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Die Lösung besteht darin, dass Geldmenge und Warenmenge in einer stabilen Relation gehalten werden. Diese Beziehung, dieses Verhältnis, nennt man Währung. Geld ist eine SACHE. Währung ist eine TAT, bestehend aus Aktion und Reaktion. Eine Tat, die ausführbar gemacht werden muss. Die Bedingungen, diese Tat zu tun, müssen erst noch geschaffen werden. Ohne verhungernde Produzenten, ohne darbende Kinder und ohne Verproletarisierung der gesamten Welt.
Wenn Geldmenge und Warenmenge sich decken, haben wir stabile Preise. Besser gesagt: Ein stabiles Preisniveau. Die Einzelpreise werden sich immer verändern, weil sich unsere Wünsche und unsere Vorlieben ändern. Heute VW, morgen Daimler. Heute Jeans, morgen Seide. Heute Käse, morgen Salami. Heute Spanien, morgen Korea. Mit sich ändernden Vorlieben ändern sich auch die Preise. Denn Angebot und Nachfrage bestimmen den Preis der einzelnen Waren.
Auch kann die voranschreitende technologische Entwicklung die Preise verändern, in einzelnen Sparten oder Bereichen. Doch das allgemeine Preisniveau bleibt stabil, wenn sich die Gesamtwarenmenge und die Gesamtgeldmenge weiterhin decken. Damit bleibt dem Geld die Tauschkraft erhalten. Kaufkraftstabilität wird dies auch genannt. Was müssen die Geldverwalter, die Währungshüter, tun und veranlassen können, um die Beziehung von Geldmenge und Warenmenge in einer verlässlichen Relation halten zu können?
Sie müssen die Geldmenge steuern! Das ist das Gebot der Stunde - doch derzeit nicht möglich! Nicht mit unserem Geld. Denn das Geld zieht sich zurück, wenn es nicht mehr genug Zinsen abwirft. Dann müssen die Notenbanker „nachschießen“. Keiner weiß, wie viel. Und auch dieses neue Geld läuft nicht um, sondern verschwindet nach kurzer Zeit aus dem Kreislauf. Also müssen Schulden gemacht werden, was das Zeug hält. Schulden auf der einen Seite erzeugen Vermögen auf der anderen Seite. Diese wollen wieder verzinst werden und so schaukelt sich die Angelegenheit ins Billionäre hoch. Irgendwann, ganz am Ende, wird dann die Notenpresse angeworfen und der Staat „entschuldet“ sich via Hyperinflation.
Geld muss in den Umlauf
Um die ausgegebene Geldmenge steuern zu können, muss sie im Umlauf sein. Sich im Kreislauf befinden. Vollständig. Nur eine Sache, die sich bewegt, lässt sch steuern. Wie gelingt es uns, dass Geld in den Kreislauf kommt, zwangsläufig und unabhängig vom "Giergrad" seiner Besitzer?
Ganz einfach: wir statten das Geld mit dem gleichen Nachteil aus, der auch die Ware zum Markte drängt. Ein jährlicher Verlust von etwa 5%. Das Ganze heißt Umlaufgebühr. Diesen Umlauf sollen heute die Zinsen regeln. Machen sie auch. Doch ab einem gewissen Punkt sind Zinsen mörderisch, weil exponentiell anwachsend. Die Umlaufgebühr auf den Geldscheinen ist dagegen der absolute Friedensengel und Reich-Macher für alle. Zumindest für jene, die Reichtum wollen und ihre Fertigkeiten und Fähigkeiten einbringen. Die weniger Ambitionierten können dann aber auch im Wohlstand leben. Wenn der Geldschein pro Jahr 5 % verliert (wenn er nicht benutzt wird), dann wird er nach zwanzig Jahren unter der Matratze zu Altpapier.
