BUT GOVERNOR, YOU CAN CREATE MONEY! JUST FORM YOUR OWN BANK.

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36 Responses

Fernando Macias, on May 27th, 2009 at 1:48 am Said:

Dear Ellen,

I just got finished viewing a video entitled “The Obama Deception.”http://www.youtube.com/watch?v=eAaQNACwaLw
This may be a little off topic from your article, but not from your blog. I would very much like to get your feedback on this video. I think it is true that the reason so many are turning to the internet for news is that mainstream media can not be trusted. Much of what I saw on the video I have been able to verify by the news that has come across the media and the research I have done in the past.

Reply
- Ellen Brown, on May 27th, 2009 at 6:45 am Said:
  
  Haven’t seen it but I’ll look when I get a chance! Incredibly busy these days. Ellen
  
  Reply
- Jere Hough, on July 24th, 2009 at 3:02 am Said:
  
  The problem, Fernando, is that much of the internet cannot be trusted either. Still, those that are open-minded and seeking truth can find a wide divergence of viewpoints on any given issue on the net.
  
  The video entitled the Obama Deception should properly be called the “Banker Deception” or the Federal Reserve Deception. The Money Powers are trying to shift the blame for all the money and banking ills on to Obama. Gullible and economically ignorant people (that’s most US citizens) will buy it.
  
  He’s just serving as their scapegoat or patsy. That’s what he was elected to do… “take the fall” for the monopolistic banksters and corporate hucksters.
  
  Reply
Jere Hough, on May 27th, 2009 at 2:16 am Said:

Thanks, Ellen, for another important truth revealing article. Sooner or later the public is going to discover that governments have the sovereign right and responsibility to create money and control its distribution, value, and velocity. The right to create money flows from the constitutional rights of the individual to enter into contracts.

I hope the discovery is sooner, as later surely means spreading economic chaos and disaster.

Just a reminder to all that our forum is open at:

http://www.forum.webofdebt.com

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Joseph Danison, on May 29th, 2009 at 1:04 am Said:

Complete this phrase: “You can lead a horse to water, but….”

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Rajiv, on June 2nd, 2009 at 4:27 am Said:

Saw an interesting map on Itulip

http://www.itulip.com/forums/showpost.php?p=101451&postcount=1

http://www.itulip.com/images/unempstateApr2009.gif

Which is basically an update to their monthly U.S. unemployment graph for April 2009 from the BLS. The rate of increase in unemployment remains in the range of 1.1 to 40% for every state except North Dakota where unemployment is rising at an annual rate of 0.6% to 1%.

I think it reinforces what you have been saying all along!

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Bob Walton, on June 28th, 2009 at 5:49 pm Said:

Regarding State-Owned Banks:

Having studied Richard C. Cook’s “We Hold These Truths The Hope of Monetary Reform”, I recognize common ground: “credit as a public utility”. In a recent e-mail I have urged Mr. Cook, a highly respected member of the American Monetary Institute, to support Ellen Brown’s idea of state-owned banks in the model of North Dakota.

While this approach does not replace or nationalize the Federal Reserve, it seems to hold more promise of success by avoiding a head-on assault on what we all recognize to be a system of immense power. With the model of North Dakota already in place, we have a beach head of success upon which to build and who wants to argue with success?

I want to encourage Ellen Brown and all monetary reformers to get together on the North Dakota state-owned bank issue- whether or not it is seen as the ideal solution. “Credit as a public utility” should be our common theme.

How to proceed? I would favor immediately mounting a grass roots “initiative” by petition in each state. We must not rely on any Governor or State Legislature because of the corrupting counter-attack which will be mounted by the Feds. Just as has been shown with the Washington District of Criminals, our state Governors and Legislators cannot be relied upon to side with “we the people” on an issue of such importance to the survival of our Nation.

This is not to say we should not enlist the help of our public officials. The state-owned bank is desperately needed by State and local officials as a means of fighting back against the manufactured economic crash which is bankrupting states, counties and cities everywhere.

