#69 Self Issued Credit

Most of you were probably never asked to put a dollar amount on yourselves. So depending on the currency you normally use, dollars or something else, try a little experiment: just take a few moments and determine in your own mind to the best of your ability what you are honestly worth in terms of skills you are capable of, things you have acquired the ability to teach, and any ideas you have that could earn you an income. Include in that any current or past employments and what you were paid for them. Come up with a monthly figure in your own currency for what that would be.

What you are doing is determining what your Innate Wealth is. This is going to seem a new concept to some, but please don't let the conventional economics bamboozle you into believing that wealth is merely things or property. Wealth, all wealth, true wealth, is only that capable of generating an income measured in monetary terms; how much in money terms does whatever you have cause to produce that capable of being bartered for other things you need but don't produce? That's getting back to the fundamental use of money, to split barter. Money is a technology or a machine that was and is one of the superb inventions of mankind.

But all money requires that it be accepted in trade. “Surely they'll take my gold,” the gold bug will cry. “Hell no, if the price in dollars continues down,” might be the prudent response of the proprietor. He has taxes to pay and they're easier to pay in the local currency, not gold.

But meanwhile there isn't enough money to suit the needs of most people worldwide. In fact the lack of money properly applied locally where it is needed most, is at the root of most problems. The solution as E. C. Riegel saw it, was for people all by themselves, to set up a parallel monetary system and begin using it. Since our last post, some have asked that were they to be paid in Valuns alongside dollars and have to come up with the extra dollars at tax time, how many Valuns should they be willing to issue and be paid in? The answer is depending on how many dollars one needs to pay any extra taxes, the same as if they'd received a raise, except that in this case the raise would be paid in another money.

An example: a $15 an hour job produces a $30,000 annual income. If the job is really undervalued by $5 an hour, it may be because the employer doesn't have or can't afford that extra money. That would be a $40,000/yr job instead of a $30,000/yr job, an increase of 33%. If no extra dollars, then the extra is paid in Valuns. As of 3 March, 2016 a Valun is $2.77 therefore $5 extra in Valuns is V1.81 or a projected extra annual income of V3,620 or $10,027.40 which is as close as we please to the objective. The A member employee who accepts this offer is prepared to have deducted for tax withholding from his paycheck what that extra would be in dollars, for a $40,000/yr job and receive the balance of his pay in Valuns.

From an accounting standpoint it would amount to the extra pay in Valuns being issued on the first day of a pay period, described in a very simple one page document called a Labour Contract, that would describe how many Valuns would be paid over what period of time and that is all. We have described elsewhere how these Valuns are first issued to the employer who must be a B member in an Independent Exchange and then paid back to the A member on successive paydays. Should the employer wish to use the Valuns between the time they are issued and the time they need to be paid back to the A member who issued them, they are free to do so. This is called float and it is offered to B member employers without interest until it is scheduled to be repaid to the issuing A member employee. At that point the employee has actually been paid in his own money. His labour backed the money he issued and whatever he exchanges for that money among other members of the trading community that decides to use Valuns, will satisfy the terms of his barter; labour for goods and services by the vehicle of money, and his barter transactions will be settled.

Now of course, and we have emphasized this too, both the A member employee and the B member employer have accounts in an Independent Exchange or IE. The real money transfers are made between these accounts. All the real money is in accounts, it always was too, and don't let anyone try and convince you otherwise, even when tokens were precious metals. Facts are, that even under a precious metals basis, very little of those actually circulated. What were circulated were certificates that could be issued by goldsmith/bankers up to 10 to 1 against real reserves. But we are venturing into known territory.

Getting back to the proposal, meanwhile, the evidences of money are in the form of short circulation V Checks which, as a matter of fact, would be bought and paid for in dollars, or whatever local currency, by the B members (all the important privately held “pillars of society” businesses) that would be invited to join a local exchange) and would write off the charge as a legitimate advertising expense, since their businesses would be featured in designs on the reverse sides of all the V-Checks. They would actually be universal coupons. You wouldn't have to spend them at the businesses that paid for the ads on them, but you could. This would also alert everyone in the community as to who was participating in the Valun exchange network or VEN, the basic understanding of a private market.

These V-Checks would be the nicest paper money you've ever seen. On the obverse or front side would be each IE's identification, the number assigned to each V-Check upon transfer of Valuns to obtain it and its date of expiration. Upon expiration, each V-Check could be exchanged for a new one or deposited regardless of whether it had expired or not. While the V-Checks are circulating, the real money is in each IE's V-Check account. But each member has their own Valuns in their own account. All member accounts are private and none of the Valuns in any account may belong to the IE for the usual purposes of lending fractions of a reserve as is common in the usual banking models, so no deposit insurance is required. As we've described elsewhere, all finance operations will be handled by separate private companies, B members of the IE's. The IE's will only follow the orders of their members based on Labour or Credit contracts or any analogous contracts that may be devised.

The glue holding everything together is a proposed properly constituted organization to serve all the IE's and to maintain uniform acceptance and adherence to the basic rules. If one keeps it simple then even the simple might understand it. We identified this organization as IVES, the International Valun (or Value) Exchange Society. We have lately begun thinking of this organization as “not for profit,” because we really don't want to give an incentive to this organization to profit from any of its operations. If IVES isn't designed for profit, then all its affiliate IE's, which would be “for profit” organizations, since they earn a tiny fee for each transaction, would be required to pay some dues to support it. IVES as said elsewhere would be a B member of every Independent Exchange as every IE would be a B member of itself.

We also indicated that we'd prefer to think of starting up with a minimum of three counties in one state (for the US). Each county would have its own IE hence its own designs for V-Checks (there will be so many different designs that counterfeiting would be pointless).

The denominations of V-Checks projected would begin with the 1/2 Valun, currently at $1.38 and designed to fall no lower than $1.08 (so we meet some existing public laws concerning alternative circulating money), then the 1 Valun, 2 Valun, 5 Valun and 10 Valun. Ten Valuns is almost $30. Other larger denomination V-Checks may be offered eventually. For any size transaction, personal checks would also be devised. As E. C. Riegel indicated, a community of traders could get along with a common accountant and each member given a check book.  (V-Checks would have an expiration date six months ahead of the date they are exchanged for circulation.  After they expire, they can either be exchanged for a newer V-Check or deposited.  This provision is also proposed to satisfy other public laws.  More legal research on these matters on a state by state, country by country basis, is required.)

Now, above we described what a $10,000 raise in Valuns would represent. Here are comparable equivalents at this point in time, with a Valun equal to $2.77 on 3 March, 2016:

$5,000/yr = $2.50/hr = V .90/hr = V1,800/yr
$10,000/yr = $5.00/hr = V1.81/hr = V3.620/yr
$15,000/yr = $7.50/hr = V2.71/hr = V5,420/yr
$20,000/yr = $10.00/hr = V3.61/hr = V7,220/yr
$25,000/yr = $12.50/hr = V4.51/hr = V9,020/yr
$30,000/yr = $15.00/hr = V5.41/hr = V10,820/yr
$35,000/yr = $17.50/hr = V6.31/hr = V12,620/yr
$40,000/yr = $20.00/hr = V7.22/hr = V14,440/yr
$45,000/yr = $22.50/hr = V8.12/hr = V16,240/yr
$50,000/yr = $25.00/hr = V9.03/hr = V18,060/yr
$55,000/yr = $27.50/hr = V9.93/hr = V19,860/yr
$60,000/yr = $30.00/hr = V10.83/hr = V21,660/yr
$65,000/yr = $32.50/hr = V11.73/hr = V23,460/yr
$70,000/yr = $35.00/hr = V12.64/hr = V25,280/yr
$75,000/yr = $37.50/hr = V13.54/hr = V27,080/yr
$80,000/yr = $40.00/hr = V14.44/hr = V28,880/yr
$85,000/yr = $42.50/hr = V15.34/hr = V30,680/yr
$90,000/yr = $45.00/hr = V16.25/hr = V32,500/yr
$95,000/yr = $47.50/hr = V17.15/hr = V34,300/yr
$100,000/yr = $50.00/hr = V18.05/hr = V36,100/yr

At proposed inception of 2 November, 2011 the Valun began at $2.16 whoich would have rendered lower numbers. Even so, the Valun should be understood to be a “heavy” currency; each unit carrying more purchasing power than the usual money (almost 3 times that of $1 at the moment) and would never fall below inception, unless gold struck a new high at which time the Valun's inception point is set higher, never lower, to compensate and each and every last Valun in existence becomes even harder. E. C. Riegel and Arthur Kitson before him, stumbled upon the fundamental basis for setting up a monetary system in terms of a Figure 1 transaction. That transaction was one ounce of fungible gold bullion = $2,160 on 2 November, 2011. We just divide $2,160 by a thousand and that's your Valun = $2.16. As the price of gold has fallen against this benchmark transaction, all Valuns have been revalued up in purchasing power against both dollars and gold. We point out that none of us had any part in any decision as to what gold or silver should be worth. We left that up to the speculators on those commodities, and the same goes for those that perform the same function with dollars (since they are also a commodity posturing as money). Meanwhile we conduct our business in Valuns and achieve stable prices for years to come.
 
