TITLES, POSSIBLE ONES, THAT CAME TO MY MIND SO FAR:

MONETARY FREEDOM, TERMS, DEFINITIONS, IDEAS, ARGUMENTS, -COUNTER-ARGUMENTS, EXPERIMENTS, PROPOSALS, REFORMS, REVOLUTIONS,- THEORIES, EXPLANATIONS, OBJECTIONS & PREJUDICES AGAINST IT, -STEPS TOWARDS ITS. - An alphabetized notebook of words, ideas, -notions, definitions, explanations, arguments, distinctions, facts, observations, predictions, beliefs, refutations, dogmas, -economic laws, arguments, objections, etc., all helping to lead- us towards full monetary and financial freedom.
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Alphabetized notes on competitive paper monies "as good as gold, which only monetary freedom could supply. ---  SNIPPETS, NOTES & QUOTES TOWARDS FULL MONETARY FREEDOM.
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How to stop inflation and end mass -unemployment and depressions from one day to the other. - Try to- refute this, if you can. Otherwise, do act upon this information -and become monetarily emancipated, too. - J. Z., n.d. & 29.5.97.
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A - Z of FREE BANKING. Attempts to define -and explain aspects of monetary freedom and monetary despotism- alphabetically, with some cross references. An open book, not- copyrighted, inviting and welcoming corrections and supplements- from anyone. Also a list of literature and addresses of interested individuals and organizations. To serve as a handbook -and clearing centre for views on this subject. Ultimately, to -include ideas, plans and projects on how to best and most easily -introduce monetary freedom for all who desire it for themselves. -- J. Z., n.d., 28.4.97.
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PERSONAL NOTES & SOME QUOTES ON MONETARY AND FINANCIAL FREEDOM. I do usually prefer rather to talk to myself and write for my own benefit than trying to talk to or write to people who do not share my interest in such subjects. Moreover, I have come to rather let them seek me out and my offers on monetary and financial freedom and other rights and liberty and peace writings than try to seek them out. I am quite willing to let whatever there is already of the information revolution work for them and for me, without any extra effort by me. - J. Z., 24.5.97. (Well, since then I have tried to push, also largely in vain, not only the microfiche self-publishing and reading option for libertarian writings but also the floppy disk and CD-ROM publishing and reading options for such literature. - J.Z., 16.9.02.
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Talking to myself and to imaginary -discussion partners about monetary freedom in attempts to clarify- doubtful points and counteract popular errors, absorbing as much -wisdom as possible from others on this, through quoting them-e extensively and ordering this compilation merely by- alphabetisation under catchwords.
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Alphabetical Entries, rough notes, some quotes and comments towards a free banking- handbook.

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AN ALPHABETIZED COLLECTION OF NOTES AND QUOTES ON THE ROAD TOWARDS FULL MONETARY AND FINANCIAL FREEDOM. - J.Z., 30.8.02.
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How to stop inflation and end mass -unemployment and depressions from one day to the other. - Try to- refute this, if you can. Otherwise, do act upon this information -and become monetarily emancipated, too. - J. Z., n.d. & 29.5.97.
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The following are some notes & quotes accumulated, over a period, and here transcribed, with some re-writing and additions. They are later to be integrated with previous alphabetized notes on free banking. Ten to hundred times that number of entries, from a variety of advocates of monetary freedom and xyz more sources than I have available to me, would be required to come closer to usefulness as an alphabetized handbook on aspects of monetary freedom. For now this very limited compilation, mostly of my own and still flawed views and expressions  on this subject will have to suffice. I am not prepared to work all of the next years on in or for whatever remains of my life, although I consider this topic to be very important. It is, after all, only an aspect of all individual rights and liberties and of comprehensive panarchism and tolerance.

Nevertheless, the whole topic of monetary freedom is already too large for a systematized treatment in a single volume and such a volume would either remain largely unread or lead to more misunderstandings than comprehension.

Thus, I believe, it should be broken up into manageable alphabetized segments with cross references. A number of handbooks on banking have attempted to do so - but, most of them, without including the ideas, terms, practices and experiences of free banking and concentrating merely upon what the laws permitted or prescribed in this sphere and what was approved by the ruling school of monetary despotism.

The final aim is an alphabetized encyclopedia on free banking, including a directory, comprehensive bibliography, abstracts and review collection, with many different contributions on the same subject by various contributors and based on the full and permanent publishing of all relevant texts, cheaply and permanently, in an alternative medium.

Open entry for all kinds of well reasoned contributions on any related subject is one of the conditions to attain this publishing aim. Microfiche, floppy disks and, more so, CD-ROMs, DVDs & the upcoming Blue Light CDs, with 27 Gbs each side, have more than enough space for this, even if websites do not.  - J.Z., 25.8.02.

For collaboration with Thomas Greco it is to be considered whether multiple files are to be kept: For example, for:
1. His version of explaining terms,
2. My own version of FB terms
3. One version we both can agree upon
4. An open input version in which all such explanations or comments are included, from anyone.
On the other hand and at least initially, not such file separation might be undertaken.  - J.Z., 26.8.02.

The length of several entries shows that for each term perhaps at least three different explanations should be given: A very short one, a more detailed one and a lengthy explanation. Also: Sufficient cross references should be added.

To be included or extracted for this compilation:

1) Comments added in all PP cover sheets.
2) Comments made in letters and articles in digitized FB files on disks.
3) Comments in Ulrich von Beckerath's books, drafts and correspondence.
4) Comments in manila folders on fb subjects.
5) Relevant entries from the Slogans for Liberty files.
6) Translation of a previous German A-Z compilation.
7) Previous English A-Z compilations on free banking. (Only this has been done so far.)
8) Extracts from the writings of Dr. Walter Zander and Prof. Heinrich Rittershausen.
9.) Extracts from e.g. PP  41, 19 A & C  & all other monetary freedom writings in the LMP series.
10.) Extracts from correspondence, with e.g., de Fremery, O'Donnel, Greco, Carnaghan. -

WARNING: These notes are so far quite insufficiently proof-read and edited, sorted out, cross-referenced and not indexed at all. No attempt has been made to eliminate repetitions and flawed terms. Not enough time and thought has been spent upon choosing the most appropriate catchwords in front of an entry or to separate notes under different headings.

Introduction
The accumulated wisdom, experiences with,- arguments, refutations of arguments and proposals and ideas and -theories, speculations, hypotheses etc. on money cannot, I believe, be- sufficiently expressed in a few pages or, sufficiently, in short dogmatic- statements. (Nevertheless, such attempts should always be made, from "Slogans for Liberty" to one page explanation attempts, platforms or manifestos. When they are sufficiently backed by readily accessible and much longer explanations then they can do some good.)
Here only a few personal notes and selected quotes on -monetary freedom and monetary despotism are offered, -alphabetized, appealing for corrections and supplementation by anyone interested, preferably via disked entries in RTF or e-mail.
My- memory and attention span are rather limited. I can't easily or -at all remember the ideas and arguments of previous pages,- chapters or of whole books. But what I can remembers, dissect and -reassemble, sometimes in different ways and details, are -particular points of view, terms, ideas and arguments. These I -can somewhat deal with, piecemeal, point by point. Their -alphabetical arrangement, under catchwords, for reference -purposes and later re-writing or editing, correction and supplementation, whenever I feel like it, are an aid intended -primarily for myself. If, alternatively, they remain spread,- unsorted and forgotten for years, over hundreds to thousands of- slips of paper, clippings and papers and in numerous manila files, or texts in my microfiched series or online, or numerous books and journal articles, mostly not readily accessible, then their thought contents is not as readily accessible -to myself, for my own purposes, or for others, as I wish it to be. -
I do hope that such an arrangement, rather than a- systematic treatise, which I have only rarely tried to provide, -will help others, too. They do not have to remember the whole monetary freedom- system or read and study a whole and systematic book on it. They can tackle entries that -interest them and follow up related points, if they want to,- without having to read the whole book, laboriously, page by page,- chapter by chapter, thus, possibly, getting turned off and -forgetting most of what they have read, because it was not of -primary interest to them.
Moreover, I do intend to offer this manuscript -as an unfinished work, one to be gradually improved and- supplemented by any of its readers who have something to- contribute to it or believe that they do.
The errors on money and -related subjects are almost as important as the truths are, for -so far they have dominated our beliefs and actions in this sphere. So all of them should be registered and refuted, as best- as we can at present. That is a job much too large for a single -person to tackle. But, it does not matter how many pages the -total effort will take. The more people participate in this -co-writing and co-editing, the better. Microfiche, floppy disks,- text only CD-ROMs and other modern media have all the pages and- volume space required, and this at prices almost everyone could- afford.
If the publication would have to be done by a- conventional publisher, at his risk and expense, then, if- interested in this work at all, he would, probably, have to -insist that it be confined to no more than 500 pages. - In this- open and participatory format it might finally come to 5,000 or even 50,000 pages. Never mind. Not all would want to possess and use the unabridged version. And this, in print, could not be updated often and cheaply enough, except, perhaps, in editions that are merely computer printouts from the latest digitized version. But everyone would be- free to offer his own abridged version, if he likes to do so.
-No one has the time and energy to read all the writings on money. In them one usually finds are endless repetitions of basic truths and, still more -numerous, endless repetition of basic errors. Here the -basic truths could be gradually compiled, explained, proven and popularised and the- basic errors stated and gradually be confronted with the best -refutations so far found for them.
For style and good English -and always correct spelling and punctuation, as far as my own contributions are concerned, look somewhere else. -Likewise, for a comprehensive handbook on banking and finance and -all their terms and practices. This effort is confined to monetary- and financial freedom notions, ideas, proposals and practices and errors on these subjects.
-Help me, please, to catch most of these truths and refute most of -these errors, in as concise, convincing, popular and interesting- way as you can manage. If you have, for instance, some relevant jokes to offer, -to lighten the reading load, by all means, do so to. If you can- chop up my often all to long sentences into clearer and shorter- ones, by all means, do so, under your own name, or offer clear- abstracts of what I tried to say.
Never mind some repetitions on this important -subject. They are as likely to occur as they occur in oral- discussions. Any truth needs repeated statements to finally sink into enough heads. Refutations, too, need frequent- repetitions, since errors are almost forever repeated, again and -again. Microfiche etc. do have space for numerous repetitions. Easy -reading and concise versions can be provided later by anyone who -can and will do so. - J. Z., 23.4.97.
SUBJECTS NOT YET DEALT WITH: They should at least be included, -in catchwords, with an appeal for contributions to them.

DIFFERENT VERSIONS OF THE SAME ARTICLES MIGHT BE OFFERED LATER: -1. A short version. 2. A medium sized best version so far -compiled or found. 3. The complete treatment, at lengths that are -often boring to many and with many repetitions, too. Articles to- complete monographs. But full books merely to be referred to, with details on -where they can be accessed, if they are rare titles.

That I have often repeated ideas, arguments and wordings here does not worry me but that, most likely, I have still missed out on good expressions of facts, ideas and arguments or included errors and wrong observations of my own - does. So point out all flaws to me and find and state better and more accurate expressions in your own terms and also in terms that would help to make others understand the issues better. -J. Z., 25.5.97.

