The Return to the Gold Standard

Fractional reserve banking is nothing new. It has gone on for centuries. However, it was not until the creation of central banks that this banking practice became institutionalized.

Of particular importance was the establishment of the Federal Reserve in 1913. It paved the way for the complete dismantlement of the gold standard, and the complete enslavement of all people on our planet. Every one of us are in some way paying tribute to the overlords in charge of the Federal Reserve.

It does not matter whether we are debt free or living off the grid. Every time we make a purchase of some kind, the overlords take their cut. There is no product today that does not in some way have a component that was paid for by Federal Reserve dollars. Debt to the US overlords are included in every single transaction on the planet.

This is because the US dollar has become the standard on which all trade is based. The US dollar has replaced gold as the base of international trade. Every international trade deal has become dependent on dollar reserves rather than gold reserves. Instead of gold being used to cover any trade deficit, dollars are now used.

This arrangement has served US government agents well. It has enabled them to borrow money cheaply from the Federal Reserve to spend it wherever they please on whatever they please. Countless wars have been financed this way, and the complete enslavement of the US citizen has been put into place. US bankers have become rulers of not only the US, but the entire world.

This has been allowed to happen because the USA has been a productive nation. The people of the US have therefore been the main contributors to the overlords, and the US citizens have been tolerant of the system because it was preferable to all other systems, especially the communist systems that plagued the world during the 20th century.

However, US citizens today are net debtors. They do not carry as much of the weight as they used to. The overall debt in the system has also exploded. The federal government of the US has increased its debt from 1 trillion since Ronald Reagan was president to 20 trillion today, and this is excluding promises of social security, pensions and all sorts of other liabilities.

US government officials have saddled every US citizen with a mountain of debt that they will be forced to service through taxes or inflation.

Since tax increases will burden the US citizens directly, while inflation will burden all people owning US dollars, regardless of nationality, the natural impulse by US gate keepers and overlords alike is to inflate the problem away. The political establishment will cover the bankers' backs as they print their way out of their mess.

The burden will have to be carried mainly by people living outside of the US.

However, this is not at all a welcomed move by gate keepers of other nations. They do not want to have their tax donkeys burdened by US debt, so they seek to find ways around the US dollar.

New trade agreements are now set up in which the US dollar is excluded. The agreements are set in other currencies, notably the Chinese Yuan and the Russian Ruble.

However, the Chinese and the Russians gate keepers do not trust each other. None of them want to be stuck with a bunch of cash. They want something more tangible, something that the trading partner cannot simply print up more of, and that something is gold.

This is the first step towards a gold standard, and very reminiscent of the final step we made away from the gold standard. It looks a lot like the Bretton Woods system in which gate keepers reserved the right to make transactions in gold, while keeping this privilege away from their tax donkeys.

What we are witnessing is a slow return to the gold standard. However, it is in no way a return to a true gold standard in which everyone can get gold in return for their cash. Tax donkeys have to buy their gold in an exchange. They cannot simply deliver the cash in a bank and expect the bank to hand over a fixed amount of gold in return. There is no direct link between cash and gold. The price of gold changes all the time.

However, the trend has turned. Over time, gold will become more important. The overlords will gradually loose their power to print what others have to work hard to get.

This will of course be fiercely opposed by the overlords and their gate keepers. No politician will welcome the trend reversal, and the bankers will absolutely hate it.

The Chinese and Russian gate keepers have not signed their trade deals out of love for gold, but out of a deep distrust of each other. At home, they will defend their own bankers' privilege to print. They will do everything in their power to stop their own people from becoming as independent of government agents as they themselves seek to be in relation to foreign trading partners.

But the trend has turned. Gold will be accumulated by governments and bankers. Free spirited people will realize the value of gold as they see its relentlessly rise in prize relative to cash. They will seek to own some themselves.

Gold will become the preferred asset for savers, and this trend will continue until the current fractional banking system finally implodes.

But don't hold your breath waiting for the collapse. It took more than 100 years to completely unwind the gold standard and enslave everyone on the planet. It will take just as long to unravel the mess. Gold is not a short term investment. It is not a get rich quick scheme. It is an asset for the long haul. It will steadily gain in value. It is the sort of stuff the prudent saver will prefer because it requires no maintenance, no daily monitoring of price actions, and no thinking.

The greatest beauty of gold as a savings vehicle is that it requires no time from the saver. Savers can therefore spend their time doing things that they love. It gives us agency to do stuff that we love to do.

Time is in the end the ultimate resource. Gold frees up our time from the daily chatter of news feeds so that we can pursue the things that matter to us. That in the end is the true value of gold.