The Fundamental Things Don't Change

As Master of the Mint, Sir Isaac Newton played a critical role in the establishment of the classical gold standard that would endure for almost 200 years.  Newton was a seminal scientist, but he is not the only towering savant to participate in the creation of sound money.

Nicolaus Copernicus first established that the Earth goes around the Sun, overthrowing the ancient and then prevailing Ptolemaic view that the Sun goes around the Earth.  It was one of the great breakthroughs in science.  Copernicus, among other things a physician, was a polymath.  He made a significant impact in monetary theory with a treatise on the reform of Prussian coinage.

 

It is at least somewhat ironic that those who seek to discredit the gold standard often take rhetorical refuge in the words of Creationist William Jennings Bryan and others of an unscientific turn of mind.

The cosmology of Copernicus and Newton’s Laws of physics are works of the most rigorous minds in history.  The insights of these thinkers on monetary theory are equally sound—as demonstrated in the laboratory of history. 

As Herman Hupfeld wrote in 1931 — and as made famous by Sam in Casablanca — the fundamental things don’t change as time goes by.

As stated by Leszek Zygner of Nicolaus Copernicus University:

Copernicus wrote three versions of his treatise on the reform of Prussian coinage in the years 1517-26

This document was produced with Bishop Fabianus Lusianus and members of the cathedral chapter of Warmia in mind and was to support their arguments in debates on monetary reform held during assemblies of the Estates of Royal Prussia (Stany Prus Królewskich). The treatise consisted of two parts. In the first Copernicus discusses general issues related to the theory of money and formulates inter alia a law of bad money driving out good. In the second he focused on the current monetary situation in Royal Prussia and in particular on the decline in the value of Prussian coinage, enumerating its types and explaining the reasons for the decrease in value of individual coins. … 

  • Copernicus was the first to explain the reason for the decrease in the value of money caused by gold and silver coins being made into an alloy with copper in the minting process. He also presented quite a detailed analysis of the debasement process in relation to Prussian coinage, referring to how the good coinage issued by the Teutonic State gradually decreased in value in the aftermath of the Battle of Grunwald (Tannenberg). …

An analysis of Copernicus general views on monetary issues show that he was a follower of the metallist theory of money; he saw the source of the value of a coin in its metal content. For him a coin was a marked (stamped) piece of gold or silver which is used as payment for commodities being bought or sold according to the legal tender laws passed by the issuer, namely the state or the ruler. According to Copernicus all kinds of money have their value (valor) and their estimated value (estimatio); while the value of a given coin depends on the amount and quality of the metal bullion of which it is made, its estimatio is its nominal value set by the overall authority in the country.

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The Most Important Thing Holding Up the US Dollar

by Ron Paul

Today’s economic conditions reflect a fiat monetary system held together by many tricks and luck over the past 40 years. The world has been awash in paper money since removal of the last vestige of the gold standard by Richard Nixon when he buried the Bretton Woods agreement — the gold exchange standard — on August 15, 1971.

Since then we’ve been on a worldwide paper dollar standard. Quite possibly we are seeing the beginning of the end of that system. If so, tough times are ahead for the United States and the world economy.

Piketty’s Gold?

April 21, 2014

In terms of public policy, though, we favor honest money. It works out better for more people. And there is a moral dimension to the question of honest money. This was a matter that was understood — and keenly felt — by the Founders of America, who almost to a man (Benjamin Franklin, a printer of paper notes, was a holdout), cringed with humiliation at the thought of fiat paper money. They’d tried it in the revolution, and it had been the one embarrassment of the struggle. They eventually gave us a Constitution that they hoped would bar us from ever making the same mistake.

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The Rueffian SynthesisJohn D. Mueller

Publisher's Note: Originally released in June/July of 1991, this detailed report discusses Jacques Rueff's economic theories and applies them to modern economic events.

By John D. Mueller

Rueff Restates the Quantity Theory of Money

... Rueff argued that the real problem with the monetarists is not that they focus too much, but rather too little on the supply of money; namely, they assign too little importance to the concrete mechanisms by which money is actually created. Most monetarists adopt the convention that the government can control the nominal supply of money, while demanders of money control its value. Rueff pointed out that under a properly functioning monetary system, even the nominal supply of money is determined by people’s demand for it.

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Excerpts From:


by Lewis E. Lehrman

"The economist defines money as a medium of exchange. It is the token we supply in order to effect payments for the goods we demand. Money is especially a standard like a yardstick – a unit of measure by which we value and price economic goods. Money units express prices which are the vital information necessary for efficient exchange. Money is surely a store of value."

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Laksmi, The Goddess of Prosperity

Ralph J. Benko  |  Apr 24, 2014
Indian culture long has held a high appreciation for gold.  The Vedic faith records four historical ages, the highest being the Satya Yuga.  Per Wikipedia, "when humanity is governed by gods, and every manifestation or work is close to the purest ideal and humanity will allow intrinsic goodness to rule supreme.

So Long, So Slow: IMF Not So Optimistic on World Recovery

Kathleen Packard  |  Apr 23, 2014
“Here’s the short story: The U.S. has exited from financial crisis: Asia and Europe have not,” wrote Rana Foroohar in TIME at the beginning of this year. “China, the second largest economy in the world, is pretty much where the U.S. was five years ago – deeply in debt...Japan, where...
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World Press
George Melloan

In Going Long, the Fed Is Short-Sighted

Stock and bond traders spent most of last year in a state of high anxiety over what would happen when...
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How to Make the Dollar Sound Again

BY disclosing a plan to conjure $600 billion to support the sagging economy, the Federal Reserve affirmed the interesting...
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Kathleen M. Packard, Publisher
Ralph J. Benko, Editor

The Gold Standard Now
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In Memoriam
Professor Jacques Rueff
(1896-1978)

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