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ABC AGAINST NUCLEAR WAR: It contains some entries which might be- worthwhile including here. (Formerly in print only in PP 16-18, then microfiched in PP 16-18. Now digitised as PP 16 & 17.)
ABILITY TO PAY & FREE BANKING: When you are buying the markets -are open, it's when you are selling that you find the markets- closed. - Klahn's law of marketing, in a letter by Robert W.- Klahn, in ANALOG, 7/95, p. 312. - Free banking can turn each- large supplier of wanted consumer goods into a large scale money--issuer and buyer of the goods and services of others, rather than -entering into a competition with them for the scarce, exclusive- and forced currency of monetary despotism. Your own money issues -will also act like advertising leaflets and drive potential- customers into your "net" - by inducing them to return your money -to you, claiming the promised and available consumer satisfaction -from your stores. You would only have to market your own money and not your goods and services directly and exclusively only for- a monopolised money. To market any useful additional money is- much easier than to market any goods and services. And your own -money would inevitably return to you in payments. What more could- you ask for than such freedom, practised alone or in more -suitable local associations? - J. Z., 19.3.97.
ABILITY TO PAY & INABILITY TO PAY, BOTH UNDER MONETARY FREEDOM- AND UNDER MONETARY DESPOTISM, SHOULD BE SEPARATELY CONSIDERED: -...
ABILITY TO PAY & INTEREST RATES: The ability to pay ANY interest -rates or not is often more important than the fact of either -high or low interest rates. High interest rates do not matter as -much when sales are easy to achieve, profit margins are high and- do not merely represent, to a large extent, high inflation rates. -Low interest rates are not an encouragement to take up loans and to- increase production when customers are missing, sales are low and -factories work only at a fraction of their potential, while -unemployment is high. Nor do low interest rates CAUSE inflation -or do high interest rates CAUSE a deflation. To judge the economy- and economic developments only by interest rates, especially only -the interest rates for monopoly and forced currencies, is almost -as one-sided as is phrenology, in trying to determine a person's- capabilities and character merely from the shape of his skull. -- J. Z., 22.4.97.
ABILITY TO PAY & UNEMPLOYMENT: Unemployment will be reduced to a minimum only once ability to pay or to clear is maximised, developed to its natural limits, which consists in the ability and readiness of people to offer productive labours and services in return, at market rates. - J. Z., 25.9.93, 24.5.97.
ABILITY TO PAY, IOU'S & CLEARING: Pay your debts with -acknowledgments of your debts. And back up your debt certificates- with your ability and readiness to supply goods, services and -labour for them. Fully acknowledge your own debt certificates -when offered to you in payment by anyone, at any time (when they -are currency, not capital debt certificates). Choose whatever- value standard unit is acceptable to you and your creditors and do -price all your offers in these units. Then, by accepting your- IOUs back, from anyone, you will have cleared what you owed to- others against what some others owed to you. And neither of you- will have had to own or use a single gold or silver-coin in the- process - as a means of payment or cover or guarantee. Such coins,- in the hands of others, freely rated and traded, would just be -your reckoning units, for your means of payment, not your means -of payment themselves. To that extent you would be independent of -their availability to you, in coin form. - J. Z., 30.9.94, 17.4.97.
ABILITY TO PAY:  Freedom to pay your debts with whatever means of -exchange medium or clearing process and value standard is acceptable to your -creditors, be they your employees, your suppliers, your -financiers or your bank. - J. Z., 18.4.93, 15.4.97.
ABILITY TO PAY: Desperate sellers of goods and services, as well -as unemployed and underemployed should cease to think that their- only rightful and sensible action would be to consider themselves- as "hunters" for the scarce "game" of a government's exclusive- and forced currency.  Instead, they should consider themselves as rightful and potential buyers first, who could freely and widely- purchase, when they have no government monopoly money at all or -are short of it, - with assignments upon their own readiness to -immediately supply wanted goods, services or labour for all the notes that they issued. Especially if at least locally -they combined their readiness to accept their own token money at -par from anyone. Then, and to the extent that they could thus offer a convenient and attractive enough local currency, they- could first "import" and then, and automatically, balance their -import expenditures by "export" in which their issued money- tokens stream back to them in payment.  They would thus have made -possible extra sales and jobs and would even have been able to- anticipate their returns from them. To prevent them from engaging -in such self-help steps is a great wrong and one they do not -always have to put up with. At least under certain circumstances -monetary revolutions are not only desirable but possible and one might even say obligatory. - As -Ulrich von Beckerath used to say: Combined purchasing power is- one of the potentially largest and yet least appreciated- revolutionary powers in this world. It can e.g. be used to -purchase the enterprise one works in and to supply oneself with -jobs and sales. - J. Z., 19.11.92, 14.4.97. - It does not only apply to combined savings but also to combined issues of currencies, that oblige only the issuers. The acceptors are thus offered the combined redemption capacity of the issuers, with their goods, services and ready and willing labor. - J.Z., 5.9.02.
ABILITY TO PAY: It should be limited only by one's ability to -supply wanted goods, services and labour in exchange. Under -monetary freedom this readiness to supply consumer goods and- services that are in daily demand, could be easily monetised by- these suppliers and their associations, thus supplying a common- local token currency or ticket money (goods warrants, purchasing- certificates, IOUs, clearing certificates). Thus they could come -to pay and clear their ways without the help of any exclusive or- forced paper currency and without possessing a gold stock between -them, that would be large enough to mediate all the exchanges -they can and want to make between them. - J. Z., 6.12.92, 30.4.97.
ABILITY TO PAY: The ability of most people to pay their debts, -to find employment or sell their goods and services, does become -greatly improved once they become free to offer to pay for all -their expenditures with their own optional money, freely rated -against an agreed upon value standard, which is also used in -pricing out their labour, services and goods. They should not be- forced to ask for and accept only the government's monopoly money- or non-cash payments ultimately based upon it. Their own money, thus -issued by them, would inevitably return to them. Only they would -have to accept it at any time at par. The combination of several -potential issuers of private money tokens, e.g. in a shopping- centre's  bank of issue association, would make their alternative -private or cooperative exchange medium even more acceptable, as a- local currency, to many if not most of the local people. Territorial government stands helpless before the economic crises which their -monetary and other economic despotism has caused in the first- place. It does not see or admit its own mistakes - but has- outlawed monetary self-help steps. Thus something like a monetary -revolution is required to get rid of its monetary despotism. Such- revolution requires a prior sufficient monetary enlightenment, one -not offered by governmental educational institutions and also a- careful choice of opportunities for it and timing and speed of -execution, so that its successes would be rapid and-, under sufficient publicity, overwhelmingly convincing. Then politicians and judges would no longer dare to suppress monetary freedom self-help steps but, -rather, jump on this band wagon. Those already fighting any- oppressive government, somewhere in the world, would, naturally, not greatly add to the -penalties that their despotic government would want to put upon them, if they -made use of monetary and financial freedom steps to finance their -resistance or revolutions or insurrections properly and overcome -the existing crises, whether deflationary, inflationary or- stagflationary. Thereby they could win with greater certainty,- faster and with much less bloodshed. Dozens of revolutionary -attempts occur every year in the World. The revolutionaries are, as a rule,- not monetarily enlightened and thus the fighting and bloodshed- becomes prolonged and even when they win, the economic problems -they suffered under will not be solved by them when they only -know the rules of monetary despotism and thus will practise them -again. - J. Z., 19.6.93 & 15.4.97.
ABILITY TO PAY: The unused and undemanded ability to pay and to- clear, via privately or cooperatively issued money tokens and -cooperatively organized clearing facilities, upon the unused own ready-for-sale goods and service -potential depends, is enormous - and still largely unknown in every -country. Otherwise, inflations, deflations, stagflations, mass -unemployment and unwanted and not merely accidental poverty could- be done away with within hours or days at most - while- governments do not even foresee their total abolition within years- or even decades - and continue to stumble around in the dark, -causing much wrong and damage with their "activities" and "measures", unaware that and how they caused most major social -problems in the first place. Alas, the billions of victims of- monetary despotism have so far shown little awareness of its- existence and desire for its replacement by monetary freedom. The- situation is as bad as in the Dark Ages, where religious -tolerance was not appreciated or in the times of slavery, when- most slaves would rather be masters but very few slaves wanted -the abolition of slavery and all too many "free" people were opposed to the abolition of slavery. - J. Z., 29.7.96, 19.3.97, 28.8.02.
ABILITY TO PAY: Under monetary despotism the ability to supply wanted goods and services is not equalled by the ability to pay, because it is artificially separated from it. Under monetary freedom the two are naturally combined. The producers and traders can issue sound money to sell all the goods and services they do offer between them, at market prices, to those who want them, because they do, directly or indirectly supply their customers and clients with the exchange media to purchase their goods and services. - J. Z., 27.6.89.
ABOLITION OF MONEY & ABOLITION OF PROPERTY & ABOLITION OF FREE -TRADE & FREE ENTERPRISE: Many consider this kind of utopia still -to be an ideal. They do not distinguish e.g. between the abolition -of the money of monetary despotism, the abolition of all monopoly -property, e.g. in land, or public utilities, the abolition of government ownership of its whole territory and of all its -inhabitants as tax slaves, military and brain-washing slaves, the- abolition of the protectionist variations of international trade- and the abolition of privileged or monopoly enterprises, - from- the optional, competitive, cooperative and voluntaristic alternatives of monetary freedom, self-managed and cooperatively- owned and run productive capital, free trade and free market- alternatives and the limited territorial State options from the -almost unlimited options of panarchism or voluntarism that are all -based on exterritorial autonomy for all volunteer communities, in -which they could even practise freely all their anti-capitalistic -and anti-individualistic ideals - at their own risk and expense. - I, too, would find the abolition of all forced and exclusive- currencies very desirable and that of all special privileges, -grants and subsidies granted by governments to some of their- subjects, at the expense of others. And I would not want to see any form of government to government "trading" and "enterprise" -continued otherwise than at the expense of consenting victims. - -From the wrongful application of the property rights principle to -property in people, slavery, all too many descendants of former- slaves or serfs seem to have inherited an emotional aversion- against all property claims, even quite rightful ones. Perhaps -there is something physical remaining in their genes, an -inherited memory of their ancestors standing on the auction block, as -slaves, at a slave market. Our present economic system has -not made it easy for them to acquire and maintain productive- property and to profit from it. The class warfare mentality, the- split into employers and employees and the anti-industrial- warfare between them for their "right shares" in the added value- of production, has coloured most of their thinking and their- actions. But from the admitted and so far all too neglected evils- and wrongs of the State paper money of monetary despotism and of -the scarcity problems with any forced and exclusive rare metal- currencies, one should not conclude that all kinds of monies must be alike despotic and difficult to attain. The situation would be- completely different under freedom to issue, clear, accept,- refuse, rate and discount alternative currencies, with legal- tender confined to the issuer and his own notes. Least of all -should supposed enemies of property discard "self-ownership" and -self-management and cooperative ownership options and render -themselves the helpless victims of central planners,- decision-makers and owners of themselves and of all other- "public" property. Without monetary freedom all the other rights -and liberties and opportunities were incomplete and one's -potential could not always be fully realized. One restriction and -suppression led to many others. The full release of all creative -energies (Leonard E. Read) can only be achieved when monetary freedom is realized, -too. Otherwise we all live in nation-wide prison-yards, confined -to the productive and exchange activities permitted to us  and- which we can manage to arrange with the exclusive and forced- prison currency provided by the authorities of this prison. That- situation does, often, provoke strong anger, even destructive and- riotous behaviour and terrorist and mass murderous actions based- on the "principle" of collective responsibility. Then scapegoats -are sought and prosecuted or even brutally abused and murdered as supposed culprits: supposed conspirators, members of other races- and religions or nations, as immigrants and settlers and- competitors for jobs and business opportunities. - Money,- property & trade must be liberated rather than abolished or -suppressed. The forms in which they presently do exist do not -really deserve their names. However, volunteer communities should- be at liberty to keep them for themselves, as long as they are -not forced upon any dissenters. - J. Z., 17.4.97.
ABORIGINES' BANKS OF ISSUE: There is much more to independence -for Aborigines than ownership of land, traditional life-styles,- dances, languages, arts and crafts activities and the primitive- and limited trades they engaged in across the continent, access -to alcoholic drinks, drugs and government schools and hand-outs at the expense of taxpayers. - If they started to organise their- own banks of issue and provided jobs for themselves in this way,- the governments would have a very hard stand in suppressing this -self-help effort and would be more likely to grant them- exemptions from monetary despotism or even repeal these laws when -other ethnic groups would thereupon claim the same liberties for -themselves. Voluntary taxation for Aborigines could also- become a popular issue, when the same people declined, at the- same time, to accept any further handouts at the expense of- taxpayers. Fully self-employed and not forced to pay taxes to- governments that they do not want for themselves, their combined purchasing power could be large enough to commercially acquire more land than has -already been granted to them. Actually, per head of the- Aborigines population in Australia probably much more land- already available to them than is to any other ethnic -group or to the average Australian. Admittedly, this land is often among the least fertile land and they and it are still under all too many government restrictions. But how much could really free people achieve even upon- such land? Compare the development of Hong Kong and of some areas of Israel. - J. Z., 27.5.97.
ABSTRACTS COMPILATION OF ALL MONETARY FREEDOM WRITINGS:
ABSTRACTS: Should be asked for of all monetary freedom writings -and schools of monetary freedom thoughts.
ACADEMIC WRITINGS ON MONETARY FREEDOM IN RECENT YEARS: Some -modern economists have finally rediscoverd some aspects of -monetary freedom, especially since Hayek wrote "Choice in -Currency" and "The Denationalisation of Money", in 1975 & 1976.- But even these are usually still far behind the monetary freedom- theories and practices offered decades e.g. by Ulrich von -Beckerath since World War I. - J. Z., 7.11.96.
ACCEPTABILITY OF MONEY, REJECTABILITY, REFUSABILITY,- DISCOUNTABILITY, READINESS TO ACCEPT FOUNDATION, MARKET RATING,- LEGAL TENDER, SEPARATION OF VALUE STANDARD & EXCHANGE MEDIA -FUNCTION: Currency cannot be acceptable unless it is -rejectable. Liberty to use or refuse it is essential to -desirableness. - Ezra Heywood, Hard Cash, 7. - Money should be optional, refusable and discountable, in its exchange medium function as well as in its value standard function. Only the issuers should always be obliged to accept it at par with their nominal values. - J.Z., 6.9.02.
ACCEPTANCE VS. REDEMPTION FOUNDATION: When paper money is not -redeemable (by the issuer in gold) then it will suffice, in -order to preserve the parity of the paper money with gold, to -arrange for the acceptance of the paper money like gold money - by -institutions which sell goods in daily and general demand. (Such institutions are e.g. the taxation department - when it "sells"- tax receipts, the railway, the P.O., and shops which owe -something to the bank issuing that paper. Their indebtedness may- arise out of the discounting of sound commercial bills and the -corresponding contractual obligation to accept the notes of the -bank like gold money. Naturally, in all such cases, the bank must- concede its debtors the right to pay back all their bank debts- with that paper money as soon as they receive it, at par,- regardless of the exchange rate of the paper money.) -  Ulrich- von Beckerath, 25.1.52.
ADDRESSES OF MONETARY FREEDOM SEEKERS, INDIVIDUALS & -ORGANIZATIONS:
ADVANTAGES OF MONETARY FREEDOM: Advocates of monetary freedom, like myself, claim that the competitive supply of exchange media would end any currency or cash famine, and could do so quite rapidly. If not effectively repressed, it would drive unsound exchange media and value standards, like most of the government paper money and its associated paper standard, out of circulation. - Moreover, the free choice of value standards would lead to a wide acceptance of the best one (or best ones, most widely - J. Z., 14.9.02) -  most likely a gold weight unit for account that is based on a free gold market, free private coinage, and gold redemption almost completely transferred to the free gold market and to gold-weight-unit pricing of goods and services, with private and optional exchange media being kept at par with their nominal gold weight value or close enough, in general local circulation and strictly at par when returned to the issuer in any payment. It would also lead to the rating of all exchange media against this standard and would thus prevent inflation, even when some exchange media would still and temporarily suffer a small discount. - Over-issues would then be to the obvious and rapid disadvantage of the issuer and not any longer, as at present, to his advantage. - With this monetary freedom, all the illiquid capital of a short term nature, especially working power and consumer goods and services, soon to be used or consumed, could be fully mobilised in monetary form and thus much easier exchanged and with less transaction costs. That is what the money of monetary freedom can do, has done wherever, whenever and to the extent that it was allowed to and will do also in the future, with or without the use of computers and the Internet. It should be the equivalent of labour, goods and services ready for sale, especially of consumer goods and services in daily demand and labour for their production and should facilitate their exchange. - The money types arising under monetary freedom would be very closely tied to this labour, service and goods basis, could not exceed it, i.e. could not inflate the money circulation and thereby the prices beyond this cover. One of the main safeguards would be the right of everyone to refuse to accept suspicious means of payment - like you would refuse my cheques or IOUs - knowing my financial situation. Full publicity for private issues and free and rapid clearing for all such tokens which went astray, would be essential features of the system. No fraud or coercion would be practised any longer in this sphere. - The most suitable issuers would be associations of retailers of consumer goods and services that would use the variety of goods and services they offer between them as a redemption fund for their local currency. These stocks and this service potential form anyhow and in all cases the short term backing of any currency, even of a gold coin currency. Fully mobilised, this capital could provide the sound exchange medium and the additional sales required to employ all the unemployed. In a city like Sydney, thousands of millions could thus be mobilised almost instantly for turn-over and wage payment credits, at all stable gold prices. - So far the retailers have not bothered to explore and state their issue potential and to demand that they be freed to utilise it, to their own advantage, that of the unemployed and of the rest of the economy. - J. Z., 1985 & 21.5.97. - To that extent they are not retailers in the same way as employers are not employers as long as unemployment exists. - J. Z., 14.9.02.
ADVERTISING COSTS WILL BE REDUCED: The rapid and automatic -reflux of this private currencies to the issuers, to be redeemed -in their goods and services, seeing that they have no other value -and only a limited circulation period, turns them also into -advertisement leaflets and reduces the need for advertising the -goods and services, thus making extra competitive price -reductions likely. There will also be less need for advertising -than under monetary despotism where free competition is confined -to a struggle for scarce and exclusive forced currency. - J. Z., 3/97.
AGGRESSION & MONETARY DESPOTISM:
AIRLINE MONEY: Air transport, at least in some countries, and- internationally, is to a large extent replacing shipping, railway- and road transport. Thus it could, like other transport -facilities, issue its own competing currencies, mobilising more- of its so far unused capacity, while helping to provide sound- supplementary currencies. - Air lines are considered as rich and -powerful but, under monetary despotism they are still struggling and many have failed, if not government subsidised or granted- privileges. Nevertheless, so far and as faras I know, no struggling airline has seriously considered becoming a note or service -certificate issuer and used its influence upon government- legislators to permit such self-help actions. - J. Z., 22.4.97, J.Z., 7.9.02..
AMERICAN OPINION, June 1983, contains an article of free banking -interest, critical of Social Credit.
ANONYMOUS MONEY, CENTRAL BANK MONEY, PUBLICITY ON ISSUERS & THEIR READINESS TO ACCEPT FOUNDATION, LOCAL MONEY VS. CENTRALIZED OR WORLD MONEY:  If I had a choice, I  would not readily trust and accept any money of which the issuers or acceptors remain anonymous or remote (like money of a central bank) and which relies upon compulsory acceptance and compulsory value, in combination with a monopoly for its issue. Such monies deserve, instead, extreme distrust and refusal to accept them whenever possible and other and better payment arrangements can be achieved. Central banks do not provide the goods and services consumers need. So why should they be entitled to issue claims to them? Any electronic currency has purchasing power towards those of the local suppliers who do accept them in payment or, for supplies from distant places, only to the extent that the additional transport costs and delays are considered to be acceptable. But for the required supplies from local suppliers it would be much more sensible to accept a local currency issued by them. For these neither a central bank currency nor an electronic world currency is required. The currency issues of distant issuers, which only they and their distant debtors have to accept, both of them unknown to me, have some value to me only if I can exchange them, at an acceptable rate, at a local money exchange bureau. They are not ready cash for me. The real backers of any sound local currency tokens are the local providers of goods and services, who have issued these tokens. Their readiness to accept them would also be sufficiently publicized. Acceptance in distant localities, by suppliers unknown to me, would not be good enough for me for most purchases. What value have "tickets" to performances for me when issuers, times of performances, their kinds and their locations are not known to me or too far away from me? Who in the world or in a country can rightly issue liquid claims to all the goods and services of a country or the world? The very concept is absurd. What can I know about the soundness of the issues of the central bank of a country or of the issues of a world bank or European Bank issuing notes? Historical experience rather teaches their unsoundness, at least in the long run. But I can easily become familiar with the soundness of the notes of a local shopping centre. - J.Z., 17.6.01, 26.8.02.
APHORISMS ON THE MONEY PROBLEM, by Ulrich von Beckerath, 1932, in- BANKWISSENSCHAFT, also in PP 587/588: - The question whether one- could utilise non-interest bearing, long-term loan certificates -and mortgage bonds in small denominations, e.g. "Wagemann Money", -"Feder Money", etc., as a means of exchange, could perhaps be put -into the following formula: MONEY IS A MEANS OF TRANSPORT. It- serves to overcome spatial distances. With money one exchanges -values that do already exist in the present. The exchange of -harvested grain for clothing, household goods and hay forks is- done through MONEY. - MONEY is necessarily interest-free. Both- justifications for interest, namely a) difference between future- and present services and b) a just share for the creditor in the- production of the debtor, do not apply to MONEY. - The notes- issued by a note-issuing bank or clearing bank are, by their very -nature, clearing certificates (settlement scrip). As such they -should not remain in circulation as long as possible but, -instead, disappear from it as soon as possible. - To oblige any- issuing centre (Zettelbank, note-issuing bank) to exchange its -clearing certificates at any time for metal, is not only -superfluous but harmful and contradicts the nature of this paper--money as a clearing certificate (or settlement scrip). - The interest rates charged by a note-issuing clearing centre are not- interest but fees. Insofar, a properly conducted issuing centre- operates INTEREST-FREE. Only when any customer of the -note-issuing centre delays the clearing (settlement), does the -bank charge INTEREST FOR LATE PAYMENT. This interest is something -quite different from clearing, although both are CALLED interest- and are ACCOUNTED as interest. (It is more in the nature of a contract fine. J. Z.) - Credit instruments that are FORCED INTO -CIRCULATION, like e.g. interest-free mortgage bonds in small- denominations, must lastly DESTROY credit. They amount to putting- warehouses on wheels and wanting to drive in them. That is- POSSIBLE but the goods storage business is thereby ruined -- although it appears, at first, as if one had solved two problems -with one stroke. It reminds of the famous rifles that were to be- at the same time useful as umbrellas, telescopes, lances and tobacco pipes. But they were somewhat IMPRACTICAL. (Lombard loan -certificates do often represent present goods, in large -quantities, that are kept out of the present market in the -expectation of future price rises. If such certificates are -monetised then, obviously, the present purchasing power is -increased but the present goods offered on the market are not- correspondingly increased. - J. Z. ) - Inflation is impossible -without forcefully equating future services with present ones. -Many do not realize this as yet. - Interest bridges differences- in time. It makes possible the just exchange of FUTURE services- with present ones. Between the present and the future neither- TRANSPORT takes place nor CLEARING. Consequently, to bridge the -present and the future is not a task for a CLEARING INSTITUTE- like a note issuing bank (Zettelbank). - Indeed, a credit -instrument with a properly certified interest claim, does have a- value in the present and can thus be exchanged for other, present- goods. Such a credit instrument (mortgage bond, annuity- certificate) is even the natural means of payment for goods that- exist in the present but are not PRODUCED in the present, e.g., -for REAL ESTATE. For this reason, mortgages are often used as- means of payment in REAL ESTATE PURCHASES. But goods PRODUCED in the present do require scrip as means of payment (notes or -clearing cheques), if the producer wants to consume the- equivalence in the present. If he does not want this but wants to- consume only in the future, then the proper means of payment is, -again, the credit instrument, e.g. the standardised mortgage -bond. - Feder wants to create a means of circulation that at the -same time bridges differences in SPACE and in TIME. That can NOT- be done. (A sound commercial bill does it, to some extent, in a- limited circulation sphere and only for a short period. Moreover, the bill debtor has immediately a corresponding quantity of goods -for sale, payable in banknotes, with which the real bill had been- discounted. - J. Z.) A railway has to overcome e.g. the distance -between Berlin and Hamburg as fast as possible, if it is a GOOD- railway. But if, at the same time, it is to act as a STORAGE facility, too, then it can no longer serve as a means of- TRANSPORT.
APHTONIOS' SCHEME: Various ways of filling it with monetary -freedom proposals.
ARBITRATION SYSTEM FOR WAGE DETERMINATION UNIONS, NATIONAL WAGE CASES, INFLATION, WAGE INCREASES, STRIKES, COLLECTIVE BARGAINING, VALUE PRESERVING CLAUSES: National wage case decisions raising the general wage level can act inflationary.  - You can try to demand money, to steal it or rob it, try to order people like employers to pay it, or to extract if from consumers via increased prices but what you will in effect achieve is no more than people are able or willing to supply. An employer has always the option to dismiss you instead of paying you a raise. If he is not allowed to dismiss you then he might not be far from bankruptcy. The taxpayers can only support so many otherwise bankrupt enterprises for a while. Nor will you be able to force consumers to pay for goods that are overpriced due to your wage demands. If it were really possible to arbitrarily increase wages by more or less judicial decisions of arbitration courts, then we should demand of them that they each entitle us to demand a million dollars every week as our rightful wage, to maintain us in style. Why be satisfied with anything less. And if they cannot provide us with a wage increase of one million then they, by their decision, cannot even provide us, on their own, with a wage increase of a single cent. - However, we tend to overlook this reality under a system of monetary despotism, which distorts not only our paper value standard and monopoly means of exchange, but also our vision or understanding of it. The arbitration system can "allocate" wage increases only when they are paid in additional forced currency, directly or indirectly. Their purchasing power would soon tend to be only the same as the former wage - and it might even amount to less. We might also lose our job in the process and the employer might be driven into bankruptcy, because the monetary despotism does not supply all employers evenly and all potential customers for him with sufficient of its scarce monopoly money, not even in times of galloping inflations, when prices and wages might race far ahead of the fast inflation rate. Usually the arbitration system's  wage increase decisions and the "wage gains" through anti-industrial and coercive union actions are only responses to an inflation that has already increased many or all prices and has left wages behind, at their formerly fixed nominal rates. Then, while no more than an adaptation to the past inflation is achieved and no indemnification is offered for the inflationary losses in the meantime, the unionists and arbitration court supporters want to be praised for the merely nominal wage increases that supposedly were due only through their actions. If they were getting out of the way and individuals, in their wage contracts, could propose and contract value preserving clauses, then their purchasing power might thus not only be preserved but even be increased, corresponding to their own contributions to increased productivity. Union and arbitration court monopoly "actions" prevent this kind of self-help and self-promotion. They also tend to prevent the spread of productive cooperative enterprises, with no wage problem and personal subordination that is not warranted by a job. - J. Z., 24.3.97.
ARMAMENTS, ARMS RACES & ALL KINDS OF MILITARY SPENDING DO INEVITABLY LEAD TO INFLATION: A popular view. It is true only if all such spending is "financed" by the government's printing presses for forced and exclusive currency. Without legal tender and the issue monopoly, it could not take place. Attempts to finance it then by additional paper money issues would depreciate this paper - but not sound value reckoning, and lead to more and more people totally rejecting government paper money issues. Under financial freedom they would then also effectively refuse to pay taxes to such a government and could not be forced to subcribe loans to such a government. Under monetary and financial despotism this kind of war promoting exploitation can, indeed, take place. This is one more good reason to abolish this despotism. - Before the Prussian wars of 1864, 1866 & 1871 Prussia was also well armed but it did not inflate its currency and could not because it had not given it legal tender, not even for the financing of these wars. But it did introduce legal tender for the conduct of WW I and maintained it, most of the time (a short period of the Rentenmark of 1923/24 excepted, I do not know exactly when that was ended ), for WW II and the "liberating" Allies maintained this monetary despotism for the old RM and their occupation marks, to June 1948 and then tolerated it for the new DM ever since, i.e., a totalitarian and communist money system even for supposedly anti-communist States that were sometimes in armed conflicts with communist States.  - J. Z., 24.3.97.
