Saturday, November 17, 2012

Golden Oldie VI

"Gold is a relic of Julius Caesar and interest is an invention of Satan." Mr. Edison continued. "Gold is intrinsically of less utility than most metals. The probable reason why it is retained as the basis of money is that it is easy to control. And it is the control of money that constitutes the money questions. It is the control of money that is the root of all evils....

"....Then there is another way—the method my friend Ford proposed the other day. He proposes just to go along and forget about gold. He says that the Government can finance Muscle Shoals without applying to money brokers for permission, and I think he is absolutely right about it. Of course, as long as the world is on the gold basis, we shall have to recognize it as an element in the international trade, but it is not necessary for commerce within our own borders. In internal business we can forget it. And we do forget it. If everybody in the United States suddenly demanded gold for their money, there would not be enough gold.

"Gold and money are separate things, you see. Gold is the trick mechanism by which you can control money. Gold is not money until the people of the United States and other nations put their stamp on it. It is not the gold that makes the dollar. It is the dollar that makes the gold. Take the dollar out of the gold, and leave it merely yellow metal, and it sinks in value. Gold is established by law, just as silver was, and gold could be disestablished, demonetized by law, just as silver was. When silver was demonetized the former so-called dollar became worth about 50 cents."

"But would not Mr. Ford’s suggestion that Muscle Shoals be financed by a currency issue raise some objections?" Mr. Edison was asked.

"Certainly. There is a complete set of misleading slogans kept on hand for just such outbreaks of common sense among the people. The people are so ignorant of what they think are the intricacies of the money systems that they are easily impressed by big words. There would be new shrieks of 'fiat money' and 'paper money' and 'green-backism', and all the rest of it—the same old cries with which the people have been shouted down from the beginning."
--Thomas Edison in The New York Times interview, Ford Sees Wealth in Muscle Shoals, December 4, 1921

1 comment:

Paul Stilwell said...

Edison failed to mention that "gold standard" is also a relic of King Henry VIII.