I was shuffling through some of the books I keep close by my keyboard for checking facts and for getting timelines right and I was struck by a theme that ran through a fair few of them.
Here's a quick sampling - Title - Author - Date Published
Please note that all these books were published over a period of 15 years and all but two of them in the first decade of the present global fiat (paper) money era - the 1970s. Every one of them predicted a collapse of the global money system unless drastic changes were made to it. Every one of them advocated some variation of a return to Gold as money and paper as a money substitute REDEEMABLE in Gold.
The most uncompromising, Murray Rothbard, ended his third edition of What Has The Government Done To Our Money" (published in 1985) with these words:
"As we face the future, the prognosis for the dollar and for the international monetary system is grim indeed. Until and unless we return to the classical gold standard at a realistic gold price, the international monetary system is fated to shift back and forth betweeen fixed and fluctuating exchange rates, with each system posing unsolved problems, working badly, and finally disintegrating. And fueling this disintegration will be the continued inflation of the supply of dollars and hence of American prices which show no sign of abating. The prospect for the future is accelerating and eventually runaway inflation at home, accompanied by monetary breakdown and economic warfare abroad. This prognosis can only be changed by a drastic alteration of the American and world monetary system: by the return to a free-market commodity money such as gold, and by removing government totally from the monetary scene."
Most financial analysts, especially the ones working on Wall Street, have never heard of any of these authors. Of the ones who have, few have read their books. And even amongst those who have read one or two of these books, most would have the same reaction. They're wrong, the sky didn't fall, the crash never happened. The system works fine.
Yet how many times has the global fiat system teetered on the brink? Here's a quick (and probably incomplete) off the top of the head tally:
The last one in that list is still pending. The bubble has already burst, of course. What has not burst, yet, is the chorus yelling at the top of their lungs that it doesn't matter. That the collapse of the subprime mortgage sector will have no effect on the rest of the mortgage sector. That even if it does, it will have no effect on the wider financial sector of the US economy. And that even if it does, the Fed and the Treasury stand ready to fix any problem.
How? Why by throwing money at it, of course. That is the way to fix ANY economic or financial "problem". That is the way the world has stumbled from financial crisis to financial crisis for the last forty years, each one potentially bigger than the last, each one "fixed" (read postponed) by throwing ever bigger dollops of "money" at the problem.
And what has the result been? Well, in 1975, Irwin Schiff (see the book list above) using actuarial accounting methods, calculated the total (funded AND unfunded) debt of the US federal government to be $US 3.36 TRILLION. In 2007, David A Walker, US Comptroller of the Currency, puts the figure at $US 71 TRILLION. Funded government debt in 1975 was not quite $US 500 Billion. It is now not quite $US 9 TRILLION.
And on top of this gargantuan inflation has been built a paper edifice of futures contracts and derivatives of all descriptions which is for all intents and purposes uncountable, but which is reliably estimated to be well in excess of $US 500 TRILLION. Such figures are ludicrous when applied to "money". When an astronomer uses them in terms of distances he speaks in terms of light years or parsecs or astronomical units.
The inevitable has indeed taken a long time. It has been more than 39 years since the US lost control of the $US 35 = 1 oz of Gold redeemability of its currency and almost 36 years since it scrapped the idea of redeemability altogether. Since then, the global monetary sytem has been kept together by the ever increasing ignorance, gullibility and credulity of most of those working within it and made to function only because of the rapidly increasing capacities of modern computers.
If you have any of the books listed above and they have been gathering dust on your shelves, we suggest you pull them down and read them again. If you don't, a bit of poking around used bookshops should unearth many of them. Some of them are even still in print! Their diagnosis of the situation was right for their times, or our times, or any times at all. The collapse of the fiat currency system has always been inevitable. History provides NO exceptions - ever. Best to be prepared BEFORE the inevitable becomes the actuality.
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