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December 19, 2005

The Priests of High Finance
by Alex Wallenwein

Understanding gold means understanding money - pure and simple.

And that's not just because gold is money. It is the very concept of money that needs to be understood in order for the imbalances the world system is currently suffering to be alleviated.

Thank God that it is really very simple - except that some people don't want you to know that.

What we have going today under the name "world financial system" is - unfortunately for all parties concerned (except for a very few) - a case of needless and dangerous interference with the normal flow of pricing information among human beings.

In essence, we have a very small, elite group of individuals (that are not necessarily "organized" in the traditional sense of the word) interjecting themselves between the absolutely natural and healthy process of voluntary human interaction (what we call "the market") and its usual participants - you, me, and everybody else in the world.

This is a very condensed thought, and it probably needs some explaining, so here we go:

The best way to lay this concept out is to look at a very close approximation of the process involved - a process that has happened in pretty much every major religion on earth.

Man's relationship with his Creator should be simple, direct and intimate. But there are entire classes of humans who have artificially interjected themselves in this relationship, essentially for their own, personal gain.

Any high priest and his second and third-tier lackeys operate on this principle: Just make something that is simple, straightforward, and natural sound complex, mysterious, and ultimately elusive - and you got yourself a life-long job.

In other words: Priests interject themselves between man and God by making people believe they can reach God only by virtue of the priets' "assistance." It's the old racket of specialized knowledge. (1)

Similarly, "economists" (or whatever goes under that name today) interject themselves between humans and their understanding of what's going on in any economy.

What we call "the market" is really nothing but the sum total of all humans' individual valuations of some thing in terms of something else, and their exchanges of goods and services based on that valuation.

As a concept, it's really that simple. The devil is in the detail, though. When you are trying to analyze an individual human interaction and how it came about in that particular way, then things can get fairly complicated - but that's not necessary for our purpose here, which is understanding Money.

A Transmitter of Info

At its barest essence, money is a transmitter of information, just like a telephone wire transmits information. Money is a concept that allows people to express their individual valuation of something in terms of something else.

In the old days under the barter system, these valuations were made directly between two desirable goods. If two people came together and each had something the other wanted and was willing to give up something else that they already owned for it, we had what we normally call "a deal." They agreed to exchange one thing for the other and then called it a day.

This became impractical very quickly, so people figured out that they can use a medium, a transmitter of value so to speak, to gain a little more flexibility in this process. If I'm a caveman and I meet my friend Zorg away from my cave and I see him carrying two bows, and mine just broke because my wife beat me over the head with it, and I want to persuade him to give me his second bow, I can't carry all my goodies with me to figure out which one he wants in return. If I have some medium of exchange on me, though, like says, sea shells, and he knows he can take those and exchange them for something he may want in the next village, then we have a "deal" again.

And so it went, throughout human history. After centuries and centuries of going through this process, people figured out - the world over - that gold and silver were the best medium of exchange.

I don't want to go into all the aspects of these metals that make them so perfect for their use as value-transmitters here. Others have written about that subject extensively and can probably explain it better than I could.

What's Being Transmitted?

Anyway. So, now that we know money is a value transmitter, we need to tackle another important concept: The concept of "price."

At rock-bottom, the 'price' of anything is value-information. The "price" of something is the point where two or more individuals' valuation processes (how much is one thing 'worth' in terms of something else?) meet. (Zorg doesn't want to give his second bow up for only two sea shells. He almost lost his life winning it because the man who owned it before him tried to kill him and Zorg won the fight. To him, it's a trophy, a symbol of his strength and skill in fighting, so if he's gonna give it up at all, it'll have to be fifty sea shells. I think he's full of it. I can go to the village and buy one for three sea shells at most, so we part our ways. No "meeting of the minds" - no deal.)

So, price is not just a matter of "what will you give me for it?" but also of "how much?"

Gain Is the Driver of Value

Another important concept is the idea of gain. If I don't think I gain value by the exchange, I don't make the deal, so gain is the driver of human interaction, at least when it comes to goods and services.

Gain doesn't always have to come in the form of "profit," which is a more narrow concept. A profit usually results when you sell something for more than you bought it for. Gain is more general, in the vein of "usefulness." If it's useful in some perceived way, it's a gain, even if I lose money on the deal.

The Issue of Control

There are some people in the world who just can't leave others alone. You know the type. The bossy ones who make your life miserable because they always want to tell you what to do and how to do it, and they're not happy until you do it exactly their way.

If people like that find themselves on the bottom rung of society by reason of their birth, or lack of physical strength, or whatever, they will do just about anything to "get their way." It's just how they are. In order to do this, they have to be super-smart. Dumb people don't get their way very often. Since they are smart (a prerequisite for social climbers) some of them figured out that this process of human valuation exchange all hinges on the thing or medium all other things are exchanged for - money.

If they can only get control of this process - somehow, in some way - then they can rule the universe, so to speak, and that fits their bossy personality trait really well.

So some of them set out and did just that. They got control of the medium everything in the entire world is exchanged for: Money.

