, the guy with one talent could have gone and bought 10 sheep, bred them, gotten 5 more and returned to the Lord with 15 sheep... Could he have sold them on the market for the original talent and some shekels to return to the Lord, in precious metals the way the Bible suggests? Dunno...

But if the supply of sheep increases, then their price decreases in gold. More production is a good thing, it means deflation and prosperity. Remember gold is the money, not the sheep, because the supply of gold grows at a slow rate. Thus usury is precisely as I have defined it above. My definition gives you a solid (not rubber) measuring stick.

Rather if one measured using sheep, paper money, etc... then it becomes an ambiguous mess, just as what we have now.

Yellowcaked wrote:But if a banker loaned a guy a talent and expected too many shekels (increase) in return (because he already knew the probability of the agreed to terms were that the guy would not be able to pay the banker back) then that would certainly be usury...

If the aggregate rate of interest in society is higher than the aggregate increase in production rate of the thing being loaned, then eventually there won't be enough of the loaned thing to pay back the loans, and thus failure is guaranteed. Period.

If we were on a gold standard, then bankers would know that loaning at any interest rate higher than the increase in annual production of gold, would be usurious and destined for failure. How can a banker earn a return if they are merely keeping up with the dilution due to increasing supply of gold? Because their loans should return increase production, which means more sheep and thus deflation and prosperity! Everything they teach in school is backwards!

You see why that is impossible with gold, but with paper digits, they can expand the supply as necessary to feed the growth in debt at usurious interest rates, then they can slam down the brakes on the paper/electronic "money" supply, thus causing massive failure as they are doing now.

Bankers hate a gold standard, because they get reduced to nothing more than bean counters, with very low margins.

Frankly, what do you think of this?

If you can't read this well, just load the http://VaultOz.com site, and click the text you see in blue in following image:

I agree with what Hommel (quoting Warren Buffet) used to write about being an investor and being balanced:

http://silverstockreport.com/email/buffett_times.html

Hommel quoting Warren Buffet wrote:...Buffett emphasized the 'non-productive"(?) aspect of gold in 1998 at Harvard: "It gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head."...

http://silverstockreport.com/2008/stumblingblock.html

Hommel wrote:...His master was sowing with him, giving him money to be wisely invested. A "talant" was 66-90 pounds of precious metal. It was a large amount of money. The master, representing Jesus, acted as a capitalist, who was investing his money in the man's ability to invest money. (Like an investor who buys a silver stock fund, that in turn, invests in stocks.) But the evil servant did not respect his master's capitalist ways; and he made a false accusation, he said the master reaped where he did not sow. But the master was sowing into the man, rather than into the ground! So, in a sense, the evil servant valued himself as less than dust, because his false accusation implied that it would be better to sow into the ground than into himself!...

And I agree that many paper silver accounts are frauds, but seems Hommel has thrown the baby out with the bath water now below, and turned his back on the biblical advice in the Parable of the Talents above:

http://silverstockreport.com/2009/Phoenix-workshop.html

Hommel wrote:...no bullion accounts, no storage programs, none of that nonsense!...

...Go to the bank, get your cash, and get your silver. And get a safe, and bolt it to your garage floor, or put it in your closet...

Here is my rebuttal (feel free to email to Hommel):

No wonder we are all confused, even Greenspan admitted we can't measure credit in a fiat system:

http://www.paulvaneeden.com/What.is.money

Mish Shedlock has an model, but I don't know if he can measure "Mv(credit)", so his model may be just as useless:

http://globaleconomicanalysis.blogspot.com/2009/02/fiat-world-mathematical-model.html

Btw, I had similar conceptual model as Mish and mentioned it in my seminal article in 2006 (and several times in the Hommel forum):

https://goldwetrust.forumotion.com/economics-f4/inflation-or-deflation-t9-75.htm#1106

Suggest you read the prior post on previous page this thread, and the whole page of posts pointed to by the links in that prior post.

Major news is that APMEX.com (one of the largest dealers in USA) will no longer be selling nuismatics! Americans are waking up to the true value of money!

I received this in email:

Subject: APMEX Site-wide Numismatic Closeout Event!
From: "APMEX News" <news@apmex.com>
Date: Fri, October 30, 2009 1:32 am

Dear Shelby,

APMEX will no longer be selling certain types of coins, currency, collectibles and
supplies! This decision has been made to accommodate the growing requests from our
customers for more precious metal and bullion related items. If you are a
collector, you can take advantage of this unprecedented CLOSEOUT EVENT as we
eliminate forever many of our coins, currency, collectibles and numismatic supplies.

