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The Neo-Alchemy of the Federal Reserve
Ron Paul
Prisonplanet.com
Wednesday, Dec 03, 2008
As the printing presses for the bailouts run at
full speed, those in power are no longer even pretending that
the new giveaways will fix our problems. Now that we are used
to rewarding failure with taxpayer-funded bailouts, we are being
told that this is “just a start,” more funds will
inevitably be needed for more industries, and that things would
be much worse had we done nothing.
The updated total bailout commitments add up to over $8 trillion
now. This translates into a monetary base increase of 75 percent
over the last two months. This money does not come from some rainy
day fund tucked away in the budget somewhere – it is created
from thin air, and devalues every dollar in circulation. Dumping
money on an economy, as they have been doing, is not the same
as dumping wealth. In fact, it has quite the opposite effect.
One key attribute that gives money value is scarcity. If something
that is used as money becomes too plentiful, it loses value. That
is how inflation and hyperinflation happens. Giving a central
bank the power to create fiat money out of thin air creates the
tremendous risk of eventual hyperinflation. Most of the founding
fathers did not want a central bank. Having just experienced the
hyperinflation of the Continental dollar, they understood the
power and the temptations inherent in that type of system. It
gives one entity far too much power to control and destabilize
the economy.
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Our central bankers have had a tremendous amount of hubris over
the years, believing that they could actually manage a paper money
system in such a way as to replicate the behavior and benefits
of a gold standard. In fact, back in 2004 then Fed Chairman Alan
Greenspan told me as much. People talk about toxic assets, but
the real toxicity in our economy comes from the neo-alchemy practiced
by the Federal Reserve System. Just as alchemists of the past
frequently poisoned themselves with the lead or mercury they were
trying to turn to gold, today’s bankers are poisoning the
economy with accelerated fiat money creation.
Throughout the ages, gold has stood the test of time as a consistently
reliable medium of exchange, and has frequently been referred
to as “God’s money,” as only God can make more
of it. Seeking superhuman power over money in the way alchemists
did in ancient times caused society to shun them as charlatans.
In much the same way, free people today should be sending the
message that this power and control over our money is no longer
acceptable.
The irony is that even had the ancient practice of alchemy been
successful, and gold was suddenly, magically made abundant, alchemists
still would have failed to create real wealth. Creating gold from
lead would have cheapened its status to that of rhinestones or
cubic zirconia. It is unnatural and dangerous for paper to be
considered as precious as a precious metal. Our fiat currency
system is crumbling and coming to an end, as all fiat currencies
eventually do.
Congress should reject the central bank as a failure for its
manipulations of money that have brought our economy to its knees.
I am hoping that in the 111th Congress my legislation to abolish
the Federal Reserve System gains traction so that the central
bank can no longer destroy our money.
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INFOWARS:
BECAUSE THERE'S A WAR ON FOR YOUR MIND
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