Das macht kein vernünftiger Mensch. Kaufkraftzurückhaltung (oder Hortung oder Schwarzgeldkassen) werden komplett überflüssig. Der Rubel wird rollen, völlig unabhängig von der charakterlichen Konstruktion seines Besitzers. Was innerhalb der nächsten Zeit nicht ausgeben werden kann oder will, landet bei der Bank. Langfristig. Dort wird es anderen Marktteilnehmern als Darlehen ausgereicht. Der Rubel rollt durch andere Hände. Egal. Hauptsache er rollt. Denn nur der Umsatz bildet Wohlstand. Die Bewegung. Nicht der Besitz von Geld. Nicht Geld noch Gold mit seiner „Werthaltigkeit“. Die ist eine Chimäre, ein Hirngespinst – und derzeit leider eine weltweite Konvention.
Weil dem Geld jede Zurückhaltungsmöglichkeit genommen ist, kann es auch nicht mehr an den Punkt von „Kapitalknappheit“ kommen. Denn Geld ist da. Was da ist, wird angeboten. Und damit beginnen dann endlich die Zinsen Richtung Null zu sinken. Angebot und Nachfrage regeln den Preis. Das muss auch für das Geld gelten. Der Unternehmer braucht dann keine Kapitalkosten mehr in die Preise einzurechnen, die Gewinnspanne vergrößert sich. Gewinne in einer Branche locken Mitbewerber. Weitere Unternehmer. Mehr Arbeitsplätze, mehr Produktion, mehr Umsatz, mehr Handel. Mehr und flottere Wohlstandsbildung. Global.
Zusammenfassend: Der Freigeldschein ist nur noch Tauschmittel, der es sich genauso wenig wie die Waren leisten kann, vom Markt fernzubleiben. Es sei denn, sein jeweiliger Besitzer nimmt Verluste hin. In der freien Marktwirtschaft erscheinen alle Waren und alles Geld miteinander auf dem Markt. Keiner kann sich mehr zieren. Punkt.
Freigeld wird als Indexwährung gestaltet
Freigeld wird als Indexwährung gestaltet. Am Index kann man dann erkennen, ob zuviel Geld im Kreislauf ist oder zuwenig. Dazu muss man nur die Preise beobachten, entweder durch bezahlte Preisbeobachter oder über den Großhandel, der z.B. vierteljährlich die Preise den Währungshütern durchgibt. Steigt der Index, dann ist klar, dass zuviel Geld im Umlauf ist und es wird ein Teil des Geldes herausgenommen, was Dank der Umlaufgebühr auch leicht möglich ist. Denn über die 5 % Umlaufgebühr werden jährlich sowieso 5 % dem Kreislauf entnommen. Wenn der Index steigt, dann schießt die Währungsverwaltung diese "bis zu 5 %" einfach nicht nach. Sinkt der Index, dann bedeutet dies fallende Preise, bedeutet deflationäre Tendenzen. Also muss zusätzliches Geld gedruckt und in den Kreislauf gegeben werden. Dann gibt es Steuerrückzahlungen, Lottogewinne oder Kindergeld für alle. Völlig wurscht. Hauptsache, Geld kommt in den Umlauf.
Geld rein und Geld raus aus dem Kreislauf – so einfach ist das ganze Unterfangen, eine wahrhaft stabile Währung zu etablieren. Diese Geldverwaltung, die Emission und die Steuerung der Geldmenge, ist auch so gut wie alles, was ein Staat noch leisten muss. Ein Staat, der dann allerdings keinerlei Ähnlichkeit mehr mit dem heutigen "Unwesen" Staat hat. Eisenbahn und Telekommunikation vielleicht noch. Und die Bodenverwaltung. Doch der Rest kann regionalisiert, privatisiert, kommunalisiert werden. Wie es den Menschen eben passt. Wer kommunistisch leben will? Bitte schön! Wer ein Sekte gründen will? Auch bitte schön! Eine Schule gründen? Aber klar. Mit 8 Kindern? Null Problemo. Durch die Bodenreform (die an anderer Stelle zu erläutern ist) gibt es ja auch ein absolut freies Niederlassungsrecht für alle. Überall. Die ganze Erde gehört jedem Menschen.
