 | By Darryl Robert Schoon |
 |
AN ESCAPE ROUTE IN A TIME OF DISASTER
Only those who have gone too far know where the limits should have been
Money served throughout history as a medium of exchange and as a storehouse of value. But when gold and silver coins were replaced by paper currencies, money no longer was the same. Paper money, no longer having intrinsic value, now functions only as a medium of exchange, a function that degrades over time.
The value of paper money continually loses value because the constant printing of paper money constantly dilutes the value of previously printed money. The more paper money printed, the less paper money is worth; and today, money is being printed at a faster rate than at any time in history.
In fiat paper money systems, today's paper money will be worth less than tomorrow's and will be worth less the day after ad infinitum. This constant degradation of paper money is known as inflation. When the process rapidly speeds up, it is known as hyperinflation. Remember that word.
For the first time in history, all money, all currencies are now fiat which means money no longer has intrinsic value. This is not because intrinsic value was deemed unnecessary for a functioning currency. The real reason is far less reasonable.
All money is now fiat because between 1949 and 1970 the US overspent its entire 21,775 ton hoard of gold and could no longer convert its currency to gold as agreed under the Bretton Woods Agreements in 1944.
Note: What gold remains in US custody today remains only because in 1971 the US refused to transfer the remaining gold owed to others; as its obligations were far greater than its capacity to settle.
Because at the time the gold-backed US currency anchored all world currencies, when the US dollar became fiat, all currencies also became fiat. For the first time in history, no currency was backed by either gold or silver including the international reserve currency, the US dollar. The destructive consequences of that act have remained contained for 35 years. They are no longer.
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