Sir William Rees-Mogg Quote

"The value of paper money is precisely the value of a politician's promise, as high or low as you put that; the value of gold is protected by the inability of politicians to manufacture it."

by:	Sir William Rees-Mogg
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Categories:	Economics, Money
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-- Mary - MI
The value of Currency as we now have it is based on our productivity...the Gross Domestic Product...so what happens when we have say, 46 million people on food stamps, and a tax system that absolutely destroys motivation to produce? The currency becomes worthless because no one will want to produce anything. And why should they? The ever more socialist system will take care of them, right?  -- J Carlton, Calgary
Nowadays "the value of gold is protected" only where actual bullion is exchanged for a buyer-offered currency or like trade. On the other hand, gold 'spot price' is fixed by just five multinational banks in twice-daily teleconferences. Two of these banks are headquartered in Britain, one is German, one French, one Canadian. Silver is fixed by just three of these five. Spot prices for both metals have dropped sharply of late in very volatile market swings, precisely when physical gold is increasingly difficult to actually obtain. Bullion dealers, if you can find one, are demanding and getting a quite substantial premium over 'spot.' For those turned cold by economics, that means the constantly updated 'spot price' is a thoroughly cooked, self-serving book, regardless of how 'free' the market is touted as being. It's a PAPER price ONLY. The bankster thrust (and onboard, wedded media exhortations) giving a haircut to gold in the face of soaring physical demand underscores two important things: First, "spot price" is as artificially low as the banksters can keep it without drawing undue, wholly negative attention to their scheming machinations. Next, doing it in full view of the unpolluted eye can only be due to PANIC over their long standing, short paper positions on gold (of special note, J.P. Morgan Chase), coupled with completely insufficient physical holdings of the increasingly hard to get stuff.  -- Mann, Kalamazoo
I believe this quote to be true. And scary in light of the level of support of government in the polls.  -- Jess Porter, Mitchell, IN
Very interesting quote and comments by J Carlton and Mann.  -- jim k, Austin, Tx
Since gold is no longer used as currency and is no longer distributed among billions of people instead of owned by central banks, the central banks can flood the market any time they want to devalue gold. A fiat currency absolutely MUST deflate in value. Its true value is difficult to determine at any given time, but on short term, it represents labor and goods at market value. The more the currency is used to pay for consumables, the less backing it effectively has. None-the-less, fiat currency is interest-bearing debt, and the price to rent our money eventually eats it away over time.  -- E Archer, NYC

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