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Precious metals

by on November 13, 2013

Some of us, after learning about money creation, begin to strongly favor returning to precious metals. Understandable, but not necessary.

Creating money from nothing is not the problem.
The real question is Who creates it.

In Goethe’s Faust II, it’s the devil. Organisations like ours, Positive Money, or those listed at immr, are aiming slightly higher: No, not God…just plain regular people, the state…US!  

Mankind’s very first money was also created from nothing: cavemen carved notches on tally sticks. Amongst other things, this helped prevent blood feuds between tribes.

Money is a way to keep score, a means to an end. Who cares what form it takes – physical or just plain information?

Benes and Kumhof:

<in practice precious metals tended to accumulate privately in the hands of the wealthy, who would then lend them out at interest.>
<There is another issue that tends to get confused with the much more fundamental debate concerning the control over the issuance of money, namely the debate over “real” precious-metals-backed money versus fiat* money. As documented in Zarlenga (2002), this debate is mostly a diversion, because even during historical regimes based on precious metals the main reason for the high relative value of precious metals was precisely their role as money.> (IMF wp12202, my emphasis)

* Fiat = money-from-nothing, remember that song? “Chicks for free”? Well, that was “for”, but the fact remains: Why do banks have the fanciest buildings? They can create the money out of thin air practically at will. “That ain’t working!”


“Banks need Boundaries!” is a loosely affiliated group of individuals who care about our socio-economic system. Please take a minute to consider our petition, thanks!


From → Side issues

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