• Home
  • About
    • Welcome to the Institute
    • It’s Time
    • What is the Gold Standard?
    • Goals of The Gold Standard Institute
    • The Gold Standard Institute Emblem
    • Meet the People of The Gold Standard Institute
  • Gold Basics
    • Buying Gold and Silver
    • Commercial Paper vs. Real Bills
    • The Definition of Money
    • The Nature of Money
    • What is a Real Bill?
  • Journal
  • Archives
  • Classroom
  • Media
  • FAQ
  • Contact
Home > Archives for Philip Barton > Page 30

The Gold Standard #46 – October 2014

October 15, 2014 by Philip Barton

TheGoldStandard46Oct14

Filed Under: Journal

Social Implications of Circulating Gold and Silver

September 18, 2014 by Philip Barton

A nice description of the social implications of circulating Gold and silver.  Penned by the legendary investor Harry Schultz…

I have written several times over the last 36 years and I want to restate this principle with force: I am pro/gold regardless of the price! I don’t fight for gold in order to make a profit on gold shares, bars or coins! Gold is important for far more important reasons and I would be embarrassed to promote gold only for monetary gain.

Gold is the essential linchpin for our individual (not group or nation) freedom.

Gold belongs to the monetary system as a governing factor. We belong back on the gold standard. I used to compromise and say a quasi-Gold standard will probably do, a modified Bretton Woods version.

And that may be what will evolve, but in my view we should fight for a pure gold standard, the old-fashioned form, because it worked! And not just for fiscal reasons! It forced nations to limit their debt, spending and socialist schemes, which meant sound behavioural habits were formed around those limitations, and those habits rubbed off on everyone.

People were more honest, moral, decent, kind, because the system was honest and moral. Cause and effect. Today we have cause and effect of the opposite standard: no limits on what governments can do, control, dictate; no limit on government debt, welfare or socialist schemes. There is no governor on the government.

This habit rubbed off on the public, causing them to go into debt, lose respect for the system and morality. The effect brings us more divorce, fraud, crime, illegitimate births, broken homes. When the money of any country loses its base/backing there is no standard for any behaviour.

Money sets a standard that spreads into every area of human activity. No paper money backing, no morality. That is why fold coin money worked so well and why the U.S. moved into paper money very slowly, carefully, keeping the paper-$’s backed 100% by gold. But slowly, like slicing a sausage, that backing was removed in stages, until now there is none.

The effect on this cause is all around us.

Violent films reflect violent society reflect no respect throughout society. Layer by layer, we are corrupted when money loses certainty.

Today’s stock market bubble is part of the scene as will be tomorrow’s mega-crash and mega-recession. Big Brother was made possible through the absence of automatic controls and loss of individual freedom via non-convertible currency. So, pass the word. Fight for gold. Not for profits, though they are helpful and help us fight for individual freedom, but for a future that returns to sanity in various standards.

If we have a gold standard we get golden human standard! The two are intertwined. They are the ultimate cause and effect. Gold blesses.

Harry Schultz, Gold vs. Price of Gold, International Harry Schultz Letter, 18 June, 2000

Filed Under: Uncategorized

The Gold Standard #45 – September 2014

September 15, 2014 by Philip Barton

TheGoldStandard45Sept14

Filed Under: Journal, Uncategorized

The American Corner: The Credit Gradient

August 26, 2014 by Philip Barton

(Extracted from the August edition of our monthly journal: The Gold Standard)

The United States, and every country, is subject to a monetary authority and legal tender laws. Here in the U.S. we have the Federal Reserve, a central bank that plans money and credit. The Fed thought they had perfected their planning (but of course it cannot be perfected). They thought they had ended the boom and bust cycle, and brought us into a brave new era, their so-called great moderation that ended in 2008. All they really did was manage the banking system to the brink of insolvency.

Let’s try a thought experiment. Suppose the monetary central planner attempts to fix the problem of insolvency by massive injections of liquidity. The central bank buys bonds. It dictates rates near zero on the short end of the yield curve, and promises not to raise rates for years to come. What perverse outcome would we expect?

Arbitrageurs see a green light, telling them that they can safely borrow short to buy long bonds. As the price of a bond goes up, the rate of interest goes down—it’s a rigid mathematical inverse. This is how suppression of short-term rates causes suppression of long-term rates.

This poses a problem for investors. Every investor has a minimum yield he must earn in order to meet his goals, such as retirement. When the yield available in government bonds falls, this gives the investor a strong push to other bonds with higher yields. Some Treasury bond owners sell, and go into AAA corporate bonds. This, of course, pushes up bond prices and pushes down the yield. This pushes some AAA corporate investors into AA bonds. And so on.

The net yield earned by every investor is pushed lower. However, at each step in the process, the effect is diminished. The wave of credit does not quite make it all the way to the other side of the pool, where the small businesses are trying to get wet.

In a free or semi-free market, credit is generally plentiful and inexpensive for mature, large enterprises. When well managed, these companies offer a low credit risk. Conversely, it has always been difficult for startups to obtain credit. When they can get it, they have to pay dearly. In other words, there is a credit gradient.

A gradient describes a change in concentration of something as you move through a range of coordinates. For example, this is a color gradient.

 Screen Shot 2014-08-27 at 09.19.48

Of course, there is always a credit gradient. Only now, the Federal Reserve has exaggerated it to an extreme. They have made the gradient steeper.

The biggest players are drunk, chugging as much as they want. At the same time, the scrappy disruptors with the greatest opportunities to improve our world are more dehydrated than ever. Worse yet, the innovators have to try to compete for resources with the large corporations.

The credit gradient is artificially enhanced. The end result is not surprising.

I came across this paper, by the Brookings Institute. Authors Ian Hathaway and Robert Litan found that “Like the population, the business sector of the U.S. economy is aging. … The share of firms aged 16 years or more was 23 percent in 1992, but leaped to 34 percent by 2011—an increase of 50 percent in two decades.”

Entrepreneurial young companies are not hiring, or in many cases, surviving. The older, larger ones are all that remain. Their hiring is anemic compared to that of younger companies. The proof is in the labor force participation rate, which shows the percentage of working age people who are employed or seeking employment. It is now down to a level last seen during the Carter Administration in the late 1970’s.

 labor-part

Although there are other factors that contribute to this dismal reality including minimum wage and labor law, taxes, environmentalism, subsidies for crony companies, and regulations, the artificially enhanced credit gradient deserves the lion’s share of the blame.

Keith Weiner – President the Gold Standard Institute US

Filed Under: Keith Weiner, Uncategorized

The Gold Standard #44 – August 2014

August 15, 2014 by Philip Barton

TheGoldStandard44Aug14

Filed Under: Journal, Uncategorized

  • « Previous Page
  • 1
  • …
  • 28
  • 29
  • 30
  • 31
  • 32
  • …
  • 35
  • Next Page »

Categories

Navigation

  • Home
  • About
  • Gold Basics
  • Journal
  • Archives
  • Classroom
  • Media
  • FAQ
  • Contact

Recent News

  • Virginia Ends All Taxes on the Purchase of Gold and Silver
  • Recession, Inflation and Gold
  • Keith Weiner Discussing the US Dollar and Gold
  • Ukraine and the Next Wave of Inflation – Part 1
  • The Politics of Sound Money With Stefan Gleason

Contact Us

philipbarton@goldstandardinstitute.net

Related Websites

Gold Standard Institute US

Copyright © 2013. The Gold Standard Institute International. All rights reserved. Disclosures.
Website by Claire de Jong