We have just provided you with sufficient information to enable you to figure out what it might be like to start earning Valuns. But rather than a “trickle down” economics, this system features a “bubble up” economics. The question is, how much of this self issued credit to allow the poor who are the only people allowed to issue money as we would say, from nothing, because they have nothing?

We get some kind of clue from what state authorities are currently willing to grant people in desperate straits or even those who have retired on Social Security. But we have to understand exactly why these social programs exist. Honestly, for the time being, and because these programs were the necessary concomitant to allowing Capitalism to run wild; as we have said before you can't have Capitalism without eventually having to allow Socialism because Capitalism uses the protection of the state to destroy wealth in the process of creating greater and ever greater concentrations of, what is it? Wealth?

To them it's wealth because it's a lot of cash, stuff and property, but we say that wealth is only wealth when it produces an income. Therefore and get this please, all those “mom and pop” businesses that used to provide adequate income were wealth that the monopolist corporations funded by Capitalism (the mere making of money on money without working for it) destroyed.

Capitalism ultimately destroys wealth it does not create it. It creates lots of stuff in the hands of fewer and fewer people who can claim THEY are wealthy while the rest of the population has no wealth, because they have no means of earning an income.

To all of you facing the headwinds of the usual economic baloney, all of this may seem impossible to grasp. All you have to know is that a group of people have been at this whole dastardly business for hundreds of years and what they do generally explains why everything doesn't work as well as it could and why there are senseless wars, even more senseless investments in technologies which should be banned, etc.

So anyway we presently need Socialism because without it the vast majority of humanity would simply rise up and destroy the rich and the so called “wealthy” who have actually destroyed wealth in the process of amassing it. All we say is, we at the local community level will ultimately take care of our own, we will insure them an income, we will guarantee a definite floor below which no one need fall. Bringing an end to poverty will be so simple that only a banker wouldn't understand it. And they don't want you to know or understand it either. That's why they're so good at confusing you with the words they use, like wealth.

So let's take a cue from a local area resident that figures $1,500 a month would be enough to cover shelter, food, basic necessities. That's $18,000/yr. I shudder to think that back in the mid 1960's we used to pay high school teachers that much, but meanwhile the purchasing power of that amount of money has shrunk by probably half. Anyway, $18,000 in today's Valuns is V6,498.19 or V541.52 per month or around V3.25/hr. V3.25 = $9/hr which means that according to our simple boneheaded analysis, the minimum wage job should be above $9/hr. Most people wont work for that little money right now so we know we're close to the break point where work is one road and poverty is another. Question: if you are so concerned that the poor get to issue money even if it's very little, tell me, who ends up with that extra money? Answer: the most productive will end up with it.

All we're trying to demonstrate here is that it's getting time to start thinking about things differently, especially about money. Once you begin to do that a lot of things must fall under question.

David Burton

dpbmss@mail.com

Current Hypothetical Value of a Hypothetical Value Unit

[4 March, 2016: Pardon me, you're going to think I'm dumb but you basically have dollars which are inflating, that is losing purchasing power, and then you have gold and some other people overseas decide what that's worth, so it goes up and down in value relative to everything else and anyway it doesn't circulate very much because people want to hoard it, and then you have your proposed valun which is somehow based on gold and dollars. Why do you need gold in there? What's wrong with say making that $9 you came up with as minimum wage the basis for the valun?

Ben in Utah 

A few points first: dollars are also a commodity that speculators bet on relative to everything else denominated in dollars including gold. Why gold was chosen as the vehicle part of the initial transaction is because we can currently hold gold while we cannot at this time hold dollars without coming under their assumptions concerning everything and anything having to do with our business. Gold is a good barrier to outside forces and allows a means to cover any costs as gold can always be sold back into the market to buy dollars for paying taxes and whatever other fees they devise might entail. We have an initial value established for silver as well as gold so we would be willing to acquire either.

Initial values: 11/2/11
gold: $2,160 = 1 oz Au = V1,000 : V1 = $2.16
silver: $42.24 = 1 oz Ag = V9.55

Present values: 3/4/16
gold: $2,160 = 1.37 oz = V729.22 : V1 = $2.74 *
silver: $42.24 = 2.23 oz Ag = V8.78

In acquiring precious metals, we would also effectively retire them from circulation, which would make gold bugs happier since their stores would only rise in value. Over the long haul, especially if mankind chooses freedom instead of slavery, the value of gold will drop low enough that we will actually be able to walk on them as pebbles in the street. Historically, when gold is not worth much relative to other more useful things, people are generally better off.

* The Valun went from $2.77 to $2.74 as gold of late has been making a fierce run up above $1,250. If it goes higher, we anticipate more trouble in the paper markets. As we said, if gold suddenly breaks over our initial values, we will set higher ones and those will stay when gold falls again making the Valun that much stronger.
 
4 March, 2016: I was asked what exactly determined how much a job was paid in Valuns. I answered that regardless of the proposed “self financing of labour” arrangement, where the employee issued his own Valuns to “buy his job” as some have said, that on the balance sheet of the business, the concern must remain profitable; at the end of the day, it must pay all its expenses for being in business and that any Valuns paid to labour would still remain a cost of doing business. This also means that accounting would concern itself with how much product, good or service was purchased in Valuns. I hope this is properly understood.

The principle behind this blog's proposal is not to gain an attachment to money or a greed for a lot of it, but to be able to use your own money as the way to settle a barter between your labour and the things you need; shelter, food, clothing, etc. The way you live and the things you use to live it are the real concern. Why should someone else's failed monetary system mean that you have to endure poverty or stagnation in your standard of living? It's time to think straight, wake up and begin taking proactive action which is not getting involved in politics.

About the first thing one does when waking up is notice all the clowns pretending to know things and convince you that they're right. Look at the results and what they do, not just what they say. Find out who has honestly made a decent living for himself and herself by their expertise and enterprise and emulate them. These people are the real “pillars of society” the John and Jane Galts, etc. If you are one of them, you should definitely read the whole of this blog, consider its proposal and help to bring this only real alternative to everything out there, into reality. Best!]

[7 March, 2016: I realized that I hadn't answered your questions. You asked, Why do you need gold in there? What's wrong with say making that $9 you came up with as minimum wage the basis for the valun?

I think we adequately explained why we based our Figure 1 on a transaction involving gold and dollars. With gold (and silver) we get instant currency exchange for every widely traded currency on earth. It's the only choice for its function. As Independent Exchanges or IE's acquire more gold and silver through currency exchange, more gold and silver is extinguished as a basis for money. Those trading outside the natural pull of the VEN exchanges collectively would see an upward appreciation for their gold and silver holdings as the intention by design is to have the IE's pull more precious metals out of the market, thus tending to pull up the prices of remaining supplies.

But now Ben, let's take a look at what your $9 Valun might be like. First, you'd have a set labour rate of no lower than $9 an hour, which might be accomplished elsewhere. Let's say someone worked 40 hours in a week, they'd expect to earn $360 before taxes. That would be V40 or 40 Valuns. Some communities might set a limit of V40 a week for subsistence living for a single adult. I covered the topic of price structures possible under such a system, but one that merely takes a multiple of their money per time as a Figure 1 is still using their money as a measure of value. What we would expect under a system based on their money is that prices would tend to conform to those in dollars, euros, yen, etc. They would all tend to inflate or rise. What we would tend to expect over much time, five years or longer, that prices under a truly independent Valun system would tend to remain more stable. We consider that Riegel and Kitson before him had pretty much solved the issue of inflation as a result of fabulous amounts of government spending and the public debt that was never intended ever to be paid off, etc. Hopefully, more people will spread this blog's proposal more widely. Best!]

#68 On the Invention of Money & Other Matters

This is a multifaceted paper, repeating some essential points and connecting with many issues covered in this blog's preceding papers; commenting on a number of subjects related to this blog's money proposal:

As we all should long have figured out by now, the human invention of money marked a turning point in human history. It distinguished the human as a truly civilized man as compared with a savage. Money has the principal use as the means to split barter between people and associations of people otherwise bound to trade by whole barter; service or substance, consumable or durable rendered in whole in trade. What most of us observe about money is its circulating tokens, or we used to. Nowadays they have us using swipe cards more often, so we lose greater track of our money and how it is being spent, while they have unlimited view of our transaction data so they can gamble on commodities and securities while holding our money, since we no longer hold it as cash.

Money could exist without circulating tokens if there was a third party keeping track of all trades / transactions; the electronic networking enabling swipe cards, a bookkeeper or an accountant. This money function was carried on in full in ancient Babylon, by the caste of scribes, although the Babylonians were circulating clay coins used to make smaller purchases. The scribes made sure that all transactions were cleared, that matters involving the buying and selling of things including human slaves and various forms of incidental human labour were accounted for with virtually no evidence of any money as tokens ever being circulated.

What one does when one agrees to work for money is barter one's labour for shelter, food and clothing, etc. by use of money. The money used to pay bills for these things or buy them outright backs the money spent. Money has no other backing and requires none. This is one of E. C. Riegel's primary observations, not on what people say that money represents, etc. but merely by what money actually accomplishes in trade.

