Since August 15, 1971, when the Gold Standard was dropped out, with the fixed exchange rate between gold and the dollar, currencies have been free to float regardless of a material reference base. This allows central banks to print money as much as they want which is reflecting what happens with bills when you play Monopoly, having the consequence btw to deprive them of their real value.
In particular, banknotes are suitable to any type of speculation by the markets and manipulation by central banks. This is due to the intrinsic currency value which is just an agreement among users, while in the world of raw materials, the values are determined by a market that has strong basis linked to the real economy of the planet.
The end of the Gold Standard has driven the world from a real economy to a financial economy, plugging in an artificial growth effect like the one that a drug has on the body: It triggers effects of false well-being and energy induced only by the consumption of substances that, at the end of their effects, cause an opposite mechanism, a rebound, which leads the individual to a never-ending dependence trying to reproduce the positive effects.
In the economy the impact of this creation of wealth determines a multiplication of bubbles from which all operators become dependent without having any real basis, but having confidence on the market only, confidence that must grow in order to let the system grow.
Like for the drugs where you need more and more doses to keep the effects forcing you to become a slave of the product and destroying your life, the risk is that the markets are experiencing a similar situation. So that the uncontrolled increase printing of derivatives and banknotes is driving the world to an artificial dependence and self-destruction.
Maybe soon the currencies that have been deprived of all value will be replaced by material goods, such as gold, hay or manure.
LAURA MALTAGLIATI
(Original article By PHOENIX)
