Ron Paul: Why Governments Hate Gold and Love Fiat Money





by Ron Paul

Last year the Chairman of the Federal Reserve told me that gold is not money, a position which central banks, governments, and mainstream economists have claimed is the consensus for decades. But lately there have been some high-profile defections from that consensus. As Forbes recently reported, the president of the Bundesbank (Germany’s central bank) and two highly-respected analysts at Deutsche Bank have praised gold as good money.

Why is gold good money? Because it possesses all the monetary properties that the market demands: it is divisible, portable, recognizable and, most importantly, scarce – making it a stable store of value. It is all things the market needs good money to be and has been recognized as such throughout history. Gold rose to nearly $1800 an ounce after the Fed’s most recent round of quantitative easing because the people know that gold is money when fiat money fails.

Central bankers recognize this too, even if they officially deny it. Some analysts have speculated that the International Monetary Fund’s real clout is due to its large holdings of gold. And central banks around the world have increased their gold holdings over the last year, especially in emerging market economies trying to protect themselves from the collapse of Western fiat currencies.

Fiat money is not good money because it can be issued without limit and therefore cannot act as a stable store of value. A fiat monetary system gives complete discretion to those who run the printing press, allowing governments to spend money without having to suffer the political consequences of raising taxes. Fiat money benefits those who create it and receive it first, enriching government and its cronies. And the negative effects of fiat money are disguised so that people do not realize that money the Fed creates today is the reason for the busts, rising prices and unemployment, and diminished standard of living tomorrow.

This is why it is so important to allow people the freedom to choose stable money. Earlier this Congress I introduced the Free Competition in Currency Act (H.R. 1098) to permit people to use gold as money again. By eliminating taxes on gold and other precious metals and repealing legal tender laws, people are given the option between using good money or fiat money. If the government persists in debasing the dollar – as money monopolists have always done – then the people would be able to protect themselves by using alternatives such as gold that are both sound and stable.

As the fiat money pyramid crumbles, gold retains its luster. Rather than being the barbarous relic Keynesians have tried to lead us to believe it is, gold is, as the Bundesbank president put it, “a timeless classic.” The defamation of gold wrought by central banks and governments is because gold exposes the devaluation of fiat currencies and the flawed policies of government. Governments hate gold because the people cannot be fooled by it.



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198 Comments:

  1. too bad the sound was recorded in someones mouth filled with marbles ..

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  2. Government always need spending, and golds can be their greatest obstacle.

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  3. I meant to say is resource based.

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  4. I meant to say is resource based.

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  5. Wow what in world are you talking about?

    How do you survive in a non resource based economy? Food after all is a resource, as is shelter, etc.

    Please share some details of this "hobby based" system you speak of.

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  6. Wow what in world are you talking about?

    How do you survive in a non resource based economy? Food after all is a resource, as is shelter, etc.

    Please share some details of this "hobby based" system you speak of.

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  7. Lol, you can continue your futile attempt to derail this ron paul supporter but you prove yourself to be highly uneducated, sorely mistaken and completely devoid of any rational thought if you think for one moment that you can talk me out of voting for ron paul, lol, go try your rhetoric and asinine bullshit on a sheep
    kkthxbye

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  8. Lol, you can continue your futile attempt to derail this ron paul supporter but you prove yourself to be highly uneducated, sorely mistaken and completely devoid of any rational thought if you think for one moment that you can talk me out of voting for ron paul, lol, go try your rhetoric and asinine bullshit on a sheep
    kkthxbye

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  9. Otherwise stop pretending to support Ron Paul. He doesn't want you to write him in. He wants you to act intelligently and fight/vote for liberty. And honestly if people can't come together under a different banner supporting the same cause and principles, then the fight for liberty, justice, and freedom is lost and you might as well vote for tyranny with the rest of the mainstream American zombies.

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  10. Lie? No. You just agreed that even if Paul won the popular vote with write-ins, it wouldn't count. Why? Because write-ins don't count. That's clearly exactly why writing in Ron Paul is completely and utterly pointless. You'd have just as much of a voice by stitching your lips together. Gary Johnson is not going to win, but every vote he gets is a VOICE against the establishment and the corrupt status quo. If that is truly what you're trying to do, vote Johnson.

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  11. you don't have to lie
    and if you are anywhere near as intelligent as you think you knwo taht every single person in america could vote for Ron Paul and no votes would be counted and romney would still win
    i can't wait to see obambies when their president doesn't win again xD

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  12. you don't have to lie
    and if you are anywhere near as intelligent as you think you knwo taht every single person in america could vote for Ron Paul and no votes would be counted and romney would still win
    i can't wait to see obambies when their president doesn't win again xD

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  13. Nope. Your failure to explain PROVES you're wrong. Then again you can wait and be completely embarrassed when after the election they count up Johnson votes and there is not one mention of ANY votes for Ron Paul. It's sad I know, I'm a huge fan of Ron Paul, but he has run his course this election. Don't degrade his ideals by making the idiotic move of writing him in. It won't help anything.

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  14. you are wrong

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  15. you are wrong

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  16. A vote for Gary Johnson is a vote for Ron Paul's ideals. Don't write in anything, it won't count. Johnson on the other hand is actually running.

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  17. I've only seen Gary Johnson a bit, haven't researched much about him, but thanks for telling me. I will make sure to look it up.

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  18. Voting for the lesser of two evils, still gets you evil.

    Has anyone noticed the Barack creature looks more and more like a chimpanzee, and the Mitt creature like a statue in Madame Tussaud’s Wax Museum…and that both are liars and cheats that hate Free Americans!

    So, are you going to vote for Plastic Man or Monkey Boy…hoping whichever one of these evils will destroy our Free Nation at a slower pace…?
    ————————————————————————–

    Or, are you going to take a stand against these two anti-American subhumans, and vote your conscience instead!

    Gary Johnson is THE ONLY ONE TO GET YOUR VOTE — if you are a Real American!

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