Thursday, February 16, 2012

International Currencies Increasingly Rejected in the Face of Inflation

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Activist Post

Currency collapse is hardly something new.  Especially when that currency is backed by nothing.  In G. Edward Griffin's seminal work, The Creature From Jekyll Island, he states that once the "business of banking" by fiat began:
This led immediately to what would become an almost unbroken record from then to the present: a record of inflation, booms and busts, suspension of payments, bank failures, repudiation of currencies, and recurring spasms o economic chaos. (pg. 184)
Since this story of banking is so oft-repeated, there are also a fair number of examples of how prosperity -- or at least stability and self-sufficiency -- was restored afterward. In nearly every case, it came from desperate, but determined individuals who shrugged off the shackles of central banking, and either returned to the currency they used previous to government hijacking, restored pre-money barter systems, or created something entirely new.

The modern-day, planet-wide collapse of fiat currencies is providing additional real-time examples of how forsaken citizens are taking matters into their own hands.  Let us look at just the two most affected: Greece and Spain.


It is a travesty that the nation where democracy and gold-backed coinage was first developed should become the poster child of a whirling black hole of debt and dependency brought on by autocratic rule. Regardless, despite the austerity riots filling city streets to make demands, there are indications that some communities are finished with demanding anything from a provably corrupt government that is literally foreign to their best interests.

The video below illustrates the rebirth of diverse means of  exchange such as time banks, barter networks, barter currency, and "priceless" commodities in Greece:


The Daily Mail reports on a town of 3,000 called Villamayor de Santiago, where "rebellious" locals have reintroduced the peseta in a project to thwart the failing euro after inflation has driven up the price of essential goods 43 per cent. The cost of bread is up by 49 per cent, milk 48 per cent, and the price of potatoes is up 116 per cent.  All while a third of this small town is out of work.
Around 30 shops in the historic town, 75 miles south-east of Madrid, started accepting pesetas last month after urging customers to dig out any old notes and coins they had forgotten about.
News quickly spread, and shoppers from neighbouring villages and towns have been flocking there to spend the old currency.
After a one-month field test, the enthusiasm for the plan has ensured its renewal.  Meanwhile, four other Spanish towns have reintroduced the peseta, as the country goes through an employment crisis worse than that of Greece, and the country's credit rating has been knocked down another two notches.


The two modern examples of Greece and Spain, echo America's own colonial history. Following China, America was the second location in the world to test fiat currency at the behest of the British Empire.  The story is fully recounted in Chapter 8 of The Creature From Jekyll Island and is well worth a full read, but the salient point is that once colonists were repeatedly subjected to hyperinflation and depression through the overprinting of money, as well as having been subjected to broken promises and tyrannical rule by the Bank of England through the removal of coins, barter became a means of exchange and survival.  Tobacco was the first commodity, but nearly anything of intrinsic value served equally well in restoring a semblance of power to individuals as a means for their self-determination.

Later, the colonists who disobeyed government dictates brought out their limited supplies of hoarded coins and re-built from the ground up using sound economic principles.  Those colonies which used sound money, such as Massachusetts, won trade from fiat-money colonies like Rhode Island.

As Griffin states:
After the colonies had returned to coin, prices quickly found their natural equilibrium and then stayed at that point, even during the Seven Years War and the disruption of trade that occurred immediately prior to the Revolution.  There is no better example of the fact that economic systems in distress can and do recover rapidly if government does not interfere with the natural healing process. (pg. 160)
And Ben Franklin proclaimed that King George III taking away the ability of the colonies to create their own currency was the true reason for the Revolutionary War:
The colonies would gladly have borne the little tax on tea and other matters had it not been that England took away from the colonies their money, which created unemployment and dissatisfaction. The inability of colonists to get power to issue their own money permanently out of the hands of George III and the international bankers was the prime reason for the Revolutionary War.
And this is the good news: what's old seems to be new again; citizens within collapsed economies are once again turning their backs on centralized international government, ignoring their unjust policies, and instead are returning to the far simpler and more logical means of self-sufficiency and prosperity -- their own inherent community strength built upon real production and trade between individuals.  In short, decentralization.

Americans would do well not to forget that the actions taken by individuals in other severely collapsed countries are those also entrenched in America's history.  Let us all observe closely, then, how the first dominoes that have fallen in the latest cycle of depression are choosing to right themselves; for it would be at our peril to ignore history, and the momentum that already has pushed others toward the same foregone conclusion.

Our forgetfulness is perhaps the root cause of our repeated inability to sustain ourselves, until another collapse scenario forces us to take action.

For an instructive case study in the risks imposed on nations by international banking interests, as well as how anyone can survive the inevitable aftermath, please view the story of Argentina below:

Additional sources and resources about barter and alternative economies:

Truly Revolutionary: Greek city starts “rebel” barter economy and alternative currency
Alternative Markets, Barter Systems, & Local Co-ops are the Lifeboats That Will Save Us 
Easy First Steps To Building Your Barter Network
New Decentralized Currency Stimulating Underground Barter Economy




Just George said...