In particular, I would cite the need to lobby our County Sheriffs to support this initiative. Living in the border region of the Southwest, I have observed that our County Sheriffs are under assault by a Federal policy which encourages foreigners to traffic in drugs and illegal immigrants. The Feds are using the lawlessness they have created as an excuse to bring in a global police state while the Sheriffs Departments are being squeezed financially so that they are unable to defend and protect the Constitution as per their sworn oath.

The battleground will be in counting the ballots. Any state which has electronic/computer voting will be subject to vote fraud. Any campaign for a state-owned bank must include a campaign for hand-counted votes state wide.

Ron Paul is not the answer. He is a libertarian gold bug whose movement is sucking up the energy of a besieged public living in a matrix of media lies and deception. However, we need to enlist all Ron Paul supporters. I have noted that the state-bank idea was posted on the Daily Paul: “State Banks- A Solution to the Fed and Wall St Greed”:

http://www.dailypaul.com/node/85147

From this and similar articles, I am attempting to identify individuals and groups across the country who would be candidates to lead such a grassroots movement as I am suggesting. For example- Does anybody know John Hoeven Governor of North Dakota and former head of the Bank of North Dakota? Now there would be a guy to get on board!

Drawing on Ellen’s March 3, 2009 article “Playing the Banking Game: How Cash Starved States can Create their Own Credit”:
http://www.globalresearch.ca/index.php?context=va&aid=12522www.globalresearch.ca/index.php?context=va&aid=12522
I see reference to Mr. Robert Ellis of Tucson who wrote a letter to California Governor Schwarzenegger. Did Arnold ever respond? Does anybody know how to get in touch with Mr. Ellis? I have been using Google and getting nowhere.

I hope this post will generate some discussion and I ask that the moderator will flag it for Ellen Brown as I would very much like to get her response.

Thank You,

Bob Walton
Portal, Arizona

Reply
- Ellen Brown, on June 28th, 2009 at 6:24 pm Said:
  
  Hi, I totally agree! Thanks for writing. Richard Cook and I are friends and in communication. I’ll forward your email to Bob Ellis. I just this moment wrote him an email on this. Maybe you or someone on this blog can check my figures for me. Here’s what I wrote –
  
  Things are looking dire for California, with the possibility of having to pay workers in IOUs beginning this Wednesday; so I thought I’d try another article on how to fix it. Could you check my calculations on this?
  
  Projected state revenues for 2009 are $128B.
  Projected expenditures are $134B. (I’m already off somewhere, because Schwarzenegger says we have a $23B deficit; but those are the figures given on the official website,
  http://www.ebudget.ca.gov/BudgetSummary/BSS/BSS.html.)
  Outstanding bonds = $56B.
  
  Say California took all $128B in revenues and deposited them initially in its own state-owned bank. These would generate 10x that sum in loans. To lend itself $23B, of course, it wouldn’t need nearly that much, only $2.3B in deposits and about $2B in capital (at 8%). But assume it wanted to buy back all its debt and fund its own bonds: it would need to finance $56B (in bonds) + $23B (the deficit) = $79B. So if it invested $7B of its revenues into the bank as “capital” and kept $8B in the bank as deposits, it would be covered, right? Of course it would now be $7B poorer in terms of available revenues, so say it financed $86B (to cover the extra 7). $7B would still be sufficient to meet the 8% capital requirement, and $8.6B in deposits would meet the reserve requirement, no? But maybe it’s unrealistic to fund all its outstanding bonds. I probably should stick with arguing for funding the $23B deficit to start, just to look credible.
  
  Reply
- therooster, on July 1st, 2009 at 7:24 pm Said:
  
  Money from nothing , regardless of interest at 0% or 0+% is not an answer. It must be backed.
  
  Real-time gold has solved the historical liquidity (deflation) problems associated with gold systems of the past. Let it rise in price as per the market and split the weight. Simple.
  
  Gold was never deflationary. Only the logistics of distribution were deflationary. No more gold is needed. Not an ounce. Just let it float and split it up by weight.
  
  The irony is that debt based fiat was indispensible to the process and arrival of real-time gold backed digital currency. The peg was the problem and had to be severed.
  
  Don’t make a simple issue complicated !
  
