I apologize ahead of time for using this title to get people to read something thinking that there really is some political solution. There isn't. The point of this paper is to demonstrate another solution. It will also attempt to correct some of the questions people ask of any Riegel inspired ideas. But first, let's address some of the political matters as they seem current.
Now we may or may not have heard the epithet, “libtard.” That's a person of “liberal” politics who is regarded as somehow retarded (mentally slow to catch on) by those with different politics. But there are “conservitards” as well. Yes, those are people with “conservative” politics, just what they intend on preserving / conserving and for what reasons is never very clear to them; they are as well, slow to catch on, are somehow retarded in their thinking.
We'll make a few statements about each caste, the other castes being those of no party, or so they assume. They aren't merely innocent bystanders. These people cast a straw at the whole system by claiming no part in it, the “independents” who generally pretend to espouse some genuinely liberal social idealisms with an odd mixture of the other end of the banker's ready made dialectic; either THEIR credit or THEIR gold. Yes, they choose the gold side, believing, CONNED into believing, that in precious metals lies freedom, when it's actually the oldest of all means of being enslaved.
We're going to speak some about gold too. But first the libtards: the best book I have for them to read is Darkness at Noon by Arthur Koestler. What many of them have done is to relegate their politics to the directives of “Liberal” politicians who take their orders from political elites espousing the usual literal interpretation of the three poisonous frogs (since they came in during the French Revolution) of Liberty, Equality and Fraternity. The original common law was Life, Liberty and Property. So what was and is the difference? The right to life was eliminated. That should be an immediate tip off.
Anyway, the “Liberal” interpretation of these are directives to reorder society as they see fit. Is it Life, Liberty and Property? No, it is Liberty, Equality and Fraternity and all three ideas are so poisoned that there can be nothing allowed among the members of this “cult” than strict political cant, what we call “political correctness” and hence the resultant “triggering” of deliberate social responses in its cultist members. In so doing, such become exactly what their detractors see; sheeple being led to their own slaughter.
At present the “conservitards” would seem to be on the ascendancy, but they are woefully misinformed about everything starting with the US Constitution. They have FAILED to understand the commercial nature of this document, they have likewise FAILED to see the references to precious metals as to THEIR (globalist, central bankers, elites) money, NOT money per se and certainly not money that “conservitards” actually can claim to own or have originally issued. Most “conservitards” think they prefer dealing (bartering) in actual gold and silver coins or perhaps in paper documents “backed” in a 1 for 1 correspondence with such coins. Let's give a simple example of how this would work:
Let's say that your gold backed money is in some arrangement with gold and silver. Let's say that it's a bimetalic design, allowing both trade in gold and silver with gold holding the Figure 1 position (basis) with respect to any paper “notes” against it. Let's say that the arrangement is 1 oz of gold = 1,000 units to be understood as paper notes. No specific time is applied. Here's what you have:
On 11/2/11 we had a close of $1,728 for 1 oz. of gold. But that was spot price. We can get our hands on gold for 20% more than spot in most cases, so we chose $2,160 as the price we'd have had to pay for an oz. of gold on that date. 1,000 parts make each part = $2.16. Silver turns out to be around 19.56 of these units: $42.24 at the time to acquire a 1 oz silver coin.
Now we're still sticking with the direct “backing” of money by gold and silver here, so time marched on.
A year later 11/2/12, gold closed at $1,677.51 and silver at $30.85. We're amazed at these figures now. What happened to the purchasing power of your “backed” money? Using the same requirements, $2,096.89 bought 1,000 of your paper money and each one of those is now $2.10. Silver buys 14.69 of these same units. Your money is only 6 cents off in one year measured in dollars (which is also just another of THEIR commodity based moneys). But notice that precious metals already buy less. Let's move on.
In 2013 (11/2/13) gold closed at $1,315.70 and silver at $27.38. The prices to acquire the metals were $1,644.63 for gold and $27.38 for silver. So the thousandth part is now $1.64 and silver buys of 16.70 of these units.
In 2014 (11/3/14) gold closed at $1,170.15 and silver at $16.12. Prices to acquire were $1,462.69 and $20.15 and so the monetary unit is now $1.46 and silver buys 13.80 of these units.
We are just three years down the road. The proposed money is actually tied (pegged) to precious metals so that as THEIR prices for these metals is determined in THEIR markets (since it is THEIRS from mines to mints and markets, NOT yours or mine), the actual money in exchange falls in purchasing power. $2.16 - $1.46 = $ .70 or the actual loss of purchasing power of said money by 32% That's pretty significant for such a short period of time.
Now we could have started our series from long before gold was priced as high as it is now and we'd have had a money that increased in purchasing power as gold rose in THEIR markets for it, and fell as THEIR markets depressed the prices for it. Regardless, THEIR money changes value and is therefore an unfit device for measuring all other value since it is not based on something that does not change relative to everything else.
Riegel's observation, also Kitson's before him, was that a unit of exchange that is truly fit to serve the purpose must represent something that does not change; a transaction at a distinct point in time. THAT Figure 1 basis would stand athwart all commodities as money whatever they may be. But the choice must be made with reference to capturing the largest possible piece of purchasing power as measured in THEIR money, including precious metals, which are also THEIR money.
That's what our proposal does. So for instance covering exactly the same time frame we used above, the proposed international standard value unit or Valun remained exactly where it began while purchasing the present value of that transaction changed in THEIR money. The Valun preserves purchasing power above and beyond all of THEIR money, by design.
It began at inception (11/2/11) at $2.16, but that $2.16 is not the same as $2.16 today. By design, that $2.16 is now $2.83 (11/29/16), capturing exactly the value of that 2011 $2.16 as a FIXED basis for valuing everything else. Prices due to inflation, where the money is never accounted as a commodity or subject to speculation, is rendered impossible. Yes, impossible. That means that where prices are high in Valuns it is entirely due to scarcity or demand exceeding supply, which is what prices would tell you in any money.
What happens when the original initial price of gold transaction is eclipsed? It goes up to a new price inception point and that new transaction continues as the basis for all Valuns. If the US dollar as a vehicle for acquiring gold ceases to be able to buy gold, as it was for quite some time, between 1933 and 1971, then we would be back in the pits of the Great Depression or perhaps something worse. We could still operate with a Valun standard based on whatever would be the largest possible quanta of purchasing power in THEIR money until THEIR system crashes.
If all THEIR markets are no more and gold trades for whatever it trades for, then we'd say that 1,000 of our Valuns would equal 1 oz of gold and some other moving factor would accomplish the same for silver. BUT as long as there exists ANY speculative market for these metals, their price is subject to manipulation and that is where the folly lies, in trusting to the whims and wills of these traders.
If there were none of these markets, perhaps we'd eventually revert to actual gold and silver coinage and paper notes for larger purchases; as dollars or euros or yen or yuan are ascribed to gold and silver bullion coins of today, well below their actual value accoring to THEIR markets.
The reason we do NOT accept ANY present notion of “gold backing” is because we already know a lot about gold, its markets, its mines, who actually controls it, etc. Same with diamonds. We want out from either THEIR credit or THEIR gold, the two ends of THEIR dialectic. The value does not ultimately reside in any THING, it resides in each of us. Each one of you out there has value in and of yourselves. Each one deserves the credit each community is willing to accord you. If you seek something more, there is a fresh start for many and a way to secure preservation of your wealth; we're speaking directly to all the John and Jane Galts out there. We need to organize and do something on our own.
Current Hypothetical Value of a Hypothetical Value Unit