This video is deceptively titled. These people aren't living without money, they are simply issuing social currency as a credit based form of currency rather than the debt based currencies used by government.

This is, of course, true and fair money - money that cannot lose its value due to inflation, or usury.

This is how money should be, and was in many parts of the world, before the monetary systems of most economies were usurped by greedy bankers, who control the issuance and availability of money to steal from the regular citizen. The general economy is no more real than this one - it simply borrows legitimacy from government monopoly.

In my opinion, the currencies used by governments, whilst looking much prettier than social currencies, are little more than a monopolistic mafia enterprise conducted by the state and banks working in collusion to feed off the working man. All established banks should be abolished, their owners thrown into prison for counterfeit, and money to be reissued as credit rather than debt.

If this were to occur, society would benefit greatly, and the criminals who have lived large for generations on other peoples backs will actually have to work for their dinner.

Rosenbaum said...

Why you should call us criminals? Oy vey!

Shearing the sheep is not such easy work. Live large on other peoples backs you say? That we should have to live lower than our cattle is this what you want?

Anonymous said...

Local control of currencies is the only way to prevent global serfdom controlled by the few.

igbymac said...

Wow, a couple of selective distortions of historical events. Straight off, the second sentence, 'currency backed by nothing' is a red herring. Whether gold or fiat, crimes of banks and crimes of state, that is crimes of powerful men, can destroy any currency. But the distortion I will address, which should be well known to all Americans, is regarding Colonial Scrip.

Colonial Scrip was a very stable, fiat currency but was rejected by Britain as an acceptable means to pay tax. This is what Franklin was getting on about regarding the primary cause of the Revolution -- it was not about the payment of tax, per se, but about being unable to pay the tax in Colonial Scrip, the self-directed fiat currency of the colony.

Gold-backed or 'intrinsic-value-backed' money has no more legitimacy than fiat as a form of exchange if accepted by the people, and with a properly controlled supply (without debt, without interest, without fractional reserve banking).

A gold-backed currency would only set up a system where the current gold holders, the global banks, start the new game with a titled playing field. And the field got tilted due to the crimes of the past.

Yes, a gold-backed system could work just as well as a fiat system IF administered correctly, as noted above. But why would we prefer to establish a system which is suppose to provide a means of exchange equal to all yet, providing no advantage as a currency, it gives a huge advantage to the banking cliques which have been oppressively operating criminal banking schemes for hundreds of years?

Let the current holders of gold keep their gold. Let the value of gold be what the market dictates as a commodity. But do not link gold directly to the currency. The administration of the money stock can only occur independently and fairly for all as a means of exchange as a fiat currency, backed by the credit and good name of the sovereign state.

Patrick Sullivan said...

“Straight off, the second sentence, 'currency backed by nothing' ….. “

That from an earlier poster. How about we think first of the labor involved in the creation of wealth that is exchanged by the money next?

Think now for a moment if your farmer didn’t farm, then your baker couldn’t bake, and there would be nothing to deliver, so no need for your driver either. What good would gold be if there was no bread and butter? A fistful of dollars and no bread and butter on the shelves, what good would money be for that matter?

So if gold is no substitute for bread and butter, nor is paper money, whether a monopoly of the state or not, so what is it that banks are selling us anyways other than a method for the exchange of labor?

At its elemental level, could we consider that money is nothing more then than a labor exchange mechanism?

If it is true that money is a monopoly of the government, then why is the issuance of it done by private bankers?

Barter is OK, yet in today’s world does it seem to be a thing of the past? If money had not been invented or there were no banks to exchange labor, sure it would be OK then. But if we have modern recording and communication at hand, why not use the regular money, to exchange our labor?

What is money then other than an abstract receipt of labor?

What could we consider to be the mother of all money other than labor?

What is the issue of money then other than the “organizing principle: of our societies?

So why is the issue of money (labor exchange mechanism) in private hands?

franz pick said...

where can I get some of that "credit and good name" to redeem some of my fiat?

Anonymous said...

Creation of money should be in the hands of government or a government agency accountable to the people.

This was the situation in the US before 1913 when the then President Woodrow Wilson passed an act that created the US Federal Reserve.

Is it too late for the US to take back the function of creating money itself? But that would mean reforming the US government itself, getting rid of the lobby groups, reviewing laws that allow politicians to raise money for electoral campaigns outside approved official channels and maybe even changing the structure of government and the Constitution itself.

Anonymous said...


"and with a properly controlled supply (without debt, without interest, without fractional reserve banking). "

There's the problem right there. People that are willing to do that can't be elected in a democracy where their opponents promise the moon by increasing the money supply. "The People" only care about fiat money collapse when it's too late.

Paul Glover said...

"Labor: the New Gold Standard"

"Hometown Money" book explains how to start and maintain a local currency system

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