  Reply
  - Bob Walton, on July 6th, 2009 at 2:49 pm Said:
    
    “real-time gold backed digital currency”:
    
    therooster: Please provide a reference for this concept. Also do you have data on ownership of the gold in the world?
    
    We have a crisis that requires a quick solution. What process would you suggest for implementing your plan?
    
    The North Dakota model is working now and, with enough public support, could be brought on in a matter of months. The bankers will fight it because the interest goes to the people and not the bankers.
    
    Fractional reserve banking was born as a scam and as such is not the long-term solution. Once the state-owned bank concept takes off, we can then transition into something like the “Cook Plan” which is explained extensively by Richard C. Cook as referenced in my post above.
    
    The fundamental concept is that the people control the currency which is issued to the people by their government as a “public utility”. It’s value will reflect the productive capacity of the nation and not be in accordance with international bankers who control the gold market worldwide.
    
    Reply
    - therooster, on July 6th, 2009 at 3:48 pm Said:
      
      goldmoney.com and e-gold are two gold backed payment processors. There are others too. Each account holder owns his/her own gold and what gets transfered via the payment system is title to the allocated gold …….. by weight !
      
      You can now buy a stick of gum in Timbuktu with gold title, fully backed and unencumbered and you can do so in an instant.
      
      There is no financial crisis. There is only a marketing challenge that must be approached from the bottom-up.
      
      The elite’s role (top-down) is to carry “the stick”. Most peope, unfortuately, will only respond to change via painful motivation.
      
      We are all foloowing the same “script”. I was cast in a nice role ……. you ?
      
      Reply
      - Jere Hough, on July 24th, 2009 at 3:08 am Said:
        
        Rooster, Why did you not answer Bob’s questions?
        
        To his, I would add this: Who wrote, or is writing, the “script”?
        
        Reply
    - therooster, on July 7th, 2009 at 12:18 pm Said:
      
      I used to believe that fractional reserve banking was born as a scam. Maybe the intention was based on such intention but there is a strange irony in the development of fiat based debt currency. Without it, real-time 100% gold backed digital currency could not have come about. Real-time gold is predicated on a floating relationship but involved the transfer of weighted gold title as payment. Currencies act as the real-time measure. That’s all.
      
      I can now buy a flea that resides on a politicians arse anywhere in the world and I can do so in an instant and close out the transaction , completely ….. with no debt.
      
      Debt free store of value has now married with instant global liquidity. The structure of gold payment processors is such that gold is central and currencies (because of pricing) revolve around gold in a real-time relationship.
      
      When properly understood, it’s easy to see that the real-time relationship is a major key and a “new wineskin” in monetary history. It’s also easy to see that the pegged relationship of gold and dollars (Bretton Woods) had to be severed so that gold could float as per its dollar price. A pegged relationship (fixed) runs counter to a real-time float.
      
      This gold backed system is better for the cause of freedom that any system where government issues currency, mainly because of decentralized structure and removing government’s hierarchical power hold (also a feature of central banking). We have been structured in hierarchy since the “fall of man” when the “apple was shoved in our faces”. The structural die was cast and all secular models followed the economic example. Structure is key, primary and most often overlooked because the hierarchical paradigm is looked upon without question and as a matter of default.
      
      Gold backed digital weight measured by currency in real time is developed and managed within the decentralized private sector with no government interference other than arbitrating the fairness of currency exchange from one paradigm to the other as currency is exchanged for gold and visa versa. Call them the “gatekeepers” is all.
      
      The best part may be that all gold is owned by account holders, outright, Sovereign. Unencumbered.
      
      The irony is that debt currency is still part of the real value for real value trade because currency is absolutely indispensable to the algorithm that “measures the amount of gold” that is needed to make payment given that pricing is done in currency.
      
      If the severing of the Bretton Woods peg at $35/ounce was necessary to reach this moment in time, were all the events that track back to 1913 also necessary ? A necessary evil is still a necessity, no ?
      
      We are all following the same “script”. Some people get nice parts, while others get those that are “tough jobs”. The script has both.
      
