This article was originally printed in the latest issue of Numismatic News.
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Gold has served as honest money for over 3,000 years. Money is defined as:
1. A standard of value. A generally agreed-upon measurement used to express the price of goods and services.
2. A store of value which holds its purchasing power over long periods of time, to allow people to save and thereby defer their spending until some future date.
3. A medium of exchange which is easily transferred from one person to another in return for goods and services.
What makes gold so attractive is that it holds its purchasing power over long periods of time. It takes hard work to find and refine gold whereas paper fiat money can be made out of “thin air.” It only takes approximately eight cents in labor and material to make a U.S. $100 bill. Fiat currencies, in contrast to gold, are controlled by governments which are, as you know, are fundamentally incapable of managing their monetary affairs.
Chart 3 showcased in this Viewpoint was put together by the American Institute for Economic Research and it appears recently in a book entitled, “How to Invest Wisely.” As seen, gold has more than held its value since 1913 whereas the world’s major paper currencies have lost lots of value since 1913. Even the Swiss Franc has lost over 70 percent of its purchasing power over the past century. By far the worst case in the history of paper money occurred in Weimar, Germany. On Nov. 30, 1923, when it took 87,000,000,000,000 German marks to buy an ounce of gold. The truth is that virtually all paper currencies lose value over time.
Why do politicians most often prefer paper money over gold? Because paper money is something for nothing and it costs very little to make by central banks. Wanting something for nothing unfortunately is a social disease which many people have – including rulers. How many people do you know play the lottery, which is a way to try to obtain wealth without working for it? By contrast, honest gold money requires hard work to obtain and this is why it keeps its purchasing power value over long periods of time. Hey, with my name, I had better understand the difference between fiat paper currency and honest gold money.
Chart 3 in this Viewpoint provides the truth of what I have been saying. Accurate data it is said is worth more than a thousand “expert opinions.” I say it is time we get back to lawful gold and silver money per our Constitution.
Weimar White is a hobbyist from Canaseraga, N.Y.
Viewpoint is a forum for the expression of opinion on a variety of numismatic subjects. The opinions expressed here are not necessarily those of Numismatic News. To have your opinion considered for Viewpoint, write to David C. Harper, Editor, Numismatic News, 700 E. State St., Iola, WI 54990. Send e-mail to firstname.lastname@example.org.
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