Wednesday, November 4, 2009

Every rich and poor is dependent on what kind of Money system you have

For a while I have been reading IBM’s advertisement which says goes “….rich and poor around the world, all of whose prosperity dependent on a money system that is stable, secure and accessible to all.

In today’s Mint Sauvik has a great
piece on how fiat money or the State monopoly money kills poor people’s animal sprits instead of making them rich.

He says:

“Private money is but whatever the common people are willing to accept in their day-to-day transactions. It is safe to predict that if fiat paper were abolished, the common people would revert to gold and silver. All these hoards of gold and silver will then be private hoards, private capital, private money. If collective action is required to manufacture standardized coins, these official mints will be converting private stocks of gold and silver into coins. Even in the performance of this task, the state should be offered nothing but its modest seignorage, with no role in establishing a fixed rate of exchange between gold and silver. All prices, including those of gold and silver, must be freely determined. That is capitalism.”

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