      The elite cannot take an active part in the proliferation of the above gold backed system because the state of the dollar is important in the transition, specifically, the rate of change. It must be a market endeavour for this reason, bottom-up, not top-down. We’re following the script. The job of the elite is simply to “carry the stick” because most people are stubborn when it comes to change and pain has proven to be a more powerful motivator than pleasure. It’s true and yes, it is a pity but it is what it is.
      
      Take the carrot. Never forget the gifts of the magi.
      
      Reply
      - Ellen Brown, on July 7th, 2009 at 1:22 pm Said:
        
        Your entries are still too long. I read it fast, and I would say you have it backwards: gold was the ruse that allowed the deceptive fractional reserve banking system to develop. Without the pretense of gold backing, the moneylenders would not have gotten away with their scheme.
        
        Reply
      - Bob Walton, on July 8th, 2009 at 4:24 pm Said:
        
        “Gold-money”, Rooster’s example of the “gold payment” processor concept, is not a monetary system but a private investment/gold storage company where the account holder can make instant irrevocable electronic transactions in “physical gold” which is held for him in a vault. This is fine if an individual wishes to own the commodity gold as a hedge against inflation while also having the opportunity to trade the gold for other goods and services and the convenience of letting somebody else weigh, count and store his gold. But how does this idea get us out from under the boot of the private globalist bankers who are choking us with debt and ruining our Country?
        
        Rooster crows that there is an “elite” yet “decentralized private sector” to which we the people should entrust our “cause of freedom” and that we must “take the carrot” and give them “the stick” as a “necessary evil”. Is this supposed to be a joke, a distraction or both?
        
        Reply
        
        Ellen Brown, on July 8th, 2009 at 8:47 pm Said:
        
        that’s good Bob! Rooster has some other posts pending that I can’t bring myself to approve, because they’re long and don’t seem to say anything and are a distraction. Either he’s trying to sell something or he’s trying to obfuscate and confuse. Best, Ellen
        
        Reply
therooster, on July 6th, 2009 at 4:00 pm Said:

This site is promoting government power and leading perceptions toward the concept of socialism. The problem with the current debt money system is not that the ownership is private. The problem is that the banking system is creating money from thin air out of nothing. Nice work if you can get it.

Asset based money creates an honest market that subscribes to market law, real work and the sweat of the brow. It also allows for competitive decentralization, something that an IOU system cannot do.

Centralization and money from nothing are like two codependant sickos in the same cooperative recovery ward.

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- Ellen Brown, on July 6th, 2009 at 6:47 pm Said:
  
  It’s not socialism. It’s the original American monetary system — money issued by the people for the people, through their own publicly-owned banks. We lost that system to a private banking cartel, and the bankers got it from us by purporting to have “asset-backed” money — notes supposedly backed by gold. Gold has never worked as a medium of exchange. It’s too limited, and “he who owns the gold makes the rules.”
  
  Reply
Nik, on July 7th, 2009 at 9:11 am Said:

Decreasing the actual entire money creation process by gold, (which is surely the obvious thing that gold fans relate to primarily in it’s contrast to inflationary debt bubbles) is a method not related to the actual cyclical price and dividend/salary/wage dynamic; it is this dynamic that is the distributive mechanism of society’s energy and resources by and large-not the chemistry make up of the means to do this!

Ignoring this will only mis-match the medium of exchange volume to the velocity of distribution again.
The only point gained is making same problem on the ground in a different way! In other words, just another variation on a top down ruled society. The way to implement credit has to be locally and done in a method outside the political paradigm-which the majority of credit should remain as, due to praticalities of human nature in the political realm.

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- Ellen Brown, on July 7th, 2009 at 1:16 pm Said:
  