That money has no other value than what it buys is often not even grasped for the obvious truth that it is. It's obvious, you don't need to look for it too hard: I earned a dollar bill, I used that dollar bill to buy a small pen with which to write a note to myself about something. Neither I nor the man who sold me the pen cared whether the dollar I used was “backed” by anything. The man who sold me the pen knew where he could spend that dollar. I presented my dollar and received in exchange the pen. Our barter transaction was completed; I worked a dollar's worth of whatever for a dollar's worth of pen. Once understood, any argument that insists that money must have any further “intrinsic” value or “backing” are exposed as the misguided or erroneous opinions of deceivers, liars, idiots or scoundrels; take your pick. All those erroneous and non sequitur (irrelevant) ideas are just extra junk you don't need in order to understand what an honest money system is and how it would operate as a machine used by society for its ends, not those of a limited number of people to whom the monopoly issuance of money has been incorrectly and erroneously given.

We have just told you most if not all there is to know about money. We said that clay coins had been used in ancient times as money. The Spartans used leather rectangles as money. The Athenians brought silver and later gold coinage into common use as money in the Greek world. Precious metals coinage as money was imposed on people by FORCE, not freely accepted by the common people, because most of the common people didn't have any gold or silver to begin with. So contrary to what Rothbard and the other “Austrians” may say, most of the people at any time would NOT have seen or chosen as money, something in such short supply, which they didn't have much of anyway, as any better than that money they were already accustomed to using; wooden coins or sticks. In fact accepting a precious metals coinage as the only money usually meant that some of the population would of necessity be enslaved to other members of the population. 

A precious metals based money actually promotes class divisions exactly in this manner. We've now told you almost all worth knowing in sociology as well. It's all in the history of money. The interested could further submit to an exhaustive study comprising Compte (this is where you simply decide to ignore anything that isn't material, including human beings), Durkheim (start here), certainly Marx, Spencer (I particularly like him), Taine, then Sumner, Ward, Du Bois, Pareto, always de Tocqueville (valuable eye-witness accounts), some Sombart, Veblen (almost timeless), Tönnies, Simmel and of course Mannheim.

Anyway, those claiming that precious metals “backed” money represents freedom are outright liars and their minds usually devoid of any historical grounding. In the Middle Ages liars were horsewhipped, charged a fine in silver coin of the realm and then let go. I admonish all of the “gold bugs” out there to take any old gold or silver coin and examine whose heads appear on them; various kings and potentates. The people never freely chose them. Wealthy merchants and bankers did, and then imposed their use on people by FORCE using the state as their chief creditor to do their bidding and it's been substantially the same game ever since. Perhaps the use of precious metals had more to do with the suppliers long experience of being cheated by the middlemen merchants and therefore demanding payment in precious metals, the value of which they themselves determined. This displays a matter of mistrust in the world trading process that exists to this very day. Since the merchants had to pay in precious metals they began demanding it of everybody else in society. The people did not and would not have chosen it freely. Thus:

The “precious metals as money” thing (thing is what it is too) is the other horn of the bankers' dilemma, the other being paper issued at interest or as they like to put it, “bank credit.”

Now, this blog's proposal takes these two things; the precious metals as money and the fiat paper as money and fuses them together, extinguishing their power or appeal. Since none of it was issued by individual human beings, including the gold, silver or other metal coinage, it is all deemed by this blog as essentially illegitimate money by definition, since this blog considers and advocates the understanding that the issuance of money is itself an inalienable personal right, one that no one can legitimately give up to a state, except by their free and open consent, which the state (and its creditors) believes it has been granted by you anyway and may regard your consent as concerns money as part of your acceptance of what you know or understand about the US Constitution under which jurisdiction you may live, if you are an American citizen.

But regardless, money issuance belongs right in there among the rights professed and understood by the First Amendment of the US Constitution. Stated with reference to E. C. Riegel, it might read something like this:

“All impecunious (penniless, poor, impoverished, indigent, insolvent, hard up, poverty-stricken, needy, destitute) individual human beings are endowed by their Creator with certain innate wealth, such capable of providing them an income, which they may turn into a money credit, limited to subsistence, determined by judgement of the communities in which they have legal domicile.”

We did say that money distinguished the civilized man from the savage, therefore we accept the interdependence of all civilized human beings and the value of civilization and of being civilized, recognizing as we do, that it amounts to a common recognition of mutual SANITY and the REASONABLE EXPECTATION of continuing peace that can and would normally prevail among us.

This blog's proposal for a complementary monetary system to operate alongside the present illegitimate one sees the organization of local communities to be served by an independent exchange which might have many branches or “counters” situated in known locations and operating during set hours as PRIVATE places of business not open to the general public, but to members only. Some basis for reporting transaction information to customers may end up being created using phone apps the way things are going. What is a gold bug going to say about Valuns being transmitted between people using their phones when this is likely to be the way of dollars before long as cash is phased out? We actually hope that cash is not phased out and would like to see a revival in interest in paper cash, designed as an advertising vehicle as well as monetary tokens. Imagine our proposed colourful and very upscale looking V-Checks on the kind of paper that was used for travellers checks in the past that would be intended to last up to six months of circulation before having to be deposited, which could be either redeemed or deposited whether out of date or not, etc.

When one works for money, one is converting one's labour for things and services one buys. That conversion from labour to things and services amounts to barter achieved by the vehicle of money. We'll repeat this so everyone gets it. And all that one buys with one's money day in and day out backs that money, and nothing else. We'll likewise repeat this one often. But people want to know why they should accept payment in Valuns alongside their usual payments in dollars, euros, pounds, yen, etc.

Well, another of E. C. Riegel's observations from his era after the Great Depression and WWII was that most labour was not adequately paid. That was all the way back then, that most labour was not well paid and that were there money issued where it was needed by those who could issue it that there would be more money for more people to be paid for what extra work might be wanting done. He also noted that since all money was lent into existence at interest, and that interest was never created along with the rest of the money, that no matter how much money was created in this way, there would never be enough money to pay off all debts. Of course this is the arithmetic proof that usury of any magnitude is ultimately stealing by the money lending class, since that which was never created must be contested for from everyone else in society; deliberate creations of money scarcity only serve to benefit an already affluent ruling class as they stand above “the masses” scrambling for ever short supplies of money, that fundamental of civilized inventions. Just because this is the way it is, doesn't mean that it is the only way such a thing as a monetary system could or should be devised and operated. One sometimes has to wait 25 years, having read all else in the field before the teacher, in this case E. C. Riegel, appears, and of course Riegel, as Arthur Kitson to some degree before him, had to demolish a lot of baseless rubbish concocted for no purpose but to prop up the uselessness of the banking and ruling classes; the true “useless eaters” etc.

We also observe that no matter whatever the tokens used as money, or even if there are any tokens used at all, as many large purchases are merely bookkeeping entries these days as they were in Babylonian times, no matter what money is used anywhere, all money represents debt to someone. ALL money represents debt. Also money is always a representation of debt. So if anyone promises you “debt free money,” never believe him because he clearly doesn't know that much about money. All money is debt, debt to someone. Therefore, it matters quite a lot just to who that debt belongs.

If I present my money as gold coins with some old English monarch's head on it, the present value of that gold, determined by people over whom I have no control whatsoever, participates in whatever I buy with it. If my debt instrument of choice, since I issue it with my labour or acquire it from my community by my poverty, is a piece of paper with advertising on one side, it is similar to a coupon that says it is exchangeable for a particular service or thing from perhaps a particular patron operating a business in a trading community.

The proposed money -Valuns in the form of V Checks- would be acceptable among anyone in a community that agrees to use them; but the whole trading association would be private. It would have to be based on mutual trust. Yet under the rules implied by the proposal, that private community could extend around the world. All this money would be backed only by what it buys, but it would be issued by the people within a particular community using a particular value measurement in common use by all; the international standard Value Unit or Valun, which would be analogous to any standard weight or measure. And since it is so tightly defined: 1 Au oz. = 1,000 Valuns = $2,160 on 2 November, 2011, it doesn't matter how many Valuns are out there, they will all be based on the same never changing transaction as a basis for all of them.

The invention of money allowed people to trade with each other without knowing each other. That could be so within a small community or just the same worldwide. We said in #39 that cash in any money allowed anonymity and that is why cash always got the best prices.

This anonymity property of money is under attack by those FORCES behind the system who want a record of every transaction possible as information so they can gamble on the probable futures of various commodities underlying the products represented by these transactions. This practise, commodity speculation, on the part of money lenders and financiers is as old as ancient Babylon, if not considerably older. It probably will never be wiped out entirely, but we would hope that the reforms in our proposal will foster an improved and transparent financial world, one designed never to bring down the transaction clearing functions of the proposed community exchanges known as independent exchanges or IE's. We'd expect to see far more competition and a greater redundancy of smaller units of finance too. Some might indeed grow to become great engines of economic growth, but they will never endanger the rest of the economy as previously because these businesses will -

1. Not have the right to issue money. They would adopt a 100% reserve basis. This would serve to limit their size and capacity for lending. All fractional reserve lending models are forbidden.
2. Not be able to use money issued to them through labour contracts as a cash reserve against outstanding debt.
3. Not be able to ask back in payment any money that was not created / issued elsewhere in the system – thus satisfying the intention to eliminate usury.
4. Not be able to promise any fixed yields / distributions to investors by percentage, but only portions of the company's earnings by a percentage of the number of common shares sold by a financial business (B member) as being the same as limited partners representing shares in the partnership (A members only) The community makes no claims whatsoever to benefit anyone outside its trading community by allowing them as parties to contracts within the community: this provision also prevents losses should those occur interfering with anyone outside the trading community.