ASSET CURRENCIES OR TURNOVER-CREDIT CURRENCIES? Some notes by J.Z. on an exchange between Don Werkheiser and Theo M, March 23, 1990. Houses and note issues upon them: Assume the asset of a house, estimated to be worth $ 180,000 and notes issued upon that asset, valued, coming nominally, only $ 120,000. - Seemingly, and in the eyes of some, these notes are then "well covered". In reality, they are only small and standardised mortgage bonds that do not even pay interest. Only the house owner would be morally obliged to accept them - if and when he wanted to sell the house. Others would accept them from him only if they are potential investors or buyers of that house. They would have to be tempted by the offer of interest.  Why should any shop owners or businesses accept such notes from such an issuer, if they are not interested in buying his house or investing in claims to it and no interest is paid and if there are no ready acceptors for such notes? What could they do with them now? Who would be contractually obliged to accept them from him? Why should they act as brokers for such mortgage bonds? There is a difference between mortgages and sound bills of exchange and between mortgage letters (or bonds) and banknotes based upon real bills. The difference lies in the securities offered, the value of a house vs. daily wanted consumer goods and also in the time factor that is involved. For the house-currency there is only a very limited readiness to accept (in case of the sale of the house) by the single issuer. The shop-foundation and short-term debt-foundation of banknotes, on the other hand, is offered by many acceptors and they offer a great variety of daily wanted goods and services. They offer something useful to the note holders, immediately or soon, a considerable and sufficient choice. The house owner would hardly want to sell his house brick by brick etc., after wrecking it first,  nor would he find many buyers for such a limited offer - or takers for his thus "secured" mortgage bonds. What an honest house owner, issuing notes "covered" by the value of his house, should explicitly declare on his "banknotes" is something like the following: "I want you to give me the values I want now, for these, my notes. But I am not willing to give you, with these notes, the values you want and might be able to get from me now - apart from the value of the house, which I have not even placed on the market as being for sale. All I offer you with my "house notes" are small mortgages secured by the market value of my house. I do not even offer to accept my notes e.g. in rent-payments to me, in case I were to let this house to you, which I do not intend to do. I do not offer you any interest payment for the period that will pass until you manage to fob of these mortgage letters upon other victims with capital, goods, services or labour that they do want to thus invest. I merely rely on your good faith, trust and confidence, for which I can offer no other basis than that the total present market value of my house, which is not ready for sale now, is larger than the total number of notes that I have issued upon this value. So, they are not altogether value-less but more than "covered" by their visible and properly estimated "security" and "cover". - If  I were to issue notes for the total value of my house and if I were to set a date for its sales and if you had managed to accumulate all these notes in your hands and would want to buy my house, then I would be obliged to hand over the title to it, in return for you handing over to me all these notes. But, since I haven't made this sales offer, I do entirely rely on your unfounded trust and confidence that these notes do have their full nominal and free market value now, equivalent to the sales price of my house, if and when I would sell it. I also trust that you will be ingenious enough to fob them off unto others, also believing in the possibility of "asset currencies", thus passing on the problems of immediate redemption for these notes to them. - I cannot say why I prefer to call these notes my "banknotes", fully covered by the value of my house, instead of mortgage bonds or mortgage letters." - Money in the own eyes is not automatically money in the eyes of others, no matter how confident the issuer is or the person who assumes that he is a potential issuer for banknotes. One should try to think through every issue and reflux, every cover and redemption and security, step by step, taking all the liberties and rights involved in consideration, all the special and general interests of all the parties involved. Then one will find that it is not just a matter of a "unilateral issue" into "circulation", a "single convenience action", as Don Werkheiser called it, but that a "mutual convenience action" must be involved, in which potential acceptors would only accept what they want to accept and to the extent that they do want it and only at times that they do. That means, in practice, that a free and informed market, made up of all the potential acceptors for such notes, would largely refuse them and the few who would accept them would greatly discount them, so much so, that a potential buyer of the house could very cheaply buy up these claims and with them, if they came, nominally, to the value of the house, could make a for him very cheap bid for that house. The issuer, if he had persisted in issuing these mortgages in spite of their great discount, would have got only whatever values he would have been able to buy with them, at their discounted rate. - J.Z., 17.9.02.
ASSET CURRENCIES: Asset currencies have been proposed and tried -out again and again, largely without awareness of their- historical precedents and failures and of the inevitability of -their failures. See: LAND BANKS, REAL ESTATE AS COVER FOR- CURRENCIES, BONDS & GOVERNMENT SECURITIES AS COVER FOR CURRENCIES. The issue principles and practices of financial -freedom are different from the issue principles and practices of  monetary freedom. They should not be mixed up. In both cases one- deals with valuable properties. In both cases the transactions -should be voluntary. In both cases free market rating should -apply and in both cases value preserving clauses or value -standards should be applied and expressed in them and in prices, wages, rents etc. Ready for sale consumer -goods and services, through suitable claims upon them, could be used for subscriptions to capital securities, rather than the latter being wrongly used as a the basis of currency issues. Capital securities can and should be issued upon capital assets. Notes for apples and meat, mortgages for houses, shares for factories. Security issues can be -sold for cash or clearing certificates. Currencies or clearing certificates can be used to buy capital securities. But this limited and in each case to be voluntarily agreed upon exchange still does not make them -identical, in the same market, among the same people, which each a full substitute for the other, immediately, among all people. Capital securities have their special markets and their separate circles of sellers and buyers. Securities represent rather land, bricks & timber and -steel, hardware - machinery, resources or the expectation of providing them and of benefiting from them in the future.- Currencies, on the other hand, represent goods, services and- labour for immediate use and consumption and already produced- & sold at least to wholesalers, on the road to retailers or already -waiting for sales there. Next year's birthday or x-mas isn't -today's birthday or x-mas. One should keep the two apart. Time- differences do matter as you will notice when you are separated -from your beloved ones for 3 months or 3 years. Future values are not -present values. Present values are not future values, although -the two are related and can be somewhat interchanged, at the -prices and costs involved. Consumers who want a currency for -today's and next week's purchases, do not want, instead, a security -for a future capital value, although sometimes, and to some -extent, they want such values, too. In some heads a real block exists against such distinctions. They imagine that only useless -hair splitting is involved. It would help if the experiences of a -number of sound banks of issue for turnover-credit banknotes were -put side by side with banks of issues that issued bank bonds, -mortgage letters and shares and if these were also compared with -the experiences of banks that tried to turn assets like land,- private shares, government loan certificates, into currency, -immediately useful for consumer shopping, although they would be- given no exclusive currency status and legal tender power. A- fourth table might indicate the experience with asset currencies,- where the assets became irrelevant because the paper supposedly backed by them were in reality only accepted because they were -given exclusive currency status and legal tender power (forced -acceptance combined with forced value. - Then the different -recorded experiences might speak for themselves and suffice to -convince. - J. Z., n.d., 30.4.97.
ASSET CURRENCIES: Assets have no real currency - except e.g.-, among brokers, financiers and real estate agencies - and those- who happen to be in the market for some assets, for a while and to some extent, with a fraction of their earnings. -- J. Z., 23.4.97.
ASSET CURRENCIES: Just because the laws have allowed them or even prescribed them in some instances, and this, sometimes, under the misnomer of "free banking", does not make them  right, honest or economically sound and efficient or competitive under conditions of full monetary freedom. Modern views on this are nothing better than a revival of the old "land bank" schemes, by which the issuers attempted to foist fractions of mortgages upon the population as if they were and could be a sound currency. This particular fallacy was often refuted in the literature. But the general asset currency notion is still very much alive and all too widely practised by central banks. They even accept government "insecurities", or investments in tax slaves, as assets. When such issues are monopoly issues then the issuers can get away with them for all too long - for people often accept bad forms of money if that is the only one which is made available to them or permissible for them. But under monetary freedom no one would be obliged to give any real purchasing power to any such currencies, by accepting them for his goods, services and labour. They would, as currency, have no more status and ready acceptance, far less par acceptance, than have mortgages, bonds, shares and other securities have in most daily exchanges for most people. I.e., they would not be currencies. They would be useful only on the capital market, which embraces only a fraction of all buyers and a fraction of all their purchases and sales. That is the main reason why they cannot be sound currencies in local circulation. Their circulation sphere and volume is all too limited. They are not tickets or vouchers to daily wanted and ready for sale consumer goods and services. That is an essential requirement even for gold coins. - J. Z., 25.12.88, 16.5.97.
ASSET CURRENCIES: The only assets which asset currencies could- effectively move are capital assets and capital securities. E.g., -mortgage letters can move large mortgages, which otherwise would- not be as easily transferable. But asset currencies do not -represent and cannot, therefore, easily transfer ready for sale- goods, services and labour. These require currencies based upon- them. - Only when all other currencies are effectively outlawed -can any monopolistic asset currency somewhat replace them, in- spite of its unsound foundation for currency purposes. Rather -than doing without monetary exchanges altogether, people would -then even accept an asset currency - up to a fraction of all the -capital assets, without responding to the asset currency issue -with inflated price and wage demands. (These price and wage- increases would not indicate a dearness of goods and labour but a depreciation of the forced and exclusive "asset currency" imposed -upon them. - J. Z., 6.4.94, 24.4.97.
ASSET CURRENCIES: To try to turn capital assets like raw- materials, premises, and machinery or the capital securities that -represent them, directly into currency, supposedly useful for the- current purchase of consumer goods, is a great mistake because at -the same time no equivalent consumer goods and services are -provided by the issuer to redeem them with. The holder of the -certificates could only force the issuer into liquidation and- then claim his share in raw materials, premises and machinery - -but few would want to acquire them. On the other hand, if there -is someone prepared for a take-over bid for the business of the -issuer, then such issue attempts would be very much welcomed by -him, for this scrip would rapidly depreciate in a free market and- could thus be bought up very cheaply and used in the take-over -bid. A few such experiences, well publicised, will serve as a- deterrent.  But that does not mean that there should not be full -freedom to issue financial securities, too, which quite clearly -represent capital assets and are bought up and traded by people -interested in capital investments. To reduce this kind of mix up -of capital securities with turnover bills and notes, the issue -departments for both should be as far as possible kept separated because- for people have fallen for the errors of "asset currencies" again- and again and they have often been embodied in banking laws.
ASSET CURRENCY: An unsound turnover currency system is not- sufficiently remedied by there existing, in case of its -bankruptcy, some securities for the benefit of its creditors. Its- function is not to provide such an ultimate guaranty or backing- for its currency but, rather, to provide for its currency a ready -backing right now, especially by short term securities and by the- ready for sale goods, services and labour which the issuers of -the short term securities have to offer to the holders of the -banknotes of the bank. Only such turn-over function and security- and guaranty and convertibility arrangement or cover can keep a- currency sound and current, by exerting a sufficient daily demand -for bank notes, to keep them at par with their nominal value. (A sound reflux.) If- the issuing banks do not provide such an instant cover, security -and convertibility and no one is instantly obliged to accept all -the currency issued by the bank, i.e., if there is no instant- demand for it but only the distant redemption via the capital securities, then such a currency must inevitably depreciate. --J . Z., 6.4.93, 27.5.97.
ASSET CURRENCY: Just because the law has permitted or even -prescribed it in some or many instances does not make it rightful- or economically sound and a desirable and predictable practice -under monetary freedom. "Modern" views on this are often merely a- revival of the ancient "land-bank" and "assignat" fallacies that -have been refuted by their practice and several scientific -studies. - J. Z., 8.4.97.
ASSET CURRENCY: See: APHORISMS ON THE MONEY PROBLEM.
ATCOPS : Roger Young, in TC144p43 reports that ATCOPS is alive -and well and in its 20th year.
ATKINSON, EDWARD, Pamphlet, title unknown, referred to by TANDY,- Voluntary Socialism, p. 103, stated on a legal tender act : "...-an act by which bad money may be forced into use so as to drive -good money out of circulation." - All correct versions of- Gresham's Law, with their author, title and date of publication,- preferably also page reference, are wanted by LMP, towards a -monograph on this subject. - J. Z., 12.4.97.
AUDITOR, Periodical published by WESTRUP, ALFRED B., for free -banking. At least 2 issues appeared. I have not seen any yet. -- J. Z., 28.4.97.
AUSTRALIAN MADE, BUY AUSTRALIAN! - If you want to sell Australian- goods, services and labour, then monetise them freely and thus -spend their value even in advance, before they are sold for this- kind of privately or cooperatively issued competing currency. - -Australian made goods, if up to world standards and at world- prices, are good enough for such currency issues, too, for international trading. If they- were not then there would be something wrong with these -recommendations. Why should Australians be foolish enough to buy- Australian goods and services and labour, if they were of- inferior quality or offered only at excess prices? - J. Z., -6.10.93, 1.5.97. - If you spend Australian paper money overseas then there is only one rational use for them, namely, to use them in payment for Australian exports. Competing Australian clearing certificates that are redeemable only in Australian goods and services, freely market rated, refusable and obligatory only for their issuers, also time-limited, would be more obviously balancing imports with exports. See the writings of Prof. Edgard Milhaud and of Ulrich von Beckerath on this subject. - J. Z.,
AUSTRALIAN MADE, BUY AUSTRALIAN: Permit the owners of all- "Australian Made" goods to issue goods-warrants and purchasing -certificates as well as clearing certificates based upon combined- goods and service offers, for goods and services that are in daily -demand by consumers, and allow wages, salaries and other debts to- be paid in them, if the acceptance is voluntary and then, to the- extent that such alternative monies will be readily accepted, the -purchasers will buy goods made in Australia with money freely -made and freely valued, accepted and spent in Australia. To the extent that such- private vouchers, in money denominations, can be freely issued,- they will stream back with much greater certainty to the issuer -and his debtors, for their goods and services and labour, than -any rare metal coins or legal tender money spent by them. They -will be busy and employed and achieve sales to the extent that- they can issue their "tickets" and get them readily accepted.- Moreover, they are morally entitled to thus offer their own -property in a monetised form. No government owns them and their -property and stocks and services and labour for sale. Thus no -government is morally authorised to issue assignments upon their -property, for which, in the act of issue, it has to give nothing- in return but a scrap of printed paper and the option to use this -in payment of tax tributes which it extorts from its tax slaves. -Government cannot provide such a soundly based money. It can only -requisition, with its paper money, the real redemption fund for -any currency in any country, one that belongs to the producers- and traders themselves: the ready for sale goods, services and -labour. - The Australian nationalists should seriously consider -how free and independent they are when they are only allowed to buy their goods, services and labour provided by Australians with -the monopolised and forced paper money by a single privileged and -legalized despotic institution in Australia, its central bank,- called the Reserve Bank. - Why should all Australians, for all- their economic activities, have to depend upon its good will and- abilities - if any - and this in spite of all the evidence that- speaks against any central bank? - When and to the extent that- Australians can issue their own competing and optional -currencies, they will, inevitably, "buy Australian!" - The same applies for competitively issued international clearing- certificates that can only be used, after imports have been paid- for with them, to purchase Australian export goods. - With government paper money, often under a controlled exchange rate,- and with foreign central banks mad enough to hoard such notes, as "-foreign exchange reserves" or foreign private citizens being -inclined to hoard such notes, because they are better than the -still more inflated paper currency of the own government, the -reflux of such paper money as purchasing certificates for- Australian goods, is much less certain. - To speed up the reflux- and make it more regular, all internal and external clearing- certificates and goods and service-warrants should also be given- a limited life span only, for 3 months to 12 months at most, thus -appealing to the self-interest of the holders to redeem them in- Australian goods, services and labour within that period. -Alas, -this kind of "buy Australian" with competing Australian monies,- is not yet popular. - Help to make it so. - J. Z., 5.10.93,- 24.4.97.
AUSTRALIAN OWNED? Because something is "Australian owned" or "produced in Australia" or "bought in Australia", following the command: "Buy Australian!" - does not mean that it is cheaper or better than other businesses or goods or that Australia, as a whole, benefits more from such enterprises, purchases and sales than it does from others. If, instead of buying from an Australian owned firm, you buy from a foreign owned firm in Australia or one overseas, then you do, thereby, enable that foreign firm, whether situated in Australia or overseas, to buy the corresponding values from Australia. And these values, sold to foreigners, and paid with by the return of the Australian paper currency, would then be proudly claimed as Australian export achievements! (They are objectively achievements, like any other sales, but in contradiction to the insistence upon buying only Australian goods.) - If the owners of Australian enterprises were not free to sell them to foreigners, i.e., if most of their potential buyers were excluded, then they would thus be robbed of part of their property rights. Each foreign owned firm means: This firm has not been given away, stolen or occupied but SOLD by an Australian, who managed to get a higher price for it than other Australians were willing to pay him. Should his property rights be overlooked? Should he be penalised, taxed or should the buyer be boycotted? His property belonged to him, not to the nation. Those Australians, who did not buy it, did not offer more for it than a foreigner or foreign company did, have no right to complain. Every transaction that is free and voluntary, i.e., as a rule for mutual benefit (apart from some errors or misjudgements or frauds on one side or the other), is right, thereby, and the nationality of the seller or buyer, or their race or religion or sex or age or ideology should have nothing to do with their trade or exchange. Nationalism, statism and borders should be entirely excluded from economic and moral considerations, as irrelevant, if not outright, wrong, harmful and anti-economic. If any Australians can make a better deal with foreigners than with other Australians, let them. The total of all earned economic satisfactions in Australia would be increased thereby - even while the number of dissatisfactions based upon ignorance, prejudices and myths would also be increased.  Mercantilism and State Socialism were and are wrongful and harmful utopias. Only those individuals who voluntarily subscribed to them should have to suffer under them. - PIOT, J. Z., 22.5.97, 15.9.02.
AUSTRIAN ECONOMICS ON MONEY: Austrian economists often asserted -that the interventionism with currencies consisting in legally -establishing an exclusive and forced currency would not matter -at all if that were only done for gold coins and gold- certificates. They could not do any harm, or so they believed, said and wrote. They could not be -arbitrarily multiplied and thus would be the only exchange media- and value standards that should be permissible and that should -also be legally enforced as exclusive exchange media and value- standards. They did this under the assumptions that prices and- wages would be infinitely, fast enough and completely enough adaptable to any changes that might occur in the quantities of- gold available for monetary transactions or to changes in the -monetary demands for gold. - This belief is dogmatic for them, fixed idea.- They do not bother to check it against the facts. They ignored -the numerous reports of currency shortages and currency famines.- They ignored the ten-thousands of reported cases of the issue of emergency- ,token- and truck-money, hundreds of years after the invention of rare metal coins and gold and silver- certificates and even the millions of incidents in which people in their exchanges were being -reduced to primitive barter transactions - although, somewhere, -the same quantities of gold and silver did still exist. Nor did -they consider the different effects which falling price levels- have upon all sellers & buyers, to the extent that the buyers can -postpone purchases, as opposed to fallen prices, e.g. due to some -technical innovations. (Even here some buyer restraint results,- e.g. in the purchase of computer hardware, in the expectation of- even further price falls in spite of continued improvements in -the hardware.) They do overlook the stickiness of prices and- wages. They do overlook the numerous contracts which nominally- express debts over a time period and which debtors would find it -hard to fulfil with severely deflated currencies, which they -would find it much harder to earn, in the same nominal quantities,- while the prices for their goods, services and labour have been- deflated. - If gold and silver were so abundant and so useful,- there would also exist the possibility to provide them in weight- units for the black market and have black market transactions -finally take over the whole market. But that hasn't taken place,- either. By now many people may never even have seen a gold coin. -Then there is the fact of trade having existed even among- Australian Aborigines, across the continent of Australia. However, -gold coins or nuggets or dust did not become currency among them,- either. The distribution of gold standard gold coins and- certificates was rather limited to a few of the more developed- countries. In others they were hardly ever seen, not even coined- out in mini-weights, for very depressed monetary prices. Nor do -most Austrian School economists seem to be aware as yet, that -clearing underlies all money transactions and that pure clearing -transactions do not require any gold coins or gold certificates- at all to become possible and wide-spread, even though they might -prefer to use gold weights as their value units. Blinded by their dogma on "-convertibility by the issuer, upon demand of the gold certificate holder", they remained blind to the -possibilities and functioning of the real bills doctrine or -banking principle and their functioning even without- metal convertibility, even after their banks were declared failed and- bankrupt, because they could not longer redeem their notes fully -in gold. The clearing function involved in the real bills- doctrine or banking principle, continued to function for a while, -because the debtors of the bank exerted a strong demand for the -notes, which enabled them to pay their debts to the banks. - The -minds of the Austrians were so focused on the metal convertibility or -non-convertibility of notes only, that most of them and -probably some of them still, overlooked the much greater -significance of legal tender - and the harmlessness and- self-limitation of banknotes not covered in gold but soundly-I ssued only in turnover credit transactions that are soon- self-liquidating. How often have they been aware and to what- extent are they aware now that without legal tender and the money -issue monopoly one cannot inflate a currency in a market that- enjoys monetary freedom and uses that freedom in freely competing- exchange media, clearing avenues and freely chosen and competing- value standards?  Held back by their limited money model, as they- are by their limited government model and limited defence model, -they have not extended their thinking to the full range of -monetary freedom, of free societal options and of libertarian and- anarchistic defence and war prevention possibilities. Anyone who- thinks that he already knows enough cannot be taught any more, as -long as this illusion persists in his or her head. - J. Z.,-26.1.94, 1.5.97.
AUTHORITY, AUTHORITARIANISM IN MONEY, MONETARY DESPOTISM, CENTRAL -BANKING, EXCLUSIVE & FORCED CURRENCY, PROUDHON : The fundamental,- decisive idea of this Revolution is it not this: NO MORE -AUTHORITY, neither in the Church, nor in the State, nor in land,- nor in money? - Proudhon, General Idea of Revolution in the 19th- Century. - Alas, in his practical proposal he always spoke only- of THE Bank of the People, not of banks of the people. - Maybe he spoke and wrote in this way because he had only a particular model for mutual banking in mind, the one for which his drafted his bank statutes. It would have been quite inconsistent for him as an anarchists to demand a monopoly for his Bank of the People. Alas, not all of his papers and correspondence seem to have been published as yet. That would help to settle this question. - J. Z.,-15.4.97.
AUTOMATION, ROBOTS & UNEMPLOYMENT: Many people believe that there is a link between automation, robots and unemployment, that people would be replaced from their jobs by machines, robots and automation and could not find new jobs. - "Japan, for example, has about 400,000 robots installed and a declared unemployment rate of 2 1/2 %, while Australia has about 1800 robots and a much higher unemployment rate. - The Australian Robot Association estimates that 118 robots were installed in this country last year. This number is too small to have had any significant impact upon unemployment. - In the past two years, IBM reduced its workforce by 90,000 jobs, Boeing by 28,000 jobs, and Digital Equipment Corp by 27,700 jobs. But few, if any of these jobs, were lost because employees were replaced by machines. Rather, according to a recent survey by Ms Trudy Bell, published in the engineering journal IEEE Spectrum, the job losses were due to factors such as the dwindling market for mainframes, diminished military orders brought about by the end of the Cold War, and reduced purchasing because of the global recession." - Michael Kassler, Survey explodes myth of the link to jobless queue, THE AUSTRALIAN, 5.10.93.
BALANCING THE ECONOMY THROUGH MONETARY CONTROLS OR MANIPULATION: The good intention is to keep goods production and service offers in balance with the money issued. Some attempt to adapt the money circulation to the increased goods and service offers and others want to adapt productivity to the currency they make available. Most think only in terms of a centrally managed, exclusive and forced currency and would not allow free and competitive or cooperative issue and reflux arrangements to keep the goods and service side automatically in balance with the money side, through market forces, i.e., free enterprise, free trading, free contracts, free acceptance or  refusals of currencies and free pricing for them, under full publicity for all details of issues and reflux arrangements. Under monetary despotism all these balancing attempts never succeed fully and for long and they cannot do so because almost all the automatically regulating indicators are stopped and no one is fully informed of what is happening and thus many false decisions result. Under monetary despotism the exchanges tend to be limited to those this despotism permits to occur and this often only under great difficulties, too. Despotic central banking and its forced paper standard, maintained by attempted quantity controls ("open market" sales or purchases of securities by the issuer, discount or interest rate policies, credit restrictions or grant of credits and increased spending via the note printing presses) can never sufficiently supply all the exchange media needed, everywhere and by everyone, nor keep those supplied sufficiently stable for long. It is an unbalanced and unbalancing system. It is so mad that in some instances it has led to "valorisation (i.e., the burning, plowing under or other destruction of crops) in order to artificially keep their prices up because, under monetary despotism and all too often, goods, labour and services cannot be sold at free market prices and the prices attainable under that despotic system might sometimes not even cover the costs, either, because they are too much deflated or, sometimes even because they are already inflated. (I have almost absolutely stopped getting hair cuts by a barber, many years ago, ever since their charges went above $ 1. That is not necessarily a rational response but it is an economic response.) That price controls and subsidies have sometimes misled producers to produce more, at artificially high prices, than the market really wanted at these prices, does, naturally, not help, either. Nor can stockpiling of such artificial surpluses, by governments, at the expense of the taxpayers, help in the long run. The economic indicators should never be artificially and coercively falsified - if equilibrium is to be maintained as much as is possible in human affairs. Neither the goods side nor the money side is to be artificially manipulated if trouble is to be avoided. - J. Z., 24.3.97, 30.8.02.
BANK CHARTERS, MONETARY DESPOTISM, RIGHT TO BANKING: Their (-bank charters ) effect is to give to individuals the advantage of- two legal natures - one favorable for making contracts, the other -favorable for avoiding the responsibility of them, when made. (-Spooner, Constitutional Law 21.) Spooner argues that all banking -charters are unconstitutional for they violate the natural right -of all men to make free contracts. Moreover, the legislature, in- granting special favors to some and none to others, abuses its -powers. - Charles Chiveley, introduction to Spooner, I/27.
BANK FAILURES: Those, who are all too readily and undiscriminately- prepared to accuse past and present banks of bank failures, have -usually not distinguished e.g. between 1.) Failure of the- issuing bank to redeem its notes upon demand fully and to their- nominal value in rare metals, or, nowadays, in legal tender money- or even in government insecurities.  2.) Failure to cover notes- issued and current deposits granted, by means of short term and- self-liquidating securities that represent goods produced and- already sold and on the road to consumers, 3.) Failure to provide -sufficient clearing facilities or debt foundation for all notes -to keep up a strong demand for them, that could keep them at par- until they are withdrawn in the final settlement or payment. 4.)- Failure via dishonesty, corruption or embezzlement among the -bank's officers. 5.) Failure due to malinvestments, large ones,- in unprofitable enterprises, so large in relation to the whole -bank business, that this single failure could send it broke. The- lending risk was then not sufficiently distributed, in accordance with insurance principles. 6.) Failure -through lending short term or medium term funds on long terms,- instead of only on the terms they were deposited on. 7.) Failure in- such cases to make contracts that would allow them such -investments but also allow them to postpone repayments until they -would be liquid again and in the meantime only offer to pay-out-s in bank-bonds, transferable ones, that would cover the remaining- outstanding loans. 8.) There are also various other forms , e.g. -"option clause" notes that would cover the risk of any temporary -illiquidity in normal business, when debt and credit terms and amounts do not exactly enough equal each other. 9) Failure of- other banks than the central banks of issue due to the -inflationary, deflationary or stagflationary policies of a -central banks. 10) Failure to sign up a credit insurance policy -for the ordinary risks of lending or undertaking sufficient- self-insurance precautions, alone or in association with other -banks. - J. Z., 11.4.97. - Runs on banks could have been prevented or greatly reduced in many ways. For instance, by starting a list for those who wanted to withdraw their money, in which those on the top of the list would have the top claim to monies received in payment of debts to the bank. The banks could have offered limits on the amounts of cash withdrawable immediately, without notice. Or it could have insisted on having been given sufficient notice for all withdrawals. (In the meantime, it could have accumulated the funds from repayments and by reducing further lending.) There is not fixed limit for the kinds of contractual safety clauses that could have been agreed upon. To promise something to all that could never be fulfilled if all suddenly claimed what was promised to them, was always wrong and bad business practice, even though, in normal times, they could get away with this for considerable periods. Generally speaking, banks and bankers do mostly not really comprehend the sound business of banking, or the "banking principle". Like politicians, they do engage in many wrongful and harmful practices, and, due to insufficient competition from alternative political and banking systems, they go on and on with their wrongful and harmful practices, all in accordance with all too widely spread popular prejudices, supported by supposed academic experts. Can one teach them to proceed morally and rationally in spheres where they imagine themselves to be experts? You try it! - J. Z., 5.9.02.
BANK ROBBERIES & OTHER CASH ROBBERIES: There would be less cash robberies under free banking because quantities of local cash that have thus gone astray are much harder to dispose of and at the same time much easier to trace than is, e.g., an exclusive legal tender paper currency or rare metal coin currency, that can be spent all over a large country. The same applies to forgery attempts. Moreover, freely competing currencies are likely to have only a short circulation period. Thus "hot money" cannot simply be hidden for a long period and then spent relatively safely. It would no longer be valid currency by them. If, after a robbery has occurred and the robbers got away, any strangers or locals were suddenly to spend large amounts of the stolen local currency, even if the numbers of the stolen notes were not known, they would immediately become suspects. - J. Z., 21.3.86, 16.5.97.