They knew (or learned through trial ad error over time) that simply accumulating more money than everyone else is a field of intense competition, and they wanted to get their "leg up" on this process. If you have to compete with the entire world on the basis of who is faster, bigger, stronger, and smarter, they lose, hands down. So, they use the leverage of specialized knowledge to gain the upper hand - and the area of knowledge they chose to specialize in was, of course, money and how it works.

They figured out that control of the "value" (i.e., the value-perception by people) of the medium of exchange means control of the value of pretty much everything else in the world. That appeals to their megalomaniacal personalities, so that's what they did.

If you're not fast and strong enough to chase money down like prey, then what's your best option?

Get people to bring it to you - voluntarily!

How do you do that? By providing some sort of "value" in return. You keep their money "safe" for them - in return for a modest fee, of course. You become a banker. A money lender.

Earn a little bit of money, then loan it out to someone on condition that they pay it back with a tiny little recompense - interest - and you got yourself a business.

You also find yourself in need of protection, especially if you're greedy and abuse your position to extract undue amounts of that "interest" from people by loaning money to the destitute and needy. That kind of stuff gets people mad at you real quick like, and so you need protection.

Who can better protect you than the lord of the realm? Of course, nobody. So you set out to foster a "special relationship" between you and the earthly ruler of your fiefdom. How can you achieve that? That's easy: loan him some money on special terms (like a very low interest rate). Help him find some rare and precious coins (a la Mayer Amschel Rothschild), and maybe help him collect his own extractions of "interest" from his subjects (also known as "taxes").

Over time, this develops into a very close, symbiotic relationship. The money lender, and the lord. Banks, and government. Priests, and their homespun "gods."

By using the power of interest and their skill of sucking up to the rich and powerful, money lenders can gain wealth and influence in the world. But, what's an overly ambitious money lender to do if he wants to rule over even the rulers?

Simple: Persuade the rulers to pass special laws that allow you to create money out of nothing and charge interest for lending it out.

In other words: Persuade governments to institute and enforce a system of fiat money on their people, and then work to make that system world-wide.

That's what the Priests if High Finance have done - and you're paying for it through your nose, with your sweat and toil and while bearing all the risks of the transaction.

If you don't pay the bankers back what they "loaned" you, they lose precisely nothing. They just delete the accounting entry they created on paper or in cyberspace, turn around, and "loan" some more so-called "money" to someone else who's dumb enough to borrow from them (or who has no other choice, which is the situation we are in today under a world-wide fiat standard).

The priests of high finance worship on the altar of debt - and debt enslaves.

How to have an (entirely legal) 'slave revolt' of sorts to free yourself from this system is the subject of my upcoming book by the title I ... SLAVE!

Here is a hint: How to successfully fight this revolt has to do with a much-maligned metal of a strange and lustrous yellow hue.

Reliability - Zero

In one sentence, the problem can be stated this way: Gold/silver are the physical world's only ultimately reliable value-transmitters, for the simple reason that they have value themselves - without depending on the fulfillment of any promise. Fiat, on the other hand, is not. And that's where the entire problem lies.

Gold is reliable because it's value-transmitting function is very, very difficult to manipulate. Debt-money, on the other hand (have you ever heard a more ludicrous oxymoron?) is totally within the manipulator's control. Except that we're not supposed to call what the priests of high finance are doing "manipulation." The politically correct term is "policy."( That does sound far more legitimate, doesn't it?)

So, when you look at your next paycheck as when you take it to the bank (oops, now we know a little more about banks than we did before, don't we?) to deposit it and pay your bills this month, when you call a mortgage company next time to apply for a loan for your new home - remember what you've just learned (if you didn't know it already) ...

... and imagine what could be done about it.

Imagine how much more secure, reliable - and real - the world of finance would be without this fraud on humanity that we call the "financial system." (2)

Got gold?

(1) Physicians probably have a pretty good claim to a legitimate use of this principle. The physical properties of the human body are indeed mind-bogglingly complex, but bankers and "economists" really can't say the same thing.
(2) It's a real eye-opener to read the etyomology (linguistic root) of the word "finance":
( From the 'Online Etymology Dictionary'):
"c.1400, 'an end,' from M.Fr. finance 'ending, settlement of a debt,' from M.L. finis 'a payment in settlement, fine or tax,' from L. finis 'end.' The notion is of 'ending' (by satisfying) something that is due (cf. Gk. telos 'end;' pl. tele 'services due, dues exacted by the state, financial means.">

What we have today is the opposite of a "financial" system. With fiat, a debt can never be fully extinguished, as the fiat itself represents only another form of debt. We live in a system of perpetual servitude to our financial (or anti-financial) masters. We are slaves of The Lords of Debt.

Alex Wallenwein
Editor, Publisher
The Euro vs Dollar Monitor

Just like driving your car, investing only makes sense if you can see where you are going. The Euro vs Dollar Monitor is your golden windshield wiper that removes the media's greasy film of financial misinformation from your investment outlook. Don't drive your investment vehicle without it!

Copyright © 2003-2008 Alex Wallenwein

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