Going forward, we will still be buying and selling all Gold, Silver, Platinum &
Palladium Bullion as well as semi-bullion items like Silver Dollars, Pre-1933 Gold,
40% and 90% Silver, and a few other selected items that our customers want. EVERY
other numismatic item will be reduced for immediate liquidation. These items will be
clearly marked throughout the APMEX website with this special icon:

Take advantage of these deep discounts and add to your collection now! We have
millions of dollars worth of numismatic and related items on sale! These
one-of-a-kind items will not be replaced. When they're gone, they are GONE!

...

Hi Shelby,

I have referenced the FOFOA blog in a few posts. I came across this blog around a year ago. I wont attempt a complete summary of the ideas presented there but I would like to try to summarise FOFOA's thesis about gold. It goes to the core of a discussion of "What is money?" Again this is part of my "what comes next" musing.

Sorry for the long post but I feel that it is important to explain why I think FOFOA might be onto something. So, before going into FOFOA's thesis I feel compelled to at least touch on the "geneology" of this blog because:
1. It goes back to 1997; and

2. I have read most of the archived material and the majority of the hints about the motives and plans of the "players" correlate* with the behaviour of gold and many gold market participants since then; and

3. The actions of players (such as the Chinese) that have been gradually revealed since 1997 align with the claims made in the archives; and

4. The people who comment on FOFOA's blog seem to be lucid, well-informed and insightful about many issues that we talk about here (eg. the principle is, if you want good Italian food in a strange town seek out a restaurant where the local Italians eat).

* I realise correlation is not causation.

Geneology:
In the late 1990s someone began posting on the Kitco gold forum under the name Another. The story he outlined concerning gold, oil, the Saudis, euro, Chinese etc was then taken up by someone posting as Friend Of Another (FOA). Both of these people appeared to have high level, insider knowledge of the matters that they spoke on. The blogger, Friend Of FOA (FOFOA), claims not to know either of the earlier Kitco forum contributors personally. He took up the task of spreading the word about what they wrote when they fell silent and to present the emerging evidence to support their claims and predictions and lastly to develop the thesis built on the foundation laid by Another and FOA.

A Few Samples Of The Claims In The Archives (NB going back to 1997):
-Gold would start to rise in earnest after the launch and acceptance in the market of the Euro (and not before).

-The end of the USD's role as a reserve currency was imminent and a foregone conclusion by the major players.

-The 1973 deal with the Saudis to only price oil in USD was, in fact and indirectly, a cheap oil for artifically cheap gold deal. The Chinese "gate crashed" this party in the late 1990s.

-The Euro and gold were developed and/or adopted as the "hammer and anvil" to break the USD hegemony.

The Thinking, Moves and Motives of the Players (FOFOA calls them the "Giants"):
Again, this is just a brief sample, by no means the full content of the archives and FOFOA's analysis and posts. I speculate that these Giants may influence and/or control Governments but they view politicians as pet cobras.

In short, the USA could not be trusted (presumably they meant the administration). The Giants decided that there was no point in attempting to re-instate any type of gold backed currency or circulating gold currency. In relation to the former FDR demonstrated that a Government would shaft the citizens without hesitation and Nixon showed them that the USA would happily shaft other countries, friend and foe alike. Public acceptance of the legal tender laws that came into being from 1909 onwards proved that the public would not stand up to a Government short-circuiting gold's monetary discipline then and it was even less likely now (due to indoctrination in fiat currency as money?).

The Giants started planning for what we are seeing today 30+ years ago and they have been quietly getting into position in gold and setting up the tools to force the desired change to the system for over 15 years. The positions in gold were acquired through subtle means such as Robert Rubin's 0% gold lease rates (under Clinton) to grow the gold carry trade, hedging contracts with mining companies and gold loans (payable in gold) to developers of new mines. (FOFOA seems to think that paper gold via the Comex and ETFs were just part of the price manipulation scheme and a means of diverting most people's attention away from the real action.)

The USD could not endure as the world's reserve currency. No other fiat currency would or should take its place, including the Euro! Bi-metallism is not on the agenda ie. no central role for silver only gold.

(BUT there is a continuing debate on the FOFOA blog about how silver will be impacted. BUT, BUT Another's disdainful view of a renewed role for silver in the next monetary system is disturbingly well supported by Professor Fekete's thoughts on bi-metallism).

The Thesis (FOFOA calls it "Freegold"):
To me, the essence of the thesis is that in the next stage of the evolution of money fiat currency will retain its' role as a medium of exchange/unit of account for transactions but it will lose any pretense that it is a store of value. Gold will occupy the pre-eminent position in the heirarchy of store of value. Gold is being completely DE-monetized not RE-monetized in order to return purely as a store of value not a circulating currency as it did in the past. Gold will be allowed to trade freely in the new system to provide a constant, "real-time" pricing/valuation mechanism for ALL fiat currencies used in trade.

