Gold Bugs versus Theft Bugs
By Robert Higgs on Apr 20, 2008 in Economics, Politics
Calling someone a gold bug is rarely a compliment, and often an insult. For most people, a gold bug is a weirdo, at best, and a complete nut case, at worst. Don’t these gold bugs understand that gold does not pay interest or dividends? And as for those who advocate a return to the gold standard, geez, what are they thinking? Don’t they know the relic of a vanished politico-economic order when they see one?
The alternative, of course, the modern, sophisticated setup that hardly anybody can imagine doing without, comprises fiat money, legal-tender laws, fractional-reserve banks, a central bank, and a cornucopia of regulations on money, banks, and nearly everything they touch, which is now pretty much everything in existence.
And how cool is that? Why, without this modern monetary regime, we might never have experienced the grandeur of the Great Depression or the thrilling 95 percent shrinkage of the dollar’s purchasing power since the Federal Reserve System’s creation in 1913. We’d have been forced to forgo even the joys of stagflation in the 1970s, because we’d have had no serious inflation to combine with the real stagnation. Christ, Jimmy Carter might never have been elected, and—horror of horrors—we’d have had to endure four more years of newspaper stories about Gerald Ford’s stumbling over his own feet or hitting his head against something.
So, obviously, gold bugs are too old-fashioned for us to abide. Instead, we moderns vastly prefer, in effect, theft bugs, because the inflation that is inherent in the modern politico-monetary (dis)order entails, among other evils, a hidden tax on all those who hold assets denominated in dollars and who fail to anticipate the impending depreciation of the dollar and to rearrange their affairs to compensate for it. Stealing is good, of course, especially if you are a professional thief, as any politician can attest, and being able to pull off a heist without the victim’s even knowing that he’s been fleeced is fabulous, indeed.
As John Maynard Keynes wrote in one of his more insightful moments (The Economic Consequences of the Peace [1919], p. 236), “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”
Who among us can resist such a deliciously wicked prospect? Evidently, only a gold bug.
My only problem with being a gold bug is that virtually no one else is. so when the crisis hits, who is going to buy the gold, or at least exchange it? I wish someone would deal with that issue. Instead of gold, I am investing my spare cash in useful things like tools and vehicles. Is that unwise? At least I can pawn the tools or use them to make a living when times get tough.
Paul the Cab Driver | Apr 20, 2008 | Reply
To Paul the Cab Driver,
There are millions of Americans who understand their “Uncle” is bankrupt and the “currency” is worthless.
But we “play the game” because it is not yet time. When will it be time? Ah, in the words of “Number 2″ (”The Prisoner”), “That would be telling.”
I will give you a sign when the day has arrived: a fare is going to come up to you and tell you they’d like to go to “xyz” and ask you if you’d take an ounce of silver as payment.
When that happens, and I predict you will have that experience this year, you will know the criminals in Washington and Wall Street will be putting their affairs in order.
As the Empire of “USA” follows the path of “USSR”, the quiet and patient Americans, who like their ancestors understand the meaning of Liberty, will once again find a home in the united states of America.
In the near future, when you conduct business, if your exchange doesn’t include gold or silver then it will include bartering.
You are wise to “stock up”. Just make sure most of your commodities are not perishable, but like gold and silver, durable.
As a coffee drinker, I can attest a can of coffee will (almost) be worth its weight in gold.
Yours in Liberty,
xearther
P.S. I also predict you will take the silver.
xearther | Apr 20, 2008 | Reply
Paul, there will certainly be a period where fiat money will be worthless and having gold/silver will be a way of getting stuff you now could not even imagine owning. You are right that getting change will be next to impossible since few others will have metals to trade. This will actually be to our to our advantage because those with no real currency are the ones we bugs will prey on(aka barter with)as they will sell anything to access hard currency to feed their kids, heat their home etc.
This however means you must be carefull in how you buy your metals; don’t buy just big bars. The key to survival gold/silver is having usable sizes for all likely situations
For example you will want to have junk silver for gas/groceries/incidentals
fractional gold coins, eagles, leafs, sovereigns, mexican 2 2.5 5 peso gold coins,(or larger silver bars) for larger purchases, bribes, medical care, property taxes.
full one ounce bars/coins or large silver for the buying of vehicles/homes etc. If the dollar gets destroyed badly enough the things you could buy for a single ounce will shock you. I’ve seen mentioned that at one point in the German hyperinflation a single ounce could have bought you a mixed commercail/residential city block in Berlin.
Big bars are fine for investment but only after you’ve built up a substantial stash of survival coins/bars.
Tools are always a good thing to hoard as is nonperishable food, frozen open pollinated seeds,
even a small plot for a garden, a weapon or two if you are so inclined.
Cars and luxury goods are not good things to invest in. These are the things people can live without and will be the very things people will attempt to trade for your metals in a desperate attempt to access hard currency for their personal needs. Why buy them now at full cost, later they will be giving them away.
Canadian Silver bug | Apr 22, 2008 | Reply
I have known one of these bugs, and now he suffers in jail because of stafa. Anyway thanks for the differentiation of these two classifications of insects in the Gold World. Peace.
Gold Coins | Jun 24, 2009 | Reply