  I see it the other way. “Credit” is just a legal agreement; the proper party to oversee legal agreements is a public agency like the judiciary. You don’t want private judges; so you shouldn’t want a private bank dispensing “credit.” A merchant can advance credit to his customers, accepting payment for his goods over time; but in today’s society, the merchant may not know his customers and therefore doesn’t trust them to repay. However, the merchant does trust the local bank, so the bank steps in and says “okay, we’ll pretend to have the money, which we’ll write into the borrower’s account, and he’ll pay us back plus interest, balancing the books.” But it’s all a fraud; the bank doesn’t really have the money, and lately the banks have been caught in that ruse. The BIS has demanded that banks have at least 8% of the money lent in the form of “capital,” and when loans default the missing money is taken out of that capital. If more than 8% of the loans default, the banks are in the hole, which is why they can’t make new loans these days. If it were all on the up and up — 2 parties who go to court with an agreement that the court oversees — there would be no fraud and no capital requirements. The borrower would just pay the merchant over time, paying extra in the form of interest in return for the merchant taking the risk that the borrower doesn’t pay. But you need that third-party court system to make sure everybody plays fair and can be found if he skips town, etc. The third-party intermediary should ideally be a public agency, not a private, secretive company driven by greed and profit, which you can’t necessarily trust.
  
  Reply
  - Ellen Brown, on July 7th, 2009 at 3:18 pm Said:
    
    Anyway how WOULD you issue credit “locally” without government? Credit of what? You can’t issue the “full faith and credit of the United States” (i.e. write dollars into an account) unless you’re a chartered bank. You can have a community currency, but who is going to accept it? Only the members, and they may not have the goods and services you need the credit for. Publicly-owned banks are the cleanest, simplest, most efficient solution.
    
    Reply
    - Nik, on July 7th, 2009 at 9:00 pm Said:
      
      I didn’t explain clearly enough in my meaning.
      The problem being the way credit is defined in the ledger, by the private financial interests, is at it’s core a problem of arithmetic-an accounting error. The accounting error is systemic though.
      So the balancing solution can be advocated for at any level. And it is an accounting error, so it is an untypical issue in the way that most people percieve the politics that they form all their opinions around.
      So it doesn’t neccessary need the usual political battles and issues, internal and external, that are manipulated by the money power. It can theroretically be approached in an entirely different format in relation to people getting together on the ground, not requiring centralisation for organisation, or even consensus on any other issue. It is kind of an inpersonal issue, which is a strong point i think.
      
      Well run public Banks have been very successful in the past while they lasted in the political process. If common sense was independant it would make things easier, and people would have public banks.
      
      Reply
      - Ellen Brown, on July 7th, 2009 at 10:17 pm Said:
        
        Ah. We agree then!
        
        Reply
Nik, on July 18th, 2009 at 11:41 pm Said:

Supporters of a Gold as ‘real’ money concept who believe in choice shouldn’t have a conflict with public liquidating money ‘Credit’ systems -like that of Ms. Brown’s well researched examples of step behind govt. spending of interest payments calibrated to the previous credit price/G&S dynamic, or of step ahead dividend economic credit payments calibrated to the same price/G&S dynamic.
They both can exist co-operatively side by side to the extent that their respective utility is demanded by a population. If some gold supporters believe primarily in the concept of choice, they should be promoting both for they are complimentary to a free market value system based primarily on goods & services.

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Jere Hough, on July 6th, 2009 at 10:40 pm Said:

therooster, on July 6th, 2009 at 7:56 pm Said: “It’s socialism if it’s centralized on the basis of government control.”

********

But that is nonsensical gibberish that arises from confusing wealth with money, among other Orwellian myths. Socialism is, by definition, the government ownership and control of THE MEANS OF PRODUCTION.

Money, on the other hand, is nothing but a claim on those real wealth assets that people like the Austrians so thoroughly confuse with money itself.

Beyond this, everything you. “the Rooster” has written above is pure fantasy that Wall Street would have us accept as reality. Reality is what is written in Ellen’s book, and is what replaces the “Money Matrix” that the Wall Street creators of Phantom Wealth have substituted for the “real thing”, and that you and your fictional story would have us continue to believe.

Real money is nothing but a public utility or service. It is an accounting device that allows for the easy transference of resources, goods and services in place of an inefficient barter system or exchange of commodities. Real money does not have a usurious price tag on it that goes into the pockets of the banksters. Real money carries no interest, or only enough interest to pay for the accounting services it renders.

And your final absurdity, that “weight is the basis of real money” is precisely the opposite of the truth. The distinguishing characteristic of money that sets it aside from a commodity is this: Real money is valued by it’s lawful stamp, while commodities are valued by their weight. THERE ARE NO EXCEPTIONS TO THIS RULE!