The Giants will not only allow this free trade in gold they will encourage it as it is their opportunity to cash out some of their positions. This event will devastate everyone who holds their "wealth" in fiat currency, most forms of paper, including "paper" gold, and will represent the greatest one-time wealth transfer in history. The upward adjustment in the purchasing power of gold will be astonishing and, most importantly, it will be a one-off permanent revaluation of the value of gold. In other words once this event occurs there will be no second chance to take a position in physical gold at its' current exchange value in fiat currency terms.

FOFOA claims that most of the gold miners will not participate in the windfall. Frankly I don't yet fully understand the reasoning on this aspect of the thesis.

Shelby,

One of the things that intrigues me about this thesis is that it gives most of the villains some inducement to accept the new system. For example politicians and Governments can still gradually screw their citizens over with inflation in fiat currencies but with some external constraints this time. The fractional reserve bankers remain in business (with a diminished role in some areas) provided legal tender laws continue to force local trade and contracts to be settled in local currency. The currency traders are still there dishing out the rewards and punishments on currencies through arbitrage against gold in local markets. Bond trading may start again after the "great die off" as the healthier economies and surviving companies issue debt again.

Even though past savers in developed countries are screwed many of the savers in developing countries are winners. All future savers get encouragement to provide capital and they get a safer place to store their future savings. The blame for the disaster can be sheeted home to past decisions by former Governments and shifted around to suit whatever propaganda line the PTB factions want to run. The world overall, strange as it may sound, might be, in many ways, better off and the PTB factions who pull this off get a payday of epic proportions.

I hope I have done justice to FOFOA's work on this. As always though "the best laid plans of mice and men go oft awry".

Cheers!

angophera wrote:...
-The end of the USD's role as a reserve currency was imminent and a foregone conclusion by the major players.

-The 1973 deal with the Saudis to only price oil in USD was, in fact and indirectly, a cheap oil for artifically cheap gold deal. The Chinese "gate crashed" this party in the late 1990s.

[...8<...]

The Thinking, Moves and Motives of the Players (FOFOA calls them the "Giants"):

[...8<...]

In short, the USA could not be trusted (presumably they meant the administration). The Giants decided that there was no point in attempting to re-instate any type of gold backed currency or circulating gold currency. In relation to the former FDR demonstrated that a Government would shaft the citizens without hesitation and Nixon showed them that the USA would happily shaft other countries, friend and foe alike. Public acceptance of the legal tender laws that came into being from 1909 onwards proved that the public would not stand up to a Government short-circuiting gold's monetary discipline then and it was even less likely now (due to indoctrination in fiat currency as money?).

The Giants started planning for what we are seeing today 30+ years ago and they have been quietly getting into position in gold and setting up the tools to force the desired change to the system for over 15 years. The positions in gold were acquired through subtle means such as Robert Rubin's 0% gold lease rates (under Clinton) to grow the gold carry trade, hedging contracts with mining companies and gold loans (payable in gold) to developers of new mines. (FOFOA seems to think that paper gold via the Comex and ETFs were just part of the price manipulation scheme and a means of diverting most people's attention away from the real action.)

The USD could not endure as the world's reserve currency. No other fiat currency would or should take its place, including the Euro! Bi-metallism is not on the agenda ie. no central role for silver only gold.

(BUT there is a continuing debate on the FOFOA blog about how silver will be impacted. BUT, BUT Another's disdainful view of a renewed role for silver in the next monetary system is disturbingly well supported by Professor Fekete's thoughts on bi-metallism).

The Thesis (FOFOA calls it "Freegold"):
To me, the essence of the thesis is that in the next stage of the evolution of money fiat currency will retain its' role as a medium of exchange/unit of account for transactions but it will lose any pretense that it is a store of value. Gold will occupy the pre-eminent position in the heirarchy of store of value. Gold is being completely DE-monetized not RE-monetized in order to return purely as a store of value not a circulating currency as it did in the past. Gold will be allowed to trade freely in the new system to provide a constant, "real-time" pricing/valuation mechanism for ALL fiat currencies used in trade.

The Giants will not only allow this free trade in gold they will encourage it as it is their opportunity to cash out some of their positions. This event will devastate everyone who holds their "wealth" in fiat currency,

[...8<...]

Exactly! That is what I was writing about in another long thread in 2008 for example here, and here, and here, and here (read whole page), and here (realize my proposed P2P system was really a store of value exchange system between high net worth entities, not a currency system for individual transactions).

You have articulated it so lucidly. Thank you so much. This may be the most important post ever on this forum.

The key point is that the coming system will freedom for those who want to trade metal in high value granularity, but it will be a jail for those who want to use metals for individual retail transactions, because this period is about the Giants killing the nations. The nations will fight back by taxing the hell out of metals at the retail and border. The nations (politicians and their mass majority welfare flock) will cannibalize their nations in order to try to fight the free market, and by doing so, they hand the power to the Giants and their one-world control system. This is exactly what is predicted in Revelations also.

