The Real Value of Money: Unmasking the Illusion

We all hold our money close to our hearts, but do we really understand its true value? We often measure a person’s worth by their financial wealth, but what if money, as we know it, is an illusion? Whether it's Uncle Sam's dollars or the Indian Rupee, they all might just be a big fat lie.

Understanding the Difference: Currency vs. Money

There are numerous countries and even more currencies circulating around the world. But are all these currencies actually money? The answer is no. There is a crucial difference between currency and money.

What is money?

Currency is a medium of exchange and a unit of account. It is portable, durable, divisible, and fungible. Fungible means each unit is identical and interchangeable with another unit. For example, a dollar in my pocket buys the same amount as a dollar in yours. Money, however, is all these things plus a store of value over a long period.

The currency in your pocket is a medium of exchange and a unit of account because it has numbers. It’s somewhat durable, portable, divisible (you can make change), and fungible. However, it is not a store of value because its value can diminish over time.

Governments can print more currency, diluting its value and transferring wealth from your pocket to the government and the banking system. This is the essence of how we are defrauded.

Gold and Silver: The True Money

Gold and silver have stood the test of time as the only forms of money that have consistently maintained their value. They possess unique properties that make them the optimal form of money.

Gold and silver are effective mediums of exchange because they store a large amount of value in a small area. They are units of account; pure gold and silver have the same value worldwide. They do not corrode, are divisible, portable, and fungible.

Moreover, they are limited in quantity, which is why they maintain their purchasing power. Governments cannot print gold and silver. Over the last 5,000 years, gold and silver have consistently retained their value, unlike thousands of fiat currencies that have failed. Notable examples of fiat currency failures include the German Mark in the 1920s and the Zimbabwean Dollar in the 2000s.

Gold is formed when a star explodes in a supernova, making it rare and unique. This uniqueness and the inability of governments to create more make gold the ultimate store of value.

The Reality of Fiat Currency

Fiat currency exists by government decree. Governments use their printing presses to create paper money and give it value through fiat designation. This process is akin to a magic show where the audience is deceived into believing the magic is real.

Historically, no fiat currency has survived without being backed by something of intrinsic value. National currencies are tools used by governments and the financial sector to leach away your time and freedom by stealing your purchasing power. Instead of storing your economic energy, fiat currencies leak it.

Inflation and Deflation: A Result of Currency Supply

Inflation is generally perceived as rising prices, making it difficult for the average citizen. However, inflation is actually the expansion of the currency supply, while deflation is its contraction. Expanding the currency supply leads to rising prices, and contracting it causes prices to fall.

Governments continuously print more currency, increasing its supply, which leads to price inflation. The real estate and goods you buy don't change; it's the purchasing power of the currency that diminishes.

Quantitative easing (QE) is a term used to describe currency creation. It started with banking bailouts in 2009, where new currency was created out of thin air and given to banks, who then paid themselves record bonuses. Whether it’s QE, bailouts, or stimulus programs, these are all methods of increasing currency creation and transferring wealth from the public to the financial elite.

The Government Trap

The currency is losing its value rapidly, and there is little we can do to stop it. The excessive printing of money has created a situation where it is impossible to assign a just quantifiable value to currency. The system is at risk of breaking down. When this happens, we may need to revert to gold and silver.

In the past 200 years, the US went from having no dollars in existence to 825 billion. With the advent of multiple QEs and bailouts, this trend has been mirrored globally. Every government is engaged in deficit spending and expanding their currency supplies, leading to inevitable economic turmoil. This includes the economies of Canada, Australia, South Africa, Russia, Singapore, India, and China.

Fiat currencies are losing power, and there is no clear solution to repair the damage. We need to educate ourselves about the impending economic challenges and prepare to safeguard our wealth. Many financial advisors recommend diversifying investment portfolios with precious metals like gold and silver as a hedge against inflation and currency devaluation.

Conclusion

Wealth is never destroyed; it is merely transferred. Educate yourself so you can position yourself advantageously when economic instability strikes. Until then, best of luck with preserving your wealth.