Example: The ABC Finance Company is a B member in a local IE that specializes in selling credit contracts to A members to buy cars. The original partners in the company use common law to define themselves as general partners with certain duties and to sell shares of their business, not to exceed 50% of said business, to A member investors who would be limited partners of said business. There are applicable tax laws -where all the taxes are to be paid in dollars or the local currencies where similar tax laws apply- to such business structures, especially to any cost basis and any dividends or distributions from such businesses, and this blog's proposal has no intention whatever of defying or sidestepping or causing or suggesting that others defy or ignore such tax laws, or any other of these public laws, except that everything in these private contracts to buy portions of these businesses would carry certain additional restrictions and stipulations and would be enumerated in Valuns.

Some of the stipulations should seem self explanatory: the shares in this private business are private, therefore you cannot sell them in a stock market free for all, where your money invested is placed one day and yanked away the next. That sort of petulant behaviour on the part of nervous capital will have to understand a few things; their success must come through the success of others. The idea that “money goes where it's welcome and capital where it's treated best,” as attributed to Walter Wriston, is fine just as long as those who use it for various projects involved with increasing or improving on value have the TIME and chance to return many times the original value invested. Such would really be the case with small farming, as when left alone, the world would thereby be able to feed itself and all naturally and organically as well.

So when an everyday person, unemployed or not, having to pay for their lives forward recognizes that they are not being paid enough money to maintain a rising standard of living -due to inflation of all government issued fiat currencies, simply because governments issue them, not that they are fiat- then the idea of an alternative supplementary source of income / money begins to make the most sense.

Usually people want more of that government issued money, but the system may not want to give it to you. If your long term reportable income through a bank account is flat or down, your credit rating may be too low to qualify you for a loan, and then once you get the loan how do you pay it back? How do you find work in a 20%-35% unemployment economy? Some economies are even worse, all for want of money to pay people to do work.

And yet everything you see around you that gives the world any value was the direct result of human labour. So where is the money? Riegel said that people would have to recognize that they'd have to create their own money and agree and trust to be able to trade among themselves or they would forever be slaves. But what should that money be like?

The only money, evidence of debt, worth holding is a money you know you can spend for something, not just today or tomorrow, but next week, next year, forever. The “gold bugs” will instantly tell you that of course everybody will trade for silver and gold coins when times get tough because after all they're worth something, or “worth some thing” in trade. This is always an argument from some dystopia when everything has at last broken down, as it has a few times before, so it will once again, that gold and silver become the de-facto trading vehicles; when all else has lost trust, precious metals become the only money. There's anonymity with using them and they are relatively portable, though they still can't fly, and they are at least reasonably durable; all the things Rothbard and others have extolled in them. But they are commodities used as money and being commodities are subject to speculation.

We have to assume that even in a Valun based monetary system that speculation on just how many Valuns might be available would be a natural preoccupation for those intending on going into finance in a Valun based system. Due to the way Valuns are accounted in the transaction clearing (credit clearing) process, it may be relatively more difficult to ascertain the exact number of Valuns in circulation at any one moment and then as we have said in a few places, not all tokens are associated with every sale. But these things have been studied as applicable in all monetary systems and there is nothing to bar anyone from many forms of finance as long as the above rules are recognized. Finance is not of necessity the sport of creating something from nothing and demanding back more than was created. No, it is the sound and risk adverse wisdom of the financier required to know what a credit contract is and how to earn an honest return from money that was created elsewhere. The only payout most financial businesses would have to make, would be to the people keeping their eyes on the transactions, so the overhead for finance could be extremely low, and of course there would be more competition driving down rates. Nevertheless there would probably be some effective level similar to the differences between outright purchase and instalment payment plans in the marketplace today, always reckoned in Valuns of course.

BTW: the markets being down, as predicted, we'd see a spike in precious metals, predicted, wont last as the general trend is deflationary driven by lower oil prices in an attempt, stupid and it wont work, to break Russia by the PTB. The Valun as a result has fallen from nearly $3 to $2.86 which will be temporary because precious metals will continue their slide to a predicted $1,050 for gold.

David Burton
dpbmss@mail.com

Current Hypothetical Value of a Hypothetical Value Unit

#67 A Statement On Fiat Money

The other day I happened to listen to a podcast by Mike Adams, the Health Ranger. You can listen to it here.

In this discussion, I could agree with just about everything Mike discussed. Some of the same issues he discussed we deal with here, but when he or anyone attacks fiat money as the cause of our current monetary and economic problems or those equally misinformed idiots (the proper term to use as it is used throughout this blog) who talk about “debt free money” or those who say they want “Constitutional money,” they are simply showing that they do not understand money at all.

All money represents debt, therefore to even consider a debt free money is an absurdity. It shows that the person saying such things is without understanding. Money is the accounting invention that we use as a means to split barter so that we avoid whole barter. The pieces of the system, the tokens, are just used as pieces in a game. Money is the entire system of accounting for transactions in trade of which the individual pieces are just tokens. If there were no tokens there could still be money. It would be as entries in a ledger. Indeed, double entry bookkeeping is itself an essential part of any money system. This is discussed better by many people, including E. C. Riegel. All money represents unsettled transactions and all money is backed ONLY by what it buys. So anyone who tells you otherwise or adds something superfluous to the basic definition of money is either a liar or a misinformed idiot, take your pick. We advise, please don't be either.

There are of course the “gold bugs” out there too and the “precious metals is the only real money” advocates. These people are likewise showing their ignorance and some of them their stupidity when they make statements such that “using precious metals in trade is a two party transaction” when it obviously is not; the third party in a trade involving precious metals is the person you bought your metals from. So please, let's not allow such deceptions into our discussions about money.

The only reason fiat money ultimately fails is because governments issue it, period! There are no other reasons to deny fiat money whatsoever.

I let that statement stand by itself. I invite anyone who has read this blog thoroughly and understands its proposal completely, not some slimy young know it all who can't get the “money as a commodity” concept out of his head. I invite anyone to contend with me on this issue by any historical documentation they can find. But one caveat; I wont accept a fiat currency that has failed that was issued by any government. Try and find a fiat currency that has failed that wasn't issued by a government. You wont find any, so don't waste your time and stop listening to the uninformed claptrap of those who only parrot what idiot economists say.

There are in fact several alternative fiat currency systems around the world, one in Switzerland, that started in the 1930's that I believe is still in use, though of course the community they serve is quite small. Some fiat systems have gone out of use, not failed, simply because people found the accounting too burdensome and had to quit without finding a replacement. In such cases, the community just couldn't make the transition away from the government's fiat currency.

Likewise the idea that any government can issue interest free money, said to be without debt, Lincoln's greenbackism, is likewise ... sorry Bill Still, but you are incorrect here ... no better than interest bearing issued fiat money and sooner or later such money would fail just the same and for the same reasons; governments issue it. 

Governments spend money on what they want first, not what the people want and they have no means of recapturing the value represented by the money they spend into an economy, because again as E. C. Riegel noted, governments do not have anything they can sell back into the economy that anyone wants to buy.

Governments tax back a portion of what they spend, but all that goes to pay off the interest on the money borrowed from a central bank. As we have demonstrated and it can be shown to be true elsewhere, all this interest comes out of money that was never created in the first place, so therefore it must be procured from each of us by a process of competition for that which is on purpose in limited supply and yet essential to settle our terms of barter. None of that is fair, honest or sensible and only benefits one class of people; the bankers.

Please understand that no matter how much money is ever created in this manner, there is never ever going to be enough to pay off all debts. Well, what happens when one can't pay off one's debts? Real assets are seized. This of course is never right or fair and amounts to theft by the money lenders who may very well have intended that in the first place, though they may protest otherwise.

There was thus always a clear mathematical reason why usury was forbidden and that reason should be respected. One respects nature, well at least until recently, and as we all know it is never advisable to traduce natural laws, though of course there are always those who would try. Some of these actions we would of course describe as criminal. To be discriminating, to discard the criminal, is actually a good thing. Please don't be fooled by people who dishonestly try and twist concepts, like saying that all fiat money is bad without also admitting that the reason it has been bad is that all of it was issued by some spendthrift government.

Then, people are very taken in by ideas they assume are real alternatives to the present monetary order when they are not. The so called “Austrian” school has taken in many. It advocates usury as part of their understanding of a good monetary system. They support banking as it presently exists, virtually unchanged except to perhaps prefer that bankers assume far less risk. These are the same folks who demand a return to gold and the notion of a gold backed limited quantity money supply as if scarcity of the money has anything to do with economics or trade when it actually does not, or to put it better certainly does not need to be. We already countered Rothbard here 

So let's put some more flesh on our contention: we say, along with E. C. Riegel, that no real honest money needs have any intrinsic value in itself whatsoever. We say that if it did, whatever that intrinsic value would be would affect the transactions in which it participates.