The one-world control system is driven by the fact that only the large fish can escape the wrath of the nations against the free market.

The Giants are may not be doing this because they want to, they are doing it because they feel they have to, as human nature of the masses (and thus politics and nations) is such that it is the only way they can be on top and instead on bottom of the wrath of the nations. The true evil is being done by the people themselves who desire socialism and usury, etc..

https://goldwetrust.forumotion.com/technology-f8/theory-of-everthing-t124.htm#2182

Shelby in his Theory of Everything wrote:...Ironically the plutocracy will lose capital because the entire pie shrinks in the end game, but the plutocracy has no choice, because if they didn't satisfy society's capacity for zero knowledge due to the Bell Curve, then some other plutocracy would. Each individual has the choice to come out of this economic cancer...

Essentially the people have rejected God, and replaced it with usury, welfare, all forms of insurance, faith in non-absoluteness of science, etc..

So now you have your answer as to why silver won't be useful to the Giants. There is no way they can pack their net worth into silver, and it can't possibly be re-monetized any more, and thus there is no way for them to capitalize on silver. And those of us hoping to capitalize on silver, have to realize the nations will be going after us (90% income tax in last Great Depression) and silver is bulky. Gold and silver will be attacked by the nations at the income tax avoidance, retail tax reporting, etc level. Everyone will have to pay their taxes in this new socialism (except for the very wealthy, who will have the privilege of using Gold as store of value). However, it is possible that silver market is so small that it will simply be ignored by the nations, and thus maybe it might end up being a loophole for getting past Gold capital controls. In other words, just because Gold doesn't serve the Kings well, it might still end up being the thorn in their side, if silver rises to $100, then you can walk comfortable with about $50,000 in your suitcase or backpack. But you won't be getting past the TSA and new more vicious H1N1 epidemic screeners at the airport! Another problem with silver for the Giants is that there is still like 5Boz of it distributed as jewelry+silverware. So they really can't mop it up effectively. If they starting buying and pushed the price to $1000, then that would still only be $5 trillion which is nothing compared to their $400 trillion estimated net worth (I do not know their liquid net worth). And then they would end up giving a windfall to the common man who has silverware.

As Hommel wrote, the Giants will then dump the Gold at astronomical prices when fiat currency interest rates peak, then they will get it back by loaning the fiat currencies (which will float relative to Gold) at usury. Then the next long wave cycle (low interest rates) will be the end of world (Tribulations), probably about another 30 - 80 years from now.

Who are the Giants? Rothschild, Rockfeller, and the people who are in their coat tails and not being manipulated by R&R. They owned roughly 20% of the world resources in early 1900s, and they are going for maybe 50 - 80% on the gold revaluation.

You are going to probably see mayhem in USA with all the guns, wackos, crack addicts, and right-wing and paramilitaries, etc...

angophera wrote:...FOFOA claims that most of the gold miners will not participate in the windfall. Frankly I don't yet fully understand the reasoning on this aspect of the thesis...

Of course, because the nations will raid them with taxes and carbon regulations, etc..

This period will be about the masses stealing everything from each other. It is called SOCIALISM!!

The one caveat is that the developing countries are still somewhat undeveloped and cash transaction based. Here I can see silver nuggets (forget the coins!) and I can see some opportunities for capitalism. The next long wave cycle will be about spreading usury in developing world to bring it to parity slavery of western socialism. The developing world is ripe with a lot of socialism already. It is only the raw undeveloped people that still give it a little flavor of lack of full govt control. The high priorities of the developing nations has been to modernize (e.g. electricity on every mountain top, to indoctrinate the natives in the non-cash tax system), so they will be on par.

angophera wrote:Shelby,

One of the things that intrigues me about this thesis is that it gives most of the villains some inducement to accept the new system. For example politicians and Governments can still gradually screw their citizens over with inflation in fiat currencies but with some external constraints this time...

The fallacy is that you assume some nations will screw their citizens less worse than others, thus the free float against gold will hammer their currencies.

But what if all the nations compete to devalue their currencies and screw themselves with inflation? That is exactly what is happening now!

For years I have been saying there will be no nation as a safe haven, and I also warned people about Switzerland well before the UBS and IRS fiasco. But no one seems to hear me, because they don't want to deal with the depressing implications.

Look there is only one way to be free-- God. The Giants do not realize that, and that will be their demise at the end also, as Revelations says, the AntiChrist will help the nations defeat the Giants, but then the AntiChrist will give the people 666 instead. You see the people always want to choose a higher earthly power to destroy the evil in existing power, and they never choose God.