You, “Rooster” are guilty of all that you accuse Ellen of, and far more. You defend and uphold the biggest criminal enterprise in all of mankind’s history: the international syndicate of private central banksters. The day of reckoning for these thugs you support is rapidly approaching.

To those who seek real answers:

In addition to Ellen’s wonderful revelations about our money system, I would highly recommend David C Korten’s last two books on what needs to be done to heal our nation and world of the damage done to it by corporate and financial criminals.

They are “The Great Turning: From Empire to Earth Community”

And…

“Agenda for a New Economy: From Phantom Wealth to Real Wealth” Another subtitle is “Why Wall Street Can’t be Fixed, and How to Replace it”.

These two books can help all concerned citizens find the way toward healing, not only our economic and financial systems but our entire planet, by removing the greatest mechanism of globalist exploitation ever created by man: the PRIVATE modern money machines. Once this is done we will see that the resources exist to feed our peoples, clean up our air and water, and deal with hundreds of other humanitarian issues. They have always existed in abundance, but for the greed and avarice of the few.

Money creation MUST be separated from other banking operations and finally brought under the sovereign control of the public through its duly elected representative governments.

We must reclaim our money, and we must reclaim our representative governments.

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therooster, on July 7th, 2009 at 2:24 am Said:

The creation of money is a means of production unto itself and as long as there is a supply driven money system, there will be a supply driven economy. We’ve always been supply driven going right back to the dawn of modern civilization.

If money creation is controlled by government, then people are vulnerable to the hidden tax of inflation. God knows they love to spend. The problem is not an interest issue in this case, but poor supply dicipline, regardless of intentions. Let the market govern supply which is a seperate structural concept from fiat currency whether it be created by the central banks or by government.

Government fiat simply replaces one hierarchy for another.

Money is more than a means of exchange. It’s a store of value and any past experiences that societies have had with hoarding gold have been based on an inefficency to deal with the logistics of gold in its distribution. In the most recent real example, this would go back to the pegged relationship between dollars and gold at $35/ounce during BW. If currency supply is inflated while the gold price is fixed, then gold becomes a bargain and people want to call it (France) or hold it on the basis of supply-demand fundamentals. This is just another reason why the peg had to be severed in favour of a real-time relationship so that true market fundamentals could be utilized. Going back in time, this same pegged characteristic always plagued the “gold as money” logistical characteristics of liquidity, right throuout history. More money translated into needing more gold. The problem was not gold, however. The problem was poor liquidity due to gold’s poor distribution support system of the day. Digitization of weight and the ability to transfer allocated title has solved that. People can control their own personal gold supplies now. They can transfer the allocated title of a milligram or even less. The ability to split the gold weight was the whole key …..once gold could float in its dollar price, of course.

Wall St. has nothing to do with the above individual ownership of gold as money. Payment processors are independent interfaces for private gold ownership. They are also competitive. It’s simple and convenient to be able to buy something as small as a toothpick anywhere in the world with a few clicks of the mouse on your P.C. When the transaction closes, it’s totally closed.

Don’t confuse centralized banking with individual ownership of bullion who’s title can be used as fully backed money and transfered in an instant.

It took the age of information to marry the age old concepts of debt-free store of value with instant liquidity. You too are invited to the “great wedding”.

You cannot pour new wine into old wineskins. Step into the information age. I have to admit that debt based currency was a necessary evil on the way to real-time commodity money. Again, the peg had to be severed and if you go through the simple real-time algorythm of a real value for real value trade of bullion for a widget, you will see that the mathematical value of gold’s real time fiat trade value is actually indispensable to the operation of the model. Gold weight is the oney, however. The fiat number is simply a measure of the gold weight because of pricing habits.

Centralize gold and let all national currencies float around it in real-time. That’s the simple basis. No national currency should ever serve as a reserve currency. If you read Gold Wars by Ferdinand Lips, you’ll discover that bankers don’t even trust paper when making settlements via the BIS. They want gold.