For instance, if I'm selling something and someone desires to make me a payment in dollars, there would be a price in dollars for that means of payment and if they decided to pay in precious metals they might get a better deal if precious metals were rising in price as measured in dollars. I'd likely not be willing to take any precious metals if I knew that their relative value against dollars was going down.

I hope this makes sense so far. I also have to remind people that all prices of precious metals are determined by people in far away cities over whom no one has any control. So holding gold or silver can be and right now is a losing proposition simply because the brokers in these foreign places have determined their relative prices and not you or me.

Whether it's Keynes and his fiscal pumping of fiat currency in when markets are down and taxing back when they are high, as if he or anyone really knows what the equilibrium price on anything relative to anything else can or should be, or the “Austrians” who advocate nothing really but a return to horrible 19^th century money and banking, there is no help relying on the bankers' dialectic. Why get yourself stuck on the horns of their dilemma?

If you really want something better, you'd better be prepared to come up with another standard for your money. And E. C. Riegel did that, which is why this blog exists. He based his idea of money on a single transaction at a particular TIME to which all other transactions using his money would relate, calling it a Figure 1. Riegel chose to base his money, the Value Unit or Valun, on the dollar's purchasing power at the end of a particular fiscal year; 1939 or a later year.

We guarantee that even if we'd chosen a dollar in 2011, that we'd have seen a fall in the dollar against the Valun by now. But we chose a different approach because we wanted to slay both monetary dragons at once, both the Keynesian and the “Austrian” and to do that we fused the two together by saying that our proposal would base our Value Unit or Valun on a transaction involving paper money and precious metals at a particular TIME. We chose 2 November 2011 because it is an easy day to remember and because our chosen start position or Figure 1 was $2,160 which has special significance as that is the geometric number of years in an Age, so that's an easy number to remember. We said that 1,000 Valuns at 2 November, 2011 would equal $2,160 on that date.

So being theoretical, following our ongoing experiment, how much was a Valun worth in dollars at inception? $2.16. How much is a Valun worth today? Nearly $3.00. What would happen should the price of gold exceed the inception price of $2,160 an oz? Whatever that new high for gold would be, would become the new Figure 1 for all Valuns. We would never allow the inception price of gold to dollars (or any other currency) to be set lower. That would go against the design of the system and destroy the community's confidence in the money's purchasing power.

Yet governments and banks have in the past devalued money for the most absurd reasons, usually having to do with a government's inability to pay off debts or for bankers to secure repayment with real assets; think what happened in Iceland and Greece as two recent episodes.  Devaluation was threatened as a means to "save the banking sector."  In Iceland's case, they wanted to make the Icelandic currency cheaper prior to the country entering the eurozone so a few could profit from the exchange, while in Greece, they wanted exactly the opposite; for Greece to leave the euro and return to a devalued drachma.  

Fiat issue in the Valun system is proposed to take two forms, both described by E. C. Riegel in some detail, as if he were just sketching them out. First for the indigent, the impecunious, the poor; they would be allowed to issue their own money, but only as much as the community deemed acceptable to maintain a minimum subsistence. Second, one would issue Valuns that one worked to bring into existence, by a “self financing” of labour concept that is one of the most strikingly original features of the proposal.

Understand that while the first means allows the poor to live some kind of life, presumably all the labour anyone would perform would demand more money than the poor get to issue and that's fine up to the point where the business costs out their products in terms of Valuns to determine how much something would fairly sell for in Valuns. Obviously if something costs too much in competition with someone else's product then it wouldn't make sense to even produce them, or at least one would have to have a unique feature that would make the product worth the extra Valuns.

The question arises, well how does the state pay for itself in a Valun system? This is simpler than it seems too. If states had recourse to no other money than the people's money that they issue, the governments would truly be at the mercy and sufferance of the people, not as it is now. Governments would have to borrow money as zero interest loans since usury is not allowed and pay it back by taxing the people for it. It would be pretty obvious that if lending were high and taxes were high, that the people would certainly scream louder than now for the heads of their states.

The result would of course be that states would have to get out of certain businesses and allow private enterprise to take over those activities. In fact there's probably little that any state needs to do other than protect its citizens from loss of life liberty or property without due process of law. Try and get any government anywhere to abide by that restriction under the present system. It's simply not going to happen.

With more freedom, more competition, an end to monopolies and the end of government coercive measures, things would sort themselves out according to the wants of the people, not their governments and certainly not those who society owes everything to under the present system; the bankers.

One of the core features of the present system is that nowhere is labour rewarded adequately for what it sacrifices in time and effort, sorry. And we certainly do not include all those positions where people are paid far more than their work is worth, sorry. And yeah, we're being sarcastic. There are always calls to raise the minimum wage when all that does is raise the price level for everything. We'd rather see people decide in each instance just how much each job is really worth. They can't do that now. If they did, perhaps less foolish, stupid and dangerous jobs wouldn't even exist as they would never pay for themselves in an honest monetary system. I hope that's understood.

People get so distracted by the tokens of a money system and assume that those by themselves are the money. No, those are only token pieces of the entire monetary system. Gold and silver coins as they circulated through that system were likewise just the tokens of that system which happened to be made of gold and silver. Ancient Spartans made theirs out of leather and some other communities used seashells or even bails of cotton or tobacco. There is no fundamental difference and moreover such discussions attempt to ignore the real elephant in the room; usury. We're sorry, but until that dragon is slain, there can be no fundamental change whatever.

So, if money need have no intrinsic value, then the cheapest form it can take the better. Printed paper certificates looks to be an adequate representation. But let's make them more beautiful than any of our present money and let's use one side of each bill to advertise a member business, since another aspect of money and economy that is often neglected is the community the money serves. Let there be so much difference in these designs that no counterfeiter would ever be able to keep up with all of them. We explained all of this in other papers.

Money is created and it is also destroyed. One way money is definitely destroyed is in depreciation of a capital asset, a machine or property that loses its value over time. If I bought a car for $40K but had run it for 100,000 miles, even if I kept the car in very good condition, it would still have lost a portion of its initial cost to me. That money is lost for good. Another way money is lost is when I paid too much for labour or that labour didn't produce a result that enabled me to recoup the loss, in some cases affecting the viability of the business itself.

Let's say I paid someone $80 to clean my gutters and downspouts simply because I couldn't get someone I knew who I could have had do it for $40. I'm out that extra $40. If I paid someone to work on a product that was expected to net my company $200,000 a year but that product fell behind schedule so that it wouldn't even be worth anything when released as it had been made obsolete by the time it was ready for sale, again, I'd be out whatever money was risked to make that $200,000. That's the way things go.

How much more extra money does one expect to see floating around chasing goods in a government issued system? Far more since the government spends money on things that are probably never supposed to be used; all military industrial gadgets, weapons, etc. There's where your inflation comes from and as long as there is inflation and more debt than there is money, everyone must race to catch up so that only a few at the top (the true “useless eaters' of society) can live nice easy lives of luxury on the backs of the rest of the people.

Also, and this too must be mentioned often; reliance on gold and silver does not guarantee an end to inflation. In the 16^th century where only silver and gold were used, there was a 100% inflation entirely due to the import of gold into Europe from the New World. The gold bugs conveniently never mention that because they don't want their idealistic bubble burst. These are people who bought high and held for decades simply because they couldn't sell for what they bought their dang pieces of metal for, who still cling to the idea that their “money” is the only real stuff. They are ... mistaken.

So honestly, do you want something better? You must ignore what the cheats, liars and other so called “experts” have to say and just go by common sense. In a Valun system, if you are poor, old, weak, disabled, etc. the system will help you. But if you have skills, talent, ambition, drive, the desire to really do something exceptional, you will be able to and no government will be able to stop you. But of course you'll probably never be as rich as a Gates, Buffett or Soros to name just a few, though I might be surprised. The people who finally decide to go to and develop the moon or Mars may defy my expectations.

David Burton
dpbmss@mail.com

Current Hypothetical Value of a Hypothetical Value Unit

#66 On Value and the Creation / Issuance of Money

Source for any and all stock market charts: here.   

It's the middle of January, 2016. Pondering present market conditions, looking at the stock market, figures for the DJIA, a classic upside down M or W formation with bottoms at around 15,400 and 15,950 and a corresponding top between them in the neighbourhood of 16,800 occurred between late August and early October of 2015. It was inevitable, given that classic chart formation, that the market would surge back up to nearly 18,000. Market technicians look for these patters for buying and selling and so do their computer programs. There is an observable curve, technicians refer to it as a moving average, in the market performance over the past two years which gave the limiting potential of the market surge to no more than 18,200. It didn't make it that far, confirming the force of this natural curve. Limiting factor up for this market is around 17,750 which means right now it can't make it that far. The long term trend is down.

The present drop can be analyzed by looking at the charts of market performance for the past few trading days. So far, we have seen worse than this, as the fall in the market late last August was deeper, but we have not seen the depth of the present fall yet. The figures from market close for 16 January show a low around 15,845 confirming two recent lows in as many trading days, with the added downward pressure of the moving average.