Freigeld ist nur noch Tauschmittel. Weil es kaufkraftstabil bleibt, solange wir es uns wünschen, kann der Sparer Ersparnisse bilden und sie bleiben ihm in voller Kaufkraft erhalten. Auch wenn er erst in 50 Jahren kommt und sein Gespartes haben will. Weder Inflation noch Deflation haben ihn seiner Ersparnisse beraubt. Sie sind noch voll da. Er hat halt keine Zinsen bekommen. Doch das könnte höchstens die 5 % der Menschheit stören, die derzeit an diesem Spiel wirklich verdienen. Und selbst die nicht so wirklich. Denn wenn die internationale Arbeitsteilung in Gefahr kommt, Produktionszusammenbrüche erfolgen, dann sind wir ruckzuck an einem Punkt, an dem selbst dem Milliardär das Kekseknabbern im unterirdischen Bunker nicht mehr so richtig gefällt…
Freigeld macht reich
Freigeld bringt allen Wohlstand und wer es will, wird reich. Popstars können weiterhin Millionen für ein kleines Konzert machen, Maler zigtausende für einen kleinen Farbklecks… alles weiterhin drin, wenn der- oder diejenige Käufer hat und Abnehmer. Soll doch jeder Mensch selbst entscheiden, was er haben und sich dienstleisten lassen will. Doch die Wahnsinns-Pop-Konzert- oder Fußball-Endspiel-Einnahmen können nicht mehr Rendite bringend anlegt werden. Sie können nur noch selbst ausgeben und verbraten werden – oder aber zur Bank gebracht, wo sie anderen Wirtschaftsteilnehmern wieder als Darlehen zur Verfügung gestellt werden.
Die heutigen Milliardäre werden noch für einige Jahrzehnte ganz weit vorne bleiben. Es reicht bestimmt auch noch für die nächsten zwei Generationen für’s absolute Nichtstun. Aber wer will schon sein Leben auf dem Sofa verbringen? Doch selbst wenn: Hauptsache, der Reichtum kann andere nicht mehr arm machen!
Was die weiteren Auswirkungen von Freigeld sind, ist nahezu unbeschreiblich: Die Monopole zerlegen sich. Plötzlich kann es sich eine kleine Werkstatt leisten, einen Wagen zu entwickeln. Für einen ganz kleinen Kundenkreis. Absolute Spezialanfertigungen. Qualität und Kunstfertigkeit sind wieder ganz weit vorne und machen das Geschäft. Neue Technik kann auf den Markt kommen. Alle Unternehmungen müssen nur noch wirtschaftlich sein (d.h. die Nachfrage für ein Produkt muss da sein und es muss sich für den Unternehmer und seine Mitarbeiter lohnen).
Heute muss selbst das Altenheim noch „Rendite“ bringen. Wie aber soll man als Heimleiter in einem Altenheim jährlich 10 % mehr herauswirtschaften und dabei anständig bleiben? 10 % für die Aktionäre und Fondsinhaber. Darunter geht es nicht, sonst gibt es eben überhaupt kein Altenheim. Die Alten stapeln? Zwei in einem Bett? Selbst gezimmerte Rollstühle? Wassersuppe? Mord? Nicht gemeldete Sterbefälle, Renten weiter kassieren? Alles schon da. Das zinstragende Geld erzwingt Korruption, erzwingt Kriminalität, erzwingt Mauschelei, Pfusch und Betrug. Bezahlt Militär, Medien, Lobbyisten, Politiker. Schmiert Richter und Staatsanwälte. Selbstverständlich kann sich der Einzelne sauber halten. Doch nicht alle. Das gelingt ja noch nicht mal der Kirche als Organisation. Sonst funktioniert das System nicht. Daher gilt das Motto: Mach alles, lass dich aber nicht erwischen!
Mit all dem ist Schluss, wenn wir Freigeld einführen. Dieses Geld macht jeden zum freien Menschen. Politiker und Rechtsanwälte braucht es dann nicht mehr ganz so viele. Das Ende der Bürokraten.
Es lebe der freie Mensch!
