I say most important, because these videos record Professor Fekete’s seminal talk on the Real Bills Doctrine of Adam Smith. This very topic is what attracted me to study the Professor’s work in the first place. Real Bills are the natural clearing system of the Gold Standard. They are the most important -and most obscure- component of the monetary system the world ran under during the nineteenth century. The nineteenth century was the most peaceful and prosperous hundred years that Humanity has experienced since getting kicked out of the Garden of Eden…!
In a nutshell, under a Gold Standard the quantity of money is essentially fixed; mine supply adds not more than about 2% to the money supply per year. There are about 160,000 Tons of Gold in the form of coins, bars, and jewelry known to exist above ground. Mine supply is roughly 2,500 tons per year; thus the stock to flows of Gold are about 80 to one. It would take about 80 years for the mines to supply as much Gold as already exists.
All other commodities except Silver have stock to flows to be measured in days not years. This is the main reason why Gold is money… and nothing else except Silver can serve as useful money. Any other commodity will have wild fluctuations in price, or purchasing power, depending on sudden variations in supply and demand. The huge existent supplies -eighty years worth- ensure that Gold and Silver are immune to any rapid changes in value.
On the other hand, to accommodate seasonal fluctuations in commercial and consumer demand, there needs to be ‘flexibility’ in the ‘money’ (actually purchasing medium) available to commerce; … and Real Bills in circulation represent purchasing medium. The need for commercial flexibility is the very excuse used to dissuade us from accepting Gold as Money; it is just too ‘rigid’!
The truth is, a Gold standard without Real Bills really IS too rigid… too rigid to survive. Real bills drawn against vitally needed goods moving rapidly to the consumer, where they will be redeemed in Gold in not more than 91 days, supply the natural flexibility required by commerce. More bills are drawn if consumers do more buying… and all bills expire on maturity… thus avoiding any inflationary effects. Furthermore, no more bills can be drawn than whatever quantity of real goods the economy can actually supply. The creation and retirement of bills are vital parts of the natural feedback mechanisms that keep a free (voluntary) market economy on an even keel… far removed from the insane volatility that haunts our ‘system’ of Debt Money!
Debt Money is the worst conflation of ideas possible; debt and money, like fire and water, are poles apart; just as water extinguishes fire, so money extinguishes debt. If debt is masquerading as money, then how can debt extinguish debt? It cannot… thus the immense growth in debt that is bringing the current monetary regime down.
Much more information is provided by these new videos; a 16 DVD set, uncut and unedited, a faithful reproduction of the Professor’s twenty lecture seminar at Szombathely in March 2011. The cost of attending the live session was 1,000 Eu… plus travel expenses. The list price of the video set is only 500 Eu, a big saving… but as a special offer, and in view of the major crisis shaking the foundation of the world economy, I am offering a limited time special price of only 350 Eu.
If you are a member in good standing of The Gold Standard Institute, or an attendee of any of the Professor’s lecture series, your price is only 200 Eu. To order a set, contact me directly or visit The Gold Standard Institute at;