Stocks are commodities. They trade in known quantities all the time; there is always someone, a stock specialist, who knows how much of each one of these stocks exist, who owns the lion's share of them, etc. There are other commodities that are in the categories of the consumables; they are used up, so require replenishing (these include energy from combustibles), the durables; those things that are used for their durability, metals, minerals, wood products, glass, etc. Stocks are part of those man-made commodities we call securities. There are two varieties, equities and debt instruments. Stocks are in the former category and bonds in the latter category. At any time there are at least ten times as many bonds for sale as stocks.

Some think of equities as the economic piggy bank of an economy -certainly one which is largely made up of state chartered corporate entities whose pieces are sold to the public as shares; stocks. When the market is up, the piggy bank is full, when it falls, the money in the piggy went somewhere else and the shares fell in price. The man who bought the stock high when the man who owned the stock had bought it low a few years back and sold it, is left holding an asset he can't afford to sell; he loses his money -until that stock may somehow manage to rise again to the point it was purchased for. 

Some consider this wealth exchange, but that's only because they're confused concerning that what is really wealth. Again, as we have and will consistently maintain throughout this blog, wealth is only that capable of producing an income. If it can't do that, it aint wealth. We aren't going to be fooled any longer by those parading themselves about with all their fancy stuff that they think someone out there wants for the money they paid for it, while meanwhile none of that “stuff” provides them directly with any income, or any return, upon which they could rely for basic necessities. Now presumably the people who should know about this stuff, and the best and brightest of them certainly do know, will always maximize the “return on investment” for their clients; what literally did that invested money produce in terms of itself? That is certainly income then and thus demonstrating that money invested in equities can produce income and is therefore true wealth. However, as everyone also knows, stocks can and do lose their value relative to invested dollars in other stocks and therefore equities can also diminish or even eliminate one's wealth. Where did one's wealth go when a stock deal turns bad due to market conditions?

This has always been an interesting question and can be explained using other items, not just stocks. It runs something like this: Tom buys a couch for $800 while Bill buys the identical couch for $500. As we've said all along, what really backed the money Tom and Bill used had nothing to do with gold in Ft. Knox or anything related to “money as a commodity” that some speculators in far away cities were wagering on. No, what backed the money they spent were the things they bought with it, period. It doesn't matter how much of this money was out there, as for one thing, and the most obvious giveaway that the “Austrians” and others are liars when it comes to this, is that not all the available money is ever wagered (bid) on every sale. If someone sells couches for $500 cash and $800 financed, the same couch varies in price in that store by $300 or 37.5% which means that Tom's identical couch is that much more expensive than Bill's and all the difference in price and value exchanged boils down to the differences in TIME required to settle the transactions.

Down through history, those who have advocated that money be just another scarce commodity and that this guarantees an end to price inflation have attempted to base their concept on one or other of these various commodities. But there is something missing here. Has anybody recognized it yet? Some say it would be TIME and probably they are right, and TIME has its uses concerning money matters, that's for certain, as the example above shows. The missing value gets down to something every human being has to one extent or another, the time to do something that has a profitable outcome in terms quantified by money, any money would do. This time allotted to paid labour we'll just call labour, and it is a commodity also, the most important one, for without it very little else could be said to have any value at all.

This one is obvious; look around you, go anywhere, everything you see that can be attributed to human activity was the result of labour. Most, not all, of that labour was paid for with money. Therefore everywhere it is possible to discern immediately how the cost of labour is related to everything, especially anything that has a more or less permanent basis. All our towns, cities, harbours, highways, railways, airplanes, etc. are all possible because of labour and would never have existed without it. We'll return to the importance of this understanding as a basis for honest money issuance. By “honest money” we certainly do not mean precious metals, which are commodities, that some people without pausing to consider the obvious, have rushed to the assumption that since they were used as money in the past that somehow they are uniquely fitted to perform the function as money and nothing else. There's a lot more rubbish hoisted about precious metals too, but that's all right; we intended to find a place in our monetary proposal that would make a useful place for precious metals and precious metals dealing as a wall between our money and theirs. A few, mostly foreign readers not Americans, have understood this part of our proposal and understand immediately why it was chosen; because there is no reason to trust any money that has the name of a bank or government printed on it.

Meanwhile, here's the reality: We have all, well most of us, been living under a “top down” or “trickle down” monetary system. It starts with the central banks at the top, lending all the money to governments as their “best credit risks” and getting their cut, which does not exist, out of the rest of us who use their money.

The government gets this money first and spends it into the economy by buying things. It pays for things for itself (which we don't want) and others (trading partners of the biggest private banks). The government cannot trade back into the market in exchange, so it taxes some of what it spends, not all, back to balance off at least some of what it spent. The inevitable result of not cancelling back what one buys with what one sells in comparable value must be price inflation; more money chasing fewer goods is the usual quick explanation, but it's a little more complex than that as location and other factors influence price and as we already said, not all money is available to every sale which voids the whole money as commodity idea when it comes to prices and buying decisions. You have side betters on prices of every exchangeable commodity. These are the commodities futures markets and they also include speculations on the future value of money by various currencies and the ratios between these form the basis of day to day international trade. There are various “side agreements” between trading partners attempting to keep prices for various widely traded durable and consumable commodities fair and predictable over as long a term as practicable.

What about those at the bottom economically, who form the majority of the world's population? Those with jobs work for fewer and fewer exchangeable value tokens (local money) in exchange for their labour. What of those who can find nothing to do to earn their daily bread? What of the growing percentage of homeless tent people living in our major cities that no one is talking about? If everybody around the world just stopped working, even for a week, the world would not perhaps grind to a halt, but it would be noticed.

The top down, centralized, monopolized, corporatized, federalized, economic black hole that steals wealth and shrinks income for the rest of humanity does not work, is unstable and built on the premise that some somebodies calling themselves bankers should be entitled the privilege of issuing money for the rest of us, clearly a mistaken concept. These and their supporters are the same maniacs, the promoters of bigness, who are the banker's best customers because there is more money to be made on bigger transactions, who can't even clean up after themselves; Fukushima and the Gulf of Mexico oil spill and expect to FORCE all kinds of things on us like bad air (Geo-engineering), bad water (fluoridation, etc.) and bad food (GMO's). They expect us all to just sit back and take it, dumbed down, watching shadows move on our huge TV's inside our caves (yeah Plato's cave), just ordering out what we need, never going anywhere anymore, because ... well, just because. One only goes out to go to work anymore in many places.

So what do we do? I pointed out that The Inner Track was an objective position one takes in one's life. I don't expect many to take me up on anything, otherwise the response to this blog might have been more substantial than it has been, but for those that do, taking an objective position on one's life is the result of a “sizing oneself up” process; what skills or talents do I have? What could I improve on? What would I naturally like to try to do? -to actually do? etc. This process, observation and evaluation of oneself should never end, contrary to what one may have been told. As long as one is alive, one has the opportunity to acquire new skills, discover new talents and have greater experiences; to build the capabilities to earn income into oneself, to work toward enhancing one's wealth. One takes stock of oneself and then, measured by the usual monetary yardsticks, one endeavours to keep mind and body together by finding someone else out there who will pay for our skills and talents, etc. We'll get back to the importance of having our talents, skills, etc. recognized in a moment.

In the process of taking an objective position on one's life, one becomes as much an observer as one is an activist; one watches oneself, what what one does, how one responds to others and to different situations, the easy as well as the difficult, one gets to know oneself hopefully as a best friend and then takes good care of oneself by seeking reward and avoiding trouble. One builds self confidence and assurance by the knowledge that one has successfully completed various tasks. No greater satisfaction has one than they who can look upon a nice stack of accomplishments.

Now, no one's labour stands on its own: a person with a known skill builds a reputation and the better one's reputation the more people vie for your time to do things they'd like you to do. Right now, everywhere in the world, we need more people to take stock of themselves in this way. The road to success does not consist in becoming just another chief among chiefs, but in how best to be or become an indispensable contributor to a worthwhile enterprise. What then is a worthwhile enterprise? It starts with anything that contributes to a community's stock of reliable consumables; food and energy or building materials or useful articles, many of which may not be consumable commodities in the sense that they are used up, but those things we might better consider appliances because we use them up over a longer period of time until they wear out and need replacement. We say such articles depreciate in value as they wear out.

When it comes to occupations of labour, there are certain advantages people have over others, so there can logically never be any complete equality as social justice fanatics (another bunch of idealist lunatics) may want for everybody. Likewise, just because one may be very young or even very old, may not necessarily mean one is limited by these from achieving a considerable monetary reward. Just as there are differences in compensation in terms of dollars, euros or yen, so too would there be in Valuns.

We feel the need to stress often the revolutionary aspect of our proposal; that people everywhere aught to be paid with their own money. Well, as long as we must live under the beast governments and work for their masters behind the current monetary curtain, we must use some of their money. But we have already indicated, and we are far from being a lone voice on this matter, that all present money is illegitimate based on the rules of its own issuance; that banks have usurped a fundamental human right as well as enacted a financial system (the loaning of money, not its more often widely misused sense) based on usury which is fundamentally unsound. 