If you choose God, you careless what happens and the whole thing becomes noise.

angophera wrote:...The fractional reserve bankers remain in business (with a diminished role in some areas) provided legal tender laws continue to force local trade and contracts to be settled in local currency. The currency traders are still there dishing out the rewards and punishments on currencies through arbitrage against gold in local markets. Bond trading may start again after the "great die off" as the healthier economies and surviving companies issue debt again.

Even though past savers in developed countries are screwed many of the savers in developing countries are winners. All future savers get encouragement to provide capital and they get a safer place to store their future savings. The blame for the disaster can be sheeted home to past decisions by former Governments and shifted around to suit whatever propaganda line the PTB factions want to run. The world overall, strange as it may sound, might be, in many ways, better off and the PTB factions who pull this off get a payday of epic proportions.

Please understand there is not one PTB. It is highly complex. Many of those influencing the nations are ignorant of the overall plan and are being fooled by the Giant-most who are actually accumulating gold. The nations are acting as they will-- the Giant-most are simply interplaying in the free market way that is their destiny. They can't help it that people reject God. If they didn't play their role, some other men would. Someone has to play their role, because the people demand it.

The small savers in Asia are also going to be crushed first by inflation, then by deflation and depression. The savers in West will be crushed first by deflation, then by inflation and depression and capital controls. They will have more opportunities than the savers in west in some respects, but less in other respects. The only real winners will be those who hold large enough quantities of gold and have the network to move it and protect it and hide it from the nations' tax men. The Rothschilds want you to think they are out of the gold business, that is why they sold their role in the London exchange in 2007.

angophera wrote:...I hope I have done justice to FOFOA's work on this. As always though "the best laid plans of mice and men go oft awry".

Cheers!

Hommel wrote about this today:

http://silverstockreport.com/2009/free-market-hindered.html

I had come to similar conclusions. Antal and Price want to force free
market on the people via legal tender-- an oxymoron.

Govt can only re-allocate. That is all it can do. Govt can't create, but can destroy. There are no externalities-- Coase's Theorem (Wikipedia).

I have also privately (and mathematically) debunked Fekete's theory that basis could be used as a trading timing tool. Whether the basis will give an advance warning of paper gold default is also uncertain mathematically (as Fekete admitted recently in his writings, the basis can also be manipulated).

http://www.gold-eagle.com/editorials_08/western103009.html
http://www.gold-eagle.com/editorials_08/field112408.html

Alf Field wrote:Major ONE up from $256 to $1,015 (actually 4 times the $255 low);
Major TWO down from $1015 to $699, say $700 (a decline of 31%);
Major THREE up from $700 to $3,500 (a Fibonacci 5 times the $500 low);
Major FOUR down from $3,500 to $2,500 (a 29% decline);
Major FIVE up from $2,500 to $10,000 (also a 4 fold increase, same as ONE)

[...8<.....]

Why quit writing these reports?

...I do not wish to provide interim levels that may cause people to be encouraged to trade their gold to skim a few extra fiat dollars or other currencies, but lose their gold as a result.

So it is Good Bye, Good Luck and God Bless,

How does a $6,000 to $12,000 gold price sound to you? Do you think your nation will let you have the untaxed??

Listen to what I published on March 3, 2007 (before it all happened):

Herein I will explain how and why I think we are in a similar transistion as we faced in 1995-6, but with some very key differences.

http://www.coolpage.com/commentary/economic/shelby/03Mar_0742____1995-6_vs_2007-8.mp3 ("gold investors" means the Giants)

Listen all the way to the end (22 mins) as it really comes together at the end. You will see how well I predicted everything that has happened since March 2007.

Btw, the record of my publishing that on March 3, 2007, is here:

http://jasonhommelforum.com/forums/showthread.php?p=9060#post9060

Something I wrote in email on Sun, May 18, 2008 7:13 pm:

Shelby wrote:
> http://jasonhommelforum.com/forums/showthread.php?p=36813#post36813
>
>

ABill;36793 wrote:...If there is really a higher probability of physical
> default the silver price would already be much higher today...
>
> ...banks...get in trouble because of exposure with silver accounts
> they...buying...physical silver...
>
> ...UBS...silver business is peanuts compared with the total business...
>
> ...private banks...lease silver...used to back up silver accounts...I
> highly doubt that there is such a practice in Switzerland...
>
> ...silver leasing rate...so low, if there is a shortage of silver...

>
> Why are TBonds are paying negative real interest, yet there are always
> more and more people who want them? Because no one thinks there is an
> alternative to paper money-- they choose between equities or bonds. The
> entire world forgot that silver & gold are money.
>
> Silver lease rates are low because no one wants physical silver, and paper
> leases have an infinite supply-- just like TBonds have an infinite supply.
> As long as no one wants physical silver, then the banks can lease,
> sub-lease, sub-sub-lease, sub-sub-sub-sub-lease,
> sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-
> sub-sub-sub-sub-sub-sub-sub-sub-sub-sub-lease, etc.. the same physical
> silver.
>
> When 0.0001% of the world's paper net worth remembers that silver is
> money, then a massive domino default of nearly infinite recursive paper
> silver sub-leases will unwind.
>
> I told you before, that bank's motivation is they will cease to exist when
> people no longer want fractional reserve banking money-- i.e. with silver
> and gold money, UBS's entire business model will disappear.
>
> It is going to be financial nuclear bomb.
>
> Now buy physical silver and stop farting around! Or lose everything, as
> 99.9% of the people in world will soon.