The solution lies in keeping a stable relationship between the money supply and the volume of available wares. This connection, this relationship, one calls currency. Money is an OBJECT. Currency is a DEED, consisting of action and reaction. A deed that must be made achievable. The conditions for doing this deed, are still to be created. Without starving producers, without starving children and without the proletarisation of the whole world.
When the money supply and the volume of wares correlate, we have stable prices. Or better: a stable price level. The individual prices will always be changing, because our wishes and preferences also change. Volkswagen today, Mercedes tomorrow. Denim today, silk tomorrow. Cheese today, salami tomorrow. Spain today, Korea tomorrow. As preferences change, so the prices also change. For supply and demand determine the price of individual wares.
Advancing technological development, may also affect prices in certain branches or areas. Yet the general level of prices remains stable if the total amount of wares and of money, continue to cover one another. With that, the money retains its power of exchange. This is also called buying-power stability. What must the administrators of money - the monetary watchdogs - bring about, to keep this connection between the supply of money and the quantity of wares in a reliable relationship?
They must steer the money supply! That is the precept of our times - and yet, today it isn't possible! Not with money as we know it. For the money is withdrawn, as soon as it ceases to earn enough interest. Then the issue-bankers have to bridge the gap. No one can say how much. And this money too doesn't move around, but disappears after a short time from circulation. So we have to go as deeply into debt as we can. Debts on the one side, generate riches on the other. These are going to want to earn interest, and so the situation see-saws it's way upwards to the billionaires. Sometime though, right near the end, the printing presses will be switched on, and the state relieves itself of debts through hyperinflation.
Money must circulate
To be able to steer the emitted supply of money, it must be circulating. Moving around. All of it. Only something that is moving can be steered. So how could we manage to keep the money circulating, unavoidably and independently of the "greed-level" of it's owners?
Very simple: we equip our money with the same disadvantage that urges the wares to the market. An annual depreciation of around five percent. We could call it a circulation fee. Today, interest is supposed to regulate this circulation - and it does. Only, after a certain point interest becomes murderous, because it grows exponentially. A circulation fee on the banknotes however, would be an absolute peacemaker and wealth-maker for everyone. At least for those who want riches and know how to utilise their skill and abilities. The less ambitious though, could also live in prosperity. When banknotes depreciate at five percent pro annum (if they are not being used), then after twenty years under the mattress, they will simply become waste-paper.
No reasonable person would do such a thing. Restraint of buying-power (or hoarding or numbered bank accounts) would become completely superfluous. The rouble would roll, quite independently of the character and nature of it's owner. That which in the near future cannot or will not be spent, would end up in the bank. Long-term. There it would be lent out to other participants. And so the rouble would roll through other hands. Whatever! The main thing is - it rolls. For only turnover brings prosperity. Movement. Not the owning of money. Neither money nor gold with it's "lasting value." That is a chimaera, a phantom - and sadly, at the present time, a world-wide convention.
Because the money would lose every possibility of being withheld, there would be no likelihood of ever reaching the point of "capital scarcity." For the money is there. And what is there will be on offer. With that, at last, the interest rate would begin to approach zero. Supply and demand regulate prices. And that must also apply to money. The producer wouldn't need to take capital-costs into account when reckoning his prices, the profit margins would grow. Profits in any sector will attract competitors. Further enterprise. More jobs, more production, more turnover, more trade. A greater and jauntier increase in prosperity. Globally.
To summarise: The freed banknote is only a means of exchange, that can no more afford to avoid the market place than the wares can. Unless their respective owners can afford to accept a loss. In a free market-economy, all the wares and money turn up together at at the market place. Nobody will be able to play hard-to-get any more. Full stop.
Freed money featured as an index-based currency
Freed money would be featured as an index-based currency. From the index then, one could recognise whether too much money is in circulation, or too little. For this purpose, one would only have to monitor prices, either by means of paid observers or through the wholesale trade, which for example, would publicise quarterly the prices given out by the monetary watchdogs. Should the index climb, then it will be clear that too much money is in circulation and a portion of it would be taken out, which thanks to the circulation fee would be an easy matter. For due to this five percent fee, five percent of the money would be taken out of circulation each year anyway. When the index climbs, then the currency administration would simply not reissue this "up to five percent". Should the index sink, it would mean falling prices, deflationary tendencies. So extra money would have to be printed and put into circulation. Then there will be tax refunds, lottery wins or children's allowance for everyone. Who cares? The main thing is, more money gets back in circulation.
