Fiat money is a half-century old… Will it give way for a new crypto-fiat standard and what will be the role of Gold?

50 years ago, almost to the day, the gold-backed dollar was taken out and eliminated…

Eliminated by Richard “Tricky Dick” Nixon.

Let’s give you some history first…

Exactly on August 15, 1971, the president announced the news to the nation live on TV.

To gain the attention of as many Americans as possible, he interrupted the popular cowboy show Bonanza with the following warning…

Prosperity without war requires action on three fronts. We must create more and better jobs; we must stop the rise in the cost of living; we must protect the dollar from the attacks of international money speculators.

The president then unveiled what we now know as the “Nixon shock.”

To defend the currency against attacks from, as he put it, “international money speculators,” he delinked the U.S. dollar from gold.

Nixon broke the promise America made in 1944 to its World War II allies to trade dollars for gold at a fixed exchange rate of $35 an ounce.

In doing so, he ended the gold-based international money system in place, off and on, since the 1870s.

August 15, marks the 50th year after President Nixon did take the US Dollar of Gold.

This event ushered into the era of debt-based money and allowed central banks to create money without restrictions. It completely dematerialized the global monetary system.

Since then, no currency has been backed by a scarce asset like gold. Central banks can create money without any restrictions and are increasingly making use of this privilege.

The latest government figures show yearly consumer price inflation running above 5%.

That’s the biggest annual rise in inflation in 31 years. And it’s the product of the fiat-money system Nixon brought in.

Gold served as an inflation “anchor” for the dollar…

Before 1971, for every $35 Congress created, it had to come up with one ounce of gold to back the new spending.

By 1971, the feds were printing more dollars than they had gold to back. But the gold standard kept government spending under an external constraint.

By ending the direct convertibility of dollars to gold, Nixon allowed lawmakers to create as many new dollars as they wished.

That devalued the dollar and with it all other currencies that are indirectly linked to the global reserve currency the dollar represents.

Today you need $6.74 to have the same buying power as $1 in 1971. That’s thanks to an “official” average inflation rate of 3.9% over that time.

The in-official inflation rate our real-world experience tells us the official inflation rate doesn’t reflect the actual cost increases of everything from burritos to healthcare.

If the Burrito Index had tracked official inflation, the cost of burrito in the 70s was $0.99, in 2001 it was $3.38 and today its $7.50. That is most certainly not a 3.9% inflation rate.

Former Head of the Federal Reserve Alan Greenspan knew that hence his statement:

“The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit. In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. Deficit spending is simply a scheme for the hidden confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard.”

So What’s Next?
A new monetary shock is on the way…

The fiat standard Nixon ventured in is breathing its last. And a new money system is taking shape

One built around Centralized Government controlled cryptocurrencies or CBDC “Central Bank Digital Currency” Money

Hence it is in Governments interest to create their own digital CBDC “Central Bank Digital Currency” money that THEY not YOU can control.

CBDC Money The New Digital Currency
Central Banks and the Future of Digital Money

81 countries are exploring issuing digital-only currencies. These countries account for over 90% of the world’s economic output.

According to a recent study conducted by the Bank for International Settlements, more than 70% of institutions are actively researching and developing proofs of concept for CBDCs.

CBDC Money is Central bank controlled. The supply of CBDC is fully controlled and determined by the central bank.

With blockchains and cryptocurrencies, there’s no central bank that can digitally “print” more currency at the press of a button. A blockchain’s monetary policy is written into its code.

Central bank digital currencies – CBDCs – are digital versions of existing fiat cash. Instead of carrying them in your pocket as banknotes and coins, you store them in a digital wallet on your smartphone.

You spend them on your smartphone, much like you’d spend bitcoin or another decentralized cryptocurrency.

Digital-only cash will allow the government to track and tax every transaction we make. The taxman will have a field day.

CBDCs are making negative interest rates much easier to impose. The Fed will centrally control this system. So it could write some code that deducts interest from our digital wallets each month to encourage spending.

That may be good for governments. But freedom-loving folks are sure to despise it.

Expect them to flock in even greater numbers into Gold, Silver, decentralized crypto currencies like bitcoin…and tangible assets.

GOLD IS THE CURRENCY OF THE FREE.

The modern system of money and banking impoverishes and enslaves.

It has made possible wars that should never have happened, it has made the gap between rich and poor almost irretrievably large and it has facilitated the rape of our earth. The problem is money.

I strongly believe the solution is the ownership of gold and also become a Entrepeneur 1 in MarketHive.

The time has come to follow the yellow brick road.

Gold and Commodity prices are starting to rise again. Tangible assets, especially commodities, selected equities in the right sector, and obviously precious metals should therefore form the solid basis of every persons portfolio.

If you don’t already own some gold, now is a great time to buy…

Gold represents Freedom

So that you to can protect yourself against the devaluation and loss of purchasing power of your currency and the loss of your freedom.

And remember “Success comes from knowing what you don’t know, more than coming from what you do know!”

Best Regards,

Goran B Edstrom - SWEDEN - Proud - MarketHive - Entrepeneur 1 Member.