Everyday lesson about the importance of money in San Francisco

In the USA you can do just about anything with enough money, and when you run out you’re on the street. Every year you need more money than the last. Most of your energy is directed toward finding more money.

In order to understand our world you must see that your money = your ownership share in the society at large.

When the society becomes more productive, each share is worth more. When bankers create money from nothing, each share is worth less.

For the last hundred years bankers have been in the business of skimming the increasing productive value which we have all produced. They do it by creating new money roughly in proportion to the increased bounty available.

Imagine what your life would be like if you could receive a safe return of 5% on money which was becoming more and more valuable each year. In our world, you receive no interest on money which is losing 5% of its value per year. You may build wealth only by out-running the tide of new money.

Given the productivity of our society, anyone who is competent and conscientious (and most everyone else) should be comfortable, relatively wealthy and secure. In some ways we are. Clothing is cheap, computers are cheap, energy is cheap, but health care, housing, higher education and taxes are extremely expensive.

Our fake money flows to industries, markets and individuals who have access to easy credit, regulatory capture, and legal immunity. Only sound money can reverse this moral decay.

As an individual, you can’t change the system, but you can save your capital using sound money which will increase in value.

Sound money has the following properties:

Fungibility — The holder has complete and exclusive control over how funds are spent and on what. In order to be fungible, the money must be held and transacted in private. *

Limited supply — Strong guarantees that no entity has the power to increase the supply beyond well understood limits. In order to have a limited supply, anyone holding the money must be able to quickly check the total supply and also verify that what they or someone else holds is valid.

Divisibility — Ability to transact the money in large and small amounts while preserving the above properties.

Money alternatives

Gold is no longer sound money because it has been financialized. Most gold is nothing more than an accounting fiction. The “price” of gold is determined by the financialized market illusion. If this were not the case, then the value of gold would go up along with the total productive capacity of the economy.

Bitcoin is not fungible or private, so owners can be identified and coaxed to let bankers hold their private keys for “safekeeping”. Bankers will create USD loans backed by that collateral. This is the financialization process. Bitcoin obligations can thus be created representing many times the actual supply of Bitcoin. As with gold, these obligations will ultimately sell at the same price as Bitcoin itself, at least until the entire financial system breaks.

Monero is a private and fungible crypto currency. The people who are attracted to it understand the nature of the financial system and the power of privacy and fungibility. It will not be easy to coax Monero holders to give up their private keys. People with a lot of capital will naturally gravitate to holding Monero because these people understand the financial system and the value of privacy. As Bitcoin becomes more and more financialized, Monero will absorb that capital.

If you want to get off the treadmill, save your capital in Monero.

* The technical definition of fungibility is simply that each monetary unit is indistinguishable from every other unit. With a crypto currency, fungibility requires privacy on many levels. With this all encompassing privacy comes the ability or at least potential to hold and transact the money without coercion by anyone.