The point of this is that physical money can't win. Symbols and ideas move at speed of light, and thus they will win for the masses. The physical stuff has to move closer to the center where movement speed will not slow down the masses.


Something I wrote in email on Sat, April 26, 2008 3:13 am:



You may be too focused on the dogma of the ruler:

http://jasonhommelforum.com/forums/showthread.php?p=34851#post34851

Dogma walks, action talks when it comes to masses. Look at the bigger
picture. Gambling (someone gets hurt) is in everything we can do in this
physical world, including buying physical silver.

The bigger picture is paradigm shifts in the acceleration of disorder
(maximizing interactions, maximizing mass dispersal, 0 mass, 0 energy is
direction towards God).

You are mired in money. Money is not the big enchilada.





================================
Let me expound on prior post.

Think about what humans do every day. It is basically a matter of
occupying their mind, emotions, and time. They usually do things that
require the use of physical energy. They have to move their body around,
do physical things.

The world bankers can easily control us because we need physical energy to
move around. Whereas humans just want to be free to use their mind,
emotions, and time freely. Humans even go into debt, because they are
trying to exponentially increase the rate at which they interact. This is
all natural and in harmony with the direction towards God. Even Bible
predicts this, saying knowledge and travel will increase.

But now imagine the network. We can go every where in the world from our
chair and easily occupy a whole day, a week or years.

The network reduces the need for centralized energy, but even more so if
the network itself is not centralized.

Physical real money (e.g. gold & silver) are important for measuring
integrity, but they are less important than order-of-magnitude efficiency
paradigm shifts (by definition this means decentralization, more disorder,
more knowledge) which can actually decrease the power of those who seek
centralized power by preying on the physical needs of people. In other
words, instead of trying to tell people to give up their physical sins,
and dogma about using a good ruler, just go direct to enabling them to!

http://jasonhommelforum.com/forums/showthread.php?p=34850#post34850

I think dash was correct about that, but I think it is most efficiently
accomplished by replacing the physical preoccupations, rather than trying
to "make something free, which is not free", as dash proposed we could
make energy and physical production free (or much cheaper). Rather we can
just replace the waste of energy (order) and production (more order) that
we do not need, by enabling faster movement of knowledge on the network.

You see the problem is that Satan has succeeded in getting people to
replace interaction proliferation, with proliferation of accumulation of
material junk.

We need paradigms that enable people to move faster on interactions.

This is why the MySpace is most popular site, and why it is the battle
ground of the cabal now...

...ditto Wikipedia...




=================================
dash,

This is all coming together for me now, I can say your wisdom is that we
must accelerate the rate at which interaction occurs (concurs with my
theory of disorder == knowledge == 0 mass == maximum actors interacting).
And then I remember your concept that we can interact much faster if we
are not burdened by physical needs, i.e. your virtual reality interaction
example. I think you are spot on.

The new energy paradigm is the network. It allows us to move at
lightspeed with very little energy used. Those who can break down the
barriers which are preventing the more full exploitation of the network,
could set off paradigm shifts that affect all 7 billion people on earth in
a rapid timeframe.

Remember energy is the dispersal of mass, i.e. the increase of disorder
and knowledge. So we need a new paradigm for energy, where energy is not
focused on the physical friction, but rather of eliminating the friction
itself!

I think your mistake is to want to address the physical needs of people
(your love of material, such a mass production via physical robots). I
think it is much more efficient to just lop off those physical needs, i.e.
connect our minds directly to the network (as you alluded in your virtual
reality example). Heck the network is already doing that to us (our
bodies atrophy as we sit at computer continuously).

We need to break down the centralized chains on the network. As you have
alluded, the new paradigm is:

***P2P***

The key imo is enabling P2P to work in an open way where is can diversify
semantically without centralized control:

http://www.gold-eagle.com/editorials_08/bloom042508.html



Here is the kicker. If we remove the dependence on centralized energy,
we castrate the cabal.

Continued here...

Hi Shelby,

You wrote here:
"Here is the kicker. If we remove the dependence on centralized energy,
we castrate the cabal."

This post is just a place marker. I plan to do a series of posts under Technology rather than here. I have been researching the "distributed energy" path (and related topics) for many years. Much longer than I have spent on economics and money etc.