Money into and money out of, circulation - the establishment of a truly stable currency, is such a simple undertaking. This money management, the emission and the steering of the money supply, is about all that a state needs to accomplish. A state though, that for certain has nothing more in common with today's dreadful "state" of affairs. Perhaps the railways and telecommunications too - and land management. The rest could be regionally, privately or communally organised. Just as the people please. Do you want to live as a communist? - please do! Found a sect? - go ahead! Build a school? - Sure, why not? For just eight kids? - No problem! Due to the land reform (to be explained elsewhere) there will be absolutely free rights of settlement for all. Everywhere. The whole earth belongs to each person.
Freed money is nothing but a means of exchange. Because it retains a stable buying-power, as long as we wish it to, a person can save it and it's full buying-power will be preserved. Even when he comes to withdraw it fifty years later. Neither inflation nor deflation will have robbed him of his savings. They are there in full. He just hasn't received any interest. But that would only really bother about five percent of people, the ones who at present really profit from that game. And even them, not so very much. For if the international division of labour were to be threatened, and breakdowns in production to occur, then in a trice we will be back to the point, where gnawing on a biscuit in an underground shelter doesn't seem so delightful, even to billionaires.......
Freed money generates wealth
Freed money generates prosperity for all, and he who wishes to can become rich. Pop stars could carry on charging millions for a small concert - painters, thousands for a little dab of colour....all may carry on, as long as he, or she, has customers or outlets. Each person ought to decide for himself what he needs to have or what services he wants. Yet the insane takings from pop concerts or cup finals, would be unable to be profitably invested. They could only be spent and frittered away - or taken to the bank, where they will be used to give loans to other members of the economic community.
Today's billionaires will stay way out in front for a few more decades. There will be enough to ensure that the next two generations will have to do absolutely nothing. But who wants to spend his life on the sofa? But even if they do: the main thing is, that at least their riches will no longer be able to make others poor!
What the other consequences of freed money will be, is almost indescribable. Monopolies will break up. Suddenly even a small workshop will be able to afford to develop a car. For a quite small circle of customers. Absolutely custom-built. Quality and craftsmanship will again be way out in front and will lead the business. New technology could enter the market. Every firm need only be economic (which means that there must be a demand for their products, and it must be worthwhile for the employer and his employees).
These days even an old-peoples' home must bring in "returns". But how is a warden in an old-peoples' home supposed to generate a growth rate of ten percent per annum and still remain self-respecting? Ten percent for the shareholders and the foundation's owner. Less than that is unacceptable, otherwise there would simply be no old-peoples' home. Stack up the old ones? Two to a bed? Self carpentered wheelchairs? Water-soup? Murder? Unreported deaths, and continuing to draw their pensions? It's all there already. Interest-earning money compels criminality, compels fiddling, botching and deceit. It pays the military, media, lobbyists, politicians. Bribes judges and attorneys. Of course some will stay clean. Not all though. Not even the church could manage that as an organisation. Otherwise the system would cease to function. Thence the motto: do what you will, but don't get caught!
All that is over and done with, if we introduce freed money. This money would make free men of everybody. Then we wouldn't need quite as many politicians and lawyers. The end of the bureaucrats.
Long live the free human!
In order to make problems soluble, one must seek out their causes. Only when the rejections have been traced back to their real causes, can one find room for functional solutions. Solutions, that do not simply bring further and greater rejection in their wake. Only when one treats a malady at its roots, can it be solved; can one be sure to avoid further plagues which spring from the same source. That's what the professionals do. Laymen vex themselves with appearances and strenuous fiddling around with symptoms. Fiddling around - because it doesn't work and cannot achieve the hoped-for results - becomes with time, ever more "violent", the ostensible solutions increasingly drastic. But violence wont help. More violence - even less. So let us rather delve down to the causes and consider first of all......
