title slide box title & headline w hat is s ound m oney ? t he a tlas s ound m oney p roject the...

Title Slide BoxTitle & HeadlineTitle & Headline

WHAT IS SOUND MONEY?

THE ATLAS SOUND MONEY PROJECT

The Atlas Economic Foundation

The Arizona Constitution Committee

January 2012

Mesa, ArizonaCopyright © Atlas Sound Money Project 2012. All Rights Reserved. www.SoundMoneyProject.org

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Arizona Sound Money Act

http://www.soundmoneyproject.org/


Title Slide BoxTitle & HeadlineTitle & HeadlineAnother great depression

Copyright © Atlas Sound Money Project 2012. All Rights Reserved. www.SoundMoneyProject.org 2

Recognizing that the US economy is too juicy of a plum for dishonest tyrants to resist taking for their own personal gain, we are not surprised at their attempts to steal our economy!

The American Experiment

Self government = Individual Responsibility

How to measure? Freedom Index[i] of Countries

Individual Responsibility = Moral Values

Moral Values = Economic Freedom

Economic Freedom = Accountable Governance

[i]




Title Slide BoxTitle & HeadlineTitle & HeadlineOne of the best performing asset classes

Copyright © Atlas Sound Money Project 2012. All Rights Reserved. www.SoundMoneyProject.org

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DEFINITIONS

Money is a man-made invention of the marketplace—a fluid catalyst to allow transfer of property based on principles of fairness and ethics.

What ensures Integrity of U.S. currency?

What is ‘Sound Money’?

• An accurate and honest signal of price• A reliable store of value [deemed worthy of trust by all]• “Trustworthy”—a meaningful unit of account for the marketplace

to make informed decisions.

What is ‘Soundness’?

Definition: A condition of protection of civil liberties against despotic, tyrannical authority





THEREFORE—“Money” is an instrument equal to• “political” constitutions• Bills of Rights (von Mises)

CONVERSLY—“Tyranny” works opposite to redefine liberty in opposite terms

• Rewards failure—questions the basis of reasoning

• Compromises value by artificial manipulation via “Issuance”

• Induces irrational decisions


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’SOUNDNESS’

• The highest integrity as a “true” measure of “freedom” in market forces, whereas

‘UNSOUNDNESS’

• Creates doubt in the wisdom of “free” marketplace [“the American Experiment has failed”]

• Should not be corrupted as a measure or tool of social policy used by authority– Ex: Swiss Franc devalued purposely to avoid overvaluation in foreign

exchange trading. In the case of the Swiss franc, it has risen to an all-time high against the American dollar, and continues to move higher against all other currencies as well. What makes the franc different from other currencies is that it has the highest percentage of its money backed by gold.

• A restraint on governments usage of money to disguise bad or failed social policy.


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CORE MONETARY VALUE 1

SUCCESSFUL, SUSTAINABLE OR “SOUND” MONEY RESULTS FROM LIMITS ON CONCENTRATED POWER

• “Power corrupts…”• Power corrupts from pressure on elected officials to product results

when the time required exceeds the time limit imposed by the elected term limit.

• Leads to the misuse of authority “An urge to impose sweeping directives rather rely on the practical wisdom of principles of a free marketplace.”

Economic devastation occurred after 1776 when excessive Bills of Credit were issued, having legal status conferred on such Bills of Credit

• MORAL: Unsound money gives tyranny an open door to use deceitful practices

• Civic duty requires policing of money powers exercised by authority and requiring constitutional compliance.