E. C. Riegel's original proposal was to have everyone that is paid in dollars (or some other currency) be likewise compensated in Valuns based on one's willingness to pay in dollars any actual increase in income taxes such remuneration would represent. All matters concerning an income tax on Valuns would have to be worked out by a competently organized chartering society, the proposed International Value or Valun Exchange Society or IVES. We would need competent legal assistance here and have placed the need to attract adequate legal talent to this cause as relatively high. If the proposal is to have each worker issue Valuns as an interest free loan to the account of their employer prior to a succession of pay dates, then since the employer does not pay his employee and since the employee buys his job with money that he issues, which is not dollars or any other national currency, then it has been argued that there could be no income tax levied. We have advised that when a state decides to do whatever it does and uses FORCE to accomplish it, that taxes even on money that is not its own can certainly not be ruled out and must be anticipated. We admit that we find the idea of a state taxing labour an insane idea, but is it any more insane than deciding to grant a monopoly to a private central bank which demands interest be paid using money that was never created? THAT is what all usury is. All we allow in our proposal is for the transaction makers to pay a tiny transaction fee; Riegel's one tenth of one percent. It must always come out of money that was created elsewhere and there are only two ways to create Valuns; you work for them or your community deems you poor enough to issue your subsistence. Any extra money in a Valun system filters up through the most productive channels so that the most productive earn the most money and naturally rise to the top of their societies. Not the way it is now. The way it is now, it pays to join the corrupt hegemony that rules by fraud and trickery but pays well as every other useful occupation seems to be ground down to the least common denominator and even that will not work forever, all due to the impossibility of ever satisfying the demands of usury to pay back debt, the great cancer in the present monetary order.

We've seen the market slide more and more. The system is ultimately going to crash and there's nothing anyone can do to save it. Oh, the plunge protection team is always at it to try, but eventually it will get away from them. They aren't gods. Their system wasn't all good to begin with and there is no hope of saving it. But what would ye have to replace it? Giving the monopoly of money issue to any government is still a usurpation of a natural right. Why can't some pundits out there get that through their heads? They're idealists of one stripe or another; that's why and as usual their idealism blinds them. Too bad. The real people will eventually insist that only money they themselves issue can have any real meaning and the proposed solution accomplishes that with a monetary instrument that is impervious to being manipulated, that is capable ultimately of ridding the world of poverty and war. Since the internet has brought us all closer together, so more people are becoming aware, isn't it about time to consider another way to do things? We know who the governments answer to, not their people but their creditors. That leads to all kinds of pressure being applied simply for the profits of the capitalists, not the good of the people. We each have to begin now to take an objective position on our lives, ask ourselves what are our talents, where is our greatest wealth (that which can produce an income) to be found? Then we should be looking for a monetary system to measure that wealth. How much does it pay to do anything? Increasingly, more want to know and will want to know.

David Burton
dpbmss@mail.com

#65 The Inner Track

Ahead of time, the author makes no apology for appealing to the ascribed words of Jesus the anointed (the Christ) in what follows:

The inner track is an objective position one takes in one's life: It acknowledges that certain things about life and this world are true and that others are false. The proportions at any time of that which is true to that which is false is by many thousands of magnitudes to one; there is little that is genuinely false, but what is false stands out against a general backdrop of truth.

All that is false are lies, deceptions, literal attempts to thwart or control or otherwise undermine your life. They take the form of things as well as ideas. There are associations one has in one's life with these things or ideas that determine the course of one's life. If the things or ideas we make our decisions about happen to be true, then over all, our life must become virtuous, which means we can do no harm either to ourselves or others, the result being good. The promotion of life is all that is good. Therefore the promotion of bad is the destruction of life.

Where abundance of truth is; this happy congruence, always happens in society and is noticeable in our daily lives in relations with others, either known to us or even perfect strangers, as we proceed in SANITY and under the REASONABLE EXPECTATION of continuing peace. Where neither of these is satisfied, as in a war zone or in a terrorist event, people generally tend to migrate or remain within zones or areas where they feel most safe as defined by SANITY and the REASONABLE EXPECTATION of continuing peace.

Experiment: try subjecting yourself to 10 minutes of music dominated by nothing but Ionian modal harmonies; major scales. Then subject yourself to 10 minutes of music dominated by Locrian or tri-tonal harmonies, if you can even find that much. If harmony it can be called; one is doing the idea of tri-tonal based music the favour of comparison in the same sense as Dorian, Aeolian (minor scales) or even Phrygian mode harmonies.

Now, one may ask why the disharmonious, the INSANE, the genuinely bad is actually part of Nature? That's a huge separate lesson in itself. The various attempts at devising and teaching systems of ethics, value judgement and morality can be studied and followed at leisure. We think some systems more intelligent than others; all the well known, well run and well organized twelve step programs to confront and defeat addictions are among the best we presently know of.

The inner track acknowledges the individual uniqueness of each one of us. It takes it for granted that everyone else out there from babies to old people has an objective position on their lives as we do ourselves. We therefore acknowledge that all virtue springs from the understanding that doing harm to anyone else is doing direct harm to ourselves. This involves acceptance of each human being's separate identities.

What if one is not conscious of their separate identity? What if they really do just follow whichever crowd of other people they feel most comfortable with?

If that's the case, they are probably on the outer track. Most people are on that track. It is one thing to ask that people wake up and become more conscious, when they are already doing their level best to maintain SANITY and the REASONABLE EXPECTATION of continuing peace, but quite another to accept their unique separateness.

One's separateness is one's opportunity. One cannot exist alone, though each one of us is separate. The interactions day to day usually enhance SANITY and the REASONABLE EXPECTATION of continuing peace. But sometimes, and the percentage is growing beyond bounds, they do not.

Since the false is outnumbered by the true by factors of many billions to one, it does not make sense to pay exclusive attention to the true as a means of escaping the false. (This was an observation of General Semantics) One will do that anyway in hundreds of thousands of usual decisions one makes each day, including mere walking. No, the false, fake, fraudulent, etc. do need to be described, studied, understood. One of the hardest lessons each of us has to learn is that the truly bad, the truly evil, the truly anti-life aspects of our world cannot be escaped, cannot even be fully eradicated.

So what is false is embedded, enmeshed in society and perhaps even in nature itself. It is the nature of things to contain particles of falsehood in each of them. A philosophy, as in "a study of the fundamental nature of knowledge, reality, and existence, especially when considered as an academic discipline," could be something like what acknowledgement of an inner track amounts to.

The inner track of course deals succinctly with all that is not truth. But it does so in what to many might be considered a cowardly manner. Recall our point about the abundance of truth being most noticeable as an ongoing social SANITY and the REASONABLE EXPECTATION of continuing peace. We approach that which is inherently false this way:

The scales have fallen from our eyes. We acknowledge that much of our current world events, the knowledge we presently have concerning them, and the people and figureheads associated with them, are a mere charade, a deadly charade nevertheless, that has been carried out largely by the same classes and sets of people for hundreds, if not thousands of years. It is their system that is destroying life, the planet, etc. NOT US and certainly as their system continues on its course, will eventually precipitate some mass extinction event. But we all use their accursed money, none of which is ever actually ours. We claim that it's ours all the time, but that's the base part of the fiction; their fiction. We've all been brainwashed, that's all. Remember, they too have their objective position and theirs is that they are rich and powerful and “so what” and “who cares” to those who are not as they. That too has always been as it has been among us.

There are other kinds of fictions we all have to live with; taxes, public education, universal health care, various kinds of licences, government and corporate involvements in our lives, espionage and surveillance, the wars they cause (banker's wars all), the migrations of peoples they cause, etc. We of the inner track do not dismiss any of these fictions, because we recognize that they have the power to FORCE us all to do their bidding at any time. This is where the rubber meets the road; this is our public life, we acknowledge the reality, the truth, of all the terrible stories that come out about our leaders and their system, conspiracies?, oh yes, but rather than reacting to any of it, we go about the business of living our public lives in SANITY and the REASONABLE EXPECTATION of continuing peace.

The practise of the inner track is to be prepared to doubt everything but accept that which is undeniable fact, no matter how peculiar the evidence supporting it -all in the service of truth. It is also the practise of the inner track to know when to speak and when not to speak, and to whom and with whom about what. The inner track is not a philosophy of personal martyrdom, but of personal salvation; that one lives a good life and the evidence of that is known by others also living good lives.

The inner track can be directly compared to Jesus' narrow way as opposed to the broad road which he said led to destruction. It is not enough to eschew evil and go off somewhere and live like a hermit, though one may try that and perhaps find a good life. If one is living on a track in this world, one will confront the need to use that which is evil in order just to survive.

Do we use their money? Do we acknowledge their flags? Do we pay our taxes? Do we shop and buy every day? Do we usually act in SANITY and the REASONABLE EXPECTATION of continuing peace? We do, all of it. To what we know and to what we shall be, we acknowledge that it best continues to be wise as serpents, yet innocent as doves, as well as to know when we are throwing our pearls before swine. This is our public life.

That is the way of the inner track. One must obey them (render unto Caesar what is Caesar's) though they and their system are false and evil and destructive of life. But one must also focus on who and what one is and what private life that is that one will lead.

Most lead this other private life right now. Even when they are leading the public life as a professional or other functionary or factotum in society, they are leading that other life too. Some call it the private life. Whatever one calls it, this is your other life.

Question: is that other life a good life? Does it promote your personal growth? What is personal growth? Objectively, the acquaintance with more truth is a road to personal growth. Are the acquisition of skills truth? By objective reality, of course they are true, especially to the extent they promote all that is useful and hence good (yes, that which is truly useful is considered good); as in, it was done as well as humanly possible.

