Gold is the ultimate storehouse of wealth, like nothing else on earth.
Gold has a history far greater than any currency period and it is limited in supply, thus real grow in supply is only possible somewhat through a change in the Gold price.
Why you may ask???
Because it is a ‘standard in a society devoured of standards. When there are no mechanisms in place to sound warning then there can be no standards by which to compare or adhere to.
Even in a social sense such as the breakdown of family, honor, integrity, truthfulness, charity & understanding. Because of these very reasons Gold in the ‘subjective’ mind of the individual opposed to the ‘conscious’ mind exists a place of honor.
Now such a place of honor is rarely identified until other supposed codes of conduct or honor are dishonored. That makes gold something special and that special nature of gold has many categories and definitions.
The U.S dollar is merely a promise to pay for something in order to provide for a need or want and backed by nothing …
Which begs the questions …
Was the U.S dollar really backed by Gold???
Or was Gold a controlled factor???
Security through Gold assumes the ability to exchange a currency for a metal for which that had a purpose. However, its purpose was terminated by the huge growth of international trade. This increase in the rate of international trade requires that the price of Gold to balance the this trade necessity, along with some cumbersome activity in the exchange of Gold.
Even if it is the simplicity of pushing these huge piles of dollars around from hands to hands through market to market by the seller (The New York Federal Reserve). That in actual fact “Gold Convertibility” may be an attractive concept but unfortunately has expired with the experience of such growth and continued growth of the world economies and international trade without the equal growth of the other side of the ‘equation’ … “GOLD”.
Most importantly and quite alarmingly that is where the newer, younger and less experienced generations have and continue to do so fail to put the connection together.
So what gave the U.S dollar more substance than it ought for so long???
In reality and now as it exists in purely as a psychological force, was not necessarily Gold as a convertible item but gold as a control item which existed as a control item via a mechanism that was called the “Federal Reserve Gold Certificate Ratio”.
In the same fashion ‘Central Banks’ control the financial system of its domain …
To summarize you had to have held a certain amount of Gold in reserve which was a percentage or reflection of your total money supply and failing to do that there was an automatic adjustment in interest rates which in those days would act as the balancing mechanism by causing a change in economic environment which would reverse the outflow of gold from one side of the equation creating an inflow on the other side thus forcing interest rates to return to the prior level of equilibrium.
Reducing this ratio to 0% meant vanishing it from the books and the equation in order to initiate a new set of ‘uncontrolled” rules. This was a ‘turning point’ in Gold’s modern history orchestrated by President Nixon and from that moment on the U.S dollar lost the greater percentage of its buying power, both nationally & internationally because it gave to the Federal Reserve the absolute freedom and power to create within an economic environment as much money (paper money) as it chose or deemed necessary either by enlighten judgment or political pressure.
This is truly a most profound point in time of ‘Modern Gold History’ …
So it isn’t the exchange of the dollar for Gold that really gave the dollar the substance which worked a gem when trade was small. But it’s Gold’s control factor that has been eliminated so the history of what happened was not the end of convertibility it was the elimination of a mechanism known as the Federal Reserve Gold Certificate Ratio & it was eliminated at first not by just drawing a line through it but by reducing it to 0% because nothing x nothing = nothing and then later merely taken off the books.
That’s the absolute history of what happened …
Today the U.S Dollar earned is a mere “PROMISE” an “IOU” to redeem a debt backed by nothing, no security, that sustains it’s value “Nationally and Internationally” only through the confidence of the majority worldwide, have on how money is being managed by the workforce who earn, the recipients of benefits, the administration & the Federal Reserve.
Which on its own is a chilling thought considering that this majority has been ‘patriotically’ called upon the consumption side of the equation opposed to the savings side.
We all know without apprehension nothing ever gets cheaper, anything a consumer wants, desires or needs will always go one way and that is to the ‘moon’ which ultimately equates to the value of ones paper currency, the dollar, eroding ones savings away.
Historically, Gold always buys the same amount of commodities, goods & services while paper currency never does. Because it is difficult to increase the supply of Gold or even take it completely out of the system.
Whilst the paper system is constantly flooded by governments continually creating more paper. There has never been a time in history where governments have made less paper. The need for a blank check is what the fractional reserve system is.
All governments have a blank check to create as much money as they deem fit for whatever they need. They can produce paper required to make payment, to pursue a war, to fund ambitious and costly projects, to build a pipeline … to do anything.
So can you imagine the imbalances this not only causes on a ‘National’ front but the enormity on an ‘International’ front to facilitate international trade!!!
Thus Gold is limited and the fact of the matter is that there is very little of it available for use today.
So the attraction to ‘Paper’ opposed to “Gold” is a concept at this point of time built on a negative foundation.
The blank check has been the substance and foundation of all the speculative bubbles over so many generations. Where weak foundations exists and stand the building rarely is able to stand for any length of time or weather a storm and that shift is upon us here and now.
Throughout all written history Gold has risen to offset the depreciation of any currency and quite frankly always will for no ‘Empire’ survives forever but Gold always will …