BANKERS & MONETARY FREEDOM OR FREE BANKING: You can no longer- bank on bankers. They will neither give you the highest interest -nor credit when you need it most, nor can they protect you from inflation or from credit restrictions and deflations, nor -from direct tax raids by governments, nor from the prying eyes of bureaucrats. They have let themselves be deprived of the business- of note issue and have let the capital market become -over-regulated. They know by now almost nothing about sound note -issue techniques nor do they show any interest in them. They help -the government to "invest" part of your savings in governmental- "insecurities", which you or your children and grandchildren then have the honour, -later on, to repay in parts, out of your taxes, or  in depreciated -currency. They have become mere agents for the government's -despotic monetary policy. You can rely on them only in one respect: They -will firmly resist, together with the government, all your- attempts to go into competition with them, opening competitive -and note-issuing banks and clearing centres, practising sound -free banking principles and all aspects of financial freedom. - J. Z., 12.7.78, -24.4.97, 8.9.02.
BANKERS OF THE OLD TYPE TO BE MOSTLY EXCLUDED FROM FREE BANKING & LAWYERS & POLITICIANS AS WELL: Their remaining privileges and the  mystique that surrounds banking still, in all too many heads, including those of most bankers and central bankers and economists, has allowed some or even many ignorant, stupid, prejudiced, careless and irresponsible bankers to get away with all too much, at other people's expense, while continuing to enjoy prestige, high earnings and high retirement benefits, no matter how many people they harmed or wronged. - Some people got even so disgusted with the false notions that most bankers entertain on bank note issues that they proposed that future note issuing centres should explicitly exclude anyone who had previously occupied any executive position in the banking world, unless they could prove that they were among the few exceptions in this business. The same might be said about lawyers and many of the brokers of our times. - That politicians should be totally excluded from this business seem self-evident, at least to me. No kind of confidence trickster, demagogue or power addict is suitable for it, while he persists in this kind of career and at least until he has been completely rehabilitated, as e .g., Auberon Herbert was. - I do know that there are SOME honest lawyers around - but what do they know about monetary freedom principles and practices and what opposition have they ever shown to monetary despotism? - If there are such exceptional people among them then they should not be kept out. - The free banking business, like the computing business, should be largely left to its fans, not to its enemies or disinterested, ignorant or prejudices people or those with a looter mentality. Luckily, the ones who are already in the business of providing consumer goods and services are also, through their local associations, the most suitable among all the potential issuers under monetary freedom and the ones who, apart from the unemployed, have the greatest possible interest in gaining and enjoying the benefits of monetary freedom. They would not need any politicians or lawyers- except in defence against the oppressive actions of other politicians and lawyers.  - J. Z., 15.5.97.
BANKERS, CREDIT & MORAL CHARACTER: Bankers perform the function- of the commercial virtues by demonstrating and advancing the -pecuniary value of a good moral character. - Henry Meulen, THE -INDIVIDUALIST, 10/75. - With their demand for securities or -guarantors for loans, governmental guarantees and deposit -insurance, bankers have either betted only on a sure thing or- have become so careless to lend even to despotic foreign governments, not only some wasteful and inefficient large private corporations. Their own government would not allow them to fail, regardless of the huge number of bad debts they managed to "expertly" acquire. They do no- longer have to be good judges of business opportunities or of good- moral character. A successful fraud was a often a better investment for -them, at least temporarily, even if, finally, he cheated the bank itself. Personal loans have -become only a very small fraction of the total loan accounts. In judging their security the assessors of personal loan- companies were, for many decades and probably still, much more competent. Bankers also refused the mini-development loans now -becoming popular in underdeveloped countries, although they have- a very low risk. The student loans, while self-administered, had- also a better chance of being repaid than most bank loans had and- have. - The number of bankers who really understood the note -issue business and who conducted their deposit and savings -accounts quite honestly has always been rather small. They were -mostly more gamblers and high risk taking speculators than sound- investors, at the expense of their note holders, depositors - or -the taxpayers. - The insistence of bankers on securities for- loans has been satirised by the remark: "Bankers lend money only -to those who can prove that they do not need it". - Moreover, the -fact that a special insurance is required for cashiers does also -seem to indicate that those who employ them are not good in- assessing their moral characters, either. - And how many bankers -do you know who have anything sensible to say on inflation,- deflation, stagflation, legal tender, the money monopoly,- devaluation or re-valuation? - Mostly the good reputation of bankers is as unearned as that of politicians is. - J. Z., 18. 4.-97.
BANKING PRINCIPLE: For me it is hard to comprehend how long two -(or more) different scientific schools of thought can co-exist, -side by side, without their differences becoming settled, or,- worse still, how representatives of especially the ruling school- of thought can simply ignore the facts and arguments advanced by- their critics, as the currency school did, largely, versus the- banking school and as is still being done today by various groups of "gold bugs" or "100% dollars". - Admittedly, much of the thinking of the free banking -school was flawed, too. E.g., many of its members did, unnecessarily and without- sufficient justification, adopt the obligation for rare metal convertibility for the issuer, although the banking principle or the real bills- doctrine indicated already the real cover involved as the only- cover required. - It is often not just one or two different views- that are mostly or habitually ignored but sometimes hundreds, if- not thousands. E.g., there are hundreds of different crisis -theories and types of socialism. Nevertheless, most write on- crises and socialism as if only their own favourite example of -them did exist  and were possible or worth talking and writing- about. How often have primitive notions on trust or confidence in currencies, as one of their basic requirements, been- thoughtlessly repeated, without mentioning the reflux and clearing foundation that is involved in short-term turnover -loans, which do not have to be covered by gold stocks at all but -are, like all debts and credits, clearable. There remain so many -unsettled questions among freedom lovers, e.g. limited- governments vs. anarchism, territorialism vs. exterritorialism, -abortion vs. right to life, mercenary defence vs. militia- defence, nuclear weapons strength and deterrence, vs. nuclear -weakness and all the possible failures of nuclear deterrence. The -money, currency, credit, clearing and value standard discussion -is full of arguments still unsettled by libertarians and- anarchists.  - J. Z., 31.7.82, 24.4.97. - It is high time to tackle all these differences of opinion fully and systematically and draw their balance sheets. -  Our very survival may depend upon it. - J. Z., 8.9.02.
BANKNOTES AS "CUT UP" REAL OR SOUND COMMERCIAL BILLS FOR GOODS ALREADY -PRODUCED & SOLD & ON THEIR ROAD TO THE CONSUMERS: Just -because SOME paper claims can in bill discounting be exchanged -into bills or banknotes suitable for temporary and local -circulation - and a short term later be withdrawn from -circulation, in payment for the real bills they were issued upon, -and then, preferably cancelled, rather than issued again in new- transactions (thus facilitating the control of the circulation,- issues and their reflux, e.g. by numbering and issues of series-), does not mean that ANY kind of paper claim can be thus and successfully discounted, especially not mere financial bills,- speculative and long term securities, or notes representing -speculatively warehoused commodities, not available on the -present market. Only goods, services and labour ready or very- soon ready for sale, can give a real and immediate purchasing -power to any kind of currency. Without it no currency is more -than a speculative security certificate that may or may not be -ultimately redeemed, one day, with interest, or that may lose its- value fast. No one is obliged to redeem it with his ready for -sale goods, services and labour - although at any time some fools -or speculators can probably be found to accept some such notes- for a while. A free market will not value them as currency at all or not for long and not at par. Seemingly, many issues had no -other foundation than long term securities or assets - because -the other foundations were overlooked or not reported. In these -cases the own capital of the bank or the private "securities" or- "government insecurities" deposited, were nothing but an ultimate -guaranty or insurance funds in case the currency had no other and sounder -foundation and did fail.  Especially their other debt, credit and -clearing foundations were all too often overlooked, although- without them all banks would have immediately failed, i.e. would- have been driven into bankruptcy and closure. That sound money is- merely a clearing certificate and does need no other value -than the acceptance or clearing readiness of its issuers, acceptors and users, -for the payments of all their debts and the receipt of all debts -owed to them, is even today not yet generally seen. Only -Professor Heinrich Rittershausen has based his unfinished work on -monetary theory upon this insight. And it is hinted at or implied- in all the writings of Ulrich von Beckerath and the monetary- writings of Dr. Walter Zander.
BANKNOTES, CURRENCY, COVER, REDEEMABILITY, CONVERTIBILITY INTO GOODS & SERVICES, AS OPPOSED TO CONVERTIBILITY OR BACKING BY SECURITIES, PRIVATE ONES OR EVEN GOVERNMENT "INSECURITIES": Banknotes and other exchange media should mainly represent the consumer goods and services that are already produced and offered for sale now. To that extent they should be merely "cut up" or discounted "real bills" or sound commercial bills or equivalent securities. They should not represent "cut up" or discounted capital assets, not wanted by most consumers at all or right now, or not to the extent that they are offered. The capital values, offered as "backing", might also be merely speculative. They might, in many instances, not even be ready for sale on the capital market but only may become ready for sale some time in the medium or long future. And they do not offer ready for sale consumer goods and services now, in form of ready or current claims against them. In some instance, they might be warehouse certificates, representing goods or mere raw materials, still to be processed into wanted products, that are currently not offered on the market at all but, rather, withheld from it, in the hope of higher future prices. Thus, instead of increasing the supply of wanted consumer goods and services, the backing for such currency is speculative, not ready for consumption but rather withheld from production or consumption. And yet the issuers of such "currency" believe that on a competitive currency market such exchange media could be kept at par without anyone being obliged to deliver any wanted goods or services at market prices for them. Somehow the notion of a monopoly and legal tender currency seems to have crept in, that would force the providers of goods and services to accept even such a badly founded currency, without sufficient reflux, if they want to engage in monetary exchanges at all. - J. Z.,9.11.88, 15.5.97.
BANKNOTES: How many wrong or only partly correct theories exist- on their origin, nature and function? See BANKING THEORIES & FREE- BANKING THEORIES, BANKING PRINCIPLE, REAL BILLS DOCTRINE, -CURRENCY PRINCIPLE. - I hold that all of them should be listed- and either proven or refuted. The same terms have all too often -different meanings for the banking traditions in different- countries and for different authors. Whenever such terms are used -then the origin or definer ought, perhaps, to be included in- brackets or the different definitions should be offered in a -numbered list and. whenever the term is used, then the meaning should- be indicated by its number being added in a bracket. - I hold- with Ulrich von Beckerath that banknotes should mainly represent -the consumer goods and services offered for sale now, within their private, -voluntaristic and competitive payment circles or payment- communities. Therefore, no "currency" should be issued that- merely represent "cut-up" medium or long term securities or- commodity or real estate capital values, whose medium or long- term value is merely speculative and whose equivalent is anyhow- not immediately available in form of ready for sale consumer goods and services and labour, at least not by the issuers of- such "asset currencies". Why should the issuers of capital- securities be allowed to thus dispose of goods, services and -labour of others, without the consent of the owners or providers- of these goods, services or labour? And why should these -providers accept such "currencies", when they are not prepared to -invest in the capital market?  There is, indeed, room for small- and standardised shares, bonds and other securities, but only in- the capital market, not in the currency market. The two should be kept quite apart, in theory and in practice. A mortgage bond or a- share does not have any immediate purchasing power. It does not- oblige any storekeeper or department store or shopping centre, -bus company, petrol station etc. to accept it, unless such- acceptance is contractually provided for. And then these -readiness to accept declarations would form the real and -immediate cover or foundation or reflux option for such -banknotes. But why should such providers depend upon others -supplying them with notes - when they could issue them -themselves? - Free after MFNL&MF 3/4, Feb. 89, & 8.4.97.
BANKRUPTCY AVOIDANCE VIA CLEARING OPTIONS: Enterprises that are- still basically sound but merely have a cash flow problem, under -conditions of monetary despotism, with its deflations, inflations- and stagflations, depressions, recessions and credit- restrictions, should be set free to offer, in settlement of their -debts, clearing certificates, in easily transferable money- denominations, that entitle the bearer to obtain from the debtor -his goods and services at par. Debtors should also be at liberty -to set up a common clearing house for this purpose, mutually guaranteeing their repayments and they should be free to offer -these certificates at a discount, that is attractive to their -creditors, while these certificates are not accepted at par -in general circulation. - With that liberty most of these debtors- would not have got into their precarious cash flow situation in- the first place. But once in it, they could trade themselves out -of it. Moreover, their creditors could get the full value of -their credits repaid to them, even if that required a larger- quantity of somewhat discounted clearing certificates. The right -of creditors to demand legal tender cash (or, as formerly, silver or gold coins ) in -payment, although that was not especially agreed upon in private contracts, should be abolished. All debtors and creditors should- be set free to enable them to pay and be paid as far as is -humanly and economically and monetarily possible, via clearing- options. If we consider that money itself is never the ultimate- objective but that it is merely a means to an end and that, with the curtain of the physical appearance of exchange media removed, in a thought-experiment, then not only the large number of non-cash transactions that do take place, invisibly for most people, but also the much smaller sums of cash transactions to merely achieve a mutual exchange for goods, services and labour for other goods, -services and labour. Only some limited time delays are involved in these exchanges. (Exchanges over longer periods are involved when some of the goods are capital values and their capital securities.) ANYTHING that facilitates this process,- through the technique of monetary exchanges or through clearing -exchanges or any other non-cash payment alternative, that can- satisfy debtors and creditors alike and that makes it easier to- satisfy both of them, should be set completely free. It would then become -obvious that, to the extent that an unemployed, a tradesman or- professional or a shopkeeper, could put into temporary -circulation his own notes, or clearing certificates or electronically accounted clearing credits, buying with them his requirements, he -would automatically, although indirectly, supply himself with- work or sales. His spending would cause his earnings, instead of-, as today, his spending would require first that he obtain scarce and- exclusive currency for it, somehow, in a considerable struggle for them, by offering his goods and services in -a market for such exchange media that is restricted through the coercive and exclusive- currency of monetary despotism. - J. Z., n.d. & 30.4.97.
BANKRUPTCY LAWS: "Would BANKRUPTCY LAWS be permissible in a -libertarian legal system? Clearly not, for bankruptcy laws compel- the discharge of a debtor's voluntarily contracted debts, and- thereby invade the property rights of the creditors. The debtor- who refuses to pay his debt has stolen the property of the -creditor. If the debtor is able to pay but conceals his assets, -then his clear act of theft is compounded by fraud. But if the -defaulting debtor is not able to pay, he has STILL stolen the -property of the creditor by not making his agreed-upon delivery of the creditor's property. The function of the legal system- should then be to enforce payment upon the debtor through, e.g.,- forced attachment of the debtor's future income for the debt -plus the damages and interest on the continuing debt. Bankruptcy- laws, which discharge the debt in defiance of the property rights- of the creditor, virtually confer a license to steal upon the- debtor. In the pre-modern era, the defaulting debtor was -generally treated as a thief and forced to pay as he acquired -income. Doubtless, the penalty of imprisonment went far beyond -proportional punishment and hence was excessive;" (even when he was a fraudulent debtor and cheated people for millions? - J. Z.)- "but at least the old legal ways placed responsibility where it -belonged : on the debtor to fulfil his contractual obligations -and to make the transfer of the property owed to the- creditor-owner. One historian of American bankruptcy law, though a - supporter of these laws, has conceded that they trample on the -property rights of the creditors." - Murray N. Rothbard, The- Ethics of Liberty, 142. - Here is Rothbard at his best, in -exposing a wrong. Alas, he does not conclude that the willing- debtor ought to be enabled, as far as possible, to clear his debt by clearing, in the interest of the debtor and the creditor alike, even -if, for this purpose, he could offer nothing but his own monetised IOU's,- based upon his own continued goods and service offers and even if -these would suffer a considerable discount, so that he would have -to offer correspondingly more of them to make up the total debt, accounted in a sound value standard. - Rothbard would be likely to- condemn such issues as mere fraudulent "fiat money" issues, even- if such a payment were acceptable to the creditor or to an- arbitrator that debtor and creditor had agreed upon. Thus,- Rothbard, instead of making debt settlement easier via the right -to clearing debts, would make the debt settlement harder to -impossible to achieve, by insisting upon debt payment only in -gold metal or 100% gold-metal-covered gold certificates. These the debtors are often -unable to obtain at all or in the required quantities and whenever needed and that -would apply also to his own debtors. Thus the debt settlement is -prevented rather than promoted. (To a large extent the bankruptcy laws were passed in recognition of such facts, such payment difficulties, even for quite honest and efficient debtors. - J. Z., 8.902.) Indeed, Rothbard assumes that, in- case of a shortage of gold, all prices, expressed in the exclusive -gold currency, would immediately fall correspondingly, so that- gold payments would continue to be as easy as before, due to the fallen gold- prices. Here he overlooks the often pointed out "stickiness" of -prices and wages and the fact that in prior centuries and in some respects even in our century, barter transactions still persisted- because gold prices never fell far enough to mediate all- exchanges monetarily. Moreover, he overlooked, like most other- economists, the different psychological effect of falling prices- vs. fallen prices upon potential buyers who do have some money -reserves which they do not have to spend immediately to survive. Falling prices- discourage buyers. Only fallen prices encourage them. Thus- falling prices lead to further falling prices, preventing for a-long time the price adaptation that Rothbard expected and predicted. In the meantime millions of unemployed and- ten-thousands of bankrupt employers ask themselves: How did we -get into this? Has Rothbard any sound advice to offer to use? All- he would tell us is: Reduce your wages and prices further. He -wants to confine our exchanges to his favourite exclusive and- forced currency, which we are short of, precisely at a time when- there is an abundance of real cover: consumer goods and- services, ready for sale, for alternative optional and market--rated currencies of our own, which we might even, to do ourselves- and Rothbard a favour, denominate in gold weight units as their -value standards and would readily accept as if they were- corresponding gold coins. But such self-help steps would be- condemned as fraudulent by Rothbard and as an unjustified- "expansion of fiat money". - He was a radical and helpful thinker, -in many respects, but not in all. Regarding money, he remained a -monopolist by prescribing "only gold" (or 100% gold covered certificates) instead of "only government- paper money". - In other words, Rothbard's ruling on bankruptcy- and on an exclusive gold currency (however competitively- supplied), would assure more bankruptcies and would not help- debtors and creditors to get the remaining debts settled, unless- they can manage to settle them in gold metal or 100% covered gold--metal certificates. - Nor does Rothbard offer clearing as a- solution. Mutual debts that can be cancelled, cleared or settled, -obviously do not require, for this kind of non-cash payment, any- gold coins or gold certificates, except for the balances -remaining. And the settlement of these can be postponed. - The clearing might well use a gold weight unit as a standard of- value for accounting purposes.  But that was not considered by- Rothbard or would not have satisfied him. He went on insisting on -gold coin or 100% covered gold certificate payments. - Or did I miss some of his writings? Did he anywhere concede the -possibility of non-cash gold value payments (using all kinds of -other means of exchange at their gold weight market rating) in -settlement of debts expressed in gold weight units? Sometimes- e.g., custom duties were so fixed and so paid. - Did he report any -complaints by debtors and creditors about such gold weight unit- accounting and clearing and payment transactions that made the -means of payment used optional? - He fruitfully pondered most- aspects of liberty but did not spend sufficient time and thought-energy- on this one. -  J. Z., 25.4.97
BANKRUPTCY RULES, See: FUTURES DEALINGS WITH CASH. See: -CLEARING.
BANKS & THEIR FEES & INTEREST PAYMENTS: You may earn the highest bank returns if you can manage no longer to go to the banks or to return to them. - More and more alternative payment methods are coming up. E. g., postal money orders are now sometimes cheaper than bank transfers. They are also not subject to taxes, like your bank deposits. Some traders, advertising on TV, allow you now to pay them through your telephone bills. Cash payments still give you the chance to arrange for discounts in all larger purchases. Unless you can establish your own or freely choose among free banks of issue and investments, you are often advised to avoid them if you want to save money. Alas, they have become paymasters for wages and salaries, which puts all too many funds at their disposal, for which they often pay an interest below the inflation rate. Your money in the bank is no longer safe. To some extent it has become the bank's money - and that of the tax department. Draw your own conclusions from this. Gain your independence from them. Use them only if you must. Safe as a bank has become a misnomer. They do not even guard themselves sufficiently against bank robbers. Nor do they offer you banking secrecy. They report to the tax department - and to who knows else. - J. Z., 11.11.92, 16.5.97.
BANKS OF ISSUE, NOTE-ISSUING BANKS: DO THEY NEED CAPITAL? Banks of issue need sense not size, sound issue techniques, not capital, sound value standards, and competition with other banks of issue, not government guaranties, self-management, not government supervision and controls. - J. Z., J. Z., 4.4.89,16.5.97.
BANKS UNDER MONETARY DESPOTISM: Banks today are not free and competitive, private or cooperative enterprises but, largely, from the central bank to the smallest bank branch at the corner, government controlled, regulated and mismanage institutions, even though they remain formally in private hands. Just consider the flood of laws and regulations on them. The "economy" of fascism and totalitarian communism should not be equated with that of a free enterprise and free exchange or capitalistic or market economy. Nevertheless, for all the mistakes of government banking, currency and credit policies, forced upon all, "capitalism" and the "market economy" and the "profit motive" and "private property" are usually blamed, even in a sphere where they do least of all exist. - J. Z., 28.7.93, 24.5.97. - See: CENTRAL BANKING, MONETARY POLICY, CURRENCY POLICY, CREDIT REGULATION.
BANKS, CREDIT OR LOAN POLICY & THEIR DEMAND FOR SECURITY: A- Banker is a fellow who lends his umbrella when the sun is shining- and wants it back the minute it begins to rain. - Mark Twain,- 1835-1910.
BANKS: Alternative names: Debt-shops. - Ezra Heywood, Hard-Cash, 7.
BANKS: Apart from the Central Bank all banks are now reduced to- being merely dealers in the nationalised exchange medium and its -forced paper "standard". Even in these limited dealings they are -highly regulated. Likewise, in their options to issue and deal- with capital securities. They are mere shadows of free banks. But, -at the same time, they are privileged banks, insofar as entry into -the business of banking is also highly restricted by legislation -and governmental compulsory licensing schemes. They and the note- acceptors are kept in a monetary kindergarten and thus are kept- ignorant and irresponsible in monetary matters. - J. Z., 4.9.86,- 29.4.97.
BANKS: Some banks really lock your money away from you. I- noticed in Los Angeles, near Union Station, a branch of the Bank- of America. It is only open on 3 week days and then only from- 11.30am to 2.30pm, at least that was its schedule indicated on 20 -Dec. 1990. And this in a country where many shops, e.g. photocopy- shops, are open 24 hours a day! - J. Z., 16.4.97.
BARTER IS NO SUBSTITUTE FOR FREE CLEARING & FREE MONETARY -EXCHANGES: Only free clearing and full monetary freedom can -fully employ all people willing to work, at their highest -capacity and skills and can make them prosperous and independent.- - J. Z., 27.7.83, 17.4.97.
BARTER, MONEY & CLEARING: Any money transaction is essentially- an anonymous and multilateral barter or clearing transactions,- one spanning time and distance, in which goods, services and labour -are exchanged for goods, services and labour. - Any attempts to -issue monies that are not based such turnovers are condemned to failures. But debts that are shortly due can keep money issues -based upon them at par with their nominal value, so that they, -too, are considered as acceptable in payment for daily wanted- consumer goods and services. Both, the goods and service cover- and the short term debt foundation, do establish a strong demand -or "reflux" for the money involved, that keeps it at par with its- nominal value expressed in some or the other value standard. For -money issued upon long-term assets there exists no strong enough demand or -reflux right away and continuously. It will occur only once that debt is soon due. -In the meantime, no supplier of daily wanted goods and services- is obliged to accept it, if he has not issued it. - J. Z.,-5.12.90, 16.4.97.
BECKERATH, ULRICH von, 1882 -1969. See: ACADEMIC WRITINGS ON- MONETARY FREEDOM IN RECENT YEARS. See also his numerous writings, listed in my main website: www.acenet.com.au/~jzube
BECKERATH, ULRICH VON, 1882-1969, See: GERMAN SCHOOL ON MONEY. See the main literature list of LMP.
BECKERATH, ULRICH von, 1882-1969. From ca. 1913 onwards, possibly -already from 1908, he has, more thoroughly than anyone else that I- ever heard of, knew or read about, explored and described the -monetary freedom options. Alas, most of his correspondence before- 1943 has been lost with his library in an air raid on Berlin. -Recipients of his letters and papers from before that time, who- preserved them, should make themselves known to me. I would like -to microfiche his whole correspondence, to the extent that it- is or becomes available to me. - J. Z., 9.4.97.
BECKERATH, ULRICH von, Monetary Freedom teachings. See e.g.: -Aphorisms on the money problem, 1932, in BANKWISSENSCHAFT. Also -in PP 587/588.
BECKERATH, ULRICH von, See: ECONOMIC & HUMAN RIGHTS ASPECTS -IGNORED BY MOST MODERN AUTHORS.
BELIEF SYSTEMS ON MONEY: There are thousands of different- articles of faith and prejudice and unfounded assumptions and -assertions, fallacies and false arguments on money. Most are as -false or misleading as the religious ones. Only a systematic and- an alphabetical register of all of them, together with their best -refutations so far out, could show us the ways out of this -labyrinth or avalanche. So far it has not yet been compiled and- all too few people have shown any interest in such a project. - -J. Z., 18.7.96, 20.3.97.
BIBLIOGRAPHY OF MONETARY FREEDOM WRITINGS. Draft in PP 1022. Ask- for further contributions and translations. Ask for permissions -to reproduce still copyrighted material at least on microfiche, floppy disks and CD-ROMs & websites.
BILL DISCOUNT, SOUND COMMERCIAL BILLS VS. UNSOUND "FINANCIAL" BILLS, REAL BILLS DOCTRINE, BANKING PRINCIPLE, CIRCULATION CIRCLES, LEGAL & JURIDICAL "RIGHT" OF CREDITORS TO DEMAND PAYMENT IN RARE METALS OR OTHER CASH: For a long time the payment of sound commercial bills, was ultimately enforceable in gold or silver coins, although, in most cases they were rather settled by clearing or payment in bank notes for which they had become the common basis for issues. Banknotes, under the real bills doctrine or banking principle are nothing but cut-up sound commercial bills, in standardized, easily recognizable and convenient denominations, that can circulate easier than the commercial bills themselves (which are largely acceptable only among merchants and bankers) and these small and even bills are finally used to redeem them. For all too long it was ignored that the right of creditors to have commercial bills redeemed in gold is quite unnecessary to preserve their value and that of the bank notes issued upon them. Their redeemability in banknotes and the short term debts that are involved, are quite sufficient to assure a corresponding reflux of banknotes from the short term debtors of the commercial bills. The bills were usually issued by wholesalers to employers, their suppliers, in payment for goods already produced and sold to them and on the road to the retailers. The employers, paid by the wholesalers with commercial bills, got these bills discounted into banknotes at a bank of issue. With these notes they paid their workers, suppliers and profits and then the notes streamed to the shops for goods and services and from them to their suppliers, largely the wholesalers, who redeemed their bills with the notes thus received. The whole is easier to describe and comprehend graphically, than in words. I have done that in PEACE PLANS 41. Still better charts of this payment circle would be welcomed by me. The right of creditors to demand payment in rare metals or rare legal tender paper money has done much more harm than good and has only secured recurrent payment crises. That right should be confined to quite optional contracts and even then, seeing that dealings in futures and their risks are involved, withdrawal premiums for the withdrawal from such obligations should also be agreed upon. Only then will the risk of such claims be reduced to acceptable proportions. It this risk remains quite unrestricted by withdrawal premiums and competition from suppliers of alternative exchange media and value standards, then it can lead to the rapid and prolonged collapse of the non-cash transactions, all dependent upon a minimum but quite regular and always available supply of cash. If cash supply sinks below this minimum, then numerous non-cash transactions are no longer possible and lead thus to a much larger demand for cash and this precisely when cash is already in short supply. Then some cash can only be attained by postponing the payment of bills and by dismissing workers and by ruthlessly collecting debts, payable in cash, even if that leads to the bankruptcy of the debtors and to emergency sales prices. Only the quite competitive supply of cash, in all its possible and desired forms, can prevent and end such money shortages, which, by the way, also lead to a collapse of the prices of capital securities because fewer shares etc. are bought and enterprises that can no longer easily sell their goods and services are reduced in their market values and cannot pay dividends or interest or only much less. Thus the right to demand rare metals or other exclusive currency from a debtor must be replaced, in the general economy (apart from some payment communities which religiously adhere to the cash payment obligation voluntarily, at their own risk and expense), by the right to demand clearing, in stated value standards, but accepting any kind of usable exchange medium or clearing certificate - but only at its market rated value expressed in the agreed upon value standard. To my knowledge Ulrich von Beckerath, 1882 - 1969, was the only economist and writer who clearly saw and described this problem and its solution. If you know of others and their writings, please let me know about them. - J.Z., 27.9.02.
BLACK LABOUR OR BLACK MARKET LABOUR: In Freiburg, Breisgau, on 4 March 93, I saw the van of a painter with the inscription: "Ohne Schwarzarbeit mehr Arbeitsplaetze." (Without black labour more jobs.) - Presumably, this professional painter would object against you yourself painting your own house, inside or outside, or getting your friends or family members to do so. Certainly he is opposed to untaxed underground contractors and does not like to take up such opportunities himself, although in his job it would be easier than in most others. He seems to count as productive labour only his own professional work. - Nor does he mention that largely rightful tax evasion and evasion of excessively high social security and accident levies are involved. Just because he is heavily taxed, he wants others to be taxed, too. Just because he loves bureaucratic interventionism, he would like others to be so enslaved likewise. He would count only officially created or recognized jobs as jobs, not private ones. Presumably, according to him, once all of us would be in untaxed and unregulated black market jobs, trading on the black market, we would all having no jobs at all. He did not put his foot into his mouth, but, as a painter, on his van - was sure to find many other fools to support him. - J. Z., 24.5.97.