The law of weights and measures have re-married in a real-time functional union. You’re promoting a measure that has no weight, which is what a debt currency is, much like a maiden who runs around through life looking for a husband.

Good news. Capitalism is actually incomplete, much more so than it is flawed. Real-time gold is barter, but with the ability to split the gold and make the system so much more user friendly than in gold distribution systems of the past.

New wine needs a new wineskin …. wouldn’t you agree ?

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Ellen Brown, on July 7th, 2009 at 2:32 am Said:

Agreed, but gold is an old wineskin. Let’s try something that has never been tried, for as long as the U.S. has been a nation — credit issued by publicly owned banks for the benefit of the people themselves. One request please: could you keep your entries shorter? It puts readers off having to plow through long dissertations.

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therooster, on July 9th, 2009 at 10:04 pm Said:

Ellen … are you still of the belief that a gold based money system requires increasing amounts of gold for the sake of economic growth and liquidity ?

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Ellen Brown, on July 10th, 2009 at 12:07 am Said:

Yes. It’s a moot point though, because there is no way we’re going back to a gold-based system.

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therooster, on July 10th, 2009 at 2:02 am Said:

You’re a little late, ellen. Gold has already been monetized by the marketplace. Like I said, there’s no financial crisis, as per a finding a designed solution. There’s simply a marketing challenge.

Model works like a charm too. Instant payment anywhere on the globe with debt free store of value.

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Ellen Brown, on July 10th, 2009 at 2:07 am Said:

Have it your way. I don’t find it an interesting issue.

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Concerned Patriot, Lorraine, on July 15th, 2009 at 12:43 pm Said:

You don’t find it interesting , E|llen ? I’ve read through the posts. Rooster makes some great points about “liquid gold”. He’s actually correct. Gold has not been a problem in gold based money systems of the past. It’s been gold’s distribution characteristics based on the logistical issues of non-digital support. The age of information changes all of that. Gold title by weight can be split a zillion ways.

I have my own digital gold account as a result of recent due diligence over the last 5 days. I guess I should thank you for the creation of this site and the useful information that comes from various directions.

A market should decide what it chooses to use as money and it should have direct influence on the guiding fundamentals of supply, demand and trade value. Bank fiat and/or government fiat do not and cannot provide for that.

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Ellen Brown, on July 15th, 2009 at 3:07 pm Said:

I guess you’re right; I don’t find it interesting. I explored all that and decided it wouldn’t work. I have chapters on it in my book. Right now I’m interested in figuring out how to save California from the jaws of the Wall Street banking monster. Will your digital gold save California? Don’t think so. The “Golden State” doesn’t have gold anymore!

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Jere Hough, on July 17th, 2009 at 8:23 pm Said:

“Gold has not been a problem in gold based money systems of the past.”
_____________

Sorry, but you are misinformed. You should read Ellen’s book, or Zarlenga’s The Lost Science of Money, or the monetary historian Alexander Del Mar, among the many authorities that disprove such naive assertions.

If you think rooster makes good points then I think your understanding of money and economics is terribly biased or skewed to one side of the issue.

For instance, the huge volumes of gold the Spanish plundered from the Americas drove the price of gold so far down that the Spanish economy collapsed, and has never since recovered.

Gold has a value as a commodity, and always has, but it is not money, nor will it ever be valid money, if “money” is properly understood. Gold or gold certificates (receipts) have always been used to begin the deceptive process of private fractional reserve money creation.

Your last statement shows a lack of understanding about the nature of money as well as the function of markets and the market system.

I own gold, silver, and other liquid assets as a hedge against inflation, deflation or money collapse, but these assets are not “money” per se.

All such misunderstandings comes from a confusion between the concepts of money and wealth, and the distinctions or differences between them. And using gold certificates in foreign trade is so expensive as to be foolish, especially in small quantities.

Like Ellen, I don’t find misconceptions about gold as money interesting. The simple truth ever remains: when gold is made to be money, only those with gold will have money, and the private central bankers now own all the largest stocks of gold in the world.

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Concerned Patriot, Lorraine, on July 17th, 2009 at 11:01 pm Said:

Jere ….

I’m sure you’re well intended, but your argument is very outdated.

