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.

  • http://www.youtube.com/profile?user=ctcole77 ctcole77

    3 QUESTIONS 911 TRUTHERS DON’T WANT YOU TO ASK THEM:

    If NORAD was told to “stand down” how do you explain F-15 fighters ordered to intercept the high-jacked planes 6 minutes after WTC 1 was hit?

    How can Dick Cheney order NORAD to “stand down” if he was never in charge of NORAD?

    If WTC 7 was destroyed via controlled demolition, how do you explain firefighters predicting the building’s collapse 7 hours in advance?

    »crosslinked«

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  • http://www.youtube.com/profile?user=legacy917 legacy917

    I’m done with you.. You have nothing of significance to bring to our table. Talk to me when you grow some hair on your balls.. Keep on fighting with words! see how far that gets ya!

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  • http://www.youtube.com/profile?user=legacy917 legacy917

    I’m done wasting my time.. You’re obviously a pussy troll, who thinks his internet support of Ron Paul will make a shit of difference. It wont because you’re too much of a pussy to do what Gen. Washington did. You’ll NEVER have the balls for a TRUE revolution. You’re a pussy whose scared of going to prison to stand for what you believe in. Unlike the founders of this country. You’re a Fuckin punk! Tough, Intellectual, MEN are what started the Revolution. Maybe you should do YOUR history. Punk.

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  • http://www.youtube.com/profile?user=legacy917 legacy917

    Pretending? Hate to break the news to you but you weak punks aren’t winning. If you think you are, you need a snap into reality. The media TELLS you who will be elected & you people bow and say “Ok”, Then you get the President which you’ve ALLOWED to steal the election. You belong to a cowardly group of submissive people, just like the Indians. You think you’re making a difference, but are too scared to initiate a violent revolution, which is all that has EVER turned the course of history. Bitch

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  • http://www.youtube.com/profile?user=ALITL8 ALITL8

    still pretending to be tough? LMAO

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  • http://www.youtube.com/profile?user=mozart116 mozart116

    “Indians… please.. If they were of any relevance they wouldn’t have allowed their land to be stolen now would they”

    Please go read a book.

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  • http://www.youtube.com/profile?user=mozart116 mozart116

    A hobby based society that embraced technology with no currencies to steal? Sounds like a real recipe for slavery and mass murder lol.

    Can you explain why technologies are taking jobs and why technologies are constantly getting cheaper? If you think we’re going to keep exploiting resources forever and keeping 2/3’s of the world’s population miserable you’re wrong. And like I said, this resource based ecnomny and society could even collapse before we get to that ‘Zeitgeist movement’ proclamation

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  • http://www.youtube.com/profile?user=FreedomsReigning FreedomsReigning

    The Zeitgeist movement is an engineered recipe for slavery and mass murder, and the Luciferians who promote it know this.

    There’s no way for you to get rid of money when you don’t know what it is or why it has value. To condemn money as evil is to condemn everything man produces as evil. To try and get rid of it, is to try and get rid of mankind, or enslave it.

    If they gave life value, or could make good on ANY of their promises, they already would have.

    They can’t. It’s a genocidal fraud.

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  • http://www.youtube.com/profile?user=legacy917 legacy917

    Indians? The fuck do those pussies have to do with anything? Oh cause you can recite some gay shit that they said? Indians… please.. If they were of any relevance they wouldn’t have allowed their land to be stolen now would they..Go ahead and keep quoting fags. Whats next a lyric from a Justin Bieber song? Fuck off…. Kid..

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  • http://www.youtube.com/profile?user=ALITL8 ALITL8

    you know nothing about me or what i’ve done to promote and support Ron Paul and his message. as for the poetry, i guess the cree indians are the fags cause that’s one of their prophecies. why dont you educate yourself a little before pretending to be tough on your keyboard, kid.

    LOL

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  • http://www.youtube.com/profile?user=jarhead1145 jarhead1145

    It’s called common sense, I don’t need proof to disapprove a fairy tale.

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  • http://www.youtube.com/profile?user=TheRealBubfield405 TheRealBubfield405

    Gary Johnson puts up with more government, which is why Ron Paul is not endorsing him or voting for him. So neither will it, and neither can i because i am only 15. Here was my response to a smartass who thought he was going to make me look stupid and get top comment. LOL

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  • http://www.youtube.com/profile?user=iah48 iah48

    LOL no where do I suggest voting for either of those puppets. Have you heard of libertarian Gary Johnson? His name IS on the ballot in 47 states! I love Ron Paul and want his msg to live on but someone is trying to convince people to write RPs name on the ballot when it s technically impossible for him to win bc his name ISN’T on the ballot! Here was my response to an immature Youtuber aiming for top comment:

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  • http://www.youtube.com/profile?user=TheRealBubfield405 TheRealBubfield405

    Yes i did. Did you read mine? Like i said it is better than voting for Mittens or Obama.

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  • sustainable economy

    What is going on?

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  • sustainable economy

    Dr Paul, maybe the US has never existed for real, because of the big propaganda of the ‘american dream’, who started that slogan?

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  • sustainable economy

    No, I think all of of this is a bad joke.

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  • http://www.youtube.com/profile?user=iah48 iah48

    Did you actually read my comment?

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  • http://www.youtube.com/profile?user=mozart116 mozart116

    Why don’t you provide links or sources saying machines won’t take jobs?

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  • http://www.youtube.com/profile?user=TheRealBubfield405 TheRealBubfield405

    Its better than voting for Obama or Romney. I’d rather go down fighting than be the establishment’s bitch. This nation is either going to have freedom or we are going to go down fighting for our freedom. If that day ever came, than Ron Paul would be our general and we would be his soldiers.It would be the 2nd American Revolution. It’s either Freedom or Slavery and they will enslave us eventually, which would you choose?

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