On the cusp of hyperinflation


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CORE MONETARY VALUE 1 SUMMARY:

• The American Experiment

• Equal Rights for All

• Rule of Law

• Ownership of Personal Property

• Individual Liberty

• Enforcement of U.S. Constitution

• Personal Responsibility

On the cusp of hyperinflation


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SOUNDNESS OF MONEY:• Gains more trust to become a reliable vehicle to accurately convey

value between dissimilar goods and services between untrusting parties—a common means of exchange

• PERCEPTION IS REALITY– A $20 bill is the same material as a $1.00 bill

• 2.61” X 6.14”• 75% cotton/25% linen• 1 gram, .04 cents cost per bill to produce

– But face value of a $20 bill is different than a $1 bill!• Eclipses the Barter System—makes everything equal (try using beaded

necklaces for trading!)• Crates market efficiency

On the cusp of hyperinflationArizona Sound Money Act


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Sweeping Hungarian money into the sewer in

1946

SUMMARY:

• Paper has the full faith and credit of value it represents over a long period of time (the future); it is a “Benchmark”

• If the value store becomes unreliable, the free market is “confounded”!

• Risk/Reward of the Entrepreneur—depends upon constraints of time and value.

• Definition of “SCAM”: a unit of value that declines over the length of expected contract—it fails the Honesty Test.• Ex: The Dollar has lost 95% of its value since 1913—somebody gets hurt—95% of a working life has been dissipated (stolen).

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ECONOMIC STABILITY DEPENDS ON CLEAR PRICE SIGNALS

•Highest quality & quantity for the lowest price EQUALS transaction, causing the market to “clear” or conduct business.

•Price sensitivity requires very clear signal of unit value—no one wants to be the first to raise prices.

•Quality sensitivity gives leniency to signal: auctions

•Market volatility—elusive equilibrium—supply/demand curve becomes unreliable “hobbled”






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SUMMARY:

• Money must clearly describe the current state of supply/demand market

• Ex: The cost of a barrel of crude oil fluctuates, but if the unit value erodes, it must be corrected for inflation / deflation.

• The ‘Official’ Federal government Consumer Price Index [C.P.I.] is unreliable…ignores key economic indicators (‘cherry picking data’) SO IF YOUR RETIREMENT PLAN IS INDEXED TO THE C.P.I. ITS CLAIM OF INFLATION / DEFLATION IS NOT ACCURATE.






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MONEY MUST HAVE INTEGRITY

• Money is a store of value—must have a good reputation over time.

• Ex: This year, the U.S. unit of value lost enough integrity to cause– Calls for its abandonment as a global “Reserve” currency– Dumping of dollar inventories at any residual value– Destabilized markets inaccurate decisions / price signals– Lends credibility to central planning schemes (we are hearing

calls now that “capitalism is drastically failing in favor of “centralized government intervention”)!

MORAL: dishonest money is unethical and hurtful






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SOUND MONEY ENABLES ACCURATE PLANNING

• Optimal prosperity vs. debilitating uncertainty

• Marketplace confidence / budgeting / investing

• “Adjusting for Inflation” is a BAD SIGN! “Real Estate Appreciation” is a false basis for financial planning!

• Market corrections must be taken into account.

MORAL: Ensure that money is trustworthy.






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PSYCHOLOGICAL EFFECTS OF VOLATILITY IN VALUE UNSOUND MONEY

• Social manipulation of the masses: inoculate the masses against dishonesty (boil the voter in a kettle of water SLOWLY!)

• Ex: How much “should” gasoline cost? 25 cents / gallon! OR, the uninfluenced free market price!)

• Ex: BOUGHT home in 1990 for $200,000 and SOLD in 2010 for $300,000. Profit? MUST ADJUST FOR ‘C.P.I.’ and sell instead for $333,605 (60% DEVALUATION) OR TAKE THE UNREALIZED LOSS on sale of home of $33,605 (and take loss on gasoline, groceries, etc.)*

*this does not take into account supply/demand, interest rate fluctuations, etc.

• THERE IS NO SUCH THING AS INFLATION—ONLY DECEPTION! (Gold does not inflate, or change price. Hence the term “Hard Asset”)




Hypothetical Example

BOUGHT home in 1990 $200,000SOLD in 2010 $300,000Profit? $100,000

BUT…MUST ADJUST FOR ‘C.P.I.’ 60% DEVALUATION (example) $33,605

SELL instead for $333,605 Profit $100,000*OR TAKE THE UNREALIZED LOSS on sale of home of $33,605*

BECAUSE THE SOFT REAL ESTATE MARKET (BUYERS)WON’T PAY YOU FOR YOUR LOSS!