Of balance and obsession: Within each normal 24 hour day, most people devote some number of hours to sleep. We acknowledge that usually each of us requires anywhere from six to ten hours of sleep in each 24 hour day. The rest of the time we are said to be awake. Part of that time is usually devoted to dealing with the outer world, their requirements upon us, such as attending school, going to work on time and doing the best job possible under whatever the circumstances, paying bills and taxes as they come due, etc.

None on the inner track ever neglect any of these things. To do so is an act against oneself. It does not matter whether any of their system is fundamentally good or terribly flawed, the value of it is not important because it is openly accepted that one is FORCED to do as they say, think as they think even and certainly to believe what they want you to believe about everything, nature, food, the government, schools, doctors, bankers, etc.

They would prefer you act dumb, docile, stupid, fat, lazy, drugged, drunk and ultimately dead, after they made a good living all your miserable life turning pennies invested into dollars, while you lived to consume this or that pointless or senseless waste of time and energy or vast quantities of any of the recreational substances they glamorize, or way too much of their nutritionally defunct (and now it's revealed chemically poisoned) food stuffs.

The inner track makes smart decisions about turning such substances and subjects into grey haze, so they are no longer recognized as worthwhile. During this process, which may take years, other much better things begin to have more substance, colour, brightness, vitality, reality and life giving qualities, that we begin taking them up instead of our former pursuits. These can and normally would include our associations with others. We might even notice that we begin to speak to each other more calmly, with more kindness and have better more intelligent conversations with those we might have dismissed in haste before.

There must always be that balance between being awake and being asleep as we need that sleep to heal our bodies and to re-balance our minds. The inner track never tries to cheat sleep and strives for a regular sleep to wakefulness pattern.

Achievable obsessions: The inner track seeks self knowledge, the acquisition of skills, the conscious pursuit of knowledge (fact and truth being substantiated), but recognizes that as it has always been down through time right up to the present day, the balance of all that is bad, evil, life destroying, etc. is not to be evaded. BUT, any and all who are involved with the present system, to the extent that they are involved with it, are destined to pay a price for whatever bad or evil they have done, whether the system made them do it or not. The consistent message has been “come out of her (the system), my people” and by the day, the system, their system, makes even that more impossible.

Some may ask, is the inner track an ideology? Does it divide people into us vs. them? You say even enemies have an objective position in life. Yes they do, and we were always asked to love our enemies. We understand that they themselves are in the grip of the system tighter than we could ever imagine. These people bind themselves with blood oaths and think nothing of murder, assassination, “wet work” intended to make it look like an accident, etc. That's their objective position. They know the risks they took to get where they are.

The question for the inner track has always been, is their idea of success knowing what it takes to achieve it, either a worthwhile objective or even worthy of admiration? Once again, some things and people, whole styles of thinking and living, are turned grey. Whatever they are, they're not for us. We do not desire even to know them. We want to build and enjoy our own private lives. We prefer to associate with those who want the same and of course we all want SANITY and the REASONABLE EXPECTATION of continuing peace.

Here's another aspect of truth: it often refers to something that goes on forever, something eternal. One of the things they would prefer you didn't go on about is anything eternal. So do them a favour and don't talk about anything that's really important to you or possibly eternal to anyone you don't know, or openly to anyone in any of the places you suspect they can hear you. It's a kind of discipline. Accept for once in your life that whatever you think you can say can't change anybody else, that most people don't know, and don't care about what you care about or who you are. Most wont even remember your name. Remember, we are each of us separate and that's our opportunity.

We should use our opportunities wisely by really valuing them. After all they represent ourselves. Shouldn't we all be thinking better of ourselves than they'd like us to think? The private or real life, the life that we live that matters most to us, THAT becomes our storehouse of opportunities. Why don't we share and exchange these with others, and gradually pull away from their dying and death dealing system?

The inner track implies living a double life, one for Caesar and one for yourself. It is something they don't want us to teach our children, but it is our survival that matters to us in doing so. Only those on the inner track know instantly and understand that doing good to those we most care about is the essence of our lives.

The inner track is not like the political “third way,” because we see no need of any state to grant us SANITY and the REASONABLE EXPECTATION of continuing peace. We understand, as perhaps we have never understood so clearly before, due to the internet, that any of those “ways” was merely just another excuse for the same bad crowd of politicians and bankers, speculators and swindlers, to remain running ruining the world. We recognize that SANITY and the REASONABLE EXPECTATION of continuing peace is not something we can ever expect from any state nor from the banks that support and enslave them.

The inner track perceives the possibility of civil society by their awareness of SANITY and the REASONABLE EXPECTATION of continuing peace and NOT the presence or absence of some state empowered in whatever fashion to use FORCE to impose the so called collective will on law breakers. Most people are frankly not so smart as to care to memorize lots of legal material that in any case they usually view as something outside their normal daily life. Again, most people daily go about their business aware of SANITY and the REASONABLE EXPECTATION of continuing peace.

Sooner or later their present system will fail and when it does those aware of the inner track will want as a practical tool a functioning financial system such as that advocated by this blog that will enable us to take care of our own by valuing them to the standards of decency determined by each local community as well as providing a means of real wealth creation. The basic function of money remains the same, a common accounting mechanism. The only question, which will be solved sooner or later, is whose money is it anyway, theirs or yours?

Until then, the inner track advises the pursuit of the double life right up to the point they tell you to risk your life for more of their favours (their money, etc.) in exchange for you to do more evil for them. If you've gotten that far down their public life role for you of giving that much more unto Caesar than that which is Caesar's, then you're probably in great danger already, you and any close to you. Anything from blackmail to “wet work” murder made to look like an accident is permitted them, so far. As we've always and consistently said, best to “walk out and not look back.” It takes a lot to be able to do that. Some are seeking it in a “life in a small house” concept. Very well, here's another perspective, “You say, ‘I am rich; I have acquired wealth and do not need a thing.’ But you do not realize that you are wretched, pitiful, poor, blind and naked.” Figure that out. Most of you do not yet realize just where you are in history or in life. You haven't the slightest idea that everything could change radically at any moment, or however they attempt it, could stay the same until it cannot endure any longer, which could be many years to come. We doubt it, but we don't know.

The dual life is a discipline. It promises a better life than life on the outer track that's open to everyone and anything. As we say, that outer track is like the broad way that leads to destruction. They even prefer that you accept the philosophy of the cynics; since destruction (death) is inevitable, why not only accept it but welcome it? Most are unaware that ideas behind The Grateful Dead, etc. were hatched in an elitist association called Tavistock. Tavistock like Woodstock, like stock (what one has), like stocks that imprison people, like stocks on an exchange. Words do mean things and have their weird associations.

But in their private life everyone might be a magician or an artist or occasionally a musician. Our lives could be an exchange of life and beauty for ourselves and our families on an earth of resplendent abundance to satisfy everyone. Without their system, there would be no money for weapons of war. People could enjoy SANITY and the REASONABLE EXPECTATION of continuing peace. You are reading this. Now you know. Nothing is accidental.

Merry Christmas!

Current Hypothetical Value of a Hypothetical Value Unit

[17 December, 2015: Someone thought this appropriate;
 
Every soul must be subject to more powerful authorities. Since there is no authority except from God, then those who are, by God are they appointed. Consequently, one opposing the authority has opposed the ordinance of God, and they who are in opposition will themselves receive judgment. For rulers are not a terror to good work, but to evil. Now do you desire to not be fearful of the authority? Practice good, and you will have approval from it; a servant of God is to you for good. But if you practice evil, be fearful; for not without purpose will he bear the sword, indeed a servant of God is an avenger with wrath to he who has practiced evil. on which account to be subordinate is a necessity, not only because of indignation, but also because of conscience. For this reason also you pay tribute; they are ministers of God, obstinately persisting in this same thing. Therefore render to all debts: to whom tribute, tribute; to whom taxes, taxes; to whom reverence, reverence; to whom dignity, dignity. You owe to no one anything, except to love one another: for he who loves another has fulfilled the law. Romans 13:1-8
 
We remind everyone that this blog does not exist as a bureau or context for any violent reactions against any authorities. We criticize whilst we may and draw conclusions as they are afforded us, otherwise we live our own lives in SANITY and the REASONABLE EXPECTATION of continuing peace and do our own thing, always aware of their power and with a decent respect for that power. Peace.]

[19 December, 2015: In discussion, it was suggested that the ethics involved in the Inner Track observation could as easily be understood without a particularly Christian context, as for instance, in Hinduism the concept of Maya or illusion being the path represented by the Outer Track and the decision to accept the way of the Inner Track is like adopting Dharma as a fundamental basis of your life.

However approached, we appreciate the potential usefulness of the concept: it should never fundamentally compromise the integrity of an individual in their motivation to do anything. Dharma is seen as interconnected; people dealing honestly and well with other people, work as having a spiritual component to it, etc.

It also came to my attention that for those who felt this piece was in any way radical, that they should hear Larken Rose hold forth and then decide. His awareness is valuable but our prescription is tame compared with his; we counsel a parallel strategy not an adversarial one.]