Tag Archives: melchior palyi

Guest Post – Infinite Money

16 Sep

Submitted by reader JMD*.

The central tenet of the Gold Standard Institute is that money is what extinguishes all debt. That is its nature, its function. If you have enough money, you can extinguish any debt you might incur and since there is no limit to human wants and desires, money is the one thing you cannot possibly have enough of. Thus the demand for money is infinite. When debt masquerades as money by government decree, that being the irredeemable obligations of central banks, the infinite demand for money can, at least for a time, be met by infinite supply.

Infinite demand met by infinite supply leads to credit or debt bubbles as the inexhaustible demand for money is met by the infinite supply of central bank obligations, or more accurately, the infinite supply of commercial bank obligations ‘backstopped’ by central bank obligations. The bubbles grow and grow, despite the obvious distortions, becoming ever more fragile as they expand, until the day they burst.

This leads to a sobering conclusion. If you have the ability to issue, without limit, debt that trades as money and the demand for your ‘money’ being infinite, you have the ability to extinguish all possible debt, you can have everything you desire and more, you have ultimate power. It is not a stretch to say you are akin to a God. Government has usurped this power, yet government is composed of humans and humans being humans, not Gods, there is zero chance this power will be given up voluntarily, would you….? Rather, it will be lost through a total collapse in the ‘moneyness’ of government debt. The government will take everyone down with them, as the ‘moneyness’ of their obligations ebb due to their declining quality, rather than admit they have been perpetuating outrageous fraud for decades and cease to enforce their ‘legal tender’. As Melchior Palyi wrote back in 1958;

There can be little doubt of the final outcome, unless the process is brought to a halt.

Alas, it won’t be.

With thanks to Doug Noland and his Credit Bubble Bulletin.

[This article was originally published by the Gold Standard Institute]

Disclaimer: The views expressed in the above article are the author’s own. They should not be interpreted as reflecting any views held by Senator Barnaby Joyce, The Nationals, or by the barnabyisright.com blog author.

* Please see also JMD’s previous Guest Posts –

The ‘Moneyness’ Of Debt

Why The RBA Sold Our Gold

Our Government Debt Crisis Is Already Here

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