The advantages of money
What is today's money? Euros, roubles, dollars....? It's a means of exchange - but not only! It is the joker in the economy. As concerns durability, it is superior to any goods. All goods rot, break, go out of fashion, and are threatened by rats, mice, water, fire and much more. All this costs money. Goods cost money to obtain. From the field, from the factory, until they reach the shelf goods cost money, to keep them in a saleable condition. They cost until the moment the customer snaps them up, puts down his money and takes his purchases away. Only then does the pressure on the producer and the trader ease up. Yet not really, for the next delivery is already putting more pressure upon them.
Money knows no problems with mould and going bad. Thus these problems don't bother the owner of money, but the producer all the more.
At this point we shall leave the goings-on at the manufacturer's and the shopkeeper's. Let's talk now of such people who have gathered enough money (like banks, speculators and born billionaires), and set out to buy ten shiploads of wheat. The money that collects at this junction, is surplus money. Money that nobody needed for the moment, to buy necessary and desired objects. Surplus money is not immediately needed, the small and the great savers alike, take their money to the bank in expectation of interest and returns.
And now we wish to cast some light upon two aspects: for one, it should be clear that the owner of the money (or his administrators) has a clear advantage over the wheat producer. He knows that storing the wheat costs money and that with each passing day it's value shrinks, until after a year it will be unsaleable - for the remains, as much as the mice have left, have gone mouldy. The producer knows this too. Over the course of millenia it has been reliably observed that all goods, on average, lose approximately five percent of their value per annum. From bread and butter to gravestones. On average five percent each year. Either the deterioration cannot be slowed at all (as with a daily newspaper), or the slowing of it costs money: cooling, security, silos, and so forth.
The origin of interest
Because all know what everybody knows, business runs thus; the money owner with his durable money - that at any time could go shopping anywhere else - may disregard this five percent. The owner of the goods alone gets stuck with it. So from the very beginning he has a disadvantage, the money owner, a structural advantage. Always. With that, we arrive at interest and it's origin. The superiority of money over goods is the source of interest. Superfluities are employed to realise even more superfluity.
Interest is an exponential function. Every sixty to eighty years, the economy reaches the point where it is swallowed up by interest. No greed of bankers or managers could wreak such havoc as does interest. And yet everybody aspires to attain some. Must at least give it a try. Even the most well-behaved sons of the church.
Money and history
The second aspect on which light should be cast, is the ingenious aspect of money. Back when our money was still cattle, life was arduous. Then it improved with the exchange medium of furs. Easier to maintain, cost-effective, divisible. Then we went over to salt and tea. Even easier, even less bother, wonderfully divisible, and yet it so often ended up in the soup, or got lapped up by grandpa. Saving, with money from those times, was as good as pointless. And as the economic performance began to expand, it also became necessary to solve a further problem: money would somehow have to be limited. For things that are in unlimited supply (for example sand), or whose number cannot be effectively controlled (like cattle), are unable to represent prices. If anybody could simply go shopping with a shovelful of sand, things would have soon ceased to function. Between salt and gold, metals such as copper and iron were used to mint coins. But their limitability could no longer be guaranteed, as the mining and processing of iron began to expand. Perspectively, another means of exchange had to be found - gold. This improvement in the means of exchange, made ever greater and more imposing projects possible, and resulted in a rapidly developing division of labour. Rome built aqueducts, roads, thermal baths and cities. Later generations; cathedrals, monasteries and vulgar pomposities. Gold was the crown of currencies, the highest imaginable. And yet, in solving the one problem we simply created the next one, because we didn't yet understand the correlation of money and economics.
Gold was fantastic, for it was divisible, easily transportable, limited and everlasting.
And that was also, of course, the problem.
