All too true, is the fact that any currency can be debased, even precious metals such as platinum, gold and silver. Inflation is mainly influenced by the amount of money supply in relation to commodity output, and is generally caused directly by government activity.
No currency has ever been completely impervious to inflation, and a long overlooked, while prudent strategy for avoiding common economic pitfalls is the adoption of multiple currencies backed by select and resilient commodities. This is only one of many possible solutions or suggestions, however, simply allowing the Federal Reserve to print money absent proper pecuniary stability (production), devalues it’s buying power in the hands of the average consumer, while temporarily propping up financial institutions and lending firms which propagates a scarcity of moral hazard in the markets.
The same goes for the Fed’s incessant practice of lowering interest rates in an effort to manipulate, and pretend to stimulate, the economy. This only serves to increase the capital gains of financial institutions, while transferring the lion-share of fiscal servitude to consumers and mortgage holders. Moreover, lowering interest rates can only be accomplished by firing up the printing press, further devaluing the money, and evaporating the buying power as it trickles slowly into the hands of the poor and middle class.
Anything of value can be used as currency so long as the money supply remains moderately low, relative to production (output). Tobacco was used as money in the United States for centuries following a law passed by the first General Assembly of Virginia in 1619, and was initially valued on the British Sterling at a slightly higher rate than the cost to produce it. Tobacco was used to pay for staples such as food, clothing, taxes…even a wife. It was not uncommon during the early settlement of America to see men carrying 80 to 150 pound bushels of the prized leaves to English ships in port, and leaving with a beautiful and virtuous new bride.
The maladies attached to using tobacco as currency began to surface as more and more Americans opted to cultivate their own smoke, leading to a devalued money supply. This was further exacerbated by the popular practice of using the worst quality leaves for paying taxes and debt to government, while prime tobacco monopolized citizen’s daily purchases.
Mirroring much of the obtruded views contributing to today’s regulatory legislation, the government of the time opted to restrict tobacco cultivation to a select, and obviously privileged, few; essentially giving them the exclusive power to "grow" money . This created a perceived discrimination, causing widespread violence and vandalism, prompting government to enact further legislation barring intentional destruction of tobacco crops under penalty of death for treason. The "tobacco notes" were eventually created, generating a fiat currency backed by tobacco commodities, and was used as legal tender up until the nineteenth century. Eventually, the attempts to manipulate the financial tobacco market proved disastrous and the currency was replaced with varying standards such as gold and silver which have a more stringent supply characteristic.
There are many hoarders, greedy businessmen, misers and foreign interests to evaluate, however, these economic contributions, neither singly nor collectively, even remotely delineate the destructive power unleashed by the act of flooding the market with baseless currency and diluting the money supply. The explosive inflation that takes hold as the emaciated currency flounders, is nearly always marked by the rise of a militant government, and has bolstered many a coup de’ etat.
A sound money supply founded on the ingenuity and productivity this nation has every right to be proud of, is essential to America’s prosperity and liberty, and no government now possesses, nor ever will, the right to debase either.
THE SWIFT CURRENTS OF CURRENCY
All too true, is the fact that any currency can be debased, even precious metals such as platinum, gold and silver. Inflation is mainly influenced by the amount of money supply in relation to commodity output, and is generally caused directly by government activity.
No currency has ever been completely impervious to inflation, and a long overlooked, while prudent, strategy for avoiding common economic pitfalls, is the adoption of multiple currencies backed by select and resilient commodities. Allowing the Federal Reserve to print money absent of pecuniary "output" stability, devalues it’s buying power in the hands of the average consumer, while temporarily propping up financial markets and lending firms.
The same goes for the Fed’s incessant practice of lowering interest rates in an effort to manipulate, and pretend to stimulate, the economy. This only serves to increase the capital gains of financial institutions, while transferring the lion-share of fiscal servitude to consumers and mortgage holders. Moreover, lowering interest rates can only be accomplished by firing up the printing press, further devaluing the money, and evaporating the buying power as it trickles slowly into the hands of the poor and middle class.
Anything of value can be used as currency so long as the money supply remains moderately low, relative to production (output). Tobacco was used as money in the United States for centuries following a law passed by the first General Assembly of Virginia in 1619, and was initially valued on the British Sterling at a slightly higher rate than the cost to produce it. Tobacco was used to pay for staples such as food, clothing, taxes…even a wife. It was not uncommon to see men toting eighty to one hundred fifty pound bushels of the prized leaves to English ships in port, and strolling happily away with a beautiful and virtuous new bride.
The maladies attached to using tobacco as currency began to surface as more and more Americans opted to cultivate their own smoke, leading to a devalued money supply. This was further exacerbated by the popular practice of using the worst quality leaves for paying taxes and debt to government, while prime tobacco monopolized citizen’s daily purchases.
Mirroring much of the obtruded views contributing to today’s regulatory legislation, the government of the time opted to restrict tobacco cultivation to a select, and obviously privileged, few; essentially giving them the exclusive power to "grow" money . This created a perceived discrimination, causing widespread violence and vandalism, prompting government to enact further legislation barring intentional destruction of tobacco crops under penalty of death for treason. The "tobacco notes" were eventually created, generating a fiat currency backed by tobacco commodities, and was used as legal tender up until the nineteenth century.
There are many hoarders, greedy businessmen, misers and foreign interests to evaluate, however, these economic contributions, neither singly nor collectively, even remotely delineate the destructive power unleashed by governments flooding the market with baseless currency and diluting the money supply. The explosive inflation that takes hold as the emaciated currency flounders, is nearly always marked by the rise of a militant government, and has bolstered many a coup de’ etat.
A sound money supply founded on the ingenuity and productivity this nation has every right to be proud of, is essential to America’s prosperity and liberty, and no government now possesses, nor ever will, the right to debase either.