FOR FREE YUGIOH CARDS, CLICK THE PAGE ON THE RIGHT!!! No scams, viruses, or malware. Click the black titles of the posts if you would like to see the entire post.
Earlier this week we marked the passing of former Federal Reserve chairman Alan Greenspan, and you'll recall that I had some rather critical things to say.
Well, arriving in beautiful St. Maarten yesterday, two days ahead of our anniversary, I found myself feeling a bit sappy and sentimental, and decided I would share with you something quite edifying that came from Greenspan's hand.
Greenspan went on to betray it completely, but he still gave it to the world, so let's remember something true he said.
I mentioned to you "Gold and Economic Freedom," a Greenspan essay from 1966 of which Ron Paul was particularly fond, so let's say a little something about that.
Greenspan began that essay like this:
"An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense -- perhaps more clearly and subtly than many consistent defenders of laissez-faire -- that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other."
He proceeded from that uncontroversial opening statement to a step-by-step description of the evolution of money, such that many countries of the world wound up on what we call a gold standard.
From there he discussed the motivations behind abandoning the gold standard, among them the view that if the banking system could extend ever more credit by means of a paper-money system, as opposed to being limited by a (for all intents and purposes) finite gold supply, perhaps the economy could be kept on a permanent boom footing.
Greenspan summarized that view like this: "If banks can continue to loan money indefinitely...there need never be any slumps in business."
Governments, meanwhile, had their own motivation for removing the (what you and I would consider salutary) restraints of the gold standard.
Governments have various constituencies whom they wish to shower with taxpayer-funded largesse. Unfortunately, the taxpayer will tolerate only so much thievery. So governments will often need to borrow the money to cover the inevitable budget deficits they incur in the process of wealth redistribution. But, Greenspan pointed out, "a large volume of new government bonds can be sold to the public only at progressively higher interest rates. Thus, government deficit spending under a gold standard is severely limited."
If they had a system whereby credit could be created out of thin air and pumped into the economy, those interest rates could be kept down, thereby masking the consequences of government borrowing and indeed keeping it cheap. Thus the racket of redistributing wealth could continue.
"This," Greenspan concluded, "is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process."
Of course, as Greenspan says, we are no longer on a gold standard, and your paper money is redeemable into nothing.
But, and here's the second message for today, even though gold has been displaced from its throne in the world of money, it still provides a service to those who own it. It isn't a make-money scheme or get rich quick, neither of which you should want anyway. But it has held its value consistently over the centuries.
For example, in 1800 a fine suit of clothes for a man could be purchased for about a quarter of an ounce of gold.
Today, just over two centuries later, a man can find a reasonable suit for between $300 and $600, and a made-to-measure or well-constructed suit for between $800 and $1500 -- putting this higher-end suit roughly in the quarter-ounce range as well.
I own gold because whatever happens in the short run, it's something I know I can hand down to my children -- and unlike the paper money I've earned, it won't be debased, and indeed it could rise in value for them.
I am not giving you advice; I am just telling you what I do. In the crazy world of 2026, we have to put our heads together.
My longtime friend Jeff Deist (he was a groomsman at my wedding), whom you may remember as former president of the Mises Institute, now works with a company called Monetary Metals, where I've had an account for a couple of years. Those of you familiar with Jeff know he's a good and brilliant guy.
The idea behind Monetary Metals is simple: people like you and me are probably going to own gold anyway, so why not make it earn a yield?
Instead of letting it sit there like a lazy bum, I put my gold to work with Monetary Metals and earn about a 4% yield per year, paid in more gold. I rather like the idea of earning income for things I was planning to do anyway, like owning gold.
Good luck finding out about Monetary Metals in the mainstream media. They would die a thousand deaths before telling you about it. But when you subscribe to ol' Woods, gems like this come with the territory.
At this point you are losing track of the number of ways the old man here has improved your life.
No comments:
Post a Comment