BLACK MARKET PRIVATE CURRENCY ISSUES: To what extent are they -possible? - Already now, sometimes and unofficially, other national- currencies are substituting largely for inflated national -currencies, e.g. the U.S. dollar internationally and the German -DM in some European countries suffering more than Germany under- inflation. - Full exploration of the extent to which the black -market might make possible not only barter and some limited- monetary exchanges (using the money of monetary despotism, or- forcing exchange, or gold or silver coins and bullion) but, -instead, at least some kinds of monetary freedom and free -clearing exchanges that could, potentially, become so extensive -that they could introduce a free market, for the first time, a- fully free market. LETS founder Michael Linton believes his -system to be capable of this. I don't. -  He seemed more -reasonable in his papers than in person and in his talk, although -he is a smooth and popular speaker. -  J. Z., 7.4.97.
BONUS PAYMENTS & WAGE & SALARY INCREASES IN THE MONIES OF MONETARY FREEDOM, AS INTRODUCTORY STEPS TOWARDS FULL MONETARY FREEDOM: Issue the next Christmas bonus or extra salary payment or salary increase to employees in the own store currency or in the store currency of all employers doing the same. Employers would benefit by paying this expense in their goods and services - instead of having to sell these first for scarce legal tender notes. Knowing this, they might even be willing to pay a higher gratuity of this type in this form. - A fringe benefit would be that both, employers and employees, would become accustomed to dealing in private notes. - A single issue of that type, existing only temporarily, might altogether escape the notice of the authorities and thus legal prosecution. If not, then it would greatly reduce the penalties involved. - When an association of shops issued this temporary shop currency, the individual shop would receive the notes as a loan, to be repaid in goods warrants or in cash - in case, by chance or by insufficient competitiveness, one employer would not receive sufficient of these goods warrants back to repay this debt with them. - The same could be done for demanded wage increases, which they employer could not afford to pay in legal tender but could well afford in his own shop foundation money. The wage increase to the builders of Roseland's Shopping Centre, in 1964 (in Sydney, then the largest shopping centre in the southern hemisphere), was a precedent for this. This made possible the completion of the building in time, and a corresponding additional cash flow from its opening day on.  Since this agreement with the unions broke a number of laws - by doing the morally and economically right thing, the case was hushed up. - Such issues might be considered as a pilot project for a monetary revolution, one to stop unemployment and end inflation - by paying all wages, salaries and profits and other expenses in shop currencies and by using a better or several better standards than the government's paper standard in the shop currency and to express all prices, wages and salaries and other debts. - J. Z., 1985 & 21.5.97.
BOOK MONEY, CREDIT MONEY & CASH : By means of bank or book money or credit or deposit accounts all cash can be multiplied up to tenfold by all banks. - Pop opinion. - Wouldn't the banks love that? Under competition they should then be able to pay their depositors much more or charge their debtors much less. But do they? - Is there no honest accountant left in the world who is able and willing to point out these "created" super-profits?  How can any rich people be prevented from becoming such bankers and as easily multiplying their riches? - J. Z., 28.3.97. See: CREDIT CREATION, CREATION OF CREDIT & MONEY, DEPOSIT INFLATION.
BOOK MONEY, MONEY CIRCULATION, QUANTITY THEORY & INFLATION: - The price effects of cash increases becomes multiplied through book money that is nominally based upon the increased cash. - As a rule everything and everybody gets blamed for inflation - with the exception of the real culprits, the central banks, their money monopoly and the legal tender legislation. - If "creative" book keeping could make the bookkeepers rich then everybody would want to become a bookkeeper and banker. Why work at all, if values can thus be merely created on paper? - We could then become a nation of book keepers and bankers. Why bother then to produce anything. We could all live on consuming our multiplied book values. - The same illusion is involved as is involved in the mere printing of paper money. Now we can express money values electronically and computers could multiply electronic symbols endlessly, without limits. But could they "create" a single cent of additional purchasing power for anybody, through electronic fiat or unilateral action or declaration, not based on any goods or services offered, ready for sale, without depriving anyone else of that one cent or without arranging a fair trade that is of mutual benefit to all the parties involved? -  J. Z., 2.4.97. - See: CREATION OF MONEY & CREDIT, DEPOSIT INFLATION, QUANTITY THEORY,MONEY CIRCULATION.
BOOKS WANTED LIST, perhaps integrated with FB bibliography.
BRANCH BANK CLOSURES: Let the major banks close as many local- branches as they like, in their cost-cutting attempts, but do allow -the local people to establish not only their own local savings,- current account, deposit and clearing banks but also note-issuing -banks, quite free from Local Government, State and Federal- Government legislation, regulation and jurisdiction. This would- mean an end to depressions, mass unemployment and inflation in -all the localities where this self-help freedom would be -practised. - J. Z., 8.11.96, 19.3.97.
BRAY, JOHN FRANCIS, Labour's Wrongs & Labour's Remedy, Leeds,- 1838, also advocated a particular kind of labour exchange,- different from that of Robert Owen. Further details are wanted- and the whole book for microfiching. - J. Z., 20.3.97.
BRECKENRIDGE, R.M., The Canadian Banking System, 1871-1890, N.Y., -MacMillan, 1895, defended the right to issue as the common right- of all. - According to Wells/Scruggs, Towards Free Banking, p. 1. -- Westrup may also refer to him. Alas, I have not yet been able- to obtain this book by Breckenridge for microfiching in my- monetary freedom series. - J. Z., 26.4.97.
BRONFENBRENNER, MARTIN, THE CURRENCY-CHOICE DEFENCE: I have got -myself a copy of this article from CHALLENGE, Jan/Feb. 1980, pp- 31-36 and fiched it in PP 803. Already its sub-title seems to- contain a disastrous misconception or wrong definition: "If any -means of exchange, not only dollars, were considered as legal -tender, the market would be left free to provide for monetary- stability." - It is one of the main objections against free- banking that, if everybody were free to issue money (and here, -usually, legal tender is presumed), then everybody could -cause an inflation. This is quite true. However, B. probably -meant here merely the lawyer's excuse for legal tender, namely,- that your are legally entitled to offer it in payment but not -necessarily that the other party is obliged to accept it at all- or at face value. In most cases, this harmless sounding term is- interpreted quite differently by legislators and courts, e.g.:- "Mark equals Mark", no matter how depreciated it becomes, $ equals $, even when its value is down to cents and mere paper currency, -by government fiat, is declared to be the equivalent of gold--certificates. The worst interpretation and most wide-spread practice is: monopoly money with compulsory acceptance and compulsory value. As such it is the- precondition for inflation, deflation and stagflation. Alas, only- very few textbooks see it as such. How many more monetary -catastrophes are required before enough people begin to realise -the nature and effect of legal tender legislation and- jurisdiction? - J. Z., in a note for MFNL, & 30.5.97.
BUCK PASSING & THE BUCK STOPS HERE: These terms could acquire a- completely new meaning if applied to monetary freedom. Those who -have realized the importance of their monetary independence might -say, to those who offered them the monies of monetary despotism: -Your buck stops here: It cannot buy anything from me. I refuse- to accept it in payment. But I have assumed the responsibility to -produce and offer my own means of exchange and sound value -standard and am prepared, on that basis, to honest trading with- anyone at any time. (They could and should issue their own "bucks", based upon their readiness to supply wanted labor, services and goods for them, and these bucks would then stream back to them in payment, i.e., their own bucks would stop there, where they started from. - J. Z., 10.9.02.) - They would no longer pass on the buck of -responsibility to the government to supply them with sufficient -sound value standards and exchange media or welfare hand-outs. They could and should so opt out of "the war against the poor". They would rather -supply themselves with productive work and trade opportunities by -their own independent monetary and financial efforts. From hand-out recipients they could turn into free people paying for their wants and needs with their own currency, redeemed by their own ready for sale goods, services and labour efforts. - J. Z., 27.5.97, 10.9.02.
BUDGET, BALANCED & INFLATION: A balanced budget would stop inflation. - A popular opinion. - But what would stop inflation if no government were willing to balance its budget. As experience teaches us, this is mostly the case. Either it increases taxes or forced loans at the expense of future tax payers or it taxes us via inflation. It has the powers to inflate, in legal tender and the issue monopoly and will sooner or later and most of the times abuse them. A shortfall in its budget is no more than a motive. It does not give it the weapon to inflate a currency. If you have a shortfall in your budget then you cannot cause an inflation because you cannot turn your IOUs into legal tender and an exclusive currency. Honest or moral minds would not engage in crimes. Honest and moral governments would not engage in inflation. But then who has reasons to think that governments are honest and moral as a rule? So, should we grant them any means to engage in an inflation and ourselves no rights and liberties at all to end or prevent one? - J. Z., 28.3.97. - The "balanced" budget of most governments today includes the degree of "deficit financing" or inflation that they planned for! - If it is balanced through government borrowing then this means that the government has further extended "investments" in tax slaves. - J.Z.,  30.8.02.
BUDGETS OF GOVERNMENTS & THEIR BUDGET POLICIES: Government- budgets indicate the way governments are going to spend YOUR- money, not THEIR money and also by how much they are going to -inflate the currency EVEN FURTHER, INCREASE YOUR TAX BURDEN, even- more so and PUT YOU IN DEBT, to an even greater extent and against your will. -Then they do have the cheek to ask you to praise them for- this and to vote for them. - J. Z., 18.9.92, 1.5.97.
BUDGETS OF GOVERNMENTS: They indicate how the loot is to be -increased, at the expense of the tax slaves and how it is to be -distributed among the politicians, the bureaucratic empires and- their favourites. - The whole tragicomedy is treated not as a -farce or a crime but put on the same moral level as a private or- company budget that only honestly disposes of the own and honest earnings. -Calling a wolf a sheep does not turn him into a sheep. Calling a- robber a benefactor does not turn him into a benefactor. One can -rightfully distribute handouts, investments and subsidies and- loans only from the own property. We should as much as possible -avoid using the misleading or cover-up or obviously dishonest and- false terms that governments want us to use to be able to continue fleecing their victims with their consent. - J.Z.,-25.9.91, 27.4.97.
BUDGETS, SUPPLEMENTARY BUDGETS, TAXES & INFLATION: Once can restrain an inflationary trend by introducing a supplementary budget which brings increased taxes. - Popular opinion. To the extent that it would introduce whatever is sound in tax foundation, this might be achievable for the government's paper money circulation. But for all other spheres. into which legal tender and monopoly currency is forced, it is wrong. To the extent that all free and competitive money issues are suppressed and coercively replaced by government paper money, these sphere are already inflated by that paper money.  They would accept tax foundation money only to the extent that they needed it for the payment of these tributes. Any excess beyond that is already forced into it because people do need some money, have to accept it, have to accept it at par and are not allowed to replace it, discount it or reject it. How much government money could circulate under free market conditions, without the issue monopoly, without legal tender and without taxation and by governments without a territorial monopoly? Only voluntary contribution and subscription monies issued by voluntary and only exterritorially autonomous communities could then remain in the sphere of the former governmental forced currency. They would be in free competition with all privately or cooperatively issued alternative currencies. - J. Z., 6.4.97. - Even when annual budgets are replaced by bi-annual or quarterly budgets, monetary despotism would remain, with its inflationary, deflationary and stagflationary effects but instead of annual stop and go policies we would have half-yearly or quarterly ones. And the adaptation would and could never be as accurate as would occur naturally and freely under monetary freedom. The victims of monetary despotism and taxation should also ask themselves whether they should be taxed to make up for the inflationary spending of governments, through additional legal tender issues, suffer extra taxes to make up for the mistakes of politicians and their central banking system,  i.e., taxed to make up for the inflation tax. If a gallows currency is not introduced (Hanging those responsible, finance minister and central bank president, when they have, once again, depreciated the forced and exclusive currency), then perhaps another response would somewhat help: Reduce the real purchasing power received by all politicians and bureaucrats at double the rate at which a currency is inflated! That might give them a vested interest in not inflating their paper currency. At present they have a vested interest in inflating it. - J. Z., 6.4.97.
BUSINESS SECRETS: Among other things, in a sound alternative- issue, clearing and credit system, there will be no business- secret. Either it will not be assumed to be necessary and- justified or it will not be planned in, right from the beginning -of competitive issues or current and clearing account services. I -would also predict that issuers or account keepers who would not - claim "business and privacy secrets" in this respect, would -be more successful, i.e. more used, than the other ones would be.-  - J. Z., 3/97. See : SECRECY.
BUY AUSTRALIAN (GERMAN, ENGLISH, AMERICAN, etc.): If -Australian money consisted of a number of competing Australian -currencies, all of them truly based on Australian goods and- services, then and automatically, all spending of it would lead- to corresponding sales of Australian goods and services, by -redeeming this money in the Australian goods and services it is -based upon. Even if some bought only imported goods with such- currencies, they would inevitably stream back to pay for the same -amount of Australian exports. - It is also true that even the central bank's State paper money, when used in paying for -imports, has ultimately no value for the foreigner than by being -returned to pay for Australian exports. But there is not time -limit on this kind of paper money, as is on private "ticket" -money. Moreover, foreign central banks, in their foolish grasp -for and accumulation of "reserve currencies", might retain a not- yet too depreciated state paper money for years to decades. This -would mean that for these periods we would have got the imports -as interest-free loans. But our central bank might not- sufficiently replace these notes, hoarded in foreign countries,- perhaps also by private citizens, which may have reasons to trust their own government's paper money even less. Consequently, the- own circulation of exclusive and forced currency might become- correspondingly deflated. Such a diminished reflux of Australian notes might also -boost the primitive notion of "buy Australian!" - Compare also a -hypothetical payment of imports with gold coins. They would not -necessarily or at all return to us for Australian exports, immediately or soon. The whole world market would be open for -them. Only according to the "law of fluctuating gold quantities"- would they ultimately tend to return to an Australia whose gold -prices for goods would have become lower than those on the world- market, because of a gold deflation (assuming gold to be an -exclusive currency). If, however, we are free to issue at any time as many exchange media as we need for our transactions and -also free to choose e.g. a gold weight unit as our value -standard, then, although our gold stock would be reduced, our- gold weight unit prices would not be. Only actual payments in -gold coins would become rarer. - Anyhow, this kind of model of an- exclusive gold currency, that once spent does not return- automatically to the spender, still spooks in the heads of people- long after gold coin circulation has disappeared and makes people -jump to wrong and protectionist conclusions like: "Buy- Australian!" - J. Z., 29.9.93, 25.5.97. - Did you ever hear or see a good refutation of this stupid little slogan, from any Dr. or Prof. of economics or any commentator in the mass media? It is endlessly repeated in advertisements - without being accompanied or followed by any criticism that I am aware of. Oh the power of the great lies, myths and prejudices - while there exists no encyclopaedia to systematically collect and publish their best refutations sufficiently. - J. Z., 8.9.02.
BUY AUSTRALIAN, AUSTRALIAN MADE: If Australian consumers were- free to accept and spend, rate or refuse and also, as producers- and traders, to issue and offer and pay with their own printed or -coined assignments upon their own goods- and service offers, in- their own tokens, in standardised and convenient money -denominations (different in appearance from any other money -issues), and using for these alternative exchange and clearing- media any value standard that pleases them, as long as it does, -then they would come to automatically buy Australian goods and- services to a large extent. Their money would have no other value -or use for them. Moreover, it would often enable them, in the -first place, to do so, by this very freedom to issue and use their issues as their means of payment. Moreover,- then they would be able to obtain or issue just as many sound- means of payment as they would need for all their transactions -and would no longer be misled, defrauded or cheated, exploited- and taxed, restricted and held back by the despotic monetary- policies of the central bank: the Reserve Bank, with its forces -and exclusive paper currency, given legal tender powers (-compulsory acceptance and compulsory value, no matter how much -it has been depreciated). Nor would they be rendered unemployed- by being forced to sell or work only for this exclusive and- forced currency, although it has often been inflated, deflated or -stagflated and has never managed to supply all of them with- exactly the quantity of sound exchange media that they do need- for their purposes. No central bank can achieve that. Free- competition and free cooperation would work its wonders, here, too, if allowed to do so. Under freedom the good money would -drive out the bad, as it should, by rights. - J. Z., 19.11.93,- 24.4.97. - By the way, any private currencies, redeemable in Australian goods and services only, if they were used to pay for imports would, in the hands of any foreigners, have no other value than as a purchasing medium in Australia. Thus, these imports would also lead to the purchase of Australian goods. With government legal tender getting into the hands of foreign merchants this return is less certain. They might then end up, for many years, in the safes of foreign central banks, as "foreign exchange reserves". - J. Z., 7.9.02.
BUY AUSTRALIAN. "Buy your kid a job: Buy Australian".- "Australian Made" or: "Made in Australia" and : "Buy Locally!": -Give a rational and new meaning to these slogans. Mobilise your own ready-for- sale goods-, service- and labour supply capacity monetarily. Pay, -as far as you can, i.e., as far as you can find voluntary acceptors for them, with your own assignments or clearing -certificates or IOU's, or purchasing vouchers, goods warrants- and service scrip - upon whatever you have to offer, in money -denominations, but avoiding the money terms and standards of the -government - due to its despotic monetary laws. All your local- spending with these would, inevitably (apart from the actions of- collectors) come back to you in form of extra sales. If, -instead, you spend government money then it might never come back -to you or to your local community. - But be not satisfied with -whatever you can achieve in this way. At least discuss completely -free clearing and note issues in your local community, as a- theoretical possibility and a self-help action as soon as you- could legally or safely do so. - In the meantime, issue your -tokens and mutually accept them at their agreed upon values, even -if none is stated in them. (only "bucks", "units" or "notes" or "points"). But you are already free to issue gift- vouchers in money denominations and there are, in cities, shop- currencies for consumer credits. Try whether you could issue them outside of consumer credits, especially in wage payments to young -people out of jobs. At least start thinking and discussing such- options and their consequences. Do not let yourself be disabled,- fleeced and exploited by the central bank and its paper money any -longer. End your self-caused ignorance of your monetary freedom- options. If your monetary freedom remains effectively suppressed-, then at least protest, e.g. by putting signs in your shop windows-: "If a local currency could be freely issued in this community, -I would be one of the first to welcome it and readily accept it. -I do not like to be dependent upon the government's paper money, -with its inflations, deflations stagflations, credit--restrictions, sales difficulties, numerous bankruptcies and mass -unemployment as a consequence!" - Even while you are not yet free -to issue your own sound money and drive with it unsound monies out of circulation, including the government's, at least talk -about sound and alternative money options, with your neighbours,- family members, friends and acquaintances. That is more important- for you, in the long run, than talking about the weather, your- sicknesses, your kids and your favourite sports teams.  - J.Z., -22.3.93, 27.5.97.
BUY AUSTRALIAN: Australians would inevitably buy largely- Australian made goods if only they were free to issue and accept -alternative and competing local, private, cooperative and- optional currencies that are based on local goods and services- ready for sale. - A cinema owner who can pay for all his expenses- with tickets will have no trouble getting his seats "sold", simply by the -return of the tickets to him, in payment for the seats he offers for his performances. - Why bother to export anything at- all when we are only willing to buy Australian goods? - What, then, could we do with the sales proceeds from our exports? - J. Z.,- 27.9.93, 29.9.93 & 24.4.97. 8.9.02
BUY AUSTRALIAN: BUY YOUR KIDS A JOB! BUY AUSTRALIAN, -UNEMPLOYMENT & IMPORTS & MONETARY FREEDOM. - Buy your kids &- yourself a job by buying locally, Australia-wide and -internationally - with your own "Australian-made" money tokens -and clearing certificates based on your own goods, products, services and labour. The government is quite unable to manage -this Australian job, for you. - J. Z., 19.4.93. - On the contrary: It has outlawed such self-help steps! - J. Z., 6.9.02.
BUY AUSTRALIAN: This popular slogan makes sense only as an- advice to let all national and local purchasing power be directly- based upon Australian labour, services and goods, in the form of- competitively issued alternative currencies, optional and market--rated, which the issuers would merely have to convert into their- goods and services, upon demand. - As for external trading: Once Australian clearing -certificates, redeemable only in standard Australian export- goods, like wool, liquid gas, coal, wheat, meat, etc., are freely- used and accepted, to pay for imports, then, indirectly, they buy, through the- foreign buyers and consumers, Australian goods and services, when these clearing- certificates are returned to Australia in payment. They have no other value and thus will be used in this way.  - Generally,- I would say: Buy Australian goods only if they are cheaper or -better or do, for some other and personal reasons suit you more. Otherwise, buy- foreign goods that suit you. Sooner or later, even the- Australian government's paper money will return to Australia to -pay for its exports. It has not other value for foreigners. (Apart from being hoarded as "foreign exchange" in some central bank. Sooner or later most foreign governments will spend that foreign exchange reserve as well. But the time delay involved may be considerable. But then and to that extent, and for this time, Australia would actually have been able to buy and use foreign goods and services - just for the price of getting deposited in the vaults of these banks some scraps or printed paper. Thus it would have received a foreign loan, interest free, in goods and services for this period. A real disaster this! - J.Z., 8.9.02.)  So- when you buy imported goods you do buy Australian goods indirectly. -To that extent the slogan is senseless. But when your A $ is not -as much depreciated as the currency in a foreign country then -private persons there and its central bank might use it to hoard, -thus introducing a time delay, in which no corresponding demand for Australian goods and services arises. This is one of the many- defects of forced and exclusive currencies. Their hoarded notes are not easily, fast and efficiently replaced by new issues. This is already a- sufficient reason to exclude them for import payments. Private, competitively -and cooperatively issued international clearing certificates are- a good substitute for them. Professor E. Milhaud and Ulrich von- Beckerath have described their principles and practices. - Buy- Australian is just a modern version of mercantilism and of the- dogmatic statement that the own money should stay in the own- country, before the truths of Free Trade were at least somewhat- realized for a few decades. Now, with such notions, we are back to the wrongful, harmful and expensive- morass of protectionism. - J. Z., 27.7.93, 24.4.97, 8.9.02.
BUY AUSTRALIAN? The only way how buying from yourself and your -neighbours can be assured is by issuing your own exchange media as far as possible, i.e. buying as many of your requirements and- paying as many of your debts with them as possible. They would,- obviously, have no other foundation than your own readiness to- accept them in payment of your goods and services and for this- they would inevitably return to you. Buy with your own local- currencies, which only oblige you and they will inevitably return -to you in payment for your goods and services, like any other -IOU. Monetize your own goods and service supply capacity. You do- not even have to be an Australian nationalist to do so in your- own interest. As far as Australian imports are concerned: See to -it that they are paid for with competitively issued assignments -to Australian export goods and services. Then, obviously and inevitably, corresponding exports will follow these imports,- obviating your nationalistic slogan appeal. - J. Z., 27.8.95,- 19.3.97.
CANCELLATION OF SHOP CURRENCY OR OTHER CURRENCIES THAT HAVE RETURNED TO THE ISSUERS: Sound money would rather oscillate than circulate permanently. (Rare metal coins and some cheap metal money substitutes excepted, for purpose of small change.) It would be issued, frequently or constantly, as required, and frequently to constantly return in payment to the issuer. As turnover-credit money, not intended to be hoarded but to be spent, in its reflux, it might have only a limited "circulation" or oscillation period. As such, upon return it should be cancelled, rather than issued again, for the still remaining stretch of that period. To replace it by newly issued other paper currency is easy and cheap enough. This would also facilitate the control of the reflux of each series and quantity of such money that is issued. To prevent forgery (a risk greatly reduced for oscillating money with a limited circulation period and circulation are and acceptance foundation) these competing notes, too, would be consecutively numbered. The return of all numbers of a series could then be easily checked - and forged notes rapidly discovered. Whatever current issue and reflux details the issuer may want to publicize, also whatever special advertisement, he could include on each new batch of notes issued. The frequent renewal of notes would also be more hygienic than notes that have been in the hands of hundreds or thousands of people. And their texts would be more legible than that of much handled notes. For savings purposes notes with a limited circulation period could be exchanged into wanted securities.  - J.Z., 27.8.02.
CAPITAL REQUIRED FOR BANKS OF ISSUE? Banks of issue require-n either a saved up capital of their own, nor investments by -others not a guaranty capital in case of their liquidation. What -they do need is at least a leased office, office equipment a -trained staff, a printer's credit and an issue and reflux -technique and agreement on it with the local businessmen, who- provide the "cover" and "redemption fund" and "guaranty capital"- with their goods and services, which they have ready-for-sale,- and an agreement with local employees, suppliers, tradesmen -and professionals to be paid in the notes of the bank of issue,- at least as long as it stands at par with its nominal value. -Moreover, full openness of all transactions and publicity would be needed for all its issue details, in order to dispel ignorance, prejudices, distrust and slander. In other words,- monetary freedom is only possible within sufficiently enlightened- circles. - J. Z., 3/97.
CAPITAL SECURITIES VS. CLEARING CERTIFICATES: See : APHORISMS ON- THE MONEY PROBLEM.
CAPITALISM WITH & WITHOUT MONETARY FREEDOM:
CAPITALISM, LAISSEZ FAIRE, FREE ENTERPRISE, FREE MARKETS, FREE TRADE, FREEDOM OF CONTRACT, MONETARY DESPOTISM & MONETARY & FINANCIAL FREEDOM: Too many advocates of economic freedom have only a limited horizon or blinkered view of the economic freedom potential. They fix most of their attention on a few economic liberties and interventions and ignore major ones, like a free and competitive supply of exchange media and free choice of value standards, and fully free clearing rather than imposed obligations to deliver gold, silver or legal tender in payment of debts, although these are obvious alternatives to the ruling monetary despotism of today. Without monetary freedom all other economic liberties are greatly devalued. And financial freedom requires also not just some degree of deregulation and liberalisation or denationalisation but a complete freedom alternative to financial despotism: freedom to issue, free international and internal exchange rates, free transferability of all capital, absence of taxation, absence of imposed regulations, absence of monetary despotism. Under full financial freedom any normal working person in a developed country could become a multi-millionaire through his old age security savings, productively invested, credit-insured, at the highest interest rate obtainable, not subject to inflation, interest regulation, taxation, forced loans, social security levies etc. - If that fact, calculation and tabulation becomes wide enough publicised: The government prevents us from becoming millionaires, by honest labours and investments, then we will have a bloodless revolution pretty soon. - Likewise, once the hundreds of millions of unemployed come to understand that monetary despotism keeps them unemployed and that monetary freedom could provide full employment for them, within hours to days, almost every present government will be shaken in its foundations if not overthrown - unless it jumps fast on this bandwagon. - If for truths like these a proper ideas market existed already, then we could benefit from them very soon. But so far not even one in a thousand is interested in such an ideas market, even among the free marketeers! - J. Z., 4.12.85, 9.5.97.
CASH HOLDINGS, QUANTITY THEORY, CIRCULATION SPEED & A VARIETY -OF COMPETING MEANS OF PAYMENT & CLEARING: When there is a variety of different means of payment and not- everyone but only issuers and their debtors will be under- obligations to accept a particular one of them, one might come to expect that cash holdings, in a variety of exchange media, might- increase in total. But that need not be true. It would, firstly, -be counteracted by the right of refusal towards means of exchange -for which one has little or not use at all. Then there would be -those who accepted some notes only because they had a discount- and because they could rapidly spend them at the issuer for wanted goods -or services, due to the discount. -Then there is the limited circulation period of most privately -issued means of exchange, which assures their fast reflux, before -that period is expired. One would also have the option to issue -one's own exchange media and thus largely refuse to accept any or -many other currencies. Then there is the effect of the better -monies driving out the bad ones, so that only a few good ones -would survive in general circulation, those which are widely -acceptable, at least locally. - Exchange media that one would- have to keep in one's wallet for a long time, before one had an-y opportunity to use them, would rarely ever get into and get stuck in a- wallet. People can learn to distinguish between good shares and attractive girls and wallflower girls. They could also go for -bargains and sound values in currencies and avoid the rest. -- Another general effect of monetary freedom might be that cash -holdings would be reduced because money would be less scarce. -One would find it much easier to sell for payments in sound  & -competitive currencies than for monopoly money - and one could- also issue one's own or one's own clearing certificates. Credit,- on a sound value basis, would also be easier to obtain. Thus the -need for cash holdings, for emergency situations, would be reduced. Under a sound currency system most people would also be -better covered by insurance arrangements against emergencies. - -J. Z., 29.3.93, 27.5.97.
CASH PAYMENTS & GOVERNMENT ATTEMPTS TO ELIMINATE THEM: For tax-"-reasons" and in the pursuit of its drug war, governments are more -and more on the road to eliminate cash payments altogether. They wish to have all non-cash transactions becoming visible to them-, on their computers and accessible to their  form of legalized -looting. Unless we can sufficiently Privatize our computerised- exchanges, we will thus become more and more exposed to Big -Brother, his exploitation and abuses. I am in favour of our doing- away with government cash and non-cash transactions, government -taxes and subsidies, government guarantees and "insurance" -schemes, altogether, in all spheres, at least for volunteer- communities which  know and want to arrange their affairs in a -more just, non-exploitative and convenient way, one that does not- endanger them and their property and exchanges. - J. Z., 3/97.