The sort of questions I want to pose and write about includes:
Q. Is cheap energy storage the bridging technology from a networked to a distributed energy model? Hint: it may be much closer than we thought.

Q. Is the concept of "solar panels on the roof" distracting us from the real issue of "turning your home into an energy provider"?

If you think this will be worthwhile please let me know.

PS I am working on another post for What Is Money? entitled "Is The Euro A Proof Of Concept?"

PPS LOVE your latest thinking on the P2P concept(s). I am not a tech (but I have been involved in this area in past business ventures) so forgive a potentially dumb question: Q. Where does the mobile phone fit into this (if at all)?

Cheers!

Hi to All,

This post picks up on my earlier post "An Intriguing Thesis" and subsequent posts from other forum dwellers.

I want to rehearse an argument: "the design and rollout of the Euro is the proof of concept (POC)" for a key element of the new monetary sytem that FOFOA believes is coming ie. fiat currency for unit of account and/or medium of exchange and de-monetized gold as the ultimate store of value with no pre-eminent reserve currency.

Self evidently there are three key aspects to this project. In order to make this scheme work you need a store of value that is/will be accepted around the world. You also need a fiat currency that provides the new template for the others. At the same time the selected or designed fiat currency has to have other attributes eg. it cannot accidently become a new global reserve currency. More on this below.

In relation to the store of value role I think anyone who has studied economic history, the hard money vs fiat argument and read the works of monetary scientists such as Professor Fekete would be able to make the case that:

Gold is the logical candidate for the role of top tier in the store of value hierarchy in this next evolution of the monetary system.

You can knock every other candidate out by a process of elimination eg. why not oil instead? - nope - it's consumed, not fully fungible, too bulky, you cannot hide it from people who are prepared to go to war over it, declining marginal utility etc.

Also this project is an investment by the PTB factions involved. If they amass a mountain of gold and fail to achieve the larger objectives THIS time around, so what! They go to Plan B, say, contrive a new/different crisis that necessitates the purchase of most of their gold by Governments around the world (at a fat profit). The gold can then sit there ready to be extracted again if/when they want to attempt to implement Plan A in the future.

Lastly you DO NOT need to convince the MAJORITY of the public of gold's suitability to fill this new role unlike a circulating currency. You only need to convince the key decision makers, the most influential institutions and politicians and a fraction of the populace.

My question is:
Q. Could the PTB commit to this refinement of the fiat currency regime without a POC?

My answer is No, too risky. The PTB's power, control mechanisms and ability to extract wealth is totally dependant on control of money. Next question:

Q. Could any existing currency have been used as an effective POC?
I don't think so. Does anyone have any thoughts on this?

As mentioned previously FOFOA and predecessors appear to be adamant that certain parameters of the new regime are already decided. These include not replacing the USD as a world reserve currency with another fiat reserve currency. This makes sense to me. The 1971 bankruptcy (let's call a spade a spade) default perpetrated by Nixon damaged the interests of other players and the need to issue and recycle USD into debt has proven to be a deadly narcotic for the US economy. The history lesson is that any fiat currency that simply replaced the USD in this role would suffer the same fate eventually.

Obviously there are design parameters for the POC fiat currency dictated by the aims and objectives of this project and the overarching priorities of the PTB sponsors. I think the overarching priorities can be dealt with in short order. Realistically the list should include:

-Fallback positions along the way and an exit strategy if it looks like blowing up.

-Maintained or increased power and control.

-Increased wealth and increased opportunities to increase wealth increasingly (damn the exponential function and full steam ahead).

-Safety and security.

-NO risk of substantial, much less total, loss of "capital" (in its many guises).

Perhaps this project is but one aspect of an even more ambitious worldwide project ie. centralised control of banking (BIS, IMF, World Bank et al?) a reliable mechanism to over-ride national sovereignty (a work in progress? European Union? Copenhagen Treaty?), a global taxation system (Carbon Trading?) and control of international trade rules (WTO?).

Frankly I don't have an answer to the question posed in the previous paragraph but I think we can demonstrate that the Euro as a POC does not preclude any of the above. (BTW I think you can make a solid case that the USD continuing in its present role WOULD prevent a global project like this from succeeding.)

Fashioning An Alternative To The USD As World Reserve Currency
Let me say something contentious. The USD has NOT been a true fiat currency during the past 30+ years. Since 1973 it has been "redeemable" in oil and remains at present "redeemable" for a host of other essential and highly prized "real things". It is the way that the USA has managed and excercised its "exhorbitant privilege" (Charles De Gaulle) that has made the USD unsafe, too weak and ultimately unsupportable in this role.

Under the "fiat for transactions" and "gold as store of value" thesis the USD has to lose its role as reserve currency and the store of value role has to migrate somewhere else. In thinking about how to address this process I offer the analogy of a high pressure vessel. Sudden release of the pressure is dangerous. To puncture the vessel in a VACUUM would be catastrophic.

