Forced money

Forced money or legal tender is (unfortunately) a key tenet of modern economics I’ll explain the idea for those of you who are new to this;

The government is giving themselves the monopoly of issuing money in a very subtle way by making their money “legal tender“. In Norwegian “tvunget betalingsmiddel”. It means that in any transaction you have to accept the governments money if you are offered it. The cruical paragraph in Norway is § 14 in the Central Bank law. You will find the same law in any country.

( This same paragraph also states that government will NOT enforce contracts in gold ( enforcing contracts is one of the essential tasks of a government). If people are left to organize themselves they use some goods as money. Metals like gold, silver and copper are particularily suitable. So the government outlaw this to avoid any alternative to their paper)

In a division of labour economy money is 50% of any transaction wich is
either
Money -> Goods or services
or
Goods or services -> Money.

Both parties in a deal want to go as cheap as possible. Consequently the holder of the money wants to go as cheap as possible. Now if you pause a bit you’ll see that all the government needs to do to get their money monopoly is making the worst money in the country. Any attempt to make better money will fail because nobody will use them as payment. Why pay with good money like gold when you are entitled to get away with the governments shit?

Some people see the government as beneficial institutiuon with competent officials laboring ceaselessly for your welfare. But what to say of this making the governements products the maximum best & impossible for anyone to provide better? Add to it the governments motiviation to create more money to buy their debt thereby diluting the currency. Follow the news about the consequences of the finance (=money) crises.

Do you really believe the governments monopoly of currency is for the betterment of the people?

Tips oss hvis dette innlegget er upassende

Filed under: on September 18, 2010 at 8:51 am Comments Off

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