THE CURSE OF A DEBAUCHED CURRENCY SYSTEM!

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CORE MONETARY VALUE 7MONEY’S MOST IMPORTANT FUNCTION IS RELIABILITY

• Reliability is a useful tool for commerce—not a tool of government social manipulation based on political priorities.

• Today it is used as a shock absorber for unexpected social policy failure.

• Federal Reserve Banknotes (ILLEGAL TENDER) are not convertible to sound money (gold or silver) nor to a fixed standard of value.

• “The low-grade fever of inflation signals a cancerous infection dissipating our healthy energy.”

• The Federal Reserve Bank LIES to us about the infection while the local bank REFUSES to loan on our signed contracts. Ex: Tempe Crane owner can’t fulfill job contract if he can’t get a loan to buy the equipment.






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CORE MONETARY VALUE 8CONSTITUTIONAL AUTHORITY• “Take away the car keys from Congress AND GROUND THEM! Clean

House completely of our unconstitutional agents (Congress) using the Constitution SCORE MONETARY VALUE Card (Rep. Ron Paul’s CORE MONETARY VALUEs = 100%).

• Phase in CUTS of all federal departments that are non-essential (at least 70% of the federal government is unconstitutional). Eliminate all “Nice to Have” bureaucracies attached to various departments.

• Get Back 2Basics: the Founders’ Fundamentals.• Enact State Sovereignty legislation to take responsibility for “the

powers reserved to the states”.• AUDIT, THEN SUE THE FED for redress of grievances (after all, they

claim to be independent contractors/agents).• States Withhold Federal Taxes from the Feds (place in escrow,

earning interest) pending correction and adjustment to the U.S. Constitution: “The SUPREME LAW of the LAND”






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CORE MONETARY VALUE 9LIMIT FEDERAL INTERVENTION BY

BUREAUCRATIC REGULATION

• EVERY centrally planned economy FAILS!

• “Free people operating a free marketplace create superior results.” Read “The Road to Serfdom”

• Get the DVD Dollars & Sense: Join John McManus as he clearly explains money,

inflation, free market economics, and sound currency. This video is an excellent tool for teaching Americans about the nature of money and how to solve inflation. Given the current economic crisis, it is a must-see!(2008, 42 min., DVD)






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CORE MONETARY VALUE 9LIMIT FEDERAL INTERVENTION BY BUREAUCRATIC REGULATION

• Let money tell the truth about the market (gold and silver do this best!) “Money is the medium and the medium is the message.”

• Von Mises: “When money provides an honest, reliable, clear, reputable store of value, capital is drawn to its most productive use. Ex: Some cities in China are now almost empty—market deflated causing capital flight.

• Stop Federal Reserve social policy engineering that uses interest rate volatility to create social change.

• Stop Federal Reserve from imposing debt on future unborn citizens.

• Stop violent fluctuations of interest rates that destabilize the market.




“Balance of Power”We The People vs. Fed “Agency” Servitude

Increaseddependency on

government

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Increasedgovernmentpower overeconomy



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CORE MONETARY VALUE 10SOUND MONEY IS A MORAL VIRTUE

• It earns FAITH & CREDIT by foreign borrowers—a good value store.• A fair rate of interest (NOT 0-1% as now) Reward Savers who supply

capital for investment.• We now increasingly see more BUBBLE/BURST “cycles” that are

PLANNED—WATCH OUT!• Fredrich A. Hayek: “To stop the increase of federal control, focus on

monetary policy.” NOT the presidential election; NOT foreign wars; NOT racial tension; NOT oil spills, etc. Footnote 4

• Tea Party Values– Limited Government– Fiscal Responsibility– Free Markets

MORAL: DEMAND AN HONEST –CONSTITUTIONAL—DOLLAR:“The oldest weapon of tyrants throughout history is

‘debasing the currency.”