I suggest that when it was time for the Pound Sterling to surrender its currency hegemony there was no dangerous vacuum around it. The USA and the USD was ready, willing and able to expand into the space that was gradually vacated by the pound. However when this project began the USD hegemony was already under growing pressure but the USD was in a "vacuum".

I would argue that the Euro is designed to point the way forward for other fiat currencies and in co-operation with gold to fill the vacuum surrounding the USD.

Design Parameters of the New Fiat Currency POC
In many instances the reasons for including a particular item on this list go beyond the brief explanation given here. I accept that you could argue about what should or should not be on the list.

1. The POC currency cannot be allowed to become a new dominant world reserve currency.

I would argue that the Euro can never be the dominant reserve or trading currency or even part of a long-term reserve because it is not even an IOU by a sovereign nation and no essential goods are traded solely in Euros globally.

2. At least one fiat currency has to serve as a template for the rest in the new system.

The Euro is used on a large enough scale to be a credible model for this new type of fiat currency. It is purpose built for transactions in the role of a unit of account/medium of exchange without any long term "store of value" characteristics.

3. The POC currency cannot prevent other fiat currencies from circulating after being stripped of their store of value pretense.

This is a requirement to secure the "buy-in' to the new system by key stakeholders such as regional politicians.

4. It has to gain broad acceptance in this newly redefined role.

By the time any significant segment of the public realises the change has been implemented the POC should be a fait accompli.

5. Fractional reserve banking must be able to continue to operate based on this new type of fiat.

In part legal tender laws take care of this issue. Currency swaps and deals of that nature take care of the trade issues. (BUT fractional reserve gold banking must end if it is, in fact, happening now).

6. Control of the fiat currency used in the POC must be outside the control of any one Government. (Preferably under the autonomous control of a Central Bank such as the ECB).

Lest the politicians f@#k up the whole plan (like everything else they touch).

Obviously my argument is that the Euro satisfies all of the POC design parameters. I would further argue that it has built-in features that meet other concerns of the PTB. Let me put forward just one example.

"Fallback positions along the way and an exit strategy if it looks like blowing up."

From time to time there is talk of one or more of the EU countries jumping ship. One of the print articles I read talked about Germans hoarding German issued Euros apparently they can be identified by their serial numbers. I am not attempting to open up a discussion about the viability or stability of the EU. My point is it would appear that Germany can return to a national currency if they choose to. In other words they have a fallback and/or exit strategy!

There are other examples but this has already been a long post.

Cheers!

The capitalists relied on theft and deceit to make it to the top, of which Rockfeller and JP Morgan/Chase were the winners in USA:

http://www.kitco.com/ind/katz/nov022009.html

...The second compromise of hard money occurred during the Civil War. Lincoln was afraid that financing the war with a tax increase would make the war unpopular in the North. So he printed money to pay war expenses. This doubled the U.S. money supply between 1861 and 1865. The railroads were enabled to pay their debts (which had been contracted in gold) in paper money (greenbacks). For example, a $1,000 railroad bond, which had cost its owner 50 oz. of gold in 1860, could be paid off in 1865 for $1,000 in greenbacks, which were worth 25 oz. of gold. They borrowed 50 oz. and paid back 25 oz. It was stealing pure and simple, and the American railroads loved it. They tried to persuade the country to remain off the gold standard after the end of the war...

angophera, I will try to reply to your posts later.

angophera wrote:...I have been researching the "distributed energy" path (and related topics) for many years...

Q. Is cheap energy storage the bridging technology from a networked to a distributed energy model? Hint: it may be much closer than we thought.

All fuels are energy storage, the relevant distinction is ease of transport or interface to intended use of the energy. Anything would be a bridge if it can enable access to fuels at low economy-of-scale capital investment. This is precisely why PTB want to control food, because it is the fuel for humans that cultivates in any backyard. The higher-order fuels do not yet, but imagine you could genetically engineer and train a very large bird to transport you!!! Then you need only feed it, and let it reproduce. Do you see how dangerous technology is to the PTB?

angophera wrote:...Q. Is the concept of "solar panels on the roof" distracting us from the real issue of "turning your home into an energy provider"?

If you think this will be worthwhile please let me know...

I am skeptical but interested, please move it to Energy thread in Technology.

angophera wrote:...P2P concept(s)... Q. Where does the mobile phone fit into this (if at all)?

The WiFiMAX cell phone could change the world, if the govts don't make the bands for license only, because anyone could set up a Tx/Rx node. For as long as the govts control the sprectrum, then cell phone impacts P2P only as a more mobile, less powerful, less bandwidth PC.

Move this discussion to Technology threads:

https://goldwetrust.forumotion.com/technology-f8/energy-t119.htm#2209