Gold exploration & production, with all of its techical advantages of the 21st century, is falling and has been for several years. The spanish were lucky to have capitalized on exploration and mining that took many generations. It wasn’t “new” gold. It was new to the market’s knowledge.
Are you expecting any major gold finds anywhere soon ?
http://www.dani2989.com/gold/goldprod0509gb.htm

If you want to debate the prospect of real over-production , consider what the structure of central banking has done. I think it’s a grave mistake to shift from private centralization to any other form of centralization, government or otherwise.

As for the fractional reserve paper creation against gold stores, that issue was solved once gold was set free to float in real-time. In the ole days, a pegged relationship between gold and paper (like dollars) meant that you had to have more gold to issue more paper. Market law is still adhered to when the limited asset rises in price relative to the expanding paper ratio. You admit it in your investment approach in connection with the hedge factor. This floating relationship only began in 1971, so any and all arguments that predate 1971 should be re-examined.

There was also an issue of too much consolidation of power in the gold holding & lending business model of reference. Networking the different parts of gold buying, gold accounting and gold holding decentralizes that power and on the basis of free market fundamentals, is proving to be the best way to go.

What took place in 1971 wasn’t enough to keep gold monetized as it was during Bretton Woods, however. At that point, even though gold could float in relation to paper and gold was allowed to rise in value on the basis of supply-demand fundamentals, no efficient way to instantly split gold, by weight, had been developed. That’s a logistical issue, as the rooster pointed out and it has been resolved by way of digitizing the accounting of 100% gold backed currency where payment is by the transfer of weighted title.
Measurments of the gold can be done in any currency, keeping in mind that we still price things in paper. Those currency based measurments are in real-time.

You can now instantly buy anything, small or large, with titled store of value, debt free and you can make payment in an instant in a global seemless infrastructure. Best of all, there is no central power. It’s private and quite competitive.

Gold is still in an investment leg of this evolution because its price must rise sustantially to cover off liabilities created by all manner of derivatives in the global market. It’s at that point that it will be monetized and it does not have to be by any government , whatsoever. It could simply be monetized by the market. Gold does not need a “crutch” fiat declaration of “legal tender”. It’s real money.

If fiat was real money, government issued or otherwise, why would it need a legal tender label ? Fiat was never a free market choice, besides, I’m refering to gold as a competitive form of money. What’s wrong with a choice ?

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Jere Hough, on July 23rd, 2009 at 4:49 pm Said:

“Gold does not need a “crutch” fiat declaration of “legal tender”. It’s real money.”
__________

This is just one glaring example of how confused and disordered your thinking is on the subject of money, and for that matter economics in general. I will make this last attempt to advance your education on these matters:

Gold is “real wealth”, a liquid asset, a commodity, NOT “real money”. And the “fiat declaration of legal tender” is precisely what makes real MONEY real. It is it’s legal status that guarantees universal acceptance that makes MONEY real. It is what distinguishes “MONEY” from wealth (liquid assets) such as gold or silver, or other commodities.

Even gold or silver money is only “money” if it is valued in the marketplace and accepted by its stamped legal value. If the gold or silver coins are valued by their weight and current market spot price then they are not being used as money but as the commodity gold, or silver.

This is the prime distinguishing feature between “money” and commodities. Money is always accepted at face value, and commodities are traded by weight and market price of the commodity at the time of the trade. That is their distinguishing feature. It is what sets them apart from each other.

Now, I am finished with this exchange. Please read some good economics textbooks (if you can find any; I would recommend Henry George or David C Korten) or some good books on money (like Ellen Brown’s) and educate yourself on the fundamentals and definitions of the terms you are trying to use.

1) Gold is wealth. It is not money.
2) Money is used in exchange for wealth. It is not wealth. It is also a measure of value, but has no intrinsic value in and of itself. Money can even be an electronic bookkeeping entry.
3) Currency, is the circulating form of fiat (legal) money, in tandem with coin.

I will not endeavor to correct your many other confusions on these matters. However, I will always do my best to answer all sincere questions.

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BUT GOVERNOR, YOU CAN CREATE MONEY! JUST FORM YOUR OWN BANK.

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