Tuesday, July 05, 2016

The Final Demise of Fiat Currency
Is Closer Than You Think
GoldMoney's Alasdair Macleod sees the new bout of turmoil in financial markets is the prelude to the final demise of government currency.. "If I’m right, a long-expected collapse in the purchasing power, and of the very concept of fiat currency, will evolve from current events. The purpose of this article is to explain why
monetary theory predicts a currency collapse.
The failure of central bank monetary policies appears to have reached an inflection point. This is what the share prices of systemically-important banks are telling us. This is what the political disintegration of Europe, upon which the new synthetic euro is based, is telling us. This is what the cul-de-sac of permanently zero and negative interest rates are telling us. This is what wildly over-priced government bonds are telling us. This is what the greatest indicator of all, the price of gold is now telling us. The inflection point, I believe, is the marker for a potentially catastrophic decline in the purchasing power of paper currencies that are unbacked by exchangeable gold. The faith and credit-standing of issuers of paper money, and not the known and suspected inadequacies of commercial finance, is the last rotten pit-prop supporting the system. We can easily see how
a new round of monetary expansion designed to save the global banking system from its nemesis will lead, not to a Lehman-style outcome, but to a collapse of paper currencies."
LINK HERE to the essay

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