Entering text into the input field will update the search result below

The Importance of Sound Money

Jan. 17, 2010 7:47 AM ETUDN, UUP, GLD32 Comments
Jake Towne profile picture
Jake Towne

Sound money is the hallmark of a prosperous society. Fraudulent money impoverishes and enslaves societies, and history teaches it commonly rips them apart in blood-soaked wars. Sound money not only imposes fiscal discipline upon government, impeding reckless federal spending and imprudent warfare, but it also provides a stable unit of account, store of value, and medium of exchange for entrepreneurs, businesses, and individuals.

When the Federal Reserve inflates or deflates the money supply, there is no net benefit to society whatsoever. Obviously, the key to prosperity does not lie in running a printing press endlessly, like Zimbabwe, and it defies logic that America's prosperity would increase if every American deflated the money supply by burning a $100 bill.

Inflation and deflation are simply methods to redistribute wealth. It is easy to see that inflation benefits debtors and hurts savers on fixed incomes, like many retirees. Conversely, deflation benefits savers and hurts debtors. However, there is no net gain. In large part due to the burden of the $12 trillion dollar debt, the American government chooses inflation to avoid insolvency.

The inflation of newly-created money redistributes more purchasing power from the American people to government bureaucrats, the military-industrial complex, recipients of foreign aid, and bailouts to corporations like AIG, GM, Goldman Sachs (GS). These select groups are then able to use it differently, paying higher wages, creating jobs that have either less (or no) economic benefit to society, investing (or leveraging) money at different times and places, et cetera. Sound money not only disciplines government from committing reckless spending but, more importantly, prevents these gross economic imbalances from ever occurring.

The United States does not have sound money, despite the fact that the Constitution, the supreme law of the land, mandates this. Today the dollar is a bill of credit not backed by

This article was written by

Jake Towne profile picture
Jake Towne was an engineer working in Shanghai, China in the semiconductor industry from 2005-2009. He resigned his job and has returned to the United States to peacefully fight for freedom. He is running for US Congress in 2010 in eastern Pennsylvania's 15th District. Jake is a columnist at The Nolan Chart (http://www.nolanchart.com/) and contributing author at LibertyMaven.com (http://www.libertymaven.com/). His column "Yet Another Champion of the Constitution" at the Nolan Chart website (http://www.nolanchart.com/author481.html) seeks truth in the ecopolitical arena, with the primary goals of helping to bring the "War on Terror" to an end and a new dawn of Honest Money.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.