Sunday, July 24, 2005

The Origin of Money.

Preface:
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There are three subjects that impact us more than any other subjects. Those three are Politics, Religion, and Economics.

Notice that somehow we are told that two of them should not be part of normal discourse from the time we venture out into the public school system. “Never talk about Politics or Religion!” Ever hear that statement when you were growing up? Also Economics is usually not taught to most people and it is vital to understanding what makes the value of money so important, and who it is that continues to devalue it.

All three are closely related. If you understand the Macro View of the world, you will see that all three affect freedom.

Throughout the Bible are examples of man’s inhumanity to man, and governments inhumanity to man. Allowing people to be free to practice their own religion is inseparably connected with freedom from interference from others, which includes governments.

The Bible has stories of conflicts between Kings and man, Pharaohs and man, and man versus man. The relationship between man and his government is closely related to Religion. The Golden Rule sums up the proper relationship for man’s non-inhumanity to man as well as governments proper relationship between the two.

Economics is also connected to freedom, because if you are not free to work where you want or to keep the fruits of your labor, except for a small amount that is needed for the proper role of government, then you are also not free.

Economic freedom is essential. “He who controls a man’s purse strings, controls the man.” (Unknown)

“A power over a man’s subsistence amounts to a power over his will.” (Federalist #79)

Governments can steal property from its citizens such that not one in 10,000 even really know it is being done. It is done through Inflation.

Governments can spend more than they take in through taxes in one of three ways; Decrease tax rates so as to stimulate the economy whereby the lesser tax rate will actually generate more revenue for government, (such as the Bush Tax Cut did), increase taxes during economic boom and gather new revenues before the effect of the new taxes causes a down turn in the economy, or lastly, increase the money supply, (inflation.)


It is inflation that is the most hideous tax because it is done underhanded, where most don't even know that the government did it. The dupes of the government will blame everyone but the government for inflation, big business, the price of gas, etc., these are all just mis-information that only the ignorant fall for. I have convinced more than one PHD of Economics that rising gas prices are a symptom of inflation not the cause. (Rising gas prices can cause other things to increase in price, but it doesn't cause the value of money to decrease.)

Also notice that the left's values are all about money. Welfare, Socialized Health Care, etc. Their march towards Socialism is all about redistribution of the wealth. So you can see why the understanding of money is so important.


Origin of Money:
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Several Thousand years ago before we had money there was barter.

Suppose you were a shoemaker and I was a shepherd. You wanted goat’s milk and I wanted shoes. We would barter for how much milk you could get so I could have a pair of shoes.

Before long people realized that gold was the most commonly desired item. Gold did not die like a cow would or wear out like shoes, so it soon became apparent that people could trade gold for any other item.

Next came the idea that carrying around large sums of gold could become obvious and dangerous so someone decided to invent the first bank. You could store all of your gold in his warehouse and he would give you receipts for the amount of gold you deposited in his warehouse. Then the receipts, (money), could be traded for goods instead of the gold.

The Gold Smiths soon learned that most people never returned to collect their gold, so they would make false receipts saying that they had on deposit in their warehouse a certain amount of gold.

You see, the receipts, (paper money), did not have any real value, it merely represented the amount of gold that you owned. The Gold had value in and of itself. You could do things with the gold that were valuable.

If the Gold Smiths, (the bankers), would issue too many fake receipts, then people would soon get suspicious and then there would be a run on the bank of people demanding their gold back.

So the way the Gold Smiths were kept honest was to have auditors double check the value of the receipts issued versus the amount of gold on deposit.

This is why for many years we were tied to the Gold Standard. The Founding fathers knew that the Banks would “inflate” the money supply if they were not required to issue no more than $32.00 for every ounce of gold in the banks.


They opposed "Centralized Banks" in the hands of the government and are probably turning over in their graves over the existance of the "Federal Reserve Banking System." Private banks would be competetive and could be held in check. But if the government ran the banking system they could use it against the citizens.

Once we got off the Gold Standard, governments could easily issue additional receipts without having to explain why this was a bad thing, since it was the government doing it. This is called “Inflation.” It is a hidden tax on the citizens because it makes all of the dollars we hold “worth less” than they were worth before. It was stealing when the Gold Smiths issued fake receipts, and it is still stealing when the government does it!

Here is a short synopsis of a similar description. Money

And yet another more full-length description of the Origin that shows why you need to know what your government is doing to rob us of our wealth by way of this hidden tax. The Origin of Money.

Lastly see one of my earlier posts on Inflation. Here.





3 Comments:

At 6:27 PM, Blogger Roseville Conservative said...

Good post, long, but good...

 
At 8:03 PM, Blogger Free Agency Rules said...

Thanks, It's a subject that is Hard to tell in 25 words or less

:)

 
At 11:56 AM, Blogger pappy said...

Your right FAR thats why we have formulas for the future and present values of money

 

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