CASH PAYMENTS VS. NON-CASH PAYMENTS. In recent years most wages -and salaries were also paid directly into bank accounts only and -spent from there via cheques and credit cards, without using- cash. Thus the proportion of cash habitually kept available, in- normal times, and formerly necessary for most wage and salary payments, becomes a smaller and smaller fraction of all the -non-cash means of payment at any particular time. When, -nevertheless, by law and juridical decisions, every debtor- remains obliged to pay in cash upon demand by a creditor, then a- large crisis factor is thereby built into the payment system,- especially a monopolised and regulated one, that would require- considerable time to provide any extra cash that is wanted and- that may even be legally prohibited from providing it. - J. Z., 3/97.
CASINO MONEY: Casino money is also possible and, to some extent,- already practised, if only to ensure honesty among a casino's -employees. So, the customers of a casino usually have to buy -first the casino's own token money before beginning their games in it and they have to redeem their winnings, if any, in-to outside money, before they leave.  Is casino money as taxed,- regulated and mismanaged as government money is? Is it ever -inflated? Is it ever deflated? Or is even a stagflation avoided- in it? - J. Z., 19.3.97.
CENTRAL BANK POLICIES TOWARDS COMPETING CURRENCY ISSUES: Survey, -country by country, with relevant legal cases cited and -abstracted.
CENTRAL BANKERS & THEIR WISDOM OR LACK OF IT REGARDING THE CAUSE- & CURE OF UNEMPLOYMENT: "Bankers wash their hands of jobless", by George Graham of the FINANCIAL TIMES in Jackson Hole,- Wyoming", taken from a column in THE AUSTRALIAN, 30.8.94, from which I- extract the following quotes which speak for themselves or,- rather, against the central bankers and their "experts": -"Central bankers from 19 countries gathered here at the weekend -at the invitation of the Federal Reserve Bank of Kansas City in- the shadow of the Grand Teton mountains to discuss unemployment- and came away with the reassuring message: it is not their -problem. A bevy of academic economists agreed that most of the- high unemployment rates in industrialised countries was -attributable to structural factors - principally the way the- Welfare State distorts an unemployed person's incentive to work -- and not to the cyclical demand factors which are within a central -bank's power to influence. - Heads nodded piously in the audience -as Paul Krugman, a professor at Stanford University, said it was- now all but universally accepted among academic economists, -though still suspect to politicians and journalists, that there -was a natural rate of unemployment. A central bank could expand- demand and push the actual rate of unemployment below that level -but only at the expense of accelerating inflation.... This is- music to the ears of most central bankers, who have long been -defending themselves against the accusation that they are buying -lower inflation at the expense of higher unemployment...."
CENTRAL BANKING & COMMUNISM, EAST & WEST: Totalitarian communism in East and West, go on and on, at least in the following forms: the monetary despotism of central banking (See point 5 of the platform of the Communist Manifesto), territorialism, taxation, welfare statism, collective decision-making on war and peace, armament and disarmament, international treaties, economic policies, migration and trade, labor, housing, roads, transport, buildings, libraries, postal services, policing, research and education.  Collectivist mass murder preparations are also very much "scientifically advanced." Their targets: the masses of the people, rather than their Big Brothers and "statesmen".  (By comparison the mass murder camps of the Nazi regime were primitive.) Dozens to hundreds of millions of people can now be murdered by "great leaders" and button pushers in minutes to hours, largely in automated ways. And such powers are hardly questioned at all . To that extent communism hasn't fallen but gained an almost universal victory over public opinion, public actions and public institutions. Naturally, all the problems inevitably associated with these communistic institutions go on and on. - J.Z., 26.8.91, 24.8.02.
CENTRAL BANKING & FORGERIES: The central banks print more of -their depreciating currencies, because their issue monopoly and - legal tender power allows them to do so, than all the criminal- forgers in their countries do. Alas, they can't be accused of -forgeries since one can hardly forge one's own notes. But they do -certainly operate under false pretences, namely their pretended- willingness and ability to prevent deflations, inflations and stagflations. Central banks also pretend to be able to help governments out of their -financial difficulties without depreciating their forced and -exclusive currencies. - J. Z., 8.11.92 & 15.4.97.
CENTRAL BANKING & INTEREST RATE POLICIES : Central bankers, other -bankers, financial journalist and economists nowadays and as a -rule to not seem to be able to think of and propose anything -better than putting the interest rate or our despotic monopoly -money either a few notches up or down. - J. Z., 3.10.96.
CENTRAL BANKING & ITS FALLACIES: I would like to see a book -written with this or a similar title, including the best refutations of these -fallacies so far found. For easier recognition and referencing these fallacies should perhaps not only be alphabetized under- catchwords and indexed and cross-referenced but also be numbered. -I would welcome any such manuscripts or essays or drafts of them- for microfiching in my series. The ultimate book on this subject- would have to result from collaboration. For no one has access to- all the monetary freedom writings - or would have time to read -them and extract them sufficiently. The literature on monetary -despotism, defending it or regarding it as self-evident or -beneficial, is much more plentiful than the rich literature on- monetary freedom (largely hidden from public view). When I- looked for writings on central and free banking at the State Library of NSW, back in 1959 or 1960, I found ca. 400, a -bookshelf full, discussing approvingly only central banking and- no work critical of it at all. Then I thought that I might get- around to extract their main arguments systematically and to have -the time, energy and knowledge to gradually refute most of them.- Now I know better. Each individual, even with the best of will,- can only do so much. If I had tried this task on my own, to the- exclusion of any other, I might have only provided another- Don-Quichote fight against the wings of a windmill. - J. Z., -8.4.97.
CENTRAL BANKING & LEGAL TENDER, FORCED CURRENCY, MONEY MONOPOLY: By legalizing the monopoly and coercive powers of the central bank we have given the government a blank cheque drawn on our earnings and our property, in form of its legal tender (compulsory acceptance and compulsory value) paper money or requisitioning certificates or forced currency. It amounts to a camouflaged tribute system because it is not recognized as such by the majority of the population, persuaded that the central bank would be for the common good.
CENTRAL BANKING & MONETARY DESPOTISM: "Under government- patronage the monetary system has grown to great complexity (*), but- so little private experimentation and selection among alternative -means has ever been permitted that we still do not quite know what -good money would be - or how good it could be. (**) Nor is such- interference and monopoly a recent creation: it occurred almost- as soon as coinage was adopted as a generally accepted medium of- exchange. Though an indispensable requirement for the functioning- of an extensive order of cooperation of free people, money has -almost from its first appearance been so shamelessly abused by -governments that it has become the prime source of disturbance of -all self-ordering processes in the extended order of human cooperation. The history of government management of money has, -except for a few short happy periods, been one of incessant fraud -and deception. In this respect, governments have proved far more -immoral than any private agency supplying distinct kinds of money -in competition possibly could have been. I have suggested- elsewhere, and will not argue again here, that the market economy- might well be better able to develop its potentialities if government monopoly of money were abolished." (Hayek, 1776/78,- and 1986: 8-10.) - HAYEK, F. A., The Fatal Conceit, 103/104. - (*)- This complexity is built upon simple despotic foundations: Note- issue monopoly & forced acceptance and forced value or legal -tender for the notes. The rest is more or less only -window-dressing and false pretences. - (**) Illegally numerous -monetary experiments have taken place. But precisely because they -were not legal and not supported by most scholars, they did not last long enough and the records of- these experiments are rather incomplete. Moreover, they were -never fully gathered together, translated into the major- languages and then fully explored theoretically. But scholars -like Ulrich von Beckerath, in a life-long effort, have come as- close to such an exploration and to sound theoretical -conclusions based upon them, as an individual, largely on his- own, could. - J. Z., 27.5.97.
CENTRAL BANKING & NATIONAL INDEPENDENCE: National independence -does not mean e.g. a national central bank or currency board but, rather, the independence of a nation and of all its citizens from -any central bank and any other centralistic, monopolistic,- despotic and territorial institutions. - J. Z., 5.9.92, 22.4.97.
CENTRAL BANKING & THE MONEY ISSUE MONOPOLY AND LEGAL TENDER -POWER: If the central banking system and its paper money were -really so efficient and popular as the government presumes it to- be then it would not need any monopoly and regulatory powers nor- any legal tender power to achieve a ready acceptance of its paper -money. - Then it could also continue on and on, at the risk and -expense of voluntary victims only, as many churches and sects did -and do. - J. Z., 26.3.93, 27.5.97.
CENTRAL BANKING & THE REDUCTION OF ITS FORCED & EXCLUSIVE- CURRENCY TO A COMPETITIVE & OPTIONAL TAX FOUNDATION MONEY ONLY-: How fast would the central bank's forced and monopolised- currency disappear or become reduced to a relatively harmless and- even (to the tax slaves) somewhat helpful tax foundation money- (while these tribute payments are still tolerated), once it- were subjected to free competition from several sound, private -and alternative currencies that are optional and market rated- against sound alternative value standards, freely chosen, too?- How fast could the State paper money be abolished or so reduced?- - Almost overnight, if this monetary revolution is well thought- out and prepared by enough people. The sooner the better. - J. Z.,-19.8.92., 23.4.97.
CENTRAL BANKING : It is absurd to speak of a free market, free- enterprise, free competition, free exchange, free trade, under -the monetary despotism of a central bank and its exclusive and- forced legal tender currency, not to speak of the other privileges and powers granted to it. - J. Z., 23.9.92, 14.4.97, 6.9.02.
CENTRAL BANKING DECENTRALIZATION: Somewhat decentralized central banking is still central banking and not free banking. - J.Z., 26.8.91. - Classical instance: The Federal Reserve System of the U.S. - Some have misread the FED so far that they think it is a private & capitalistic bank. Some still remain unaware of its legal tender and of its monopoly power, although they have handled its money often enough and have experienced the result of its actions. The Federal Reserve Act of 1913 and all its amendments, is so badly publicized that I have come across a copy of it only once, in the hands of a Social Credit advocate. The issue monopoly clause of it was so well hidden that I could not find it in a hurry. That may have been intentional or the result of the usual bureaucratic bungling even in drafting legislation. - J.Z., 26.8.02.
CENTRAL BANKING, ACCOUNTS OF OUTLAWED GROUPS: Somewhere and some- years ago I found a hint that a central bank has been instructed- to stop payments of the accounts of all outlawed groups. Thus, -merely by one of an avalanche of interventionist laws, which no -one has the time to fully peruse, any group could be outlawed and -its bank accounts confiscated. The abuse potential of this power -against political opponents is immense. Are ordinary criminals,- who committed crimes of violence, treated as severely? Are- criminals in office so treated? - J. Z., 1.5.97.
CENTRAL BANKING, CENTRALISM, MONOPOLISM, THE POWER OF IT : The most important, centralistic and monopolistic economic institution of the Australian Federal Government is its Reserve Bank. - We want to break its stranglehold on the economy - not by destroying it but by depriving it of its privileges and powers, by introducing free and decentralised competition against it. Thereby we could overcome the depression, unemployment and inflation it has caused. - Try exchanging without money and you will soon find out how large your dependency on the central bank and its exclusive currency has become. - Allow any employer to offer, in payment of wages and any employee to accept any other exchange medium that is agreeable to him. Do not force both to deal only in a monopolistic and also rapidly deteriorating and otherwise mismanaged exchange medium and value standard. Let's have the exchange media as competitively supplied as knives and forks are - and we will have no shortage of them, either. - With sufficient sound exchange media, sound value reckoning, free pricing and when no job or trade is closed to anyone by any monopolies, then unemployment could be done away with within hours to days in almost all cases - by people who understand and are free to apply the monetary freedom techniques. - J. Z., 1985.
CENTRAL BANKING, COMMUNISM, VOLUNTARISM, PANARCHISM, MONETARY FREEDOM: The communist central banking system, as well as the communist system as a whole, like any other system or belief-construct, should be confined to volunteers only and that requires exterritorial autonomy or experimental freedom for all communities. - J.Z., 23.9.99, 24.8.02.
CENTRAL BANKING, EURO-CURRENCY, WORLD BANKING, INTERNATIONAL- MONETARY FUND (IMF) & MARXISM, COMMUNISM, STATE SOCIALISM OR STATE- CAPITALISM, MONOPOLISM & ANTI-MONOPOLISM: Central Banking, in -its national, Euro-currency and World Banking ideas and practices, exemplifies of the central Marxist error that to defeat "monopolies"- (usually quite wrongly defined) you ought to establish,- instead, a nation-wide, European or even world-wide monopoly,- rather than abolish all monopolies and introduce free- competition for all productive, creative and free exchange- activities. - J. Z., 14.8.89, 29.4.97.
CENTRAL BANKING, INFLATION, PAPER MONEY, RESERVE BANK OF AUSTRALIA, AUSTRALIAN DOLLAR AGAINST US DOLLAR: How much longer will it take "our" official "guardian" of "our" currency to reduce the value of the A $ to 1 cents in U.S. currency? It has already brought the value of the Australian dollar down to 47 US cents. And that comparison does not even take into account how much the US $ has been depreciated in the meantime, by the same method and kind of institution. Against the former value of the US $ the A $ may already be down to 1 US cent! - J.Z,, 1/10/01, 27.8.02.
CENTRAL BANKING, INFLATIONS & PRICE DEVELOPMENTS: Central banks are destroyers of the values of their currencies. Just compare the price history. - J.Z., 31.3.02.
CENTRAL BANKING, LEGAL TENDER & ISSUE MONOPOLY: Was there ever a- large-scale and persistent paper money inflation, inflating the -whole price and wage level, without these three pre-conditions?- Economists and historians should be able and willing to check -these relationships out. If the finding is that there was not and there cannot be such an inflation, by the very nature of monetary- exchanges under freedom, then these findings should be publicised- and lead to resistance against monetary despotism. - J. Z., -15.4.97. - Can they really call themselves economists and historians if they do not engage in such surveys?
CENTRAL BANKING, LENIN & COMMUNISM: Lenin knew it. He said that- establishing a central bank was 90% of taking over a country. - -James P. Hogan, Mirror Maze, 315.
CENTRAL BANKING, MONETARY EXPERIMENTATION, DEVELOPMENT & FREEDOM: -"Like morality, law, language, and biological organisms, monetary- institutions result from spontaneous order - and are similarly susceptible to variation and selection. Yet monetary institutions- turn out to be the least satisfactorily developed of all- spontaneously grown formations. Few will, for example, dare to- claim that their functioning has improved during the last seventy- years or so, since what has been an essentially automatic- mechanism based on an international metallic standard was -replaced, under the guidance of experts, by deliberate national -'monetary policies'. Indeed, humankind's experiences with money- have given good reason for distrusting it, but not for the reasons commonly supposed. RATHER, THE SELECTIVE PROCESSES ARE -INTERFERED WITH HERE MORE THAN ANYWHERE ELSE: SELECTION BY -EVOLUTION IS PREVENTED BY GOVERNMENT MONOPOLIES THAT MAKE- COMPETITIVE EXPERIMENTATION IMPOSSIBLE." - HAYEK, F. A., The Fatal -Conceit, 103/104. - Alas, government interventionism with -exchange media, clearing and value standard had begun, many -centuries before. Hayek admits this in his next paragraph. They -have, in almost every sphere, prevented or suppressed spontaneous- development into the best forms possible for particular times,- people and circumstances. For instance, the intervention with- "truck" payments went on in Europe for ca. 500 years and did not -permit them to develop beyond some primitive and still very -inconvenient forms. However, even these were often the only- "payment means" that employees could readily offer and neither the -employers nor the employees cared much then - or now, about how- such private payment options could be greatly improved and made even very attractive, superior to the coins of the realm or the- paper monies of central banks. - J. Z., 27.5.97.
CENTRAL BANKING, MONEY DEPRECIATION, "GUARDIANS" OF THE CURRENCY: Central banks are not "guarding" their nationalized paper money currency against depreciation but, thanks to their monopoly and legal tender coercive power, they are systematically and regularly depreciating them - while suppressing any competition against their misrule and abuses. - J.Z., 28.4.02.
CENTRAL BANKING, MONEY DEPRECIATION, CENTRAL BANKING POWERS &- ACTIONS: How, when, how often, by what means and why, do central- banks, not private forgers or issuers or "creators" of money, depreciate national currencies? Do they report all the relevant -facts and powers and consequences to the general public? Do they- promote monetary enlightenment and emancipation or, rather, -monetary ignorance, prejudices, myths and outright lies? - J. Z.,-8.11.92, 15.4.97.
CENTRAL BANKING, MONEY MONOPOLY, MONETARY DESPOTISM, GOVERNMENT,- TRUST & CONFIDENCE: A currency entrusted to any government is -usually as good as lost. - J. Z., 27.1.93.
CENTRAL BANKING, NOTE ISSUE MONOPOLY, REFLUX: Using  a central bank's banknotes it is often easy to get credit paid in them - but hard to pay it back because these notes, once spent, do not return automatically to the spender. E.g., tax collectors and other users, in other localities and industries do "waylay" them. Trade becomes a struggle for a scarce exclusive currency that is well supplied only in those channels favoured by the central bank system and governments spending its notes after first extracting them from almost everyone or simply printing them. Self-issued notes or notes locally issued in association with others would return to the issuer or issuers, soon. - J. Z., 13.5.87, 9.5.97, 13.9.02.
CENTRAL BANKING, REDUCTION OR INCREASE IN UNEMPLOYMENT BENEFITS, -THEIR TRANSFORMATION FROM GIFTS INTO CREDITS & THE DEGREE OF -UNEMPLOYMENT: The Reserve Bank (central bank of Australia) -proposed to reduce unemployment benefits in order to reduce- unemployment. While it is true that one can get almost any degree- of unemployment that one is able and willing to pay for, the abolition of involuntary unemployment, in total, should remain- the aim. But, the central bank is the main culprit with regard to -unemployment although subsidies, price controls, wage controls, -coercive unionism, collective bargaining, etc., do also play a -role here. Typically, the Reserve Bank did not propose the -reduction or abolition of its monopoly, privileges and regulatory -powers, as means towards the abolition of unemployment. Most of -its directors and employees probably still imagine that it could- reduce rather than cause and increase unemployment. Nor did it- propose the transformation of the unemployment benefits from- gifts into credits, a thought which ought not to be way-out for -any bank. But then only the central banks have access to the note- printing presses for their exclusive and forced currency. With -that power, they do not seriously consider the alternative of- permitting employers to pay and employees to be paid in- alternative and competing currencies. - To sort out the moochers from the genuinely unemployed, I would rather propose an -increase in unemployment benefits but, at the same time, make -them repayable by the unemployed, even if he might have to sell -his house and car for this purpose. Moreover, he should see to it -that his family members and friends do guaranty his repayment, if -necessary. That will tend to spur them into accepting almost any -job they can get and looking for any job opening. That would also induce them to accept lower wages or salaries. But it would- still not suffice to induce most of them to ponder monetary and- financial freedom as the main cure for unemployment. With the -gambling spirit probably still rather large among the unemployed, -too, perhaps it might be worthwhile to get them involved in a- prize competition for the best ideas, not so far refuted in- literature and practice, to end unemployment. Let them seriously- search for such ideas and practices. Let us say that there are 1- million unemployed in Australia (there may be, governments tend- to understate the case). Then, if every unemployed just -contributed 1 dollar a month, there could be monthly prizes- of 1 million for the best idea of the month. The scheme could- even be judged by the unemployed themselves, voting on each- scheme, with its pro and con, as compiled by them. To simplify -the voting process, one could use the jury system. 12 of them- would have to agree, unanimously, on the best proposal for the- month. Such jury sessions should be publicised as much as -possible. Let the finding and proving the cure for unemployment -be the job, as far as possible, of the unemployed themselves -- and of anyone really interested in this question. - The news on -the Reserve Bank proposal was aired on radio news on 13 Dec.-1993. - J. Z., 23.4.97. - I may be the only surviving member of -the Berlin Society of 1952 to Fight the Causes of Unemployment. -It had much to say on this subject which is new still to most- people, even to those who consider themselves to be experts on -this subject. See the details in my  PEACE PLANS series, all on- microfiche. - J. Z. - Later I suggested somewhere that half of the money so collected should be used for the prize money for the best proposal and the other half for the collection, ordering and publishing of all these ideas and opinions in the cheapest media, e.g. on microfiche, floppy disks and CD-ROMs, even paying some of the unemployed for full-time work on this library, archiving, editing and publishing project. As Ulrich von Beckerath frequently remarked: Combined purchasing power is one of the greatest and also one of the least utilised forces in the world. - J. Z., 7.9.02.
CENTRAL BANKING: "Small is beautiful, wrote Prof. Schumacher, and -by this three-word aphorism, acquired more fame than by his big -books. Cannot our politicians and economists see that the -principle applies to banks as well? When this truth glimmers in on -them, they may discover that it was state interference that gave -us bank monopoly, and so gave rise to all the other monopolies." - -Henry Meulen, THE INDIVIDUALIST, 6/78, p. 27. - See: -DECENTRALISATION, MONEY MONOPOLY, NOTE ISSUE MONOPOLY.
CENTRAL BANKING: A central bank, like a monarchy or a monopoly -post office, may, sometimes, be reasonably well run for a while,- within its inherent limitations. However, in the long run and for -most cases and times, it is a recipe for planned or unintended disasters. -- See e.g. Kurt Schuler's writing on the Currency Board version of- a central bank and Prof. Heinrich Rittershausen's attempt to make -the best of this evil through his teachings in his work: Die -Zentralnotenbank. - J. Z., 30.8.93.
CENTRAL BANKING: An engine for inflation and mass unemployment- and trade depressions and one that often manages to combine both,- inflation and deflation, to "achieve" stagflation. - But- legislated into power and upheld by monetary prejudices, it -remains in force to dispense its wrongs and evils, in all -countries. - J. Z., 10.2.93, 14.4.97.
CENTRAL BANKING: Central banking is the Golden Calf worship of -today. It offers no benefits but only disasters. But when has -that ever deterred any worshippers anywhere? - J. Z., 29.12.92.- - See: MONETARY RELIGION, MONETARY DESPOTISM.
CENTRAL BANKING: Do nothing, be nothing & dissolution are the -best 3 policies for any central bank. However, they still have- some penalty lessons to teach to their VOLUNTARY victims and we- should give them that chance. - J. Z., 7.4.94, 24.4.97.
CENTRAL BANKING: It is based on self-interest of governments,- that of politicians, bureaucrats and their lobbyist favourites, -very contrary to the public interest. Otherwise the victims would- not put up with its powers, monopoly, coercion, meddling, fraud -and false pretences. It is the most powerful economic institution -in every country. However, since it is legalized and has a whole -statist faith as its backing, it goes on and on and is not judged -on its merits or rather demerits but upon the utopian and State- socialistic dreams that are involved in it. To this faith it does- not matter that almost all facts speak against it, since central -banking was established. It even allows totalitarians like Lenin -to gain power and maintain themselves in power. It even allowed a -madman like the German emperor Wilhelm II to start and continue WW -I and allowed Hitler to finance WW II. - Nevertheless, we are not -supposed to criticise this "holy" institutions and to try to -replace it by free, cooperative and competitive ones. Nay, rather -have WW III & IV & V and more totalitarian regimes for further- decades. That, in the minds of most people, seems easier to bear -than the job of tackling the problems created by monetary despotism and studying the -solutions of monetary freedom. - If I were a visiting alien and- looked at this all too wide-spread mentality, I could understand- if such an alien would say to himself: I have the power to wipe out- this insect pest on Earth - why shouldn't I use it? Perhaps,- after a few million years, the cockroaches or butterflies might -turn into something better! - J. Z., 19.8.92, 23.4.97. - But then this would apply "collective responsibility" on an even larger scale than the present war on "Iraq" does, rather than holding Saddam Hussein individually responsible for his government's actions. For the latter approach one does not need any large military forces or any war. - J.Z., 7.9.02.
CENTRAL BANKING: National central banks have led to as many- disappointments as national governments have, national post- offices, national railways and national roads. Have any -nationalised industries been successful under their motto: "Not- for profit but for use"? Have they achieved consumer satisfaction -at less than market prices? Their subsidised prices should not be -quoted here - without adding the subsidies that are involved. -How many centuries of central bank failures do we have to suffer- under before we finally abolish central banks? Price controls- were tried, again and again, quite in vain, for 4,000 years. So -were inflationary and deflationary policies by monetary- despotism. One feature, the suppression of all kinds of truck--payments and truck payment notes, was applied over at least 4- centuries and in emergencies, caused by the government's monetary- despotism and in spite of numerous legal and juridical- prohibitions, employers and employees had to resort to this -self-help means again and again. - If politicians, their experts- and the whole community will not learn sufficiently from such -failures, then at least we should set free all the minorities of- people who believe that they have and can apply a better system,- at their own expense and risk. We should grant them the same -experimental freedom that we grant to scientists, artists, -technicians, biologists, agriculturists etc. Otherwise monetary -science and practice will stagnate under the rule of monetary -despotism, possibly for further centuries, if not thousands of- years. - J. Z., 19.8.92, 23.4.97.
CENTRAL BANKING: The central bank, through its issue monopoly -and legal tender power, has coercively and parasitically inserted- itself as a third party into almost every economic transaction, -exploits almost all of us to its own advantage and at the expense -of our rights, liberties, security, property and earnings, -keeping the economy unbalanced, throwing it from one crisis into -another and provides us only with the illusion that a uniform- currency would be a great benefit for us, and the illusion that -it and only it could manage to provide a sound currency, although -it has never delivered one so far but has destabilised the- monetary system as much as possible. This system is legally -upheld, no matter how wrong,  mismanaged and uneconomic it is for- the whole economy and each of its participants. Those in charge -of it seem to have adopted the motto of a French king before the -French Revolution: "L'etat, c'est moi!" and: "Apres nous la- deluge!" (I am the State! - The great flood will come - but only- after me!) -That any person with great powers could become so- corrupted and conceited is humanly understandable. But that- people and even scholars put up with this, not only for years but -for decades, for generations, is not as comprehensible. Most -totalitarian regimes have by now been overthrown. The rest might follow, soon. However, we have established and retained their -most totalitarian institution  everywhere, even in the supposedly- free West! - I, too, am human, but this is all too inhumane and- alien to me. - J. Z., 18.4.93, 2.5.97.
CENTRAL BANKING: The management of money has not improved its- quality. - Sir Ernest Benn, The State the Enemy, cover. - He- should have said: Centralised and coercive management. He might- have added: It has not managed to provide the correct but for- each day fluctuating required quantities, either. Instead, it -over-supplied or under-supplied its exclusive and forced- currency for all too long, almost as a rule. - J. Z., n.d. &-15.4.97.
CENTRAL BANKING: The very cheek of the central banks of- governments, forcing themselves as a monopoly mediators into every -monetary exchange transaction and into every value standard -measurement within a country and this with a very inferior and- fast depreciating means of exchange and a rubber band and- manipulated value standard that is close to the worst of all- which have ever been imagined and practised. And with all this -they still pretend to be able and willing to sufficiently supply- the market with exchange media and with a sound currency. It is -like a highwayman monopolising crime in a country and then- pretending to be a crime fighter. Could anyone possibly have- accumulated more disqualifications for the job of supplying a sound value standard and sufficient exchange media, than have the- central banks, in every country? - J. Z., 19.8.92, 23.4.97.
CENTRAL BANKING: There is not a single good reason to confine -monetary, clearing or credit competition or cooperative -credit and monetary arrangements to international competition- between central banks, their exclusive and forced currencies, for- whole national territories and their exclusive and enforced paper -"standards" only. That is like considering politics only from the -point of view of despotism and economics only from that of -command economies. Those with as limited horizons should only be- free to limit their own horizons and actions within their own- limited spheres  and associations, not the horizons and actions of others who do -leave them alone. - J. Z., 18.3.97.
CENTRAL BANKS & COMMUNISM, CENTRAL COMMITTEES OF DIRIGISM OR THE CENTRALLY PLANNED & MISMANAGED ECONOMY: Economically, the central banks are the worst central committees of the communist movement. - J.Z., 5.8.91.
CENTRAL BANKS AS "GUARDIANS" OF GOVERNMENTAL PAPER CURRENCIES: The governments' central banks are reducing the value of their paper currencies almost all the time (at different rates), although they are supposed to guard their currencies against depreciation. - J.Z., 20.12.01. - As usual, governments achieve the opposite of what they aimed to achieve by their legislation, "measures" and "policies". In addition, central banking has achieved and maintained large degrees of involuntary unemployment over long periods and the persistence of some involuntary unemployment even during its "boom" periods. It has made all economic crises worse. It has also prevented the ending and prevention of depressions, deflations and inflations by the self-help methods of monetary freedom. Regarding financial freedom and at least in countries like Germany, it has also outlawed value-preserving clauses or made them conditional upon permissions granted by the central bank, which are almost never granted. However, the customary, traditional or legislated exclusive currency condition of metallic currencies, and of metallic redemption currencies and lack of clearing knowledge, techniques and facilities, had also caused frequent and persistent deflations before central banking arose to its present dominant position. - J.Z., 26.8.02.
CENTRAL BANKS, INFLATIONS, DEFLATIONS & STAGFLATIONS: Is there- any central bank that has existed for several years or decades,- and that has not yet caused inflations, deflations and- stagflations several times - while blaming others for its actions- and their consequences? - J. Z., 19.8.92, 23.4.97.
CENTRAL BANKS, UNABLE TO FULFIL THEIR SUPPOSED FUNCTION OR ROLE: -Central banks do not know and cannot do anything better than- fluctuate, almost constantly, between inflation, deflation and- stagflation. Having removed competition and market rating and- full publicity for their issues and practices (compare- especially their secrecy on the date and extent of planned -devaluations), they are thrown back to fiscal policies, open- market sales or purchases of securities, the insecurity of- government securities, enforced claims upon the holdings of other- banks, legal tender and their monopoly position, the observance- of foreign exchange rates, and their stock of redemption funds -in rare metals, securities, insecurities and foreign exchange) -and the regulatory power they have over the interest and discount- rate, to more or less mismange the exclusive and forced currency- entrusted to them. Almost all of them can point out only to- decades of mismanagement, due to misjudgments and to their- failures to attain stable currencies, a booming economy and full- employment. A few have managed to keep their deflations, inflations and stagflations within bounds, for a few years, one- never knows for how long they can manage to do so. And, even in -these cases, monetary freedom would have supplied rightful and- better monetary services. Thus one would expect sufficiently -enlightened victims of this system - if they can be bothered to- take an interest in it and to study it and alternatives to it, to -ignore, outlaw or overthrow this despotic and harmful regime. -Except a few of its directors and employees, we are all wronged -and harmed by it. But it does do well enough by them. - J. Z., 2.8.94,-17.4.97.