The inadequacies of gold as money
To be exact, there are two inadequacies that came to light with the use of gold. It's durability and the insurmountable difficulty of reproducing it. Surplus gold was lent out or hoarded. The less the lending brought in, the quicker it was taken out of circulation - hoarded. A few great projects were successfully completed. Certain contrivances led to more and better wares, and more wares were in the market than before. And yet the number of coins spent was the same as before, for it depended on the amount of the gold found. Because more wares were wanting to be exchanged for a hardly altered amount of money, the price of these wares began to sink. A general drop in prices is the result, when as a result of better methods, production increases, while the amount of money available cannot be adjusted to accommodate it.
Gold-money cannot be increased at will. Either there is too little means available in relation to the increased amount of wares, or the means of exchange are being withheld. Or both. If prices fall - whereby it is much of a muchness, whether from a certain amount of wares onwards too little gold-money was available, or whether too little of it was spent - the mischief is done. Trading is baulked. Who buys today, pays more than tomorrow. Who buys tomorrow, still pays more than he would the day after. So why not just wait until next week? The merchant is the first to stop working. He will only continue to buy for himself.
Unsold wares are a real annoyance for the producer. They have to be protected from thieves, from damp or drying out, from heat or cold, from vermin or from the whims of fashion. For that too money is needed. And money, for the producer, becomes ever rarer. The available gold becomes slower and slower, and some of it will be buried. This brings the producers' annoyance to a head, and makes them more willing than ever to negotiate prices. But with all this, the drama simply grows. A rapid fall in prices intensifies this cycle, which one may safely call a vicious circle.
That was the moment, in which less money was circulating than was needed. Through fear of the future, the gold was in the true sense of the word hoarded. The greater part of the gold-money, still in circulation, became suddenly invisible. Buried, hidden. These practices couldn't even begin to be countered. And neither could their consequences. Gold could neither be reproduced or manufactured. It could only be found. It's durability and it's non-duplicability became the problem.
The discovery of gold, and the possibility of the increase in financial means which it brings with it, drive gold production onwards. Prices rise and that pleases the traders and the producers. Production soars, and continues untiringly. And this draws even the last of the buried coins from their hiding places, for otherwise they lose in value as opposed to the wares. With climbing prices and the consequentially increasing production and division of labour, comes an improvement in the living conditions of the people. Birth control will also be significantly affected by these circumstances. More people are able to live on the available resources. An increase in the division of labour often leads to a growth in population. In times of falling prices, the people are often hostile to one another. There are more people than before. Also, the methods of attaining gold refine themselves, together with the division of labour - even when it could only be got by robbery, when no new gold could be found. This activity too, grew as a result of the described shortage. In this, ultimately, lies the root of war: Whoever wishes to live under such conditions, must be prepared to kill.
If no gold could be found, one could still invade other countries, plunder and murder - and that in the name of the realm, the state. To keep the bake-houses of Rome in action, gold had to be available. If it couldn't be found, it could always be stolen, confiscated or requisitioned. Even the richest of the Romans could be bumped-off or outlawed, so that one could take over their latifundia and plunder their gold-coffers. That too was done. But even that didn't help: there simply wasn't enough gold - and that was bad luck for the economy. The empire fell, the division of labour crumbled, and Rome was populated by goats and their herdsmen. For more than a thousand years.
Previously too, great cultures had failed because of their money. Gold-money. It took centuries until the idea of paper money was born. We could then have corrected the mistake. But nobody knew of it, nobody understood how inflation and deflation were caused: The currency crises. For economic crises are always simply currency crises! Unless absolutely nothing would grow anywhere any more. And then we would have no more need of an exchange medium anyway.
Paper money is also superior to wares and demands returns
And so paper money had tamed the warmonger gold, for one can print paper. One doesn't have to find it or raid other peoples for it. Yet the durability of money and with that it's advantages over all wares also apply to paper money. And with it interest comes into being as explained above. Because money has an advantage over wares, it wants to - and must - put this advantage into practice. It is no investment, if it doesn't gain a decent yield. No one would lend his money, if it didn't bring in more money. Then rather put it in a safe.
Money will only be released and put into circulation by it's owner if he can expect at least two to three percent interest. Less than this and it will remain in his safe. Or it will make deals, wherever it can still make them. In China for example. One day or another though, one has gone through the whole world, and a decent return is nowhere to be made any more. In the meantime we have reached this point. Only atomic power stations for China and drones for Pakistan are really worth considering. Or drugs from Pakistan.