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CORE MONETARY VALUE 10SOUND MONEY IS A MORAL VIRTUE• The Coinage Act of 1792 precisely defined the Dollar as

– 371.25 grains of silver– 24.75 grams of 99.99% pure gold– NO BILLS OF CREDIT (paper dollars)

• The Bretton Woods Agreement in 1944 made paper Dollars the global Reserve Currency– Congressman Jack Kemp “The Dollar should be as ‘good as gold’.”– Pres. John F. Kennedy (Endnote 6)

• Bretton Woods II Agreement sponsored by George Soros in April 2011– “We now need a new global monetary system that does not include

the U.S. Dollar.”– World Reserve Currency? American Depository Receipts (ADRs)?– Default global currency already is GOLD (or 100% hard asset

backed instruments). This is why the globalist banking cartel induces foreign governments to use debt-centric fractional banking.






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CORE MONETARY VALUE 10SOUND MONEY IS A MORAL VIRTUE• The Coinage Act of 1792 precisely defined the Dollar as

– 371.25 grains of silver--troy ounce = 480 grains; 77.34%– 24.75 grams of 99.99% pure gold– Gold/Silver ration VARIES…typically about 15x– NO BILLS OF CREDIT (paper Dollars) PER U.S. CONSTITUTION

• But, but, but…THAT’S ALL WE HAVE! Paper with a promise to pay!• “U.S. Dollar is backed by the FULL FAITH & ‘CREDIT’ of the U.S. Government!”

• Default global currency already is GOLD (or 100% hard asset backed instruments). – This is why the globalist banking cartel induces foreign

governments to use debt-centric fractional banking.






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HOW TO RESTORE SOUND MONEY

Implement these actions:

1. Teach U.S. Constitutional monetary policy.

2. Demand money we can trust.

3. Establish constraints on issuing volume of currency created.

4. Enforce the Constitution as the SUPREME LAW of the LAND—Congress CANNOT legally print paper currency—only regulate its value as it regulates other weights and measures: Article 1 Sections 8 & 10. States can mint coin established by Congress.

5. Ensure that Gold & Silver Certificates are convertible to REAL Gold & Silver on demand. Ex: Link certificates to gold by government gold-backed bonds.





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1. Allow currency competition (foreign gold coin—historically used the Spanish Milled Dollar).1. Gresham’s Law: “Bad money drives out good” (sick money

causes hoarding of good money resulting in good money being removed from circulation as an ultimate store of value.

2. Ex: 1923 inflation caused refugees fleeing Nazi Germany to take gold in suitcases; Nazis confiscated the gold and hoarded it themselves).

3. Ex: Gold-backed Treasury Notes, Gold-backed plastic card2. Pass Rep. Ron Paul’s HB 1098, better known as the “Free

Competition in Currency Act of 2011,” which would repeal the legal tender laws in the United States Code (Section 5103 of Title 31).

3. Reverse Gresham’s Law: “Enforced good money will drive out bad” (Promote healthy tender to circulate alongside sick tender).

4. Practice fiscal responsibility with standard accounting rules.1. Alan Greenspan 1966 quote p 18 on policy; 1981 quote






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1. NO BALANCED BUDGET or NATIONAL DEBT RELIEF AMENDMENTS

If Congress will NOT enforce the U.S. Constitution, why would anyone in their right mind want to change it to try to accomplish austerity that way? (Definition of insanity)

2. Impose commodity price rules (not controls) to dictate expansion / contraction of M3 money supply (18% of Gross Domestic Product MAXIMUM)

1. MARKET-DRIVEN supply / demand.2. NO DEFICIT SPENDING “If you don’t have revenue to spend,

do not spend it.”3. Allow the free market to improvise solutions.






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1. AUDIT THE FED REGULARLY just as any other required, periodic business audit.