CENTRAL BANKS, UNEMPLOYMENT, SALES DIFFICULTIES, DEPRESSIONS: The central banks are so useless that they cannot even make use of all willing and available labor and skills, of all the services and goods offered for sale, of all the machines, workshops and offices available for productive efforts, not even for 8 hours a day, far less for 24 hours a day. - Instead, in their helplessness, ignorance and prejudices, the juggle with interest rates, play with selling or buying securities and offer promises, while almost continuously, apart from their credit restrictions, depreciating their paper money currency. In the absence of free market rating for their paper money against a sound value standard, of well run tax foundation for their cash and of and optional acceptance and of competing internal currencies, they do not know how much more or less to issue of their forced currency and where and when they ought to do so.  - Nor are they able and willing to systematically study the alternatives to their own rule, although, surprisingly, some of their employees have managed to publish some papers on free banking in some of their periodicals.  So, at least, not all of them do systematically suppress all freedom of expression and information in this sphere. But under the present conditions of monetary immaturity, from top to bottom, they do not have to do so, either, to maintain themselves in power. -  However, one can also charge most opponents central banking with having insufficiently studied the alternatives to it. -  J.Z., 22.4.01, 24.8.02.
CENTRAL BANKS. SHOULD THEY BE ABOLISHED OR DESTROYED? Maybe the- Tamil Tiger terrorists of Ceylon are not so dumb as most other -terrorists tend to be? According to ABC radio news on 1 Feb. 96, -suicide bombers attacked the central bank in Colombo, Ceylon.- Alas, in their attack ca. 100 people were killed. A night time- raid, preceded by a warning, might not have cost any lives. There -was no report on how much the bank and its ability to function- were destroyed. No such raid would be as helpful as private and -cooperative note issues could be - and refusals to accept the -central bank's currency any longer. - J. Z., 1/2/95.
CENTRAL BANKS: Central banks for communists and other central bank adherents only: They deserve to get what they want, in self-inflicted punishment. - J.Z., 27.5.01, 26.8.02.
CHEAP MONEY: The cheap money of monetary freedom is different- from the cheap money of monetary despotism. It would not and- could not lead to inflation and unjustified economic investments.-- J. Z., 1.12.96. Its production and acquisition would be cheap. -It would be relatively cheap to get it accepted in your local -community. And it would have a cheap, easy and fast reflux to -you, for its redemption into the goods and services that are the basis of your issues. You would not have to pay a monopoly -interest rate for exclusive and forced exchange media provided by -a monopolistic and coercive central bank. Your own money would be- cheaper and better for your purposes and those of your customers.- - J. Z., 20.3.97.
CHEAP MONEY: To attack some monies as "cheap" money is a rather -cheap attack. Neither cheapness nor expensiveness is decisive for -money but, rather, its usefulness, soundness, competitiveness,- free market rating for it, refusability, discountability,- availability or unavailability, the ability or inability to supply- it oneself or in association with others, its acceptability to- sovereign consumers, at least locally, e.g. in wage payments., and, quite basically, its rightfulness or honesty, its degree of "optionality" or "voluntarism" or "free choice" or "competition", as opposed to coercion, intolerance and despotism. -Indeed, some alternative currencies, that CAN be as good as gold- coins, although not convertible into gold coins by the issuer but -only on the free gold market, are cheap to produce, compared with- gold coins and gold certificates. But that does not turn them -into cheap and nasty money. Indeed, central banks that can pump -their forced and exclusive currency into circulation, almost -without limits, will find their paper currency cheap to produce- and circulate - until the last stages of the inflations they do -so cause or until other effects of inflation begin to matter considerably, e.g. the results of price controls -and rationing, the cessation of credits on a paper money basis, and finally even the severely increased printing costs for the notes-. To that extent its "cheap" money can very often- become very expensive for a government. It might even be overthrown, if not immediately, by a crackpot like Hitler & Co,- who tried it in 1923, but, largely as a result of this inflation-- and the subsequent monetary crisis of the Great depression, by -the same crackpot dictator, 10 years later. Money that is very -expensive to obtain and with which an economy cannot be fully- supplied, can reduce that economy to degrees of barter and to -emergency sales prices. In such situations, and until normal- marketing conditions for goods, services and labour are restored, -the availability of some form of cheap money, even if it is not- ideal money, would be widely welcomed. But governments in such- situations make neither the own exclusive currency sufficiently -accessible nor do they permit or encourage unofficial competitive- supplies. (On the contrary, in the last years of the Weimar Republic the suppression of alternative currencies reached new heights in legal and juridical comprehensiveness.) Once the "cheap" (despotic) money of monetary despotism has- expropriated creditors (including all wage and salary and- pension recipients) by the millions, a rather costly treatment -for them, the value of that currency will finally come close to- zero and to total refusal to accept it. Already in the meantime- many people will resort largely to primitive barter. - The money of -monetary freedom is physically cheap to produce, too. Only some -forms of it are believed, by their supporters, to require gold- treasures, circulating gold coins and convertibility into gold. Others can do- without that, even while continuing gold weight reckoning and would thus be much cheaper to provide. The cheapness of aluminium- via modern production methods has not made it valueless but much -more widely useful and used. - One should also distinguish between the low -production costs and high production costs of money tokens and -low and high purchasing power of them. Low production costs for -monetary freedom issues do not mean that they have to have a low- purchasing power. And high production costs of notes during a -galloping inflation does not meant that they do have a high- purchasing power, even though their denominations are very high.- The largest German RM note of 1923 was 100 billion RM, worth then- only ca. 7 pounds sterling. Poor people, with a few dollars or -pounds, could then live in luxury in Germany, although their -foreign exchange paper money was also very cheaply produced. - In- general, the mere production costs of sound exchange media should- be as low as possible and their purchasing power should be as -high and stable as possible. - J. Z., 13.1.94, 1.5.97.
CHEQUES FOR CLEARING ONLY: They do not have to be covered by -legal tender savings or deposits or gold or silver reserves and -do not have to be redeemed in any rare metal. It is enough if -they are useful enough for clearing settlements, i.e. if the -cheque account holder gets enough credits written into his cheque- account from the sales of his goods, services or labour, which -here, too, form the real cover for the value of his cheques.- Without them his cheque account would soon run red. - J. Z., 3/97.
CHEVALIER, MICHAEL, French economist who opposed the note issue monopoly - according to Rist.
CHILD LABOUR, CHILD LABOUR LAW, UNEMPLOYMENT & MONETARY FREEDOM: -Child labour, voluntary and unexploited, should be part of a- child's learning process and could make a child financially independent of its parents at an early stage, which would help to avoid much -friction and frustrations between the generations and also among parents in nuclear families. When -unemployment is wide-spread then children and juveniles are kept out of the labour -market by compulsory schooling and "protective" child labour -laws, like minimum wages, set about the market level for their work contributions. (In the average case, not in individual cases. Under freedom of contract for wages many able and willing young people could earn much more than their present minimum wage. But now neither they nor their employers are given the chance to find out how productive they can be.) When labour is still very unproductive and insufficiently- supplied with capital and also forced to be sold only for a -forced and exclusive currency, then the income of a family was- often insufficient and so the children had to be sent work to -work. Now they are not allowed to and their time is taken up by -compulsory school attendance and imposed homework so that for much of the rest of the time they try to escape into games, entertainment and play. (Just like adults, who are bored or stressed by their job situations.) Neither of these are- very educational and a good substitute for giving children the -chance to become early-on involved in various self-supporting -labours that are self-chosen and naturally educational. Under full employment they could change their jobs every -week, if they wanted to, to give them a more varied although not a- very deep experience with them - but they might find their true vocation in- this way. That they should no be exposed to great risk to life, -limb and health is self-evident. Parents and guardians should- have a veto there. Under monetary and financial freedom parents would, as a rule, be able to earn enough to support their- children and they would remain their guarantors and guardians and- not forced, by their poverty to send their children to go to work just to earn -enough money to help support the family. Most would see the value- of unforced labour for their children. Moreover, then there would- be many more part-time jobs. A few hours of work a day and some- days a week is more bearable for them than 40 hours or more a- week. Furthermore, upbringing and education loans would be much- easier to obtain and easier to repay later, by the parents or the- children or both.  One child charity asks currently for $ 1 a day -to support a child in an underdeveloped country. I feel certain -that FREE children, ECONOMICALLY FREE, and that would also require full monetary and financial freedom, would be able to earn much more than $ 1 in no more than- 1-4 hours of daily work, if allowed to do so and most of them- would tend to learn more from this than they do now in schools (in their "12 year sentences"). At -the same time, competing schools and education systems, could be -made much more attractive for them, give them a choice and their -lessons could also be paid for by the children themselves, so low could they be, if they were- organized e.g. under the monitor system of Joseph Lancaster. High -school and university students, being already literate (only somewhat literate, under present  government schooling), would find it much easier to support themselves through part-time work,- with chosen stretches of full time work between stretches of full- time studies. Learning is more and more becoming a life-long -process, anyhow, for all, since the job skills and knowledge -required are continuously changing, too. The fixed, long and compulsory school years are a form of unjustified enslavement for- children and one of the major causes of juvenile delinquency, -escape into drugs and alcohol, mind-numbing and hearing-damaging -music and of unnatural friction between children and parents. It -also does most children good when they are not only disciplined- by parents and teachers but by job, trade and market requirements,- as spenders of their self-earned money etc., becoming as early as- possible self-responsible instead of delaying that more and more.- How many of them are e.g. killed on the road, because the driving- option was withheld from them until they were almost 17? I would -like to see a statistics comparing country children, who often- drive tractors etc. on their parents farms, much earlier, with -the driving records of city children, forcefully kept from- driving until almost 17. For any suppression of natural urges -there is always a price to be paid. Their internal control and naturally learned self-control is- much more preferable then the controls imposed by compulsory school attendance and government run or regulated schools. - 4.5.97. - J. Z., 13.9.02.
CHILD LABOUR: Why are most kids not productive most of the time? -Because we are prepared to subsidize their idleness, although- there would be plenty of jobs for them in house and garden,- industry, business and agriculture, all voluntary, part time, -market rated, if all restrictions upon their creative and -productive activities, including taxation, licensing, labour -laws, wage controls etc., were abolished. Only their guardians -should be free to set rightful limits upon their activities. - J. Z., 16.3.97.
CHILDREN AS FREE BANKERS?  To what extent would they be immune -from the penalties for infringing the money monopoly that would -fall upon adults?  Could they be penalised at all? Would their parents be? Could children be -trained for such freedom actions? (That would certainly be more rightful and useful than training them in the use of automatic weapons, as some regimes do. -  J. Z., 10.9.02.) Would they be interested enough -to try? - One should try to write a primer, interesting and- understood even by children, on this option. It should point out -the connection between  unemployment and child abuse and youth -suicides, the especially high rates of unemployment among young -people, the educational options of free child labour, the- economic independence they could acquire as such bankers and as -children whose jobs would be made possible by such a bank. Their -right not to be taxed in their productive efforts should be- stressed. A bill of rights for children should be attached. The -project should be discussed with children, e.g. on the Internet,- to which many school children now have access. J. Z., 2.3.95 & 27.5.97. - See: START-UP OPTIONS, OLD PEOPLE'S BANK OF ISSUE,- WOMEN'S BANK OF ISSUE, ABORIGINES' BANK OF ISSUE, RED INDIAN -BANKS OF ISSUE, IN RESERVATIONS, NEGRO BANK OF ISSUE?
CHINA, UNEMPLOYMENT: "Hong Kong Bank says in its latest CHINA- MONTHLY REPORT that labour problems in the country have worsened- but have only recently drawn major concern and attention. - The -bank estimates that there are between 10 million and 20 million- redundant workers in the State sector, with another 120 million- in rural areas - figures which are growing each year." - Robin Brombi, "Bank warns on China's soaring unemployment." A photo -accompanies the article with the inscription: Searching: Some- of the 25,000 students who applied for 1500 jobs in Zhuhai zone. -- THE AUSTRALIAN, 24.4.94. - How can one raise interest in the- monetary freedom options in mainland China, or at least in- Taiwan? Could only a revolutionary army be interested in them? If -it could supply deserters and POW's almost instantly with -productive jobs then it might not have much fighting to do. -- J. Z., 27.5.97. - Even our defence department should be interested in "armies" of unemployed, for another Hitler, this time with Chinese features, could turn them into conquering armies. Moreover, if we could supply any number of deserters and refugees very rapidly with productive and self-supporting jobs, by utilising especially all monetary and financial freedom options, then we would not have to fear any conscript armies or hordes of refugees. - J. Z., 10.9.02.
CHINA: 200 MILLION UNEMPLOYED: "China admits 200 m people unemployed." Headline in BANGKOK POST, Wednesday, March 3, 1993, p. 18: Peking, (UPI) - A government-run newspaper admitted yesterday that China has more than 200 million unemployed and called on the government to replace its failed social welfare policies with neo-classical economic solutions to the growing problem. - The official ECONOMIC DAILY asserted that misleading government figures are covering up whopping unemployment figures equivalent to more than one-sixth of the nation-wide population.... No statistics were given on the national working-age population, but 200 million unemployed could translate into an unemployment rate of as high as 30% if western statistical methods are used.... The Ministry of Labour has officially admitted to only a 2.3% unemployment rate nation-wide for the last few years, but these figures have long been considered suspect by outside experts.... But most of the unemployed are made up of farmers, who migrate by the hundreds of thousands into cities to look for jobs. ..." - That is like the population of 4 large nations. Add their dependants! What a bankruptcy declaration for a communist regime, a supposed dictatorship of the proletariat. With all the political and economic powers imaginable in its hands, it still does not manage to employ and thus, according to its notions and practices, exploit as many unemployed. Even the millions of political prisoners in the forced labour camps and the dozens of millions of supposed "class enemies", which the regime previously murdered, have not prevented such an enormous failure rate. - That many unemployed does automatically suggest: Why do as many people, mostly intelligent and productive people, do not employ each other, i.e., produce and exchange as best as they can? What hinders them, apart from their ignorance, increased by the miseducation system of the regime? - Admittedly, in China they do encounter not only monetary and financial despotism but more than the usual other economic interventionism. Obviously, when the government is not able or willing to employ them, they ought to be free to assert their right and liberty to employ themselves, as best as they can and this independent of any government laws, policies, measures, institutions, especially the monetary, financial and trading and taxing laws of their government. As many people, the equivalent of several large nations, ought to be able to arrange for division of labour and free exchanges among themselves, if not forcefully hindered to do so, and thus to employ themselves fully and productively and even prosper. Naturally, there ought to be no hard and fast borders around them. They should not be reduced to a ghetto existence. In other words, they should also be free to trade with "outsiders", to mutual benefit. Self-employment to mutual benefit and among themselves is only suggested here as a thought-model to break through the mentality that either the central government "provides" jobs or private employers do or one is completely helpless and must remain unemployed. China has a long tradition with various monetary experiments. It's copper tael currency, using copper by weight as an accounting unit, has for centuries helped Chinese to become independent in their value standard reckoning from the depreciated standard their governments provided. Private and competitive note issues go back, according to one book in my possession, to about 1300 AD - but were suppressed by the paper money despotism of the ruling Mongols. - The communists make of talking about production for use, not for profit. But they do not enable these 200 million to produce and exchange for their own use and to profit thereby. They should not be forced for their production and exchanges to use the forced monopoly money of the Communist Regime which has made and kept them unemployed - and exploited and oppressed for so long. Allow them to pay taxes with their own currencies - if they cannot avoid tax payments at all. - With as many Chinese producing and exchanging independently from the regime, even the communist regime could benefit much more internal and exterritorially autonomous economic communities, practising free enterprise, & free trade internally and externally, under the practices of full monetary and financial freedom, than it has benefited, over the last few decades, from trade with Hong Kong. The communist regime, in its own interest, has tolerated this trade with a much freer Hong Kong, on the basis of a territorial separation, until now, when the treaty with the U.K. runs out and has promised to continue its economic liberty. It has also permitted various industrial and free trade zones (a little bit liberated from its economic despotism) in its domain, out of sheer necessity. Hong Kong, when it was leased, was a largely rocky, mountainous and infertile area. It showed something of what people can do, if only somewhat set free. Instead of a territorial liberation let there be a personal one, based on exterritorial autonomy for volunteer communities - starting with those the regime is helpless to help. - Naturally, this would and should ultimately have political consequences, too. - I for one would favour allowing them to produce or purchase arms for their defence against continued aggressions and interventions by a government that has made and kept them unemployed. Allow them to trade freely with the world and to refuse to trade , if they want to, with the Communist Regime, which kept them largely enslaved but would not even supply them with the life support of slave labour! They should be free to refuse to pay taxes to Peking and to levy any, if they want to, only for their own purposes. They should be free to declare their political independence, too. Also, to federate freely, if they want to, with all other more or less free Chinese communities in the rest of the world - and all other somewhat free communities. -  Once they have learned to support themselves by their own labours, in a division of labour and free exchange process, then an army or self defence force or militia of millions of members, serving voluntarily and part time, a real "people's army", could serve for their self-defence, protecting their liberties. Among its rightful aims should also be full exterritorial autonomy for all the remaining communists and socialists and other ideological groups, all based completely on the free choices of sovereign individuals. That is not a declaration for a permanent civil war or party struggle but a declaration for a quite tolerant and permanent peace option, offering to everyone the government or free society of his or her dreams. It would be the analogy to religious liberty or religious tolerance but this time in the political, economic and social (ideological) spheres. Chinese had much experience in the last 2 centuries with exterritorial or personal laws. Alas, these were, mostly, unilateral options for foreigners only. Chinese, unilaterally, could make them multilateral, for all kinds of Chinese groupings and for all kinds of foreigners, not only in China but in the rest of the world. (As the oldest continuous culture, with the longest economic, political and social experience, they should and could take the lead in this sphere. - J.Z., 16.9.02.) - If the communist regime tried to suppress their self-help and autonomy efforts and defeated them in China, allow them to retreat to any other country, there going on to employ and support themselves, rather than becoming burdens for others as refugees under other regimes that also cause mass unemployment. They would probably gain much international sympathy if they formally declared their secession from the communist regime - but, at the same time, did not engage in any revenge or repression measures of remaining communists in their areas or spheres of influence but allowed them to continue to do their things to themselves, at their own risk and expense. On that basis they could minimise resistance against them and maximise the chances for Chinese people anywhere to become liberated, as far as they want to become liberated.  - Any "nation" (The Chinese want is largely an involuntary conglomerate, too!) which has an unemployment rate of 20%, assuming a Chinese population of 1,000 million, as the above quoted article suggested, is already in a potentially revolutionary situation. The Nazis rose to power on ca. 10% only. Obviously, friends and relatives of these 200 million victims and self-liberators would sympathise with them. Once monetarily and financially liberated, they could offer amnesty and jobs to the conscripts sent to fight against them, provided only that they either desert, let themselves be taken prisoners or declare themselves neutral. - Chinese people, if not lorded over by ideological fanatics, could also establish various self-management and cooperative production and consumer coop enterprises, very different from the governmental ones, with all individual and group incentives and rights maximised, rather than subjected to externally imposed bureaucratic rules, so that the best ideas of alternative forms of socialism and communism (There exists even something that calls itself "libertarian communism"!) could, on a voluntary basis, be realized by themselves and among themselves. In practice it would be found, I believe, that the best forms of "socialist" self-management practices are not greatly different from the internal best business practices of what has been called "free market capitalism", with its property, profit and free enterprise incentives, which were, alas, only realized in the "free" countries for a minority in every enterprise, instead of for everybody, from the messenger boy to the to manager. - J. Z.,24.5.97.
CHOICE IN CURRENCY COMMISSION, Exec. dir. Joe Cobb, 325- Pennsylvania Ave., S. E., Washington, DC 20003, USA, T.-202-226-7850. (1986).
CIRCULATING MEDIUM: A forced and exclusive currency hardly -deserves the name of a "circulating medium". - J. Z., 2.7.96. It -is rather forced, like a requisitioning certificate, into the -hands of helpless creditors, including all wage and salary and -pension recipients. - Something that circulates only under -coercion does not circulate under its own steam. It would be -rejected under freedom. - J. Z., 19.3.97.
CIRCULATION CHARTS: See my 11 pages on this in PEACE PLANS 41.
CIRCULATION OF FREELY ISSUED SOUND EXCHANGE MEDIA, ESPECIALLY UNDER THE REAL BILLS DOCTRINE OR BANKING PRINCIPLE: Verbal description of the circulation process involved: 1.) The employers have received the services of their employees and produced, using their capital (raw material, machines, premises, etc.) and with this labour, equipment, raw materials etc., the produced goods which they would sell to wholesalers. - 2.) The employers would be paid in commercial bills of the wholesalers, or other short term debt certificates, instead. -  3. These they would then get discounted, into private goods warrants or bank notes by the issuing centre of the local shop association or a bank operating on the pure banking principle or real bills doctrine. - 4.) With these notes or goods warrants the employers would pay the wages of their employees and their suppliers. They would take out their own profit in this way, as well and, after a corresponding tax reform, pay their taxes with them also. (Otherwise the State, as long as it is still allowed to raise taxes, could raise only as much in taxes as it made sound tax foundation money available for current and near future tax payments.) - 5.) The wholesalers would have received the goods and given their commercial bills in return, obliging themselves to repay their bills when they are due in goods warrants, or get them settled by clearing.  They would sell the goods to retailers, usually not for cash but upon the short term promises of payment given by the retailers, to pay them for the goods in goods warrants or banknotes within 1-3 months. 6.) The retailers, between them, would receive the goods from the wholesalers, and would be obliged to repay them in goods warrants or banknotes in the near future. The additional goods they could thus offer, together with their stocks remaining from previous deals, would constitute the ready for sale cover of the goods warrants or bank notes issued by the issuing centre of the local shop association or the local bank of issue. 7.) The retailers would sell their consumer goods to the employees for the goods warrants or banknotes and would thus be enabled to repay their debts to the wholesalers. 8.) The employees would have given their labour, would have been paid in local goods warrants or banknotes and would have spent their earnings in the shops. 9. The issuing centre had discounted the commercial bills, or the equivalents, of the wholesalers, presented to them  by the employers, with its own goods warrants, or notes, keeping the bills as a short term security. Lastly, the wholesalers would have been paid for the goods supplied to the retailers and thus enabled to redeem the bills of exchange, that were discounted and kept by the bank. All these deals could also be transacted via non-cash accounts, deposit or cheque and clearing accounts, credit cards or purely electronic transactions. -  All members of the issue association or bank, at least as debtors of the banks of issue, would have to oblige themselves to accept these certificates in payment. Especially the employees, if they want to be employed, should not exclude such payments, as they have long been accustomed to do. But they might rightly state that they would only be prepared to accept these alternative means of payment if and while they are locally accepted at par, in the shopping centre and, e.g., in their own consumer cooperative and in the canteens of the employers. Their wages having been contracted in sound value standards, they would insist upon being paid correspondingly more - in case the local currency would ever be depreciated. - If they insisted instead upon being paid in some or the other exclusive currency, which the employer could not or not as easily and sufficiently obtain, they might lose their jobs or their pay would have to be reduced. - To make this form of payment initially more attractive, a wage and salary increase might be readily offered if they accepted it in this form of payment. - Once the notes or goods warrants have been used to redeem the short-term securities - upon which they were issued, which would represent goods produced and sold, the circulation process would be closed. Not a single gold- or silver coin would be required for it and not a single legal tender note. Then this process could be repeated over and over again. - For the service cover that is locally offered, the circulation system would be slightly different. The independent tradesmen and professionals involved could get their own bills discounted by the retailers' issuing centre - up to the amount of their service potential and average trading during the next short term period. By paying their suppliers, profits and wage bill in goods warrants, they would put them into circulation. By accepting them in payment for their services, they would be enabled to withdraw them and repay their IOUs with them. - Instead of joining the local note-issuing bank or issuing centre of the local shop associations, the service providers, tradesmen and professionals, could also establish their own issuing centre. They might include e.g. transport services, restaurants, amusement centres, educational services etc. - Local people would decide whether they would be prepared to accept 2 or more such local currencies. - The issues of the goods and service warrants would merely provide the necessary turnover credit. They would not and should not be issued to provide medium or long term capital loans - because that would not assure their rapid enough return to the issuing centre. If issued for longer periods, they could depreciate. But they could be used, like cash, to subscribe to term deposits, bonds and shares and to pay out medium and long term loans and, later issues, could be used to repay these loans etc. - This use of monetary freedom would mean that due to our private local issues (alone, or, preferably, in association with others), we would no longer have to scramble for a chance to sell our labour, services and products against a monopolistic and more or less scarce exchange medium issued by a central banking system. Instead, we would be enabled to pay with our own notes or the notes of our association and thereby we would assure that our own notes or those of your association would come back to us and our association - to pay the goods and services we have to offer, alone or together with them. - To the extent that we have valuable goods and services to offer and do offer them at competitive market prices,  and that others have valuable goods and services to give in exchange, also at free market prices, we would then be enabled to exchange them, independently of the monetary policies and mistakes of any government. All our issues would automatically flow back to us to be redeemed in the gold-weight-values expressed in our goods and services. (If we had accepted these as our value standards.) All our earnings and contract earnings and debts would also be expressed in sound value standards as reckoning units. - An instance of a single issuer, however unlikely and rare such instances might be: A barber, to the extent that he would be able to circulate standardised hair cutting tickets, would not have to be afraid of being out of work. They would, inevitably, stream back to him to be redeemed by him through his services. If he were to spend the same amount of government cash, it would not necessarily stream back to him or not fully. - Without this freedom, employment opportunities are, indeed, tied down to the supply of legal tender. Under monetary freedom, they are only limited by your willingness to give your productive labour and services in exchange for those of others. In fact, under monetary freedom you could anticipate your earnings, spend them with your own notes or clearing certificates and then work, earn them, be paid in them and thereby finally pay off what you bought with your standardised IOUs or those borrowed from your local shop association. Naturally, you would always have to accept your own notes in payment for your own work. Likewise, the notes of your creditor, since you could use them immediately to pay your debt to him. (I am speaking only of short-term turnover credits!) - Compare this self-liquidating issue, acceptance and reflux system with the issue of e.g. gold or silver coins or the circulation of legal tender paper money notes. These coins and notes are not as effective in providing work for you because - whenever you pay with them, they do not necessarily return to you, or your association, or not soon enough or with sufficient certainty. Instead, they may flow to anyone else in the country or even, temporarily, into foreign countries. - Private notes, promising redemption in the goods and services of the issuer - and his associates - have the essential capacity for a rapid and regular reflux, i.e. they must stream back to the issuer, if they are to have any value for the holder, and will thus provide corresponding sales and employment for the issuer. To that extent they are like tickets. That could and should be formalised by giving them only a limited circulation period, 3 - 12 months at most. - If they happened to suffer a small discount in general circulation and all the rules of a sound issue technique would have been obeyed, then these notes and their discount would disappear, with them, rapidly from circulation. Debtors of the issuing centre would not only accept them at par for their goods and services when anyone buys something from them, but would go out of their way in attempts to buy them up on the market for exchange media, using other means of payment, and gladly acquire them thus at a discount. If a debtor would thus be enabled to buy such notes at 1% discount and could with them repay, on the same day, his debt to the issuing centre, he would have made a 1 % profit on this day, amounting to an annual profit rate of 365%. That would be so attractive that the discounted notes, and with them their discount, would soon disappear from circulation. (Provided only the issue and reflux technique had been quite sound.) Potential customers of the stores of the issuing centre (if it is a shop association) would also love to acquire such notes at a discount - in order to carry them fast to these stores to be redeemed in goods and services at par. In other words, a discount for a sound goods warrants issue could not last long and would not be large. But, if a discount were considerable and persistent then something else would happen. People would mostly refuse to accept the notes altogether. Only a few would continue to accept them, at a considerable discount - to the extent that they could still use them against the issuer. In other words, the issuer could no longer issue more notes or only at a loss. The loss would occur because he could issue them only to a few and at a discount whilst he would have to accept them again at par and immediately. - J. Z., 1985 & 21.5.97. - For graphical descriptions of the circulation process for optional and freely issued exchange media that are based upon shop or service foundation see my drafts in PEACE PLANS 40. In the writings of Ulrich von Beckerath you will also find many much shorter and clearer verbal descriptions of this process. - I have not yet got around to extract them all and all his numerous other important remarks upon monetary freedom, which he studied, pondered for over 60 years and wrote about for at least 48 years. Alas, most of his writings are still unpublished, even on my microfiche, in German only and untranslated.  - J. Z., 14.5.02.
