Sound money by Bill Frezza (Forbes op-ed)

In the recent past, Forbes has surprisingly and boldly gone where few, if any, main stream publications have gone or will go.

Granted, it is only an op-ed as, in the recent past, it was always third party contributions making similar points rather than Forbes actually picking up standing behind the ideas and arguments being expounded. But it is a start nonetheless.

Here are some excerpts that define the entirety of what money is and how it should do what it is supposed to do. Nonetheless, the entire article is truly worth a good read.

[…] Frédéric Bastiat […] stat[ed]ing that money was a promise to “Pay the bearer a service equivalent to what he has rendered to society.” Note the past tense — a product or service must be rendered before money can properly come into existence.

Money’s unredeemed promise might be tokenized by a paper note, a gold coin, or a few bits in a computer database. ” […] The moral claim real money places on society on behalf of its bearer comes not from the intrinsic value of the token but from the fact that the bearer had previously produced some good or service deemed valuable by others. This is what gives money its moral legitimacy.

Note in the above excerpts that money might be tokenized. It might be, because it does not have to be. Money is only a vehicle that facilitates exchange. Money is not intrinsically valuable. It matters not what is used as “money”. In prison, cigarettes can be money. On Yap island, stones was money. On some Pacific islands, shells was money.

“Money” only facilitates the exchange of one’s skills and ideas in order to obviate the problem known as “coincidence of wants”. That is, in a barter society if you are a shoe maker and need bread, you must find a baker that might want shoes before you can get your bread. Money allows you to sell your shoes to absolutely anyone that might want shoes an then you can use that money to buy your bread or anything else you might need. The “wealth” in this example is represented by the bread and the shoes. It is the product of human ingenuity and skills that is intrinsically valuable. Not the vehicle that allows the exchange of same.

In the article, Mr. Frezza also remarks on what effectively is happening on the ground in Greece where barter networks have sprung up in order to obviate to the loss of revenue of individuals and their lack of savings. The necessity of returning to barter also suddenly enlightens individuals to what money is or at least, what it should be.

Money cannot exist prior to anything having been produced.

And this is the great con that a restricted elite of bankers with the assistance of politicians has successfully pulled over society in the past century. It began in the USA on 23rd December 1913 and was subsequently pulled in Europe in 1971 and then, through globalization, gradually on all countries that became members of the “Floating Exchange Rate” mechanism i.e. all currencies that accepted the US$ as reserve currency.

Today, the nature of money has been subverted to the point where even most finance professionals staunchly believe that Debt Based Fiat Money is capital.

It is not. And the reason should by now be clear as to why.

But why is it important for us to understand the nature of money? All of the above may seem like an interesting intellectual exercise. But are there any real life implications in pushing for one type of money or the other?

Those individuals that are now having to resort to barter not by choice but by necessity, have understood the real life implications of DBFM:

““The most exciting thing you feel when you start [bartering] is this sense of contribution,” a participant reports in a recent news story. “You have much more than your bank account says. You have your mind and your hands.”

– Permit me to issue and control the money of a nation, and I care not who makes its laws. (Mayer Amschel Rothschild)

As an illustration of the nature and consequences of DBFM imagine the following. You are playing Monopoly with your friends and you are the bank. Imagine too that you just happen to be the owner of the factory that produces the Monopoly game boxes. In this construct, your source of Monopoly money is inexhaustible. Thus, in this construct too, you cannot lose. No matter how inept you may be, eventually you’ll buy everyone and everything out.

And that is the reality of DBFM. The monetary authority and the entities that gravitate around it, simply by dint of having access to the newly created currency and credit first, enjoy a disproportional purchasing power advantage over anyone that comes later in the chain of users of the currency. And as far as the consumer is concerned, well, by the time the new money reaches his/her pocket, it is at the lowest purchasing power. So that, in due course, the monetary authority and its acolytes will end up owning everything … and everyone…

This is the importance of understanding what money is and how it works.  And although this dynamic has been evolving over the past century it is only today that most people are beginning to feel the real life squeeze the monetary authority has over people. This is not a metaphor. This is a real, honest to God, no holds barred coup by a restricted elite over the rest of society. This is the reason why, financial institutions are at the top of the ownership tree of most productive assets in the West and why today all our leaders are capable of doing is shoveling money hand over fist towards the banks.

Other than open and violent rebellion, is there anything that we can do to reverse our descent towards physical and material enslavement?

So far, I have been advocating collapsing the velocity of the currency so as to impact the capital ratios of the major banks by closing lines of credit, moving savings to smaller local banks or co-ops, increasing savings, accumulating gold bullion and, eventually, just plain leave your country so as to starve the beast of your fiscal contribution.

But after reading Mr. Frezza’s Op-ed, I am reminded that barter too is a very effective way to collapse the velocity of the currency. So, yeah, barter… barter anything and everything… barter away all you are allowed to… because, for example, in countries like Italy, there are restrictions as to what assets can change ownership without making use of money. I found this out twenty years ago when I wanted to gift my vehicle to my sister.

There is more to money than just the bits of paper in your pocket. Money and the monetary system are upstream of all and any human dynamics bar none. The choice of monetary system is a choice between liberty and enslavement and indoctrination.

A bon entendeur, salut!

– If the American people (or any other people) ever allow the banks to control the issuance of their currency, first by inflation, and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property, until their children wake up homeless on the continent their fathers conquered. The issuing power of money should be taken from banks and restored to Congress and the people to whom it belongs. I sincerely believe that the banking institutions having the issuing power of money are more dangerous to liberty than standing armies.
(Thomas Jefferson)


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5 Responses to “Sound money by Bill Frezza (Forbes op-ed)”

  1. Pat Donnelly Says:

    One of the reasons i am less shrill than you, Guido, is that I am aware as are you, that we have far more wealth than in the last depression. Japan holds no fears for the bulk of people, unpleasant though it will be for many.

    Social cohesion is less strong in the USA etc but food stamps and so on will ensure no great mob events. Money can be printed for projects to occupy the able bodied and spy jobs for those to keep agitators under supervision, so what problems do you foresee?

    • guidoamm Says:

      What problems I foresee? You mean other than a war where the unemployed and the homeless will be sent to the front to fight an ostensible foreign enemy with the inherent loss of human life and devastation of countries that will engender? Not much.

      If you have no debts and understand how to protect yourself from the coming onslaught of increased taxation and diminished social and public services and you are past the age for being drafted in a front line position, I suppose you should have nothing to fear.

      • Pat Donnelly Says:


        That would require a really big false flag! One that is overdue, given the responses to the occupy demonstrations. These were I presume, designed to flush out the likely leaders of resistnce? Obama’s mentor was involved in that sort of operation?

        The regime changes suggest an Islamic foe? No real need for conscription there, surely?

        If you really thought that way, you would have taken steps to change country? If this is a definite item on the NWO agenda, then I expect it to be a series of brushfire wars, akin to Iraq, against less organized opponents? Two decades of it. Else the Chinese make a big mistake!

  2. ducati998 Says:


    Unfortunately ‘barter’ is incommensurate with the division of labour, and will lead to a breakdown in civilization. Barter as an interim towards the selection of a free market money is both historically and logically consistent.

    jog on

  3. Pat Donnelly Says:

    Most financial professionals want fake money. It makes their job, stealing OPM, much more lucrative and easy, as carrying gold and silver requires muscle.

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