– “Central banks are grasping at straws, hoping that flooding the world with money created out of thin air will somehow resolve a crisis caused by uncontrolled government spending and irresponsible debt issuance,” Rep. Ron Paul said.

– “The Fed is behaving much as it did during the 2008 financial crisis, only this time instead of bailing out politically well-connected too-big-to-fail firms it is bailing out profligate government spending.”

– The solution, Paul said, is simple: Restoring sound money. It would help prevent wild government spending, unsustainable debt, and widespread economic manipulation by central bankers — all key causes of the current crisis.

– Ron Paul: Cancel $1.6 Trillion Fake "Debt" Owed to Federal Reserve –IT’S UNCONSTITUTIONAL!




http://www.jbs.org/the-john-birch-society/ron-paul-cancel-1-6-trillion-fake-debt-owed-to-federal-reserve

http://www.jbs.org/the-john-birch-society/ron-paul-cancel-1-6-trillion-fake-debt-owed-to-federal-reserve



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Rep. Dan Burton (R-Ind.) said in a statement.“We should be under no illusion about today's action by the Federal

Reserve,” “The Federal Reserve's decision to allow European banks to borrow American dollars cheaply, combined with the Administration's action earlier in the week to double the United States financial contribution to the International Monetary fund is nothing more or less than a U.S. taxpayer bailout of Europe.”

Rep. Burton: …even though markets may have reacted positively to the newest bailout announcement, the long-term consequences will be devastating. "This boondoggle will only serve to • further devalue our currency, • increase inflation pressures, • worsen our ability to rebound from the likely failure of the Euro• make it that much harder to solve America's own crushing

financial problems.”




http://kokomoperspective.com/news/local_news/rep-burton-slams-reckless-bailout-of-europe-by-federal-reserve/article_03276702-1b96-11e1-82ff-001cc4c002



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Euro Pacific Capital chief Peter Schiff, who has forecasted economic events of recent years with uncanny accuracy, said this week,

“The Fed would likely continue to debase the dollar for as long as possible. This is not about economic growth, it’s about propping up insolvent financial institutions by creating inflation,”

Schiff was telling investors to stock up on precious metals now.

http://www.active-investor.com/peter-schiff-on-u-s-led-global-bailout-of-banks-3076




http://www.indexuniverse.com/hot-topics/10269-schiff-fed-will-debase-dollar-till-it-cant-.html



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Plan for the PROSPERITY of our POSTERITY

– We are now ensuring our children’s and grandchildren’s economic slavery.

– Today’s college graduates cannot get good jobs.

– Generations X & Y have little concept of constitutional Austrian Economics (www.mises.org)






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HOW TO LOBBY YOUR LEGISLATURE FOR SOUND MONEY

Know which legislators are on which committees and their voting record. Compile a list of legislators’ phone numbers and email addresses and contact them regularly.

SIGN UP FOR THE ALIS “Request to Comment in Committee” system.






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HOW TO LOBBY YOUR LEGISLATURE FOR SOUND MONEY

Educate yourself on each core issue affecting government, sound money and constitutionalism:

www.JBS.org/ISSUES divides issues into 24 categories with research on each.




http://www.jbs.org/ISSUES



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HOW TO LOBBY YOUR LEGISLATURE FOR SOUND MONEYThe Arizona Sound Money Act

http://ArizonaSoundMoneyAct.wordpress.com/ has documents for download on Sound Money and Honest Banking for your state.




http://arizonasoundmoneyact.wordpress.com/



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HOW TO LOBBY YOUR LEGISLATURE FOR SOUND MONEY Become a member of JBS to receive timely and well organized action

steps to RESTORE and ENFORCE constitutional law in our society.





www.ArizonaSoundMoneyAct.wordpress.com

The Arizona Constitution Committee

[email protected]


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http://www.arizonasoundmoneyact.wordpress.com/



title slide box title & headline w hat is s ound m oney ? t he a tlas s ound m oney p roject the...

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