Saturday, March 3, 2012

Why Metals Backed Currencies are NOT The Answer to Our Problems

Some people think that backing currencies with metals makes it possible to control the money supply, while disciplining government spending.

However, think about the implications for extractive industries. These industries contaminate air and water.

For example:
Gold Mining Boom Is Killing the Children of Nigeria
By Elizabeth Grossman, Yale Environment 360
03 March 12

[excerpted] In early 2010, while working in the impoverished rural region of Zamfara in northwestern Nigeria, the group Médecins Sans Frontières - Doctors Without Borders - encountered many young children suffering from fevers, seizures, and convulsions. An unusually high number of very young children, many under age five, were dying, and there were many fresh graves.

The doctors initially suspected malaria, meningitis, or typhoid, all common in the region. But when the sick children didn’t respond to anti-malarial drugs or other antibiotics, one of the physicians began to wonder if local mining activity might be implicated. Historically an agricultural area, Zamfara had been experiencing a small-scale gold rush, thanks to rapidly rising gold prices that encouraged the pursuit of even the most marginal sources of ore. Mining work was taking place in and around the villages and within many of the mud-walled compounds where families were using flour mills to pulverize lead-laden rocks to extract gold....

read the entire article at the link above

MAJIA HERE: This is one important reason for avoiding a silver or gold backed currency.

A silver or gold backed currency could not prevent another financial crisis on its own.
The problem with our economy and society is NOT the fiat currency; the real problem is that people in finance and the government have allowed corruption to run rampant at every level and we the people have become distracted by junk food for the mind.

Ethical failure on the part of corporations, government, and society caused the financial crisis.

A metals-backed currency is not an adequate solution and has massive environmental costs.

Metals do not have much disciplining power in the era of electronic capital. 

Derivatives contracts written on everyday printer paper produce more wealth than ever printed in formal government currency.

A metals-backed currency is a false path to a better society because it is (1) insufficient and (2) has big human and environmental costs.

Long term survival is inconsistent with a metals-backed currency.

Long term survival entails looking honestly at the mess we have created in order to figure out how to use all available resources to fix and remediate major problems quickly...

...while investigating and implementing sustainable solutions.




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