We talk of national economics, of the world-economy. If no more money is put into circulation, then the amount circulating becomes less, with respect to wares. In speculation or in reticence (large current accounts, money kept at home, very short-term investments) there are masses of money. Yet it doesn't place itself at the long-term disposal of the economy. As said: less demand on the part of the consumer, less production. The deflationary spiral begins it's downward twist.
Money in it's imperishability carries the deflationary tendency, so to speak, into the world. These days though, much is cushioned by the banks who offer credit and yet more credit. "Here, take our money, we're not interested in securities!" The companies are already in debt, for them there is no more credit to be had. And so private customers are provided with credit, so that they keep up a steady demand, and the companies can also acquire more money through their turnover. But for the private people, this pushing can also only last for a limited time. When securities (land, property, life-insurance, blocks of shares) have to stand surety for the second or third time, then the banker begins to smell a rat - the bubble could break. Then when there are too few creditworthy creditors among the private people, the state will have to take up the slack.
The state incurs debts in our name, receives credit from JP Morgan and pays ten percent interest for it. The state is the best of all debtors. Thereby, it is of course only a question of time before the government begins to put pressure on the issue bank, to get the printing presses going before there is no more exchange medium wandering around. And from then on, it is again simply a question of time until the deflation changes to inflation, and from there proceeds into hyperinflation. It is all a matter of weeks. And no one can say when it will actually happen. It could happen any time. For already, in Germany, there is three times as much money and claims on money, as the social product of a whole year. So the Euro is already done for. It is the moribund cancer patient, who simply hasn't yet been to the doctor. And so far, one may think that all is still in order with him. Just a little stomach-rumbling, that will soon be over. Yet sometime or other, every truth will be diagnosed.
The expended money is not to be found among the masses of pensioners, children, the unemployed, low-income earners and small businesses. They have already spent their money. No, it is to be found in just a few accounts, in which it must inevitably accumulate. For as said: Interest is an exponential function. The owners of the unavoidable agglomerations, which occur at these few points, have really not much idea of what to do with them. When all baths have golden taps, and ten cars are parked before the door, when one has no real fixed abode any more because he is always away on holiday, and he richly bestows his money on a dozen projects in Africa - then most money owners arrive at the limit of their imagination, as to what else they could do with it. For he isn't necessarily an enterprising person. And he hasn't any great business ideas. And so he simply uses his money to make more money. That which he receives as interest, must certainly be put to work. And that in an economy in which the participants, under the credit line, don't get any more credit, are unable to start up new firms or keep the old ones going, and in which less and less money remains in circulation. Demand dwindles, buying-power declines, production is slowed and sometimes closed down. The economy collapses.
The question is: "How much longer can the world keep on tightening it's belt?" We are currently playing monopoly. But in reality! And in reality one person cannot, at close of play, "own everything" as in the game. Before that happens the social tensions, would grow so intense that they forcibly compel a redistribution. Still, as long as the cause of the problem remains unrecognised and isn't rectified, we shall continue playing monopoly and musical chairs. For just as long as the economy allows.
So: too much money compared to the wares on offer, causes inflation. Too little money compared to the offered wares, causes something even worse - deflation. About deflation, the retraction of money from circulation, the following remains to be said: the companies suddenly receive no more credit, because the banks among themselves are no longer granting any (they all know about the bad debts in their own ledgers, and surmise that things aren't looking much better in the other banks.....in which, they are of course correct). Credit will only be granted against the highest securities. The credit squeeze has begun.
Companies cease to be supplied with enough credit and must attempt to get some money through their turnover. They do this, by reducing their prices. And how that progresses is easy to imagine. Other firms in the same business, get the idea and follow suit (for several years advertising in Germany used the slogan "Stinginess is Sexy", until even the advertisers realised that it is anything but sexy). Soon other branches have also to follow. It spells ruin for traders and producers alike, that much is certain. That cannot be the solution.