CIRCULATION OF MONEY: "Strictly speaking, money does not 'circulate' : it is exchanged against goods. When the turnover of (*) money increases, the turnover of goods increases correspondingly." - Henry Hazlitt, Where the monetarists go wrong, THE FREEMAN, Aug. 76, p. 76. (*) Here I would insert: "good" or "sound". - If money is just turnover-credit money then it could and should, perhaps, upon every return to the issuing centre, be cancelled, instead of being issued out again into circulation. This would facilitate the control of the issue. It would correspond to the cancellation of the real bills the issue was based upon.  It would make e.g. the issue of new series more frequent and thus give less opportunities for forgers. It would correspond to the use of tickets, mostly just once. And it would become necessary - once one has found the limitation of the circulation period to be useful or advisable. The discovery of forged notes, with the same numbers, would be facilitated, too. Theoretically, one could take down the numbers of returned notes before one issued them again. But when another note appears with the same number, it would not always be clear or easy to determine which of the two notes is the forged one, in the absence of the first one that was received and re-issued again. - Thus Ulrich von Beckerath advised to follow the old practice of the Bank of England and to clearly cancel all returned notes and keep them as a record. - In that case notes would have only a very short and temporary circulation, it could be called that at all, and would, instead, oscillate, with each new oscillation: issue and reflux, being undertaken by a new series or new set of numbers of an old series. - J. Z.
CIRCULATION OR OSCILLATION OF MONEY? Not all kinds of sound money -need to "circulate". Various private notes might be issued and,- shortly afterwards, stream back, like stamps, tickets and gift--vouchers or tokens. The more it is issued merely upon the -"security" of the goods and services that any money is usually -"redeemed" in, every day, by consumers, according to the note--holders' wishes and needs, among the choices offered to him in his -payment community, usually the local shopping centre, the more- will the issues be the accurate equivalent to the goods and- services for sale and wanted, at market prices. Then, with any -increase in output, that can still be sold at close to the old prices, or -with any increase in the total of all prices asked for and which- the consumers would be prepared to pay, if only they were sufficiently supplied with purchasing power, the additionally -required purchasing power could be issued by the suppliers. The -money would be issued and would stream back fast, in the quantities required, to be redeemed in its goods and service-s cover. More could not be issued than is required for this, for- then it would be discounted - and the issuer would still have to- accept it at par and wants to stay in business, rather than being -boycotted for not keeping his exchange media sufficiently at par -in general circulation. - Henry Hazlitt may have had something- similar in mind when he wrote, in "Where the Monetarists Go -Wrong", THE FREEMAN, August 1976, p. 76: "Strictly speaking, -money does not 'circulate': it is exchanged against goods. When -the turnover of money increases, the turnover of goods increases- correspondingly." - I would rather say: When the turnover of -goods money or goods warrants or purchasing certificates -increases, the turnover of goods increases correspondingly. - J. Z. MFNL 3/4. - Money is here like oxygen in the blood circulation: Continuously issued by the issuing centre, it is earned and used up by the consumers, in their working lives, and replaced again and again by the issuing centre, e.g. the local shop association. A clearer image is probably provided by comparing them with transport tickets or other tickets. They, too, oscillate rather than circulate permanently. They are continuously replaced by new issues when they have achieved their intended turnovers. - J.Z., 5.9.03.
CIRCULATION PERIOD, LIMITED, FOR COMPETING CURRENCIES, TO SPEED UP & ENSURE THEIR SUFFICIENTLY FAST & COMPLETE REFLUX: The possibility of a discount, as a warning signal, is a necessary factor in this payment system. It is a sign that something might be wrong with the issue or its reflux and that some counter-action is required. For instance, if it happens, the issuers might arrange for a special sale to speed up the reflux of their notes. They might also charge a higher fee for short term loans they grant in their own currencies, for wage payment purposes or increase the discount rate when they discount sound commercial bills of their members. Another option would be to shorten the reflux period for all newly issued notes, until they have achieved a reflux period which would keep their notes at par. E.g., if they used a reflux period of 10 years, then many of their notes might become discounted because they are not rapidly enough streaming back to the store in repayment. A reflux period of 1 day only (like for cinema or theatre or sports events tickets) might maximise reflux but would be rather inconvenient for a local currency. Thus, somewhere between at least a week, if not a fortnight and 3 to 12 months, is the optimal circulation period for any competitively issued exchange medium that is to retain its par value while it changes hands locally. Ulrich von Beckerath ascribed the limited circulation period to a proposal by Prof. Edgard Milhaud. But it merely corresponds to the limited circulation period for most sound commercial bills of exchange. It also can satisfy the anti-hoarding aspirations of Gesellians, without burdening the note holders with a special tax upon their notes or the obligation and bother to affix stamps to them. It would, moreover, express the nature of most alternative currencies as ticket money, transport vouchers, clearing certificates etc., for time limited, i.e., perishable goods and service capacities. A reflux of notes that is assured only in 1 to 10 years  is no more useful to most sellers of goods and services than is a rain, coming only every 120 days to 120 months is to an agriculturists. - And even for hardware goods the owners and sellers do not want irregular but as far as possible regular sales. Naturally, especially with regard to this, it would be a mistake to issue large quantities of a local currency and all of it with the same expiry date. Instead, the expiry dates should be staggered, best perhaps from the day of issue, perhaps by date-stamping previously printed notes only once they are issued. What is possible for transport tickets should be possible for these paper token monies, too.  - J. Z., 11.3.89, 28.11.92, 16.5.97.
CIRCULATION QUANTITY: How can one determine for any particular- time and place and condition the right quantity of exchange -media. In the same way as the right quantity of any products and- services is determined, i.e. by free pricing. When sound exchange -media are freely chosen and publicly rated against each other and -the competing exchange media against them and against other -exchange media, then the exchange media will either be at par -with their nominal value (their value standard units) or below- or above par with them. If below par, or at a discount, they will -be less and less issued and more and more refused or discounted.- Thus they reach the limit of their circulation. If they do -circulate still at par or even above par, then further issues are -possible and desirable. Free market rating for exchange media, -sound value standards, and full publicity make the circulation- determination automatic. We would no more suffer shortages of the- media and of sound standards, than we do suffer shortages of pens- and rulers, milk and litre measures, wheat and kg weights. Any- despotic attempt to determine for others the right quantity of -exchange media or clearing transactions and of supposedly ideal- value standards for all their transactions, is condemned to- failure, like all other attempts at central planning and -direction or experiments with command economies. - J. Z., 3/97. See : LIMITS FOR -ISSUES.
CIRCULATION SPEED OR RAPIDITY, NUMBER OF TURNOVERS OF A CURRENCY,- DEGREE OF HOARDING, DEGREE OF CASH HOLDINGS: A rapid circulation -is not as important, mostly, as a certain and full circulation is- - of all goods, services and labour, mediated by money tokens and -clearing. Only monetary and clearing freedom, combined with free- choice of value standards, can achieve that. This freedom can -also make issuers and acceptors largely independent of the -quantity of hoarded exchange media, since they can be easily replaced by additional issues, should a currency shortage occur.- Moreover, competing exchange media, to assure their reflux, will -usually be given a limited circulation period, too, like -commercial bills and cheques and tickets. However, in their own -interest, issuers of sound and private or cooperative turn-over currencies, will see to it that their issues will return to -them, in payment for their goods, services and labour, as soon as -possible. To the extent that electronic clearing and account -checking has become possible, payment and clearing can become -almost instantaneously. Quite possibly, people who do some of- their shopping still for cash but only weekly or fortnightly, -would be quite satisfied with a local shopping currency, to the -extent that they want to and can spend it, that is valid only for -a week or a fortnight or a month, and to the extent that they can and want to satisfy their requirements from local suppliers. The circulation of alternative -media of exchange will also tend to be speeded up whenever and- wherever they have suffered a discount. For then the holders will- want to spend them fast - and can be sure of getting them -accepted at par only by the issuer. Even while a discount does -not occur, the system must provide for the possibility of a- discount. The slightest discount, perhaps only at money- exchange offices or in wholesale trading, sends an important signal to- the issuer: discontinue further issues, while the discount exists and before it become noticeable in general circulation and -thus gives us a bad name. The same self-interest would also induce the issuers, if self-given or adopted issue statutes do -not already oblige them to do so, to use other means of exchange- to purchase the own ones, especially when they are anywhere- traded at some discount.  Any money that is essentially ticket -money or clearing money, does not have, as a rule, any trouble- with its circulation speed. Nevertheless, additional reflux -arrangements could be provided for it. E.g., debt repayments in- other exchange media could involve payment of a small penalty or -a fee for the conversion of exchange media which one is not obliged to accept, because they are not the own. The prices might -then be market in the own exchange medium at par and in other -media "plus 1-5%". That would also speed up the reflux of the own -exchange media. Furthermore, loans might only be made within the -vicinity of the centre of issue. Nor should the total amount lent -to any one business come to a large fraction of the total- issue, thus involving too large a percentage of the issues of a centre in the always possible failure of that particular business. To -"suck" the own notes back to the issuing centre, in payment of -debts, like with a vacuum cleaner, the issuing centre might -oblige all its debtors to accept its own notes and to indicate -their readiness to so accept them by large signs in their shops- and offices. Daily note exchanges and clearing between centres of- issues will also speed up the reflux of notes or clearing of -accounts. Electronically clearing could even occur almost instantaneously.  - J. Z., 14.12.93, 1.5.97.
CIRCULATION, PRODUCTION, DISTRIBUTION, CONSUMPTION, MONEY, TURNOVER -CREDIT & TURNOVER CLEARING OR TURNOVER EXCHANGE MEDIA, CAPITAL & -THE ECONOMIC PROBLEM OR CRISES:  "The economic problem is in- reality not a problem of consumption or of production but a -problem of circulation." - Dr. Bank. Date? Source?  See: EXCHANGE -MEDIA, FREE EXCHANGE, MONETARY FREEDOM, FREE BANKING. - Which economic problem? Are consumption and production really problematical? Does money really have to circulate permanently? What does have to circulate? Are economic crises due to insufficient "circulation" of capital or of exchange media? Doesn't during an inflation at least one thing circulate too extensively, namely the government's forced currency? All such general phrases and explanation attempts do not sufficiently explain the realities but rather distract from them. - J. Z., 9.9.02.
CLASSIFICATION OF WRITINGS ON THE SUBJECT, in form of charts, -especially of details of exchange media and value standards -proposed, stressing good points and errors still involved.
CLASSIFICATION SCHEME FOR EXCHANGE MEDIA AND VALUE STANDARDS: The -literature on the subject is too extensive. Tabulations of the -historic and proposed exchange media and their characteristics -and, likewise, of value standards should be drafted, amended and gradually filled out in a collaborative process. False premises, -observations, conclusions and theories involved in them should be -pointed out, as well as the literature defending and attacking -each position taken. No copyrights should be claimed. But each -contributor should sign his statements.  Giving each statement a -number would make referrals more easy. - J. Z., 16.3.97.
CLEARING  A clearing transaction does not need ANY quantity of- exchange media nor ANY quantity of value standard units, beyond -the one unit adopted, e.g., an ounce of gold. It can operate well- enough with book keeping and electronic accounting only, in- figures, expressing purchasing power in multiples or fractions of -the adopted value standard units, e.g. of an ounce of gold. The- value of the value standard chosen is in no way changed by changes in the number of clearing transactions, in the same way- as the sizes of the meter, the weight of 1 kg, the volume of 1 -litre, are not changed at all with the number of transactions -that use these measures. To affect the purchasing power of a -medium of exchange its nature of exchange medium must be legally- and coercively combined with a fictitious abstract or paper value- "standard", the exchange medium and this value standard must be -exclusive and forced ones (compulsory acceptance AND compulsory -value, at its nominal value) and people must not be free to- express their prices, wages, salaries etc. in sound alternative -value units. Then, indeed, quantity changes in such forced -currencies do affect prices, wages etc., which have to be priced -out in this "standard" and have to pay paid in this "exchange- medium". - J. Z., 4.1.0.91, 27.4.97.
CLEARING & COVER, LIQUIDITY VES. SECURITIES, CASH VS. CAPITAL: To the extent that any kind of money is a clearing medium (Actually any kind of money is basically a clearing medium, a counting token, whether its material is cheap, expensive or electronic, for a multilateral and anonymous and automated clearing process.) it does not need a "cover" at all. It either represents a debt or a credit and all of these cancel each other out, at least over a period. However, instantly or soon clearable debts and credits should be distinguished from those settled only over medium to long term periods. For instantly or soon clearable debts and credits money tokens and accounts are suitable. For medium to long term debts and credits capital securities are the suitable issues. In any somewhat free economy some cash exchange media (or non-cash payment accounts) are all the time turned into capital securities or capital securities into cash or bank accounts, but only to a limited extent, one voluntarily determined by savers and investors. Capital securities are not suitable "covers" for cash nor is cash a suitable cover for securities. Most cash is needed to buy goods and services, not capital securities and capital securities do represent real productive capital & future earnings opportunities and, as such, do not need a cash cover but merely some cash operating funds. Their main purpose is not to represent cash but to earn cash by the production of wanted goods or services. The fact that most of the time sound capital securities can be relatively easily turned into cash does not make them equal to cash. Sometimes, for instance, they are hard to sell or only at a loss. With sound cash it is different in normal times, only emergency situations excepted, when real goods and services are often preferred to cash. Both are valuable in their spheres, promoting the transfer of values, but that does not make them identical or sufficiently interchangeable for all purposes. The main purpose of cash, or corresponding liquid bank accounts, is to pay for daily living expenditures and frequently occurring minor debts. Try to pay for them with shares, bonds, treasury notes or mortgage letters! In a perfect clearing system we would not need any physical or electronic money tokens at all. All debts and credits could be cancelled without them. Only some suitable value standards would have to be agreed upon by the participants. Bad debts would have to be born as losses by some - and unearned gains by others - or would be covered by insurance premiums that had been paid by the traders. - J.Z., 13.3.02, 24.8.02.
CLEARING AND EXCHANGE MEDIA OR MONEY: Almost all sound exchange -media, which do not, like gold or silver coins, carry their- subjective and market determined commodity value in themselves, -are essentially merely clearing certificates for an anonymous and- multilateral clearing process, which they facilitate and simplify- by their very nature. But it lies also in the very nature of free -clearing that it does not inherently depend upon any QUANTITY of -exchange media or any QUANTITY of value standard units but merely -upon a sound enough value standard that is agreeable to all -concerned and that is merely used for clearing, accounting and- reckoning purposes, but that does not have to be supplied and -used as a means of payment or cover or reserve, in quantities and values that are equivalent to the free clearing transactions that could- be carried out without any exchange media. To maintain the value -of an adopted value standard unit it is not required that it -becomes demandable as a physical means of exchange in by every -creditor. It suffices that some transactions in this metal take -place, which conform its market value against exchange media and- value standards of another kind and that such trades are regularly and publicly reported. While it can do no harm if debtors well -supplied with gold quantities remain free to offer them in- payment, even gold coins should not be turned into legal tender -- except perhaps within private payment communities whose members- agreed to so accept them. - The clearing nature and value reckoning nature of money is -essential. The rest is an unnecessary although sometimes- convenient formality. No monetary policy or theory should ever -ignore this fact. Then it will not be lead to wrong conclusions -or towards monetary despotism. - J. Z., n.d., & 30.4.97.
CLEARING AND INTEREST RATES, SHARES AND TICKETS, SAVINGS & -TURNOVER CREDITS: An extension of clearing merely indicates- easier sales and a greater total turnover. It does not directly- indicate or represent a corresponding increase of medium and long--term capital becoming available. Additional turn-over clearing -can only reduce the short term turnover credit interest rate. To -affect the capital interest rates, clearing certificates and- notes must, like money now, be saved up and invested on medium or -long terms. Tickets to a cinema are just turnover media, too. One -cannot buy the cinema with them, directly. But if one had bought -e.g., a large block of tickets for a large party and for one or -the other reason the party is turned off, then one could negotiate with the cinema, offering to sell it back the block of -tickets, either for other forms of cash or for one or several- shares in the cinema. If the cinema is certain to be able to sell -the tickets again, before the performance, then it will be -amenable to either buying them with other means of exchange or,- perhaps, with some shares in the cinema. The time span, -motivation, ownership, function of shares and circulating notes -is quite different. They circulate for different periods and- among different people and are used for different purposes, even -when both are issued, somewhat circulating and ultimately- somewhat redeemed, at least during liquidation of a business. To- try to turn capital assets like raw materials, premises, and -machinery or the capital securities that represent them, directly into currency, supposedly useful for the current purchase of- consumer goods, is a great mistake because at the same time no -equivalent consumer goods and services are provided by the issuer -to redeem them with. The holder of the certificates could only- force the issuer into liquidation and then claim his share in raw- materials, premises and machinery - but few would want to acquire -them. On the other hand, if there is someone prepared for a -take-over bid for the business of the issuer, then such issue- attempts would be very much welcomed by him, for this scrip would- rapidly depreciate in a free market and could thus be bought up- very cheaply and used in the take-over bid. A few such- experiences, well publicised, will serve as a deterrent.  But -that does not mean that there should not be full freedom to issue -financial securities, too, which quite clearly represent capital -assets and are bought up and traded by people interested in- capital investments. To reduce this kind of mix up of capital- securities with turnover bills and notes, the issue departments- for both should be as far as possible kept separate, for people -have fallen for the errors of "asset currencies" again and again- and they have often been embodied in banking laws.
CLEARING AND MONEY & THE QUANTITY THEORY OF MONEY, MONETARY -DESPOTISM & TICKET MONEY: When you consider money merely as a- clearing facilitator, not as a commodity, then the quantity of- goods, labour and services that people possess or can will offer, in exchange for the goods, services and labour of others, has no other limit than these goods, labour and service readiness themselves and the- quantity of "money" available becomes irrelevant, because under fully developed and free clearing no money would be required at all. Only for -some minor payments would some form of physical clearing -certificates, which might be called money, still be convenient,- more convenient than formal non-cash transactions, no matter how- computerized. Under free clearing, essentially not needing any- money tokens or money commodity at all, in quantities -corresponding to the sum total of the cleared goods and services, -but possibly using e.g. a gold weight unit as a value standard to -price all goods, services, labours and contracts. The value standard unit that might be used in all the accounting and clearing of the free exchanges might not even exist at all or might not be traded at all within that clearing community. E.g., gold value trading in Sydney might use- the market price of that gold weight unit in London, Zuerich or- N.Y. for its own value measuring purposes. Some clearing or payment -communities might be satisfied with a value standard less stable -than gold or discover and use one that is even more stable. -Freedom of choice, here, too. No exclusive and forced value- standard (except by private contracts, binding only the- contractors) and no exclusive and forced exchange media and- clearing avenues (except within voluntary payment communities).-Under free clearing the number of transactions might increase or- decrease. The total value of transactions might increase or- decrease. This would not influence the standard of value used or- depreciate or increase the value of the clearing avenue - or of -clearing certificates. To try to put a quantitative limit on- clearing certificates or mere turnover credit notes would amount to -forcing people to limit their production and their exchanges when- there is no justification or need for this at all. An issue or -circulation limit would then amount to a rationing system for the -whole community for goods, services and jobs. No more could then be- offered and traded than is prescribed or permitted by the monetary despotism involved. - The -quantity theory of money makes only some sense for an exclusive -and forced currency that is issued beyond the limit at which, -under freedom, it would have been accepted at par with a sound- value standard. Then it can be arbitrarily multiplied and thus- depreciated, while the goods and services at the same time cannot -be as much multiplied and would, even by multiplication, not- necessarily be depreciated in their value, either. For instance, -if a baker bakes 10,000 loaves of bread instead of merely 1,000 a -day, and if he finds buyers for all of them, then the value of the -bread for each of the buyers would not be depreciated. Nor would- the money or clearing medium be depreciated because at least for -these turnovers ten times as many money tokens or clearing -certificates would have to be used. The need for monetary- exchanges is, essentially, a need for clearing exchanges in a- very convenient form. If that is kept in mind, then we will avoid wrong conclusions on varying quantities. A community is enriched,- not impoverished, when its money and clearing system enable it to -exchange more goods, services and labour efforts, quite freely- and easily. The money and clearing transactions would be increased - and so -would be the goods, services and labour turned over. - The best -method would be to transform, as far as possible, all ready-for--sale goods, services and labour into exchange media or clearing- certificates or clearing accounts (using sound value standards), to the extent that this can be done without turning the par-value of such shop currency into a deterring discount. (If one can judge by the experience with sound tax foundation money then shops might even be able to monetise not only their current stocks but their turnover for the next 1-3 months. Much would depend on current terms for earnings and timing habits for consumer spending.) -Then any quantity of goods, services and labour could, with their -help, be easily exchanged for those of others, in a division of labour- and free exchange process - in a free market that would include- monetary and clearing freedom. The need for money is merely a need for clearing or for complete freedom to exchange, using the- best and easiest available means, those accessible, in self-help -steps, to every productive and honest persons. As Ulrich von- Beckerath used to say: Allow people to transform their NEEDS -into effective monetary DEMAND, but only to the extent that they -are prepared to supply, ready for sale, goods, services and- labour. - Then and with their "ticket-money" (or goods, labour or service warrants), they can satisfy their -needs, to this extent and the others can use these tickets- against him as an issuer, to the extent that he is able to supply -their needs. That would amount to production for use and profit -at the same time. Useless tickets would be refused. Tickets that are only marginally useful would be discounted or refused, thus limiting their circulation. The tickets would -have an automatic reflux to the issuer - and would serve as- advertisements at the same time. Ticket money! That's the -ticket! - J. Z., 26.4.97, 8.9.02.
CLEARING AND QUANTITY OF MONEY: Full clearing freedom  (as well- as the freedom to issue and to rate and discount or to refuse- money tokens, be they "real" money or "merely" sound money substitutes) when -fully thought through and applied, at least in thought- experiments, demolishes the notion that a certain quantity of -money is absolutely necessary and that it ought to be fixed, e.g. -to the GNP, as calculated by some, or increased at a fixed rate, -or tied to the population, the price level, a corresponding gold--reserve etc. etc. People need only freedom to clear and to- account in value units chosen by them or accepted by them or even -established by them, not any exchange medium or any particular -quantity of any exchange medium. However, once exchange media are -seen as media to facilitate clearing, then as many of these media-s as those people involved in the clearing find convenient to use,- should be freely issued and accepted by them and cancelled after -their use. Nobody can rightly prescribe for others how many of- such more or less advanced private "cash" or clearing or ticket -certificates they should be allowed to issue and accept. That -would be like prescribing to them how much they should produce -and exchange. The subjective value theory applies here, too,- quite apart from property rights and the right to make private -contracts. No monetary theoretician or technician, expert or -reformer or authority has the right to prescribe to them how they -are to settle their exchanges and to promote them to the utmost -and what means and processes they are to use for them. In fact-, there exists no one and no one may ever exist who knows best what- is best for all other people in all situations or even some of -them. Even if he did exist, he would still not be entitled to -force other people to become happy or rich in the way he thinks -they ought to go. If they do adopted him, individually, or as a group, as their medicine man or guru, then that is their affair -and risk, indeed, also their right and part of their liberty. - J. Z., 3/97.
CLEARING AS THE PRINCIPLE & PRACTICE BEHIND ALL MONETARY -EXCHANGES & HOW IT COULD BE CARRIED OUT MORE PURELY & EASILY,- for all but minor transactions :
CLEARING BANKING, DEPOSIT BANKING, CURRENT ACCOUNT BANKING, CREDIT CREATION? CREDIT EXPANSION? MONEY CREATION?  - A) AMONG BANKS WITH OR  B) WITHOUT OWN CAPITAL & CAPITAL RESERVES, C) AMONG BANKS THAT PROMISE RARE METAL OR LEGAL TENDER REDEMPTION, D) AMONG BANKS THAT DON'T MAKE SUCH A PROMISE, E) SUCH BANKS REGULATED BY A CENTRAL BANK & F) SUCH BANKS NOT REGULATED BY A CENTRAL BANK & IN FREE COMPETITION WITH EACH OTHER: Preliminary notes. This is a very muddled-up subject. All kinds of different definitions and premises, arguments and conclusions abound. It is difficult to work oneself through the jungle they form. Even when one manages to hack temporarily a path through it, much of the jungle remains, right and left and the path is soon overgrown again. I have seen some famous libertarians and free marketeers repeating a few of the most popular errors and prejudices in this sphere. All the errors and myths in this sphere, often combined in Social Credit notions, are a great obstacle to monetary freedom. - For mere current account or clearing banks no bank capital or reserve would be required at all. It would merely administer the accounts of its clients, more of less efficiently. Ideally, even its customers would not have to deposit any cash, gold or credits from other banks there. Its bank customers could just start with it "ab ovo": Each just opening an account there, with a zero credit and would contract to use this account for all his trading with the other customers with this bank. For the sake of simplicity let us assume that this is the only bank that they would use and that this would bank would mediate all their trading, i.e. that there would be no trading by them with the rest of the country or the rest of the world. We could assume this to happen either on the local level, on the national or even at the international level. Let us also assume that the participants have agreed upon a sound standard of value for their pricing, all their trades and their accounting at this bank. Let us also agree that they would use their accounts only for their daily turnovers, not as a savings and investment account. (Here certain precautions could and should be taken: Those building up too much of a credit balance would, at a certain point, either have to forfeit them or to purchase, with all the excess amounts, bank bonds or fixed term deposits. These amounts, and these alone, could then be used for corresponding loans to members. On the other hand, all those who built up too much of a debit balance, would have to pay up the excess debt in their own IOUs, in convenient denominations and with a discount to be settled between the bank and its debtor, perhaps through arbitration. The debtor would have to accept these IOUs at par from the bank or any of its customers. In other words, he would be forced to undertake a discount sale towards all who offered him his IOUs. For all customers some leeway would have to be determined in their debts and credits on this account, in accordance with their kind of business and their normal turnovers. - So much about possible abuses and difficulties of this system. ) -  Normally, the members could then settle all the debts and credits arising out of their current trading among themselves, without any other means of exchange, merely by assigning account credits or account debts to each other. They could do so by cheques (cheques for clearing only), by orders to the banks, by passbook entries, via credit cards or any other convenient means. Among these might be standardised clearing notes of the bank, in convenient money denominations, which would promise nothing else by the bank than acceptance at par on all its clearing accounts. When giving such certificates to any account holder, his account would, naturally, be proportionally reduced or put into debt. - To assure their use for clearing only, not for credits, these clearing house certificates should be given only a short life-span or circulation period. In essence, each payment through this bank would be an instruction to the bank: Debit my account by xyz and credit A with xyz. They would use these payment instructions (whichever payment method or means is used , in payment of any goods, services and labour received. Naturally, they could do that only towards all those willing to accept these transfers, clearing certificates, etc. at all and at par or at a mutually agreed upon discount. - The total of the debts of the members would exactly be proportional to the total of the credits of the members. There would be no left-over capital amounts which the bank could lend out, on medium or long term, with or without consent of the account holders, apart from the above-mentioned (in brackets) purchases of bank bonds or fixed deposits. - Now, it is very important to note that their turnovers would not be confined to any level, to any maximum totals. If they can manage to produce and sell more to each other, then all their mutual debts and credits will simply become correspondingly larger. Goods, services and labour being priced in sound value units, likewise the accounts and the transfer orders, the fact of there being many more payments would merely meant that there are many more exchanges. Millions instead of hundred-thousands, billions instead of millions - IF people could increase their productivity and exchanges by that much - or just in accordance with the increases, or decreases, that take place at any time. Thus, apart from fluctuations of prices from the goods, services and labour side, no depreciation of these means of payment or clearing would take place. They could increase their turnovers a hundred-fold or a thousand-fold and there still would not be an inflation. Simply as much more would be exchanged. Their self-chosen value unit, e.g. a gram of gold, would not be depreciated by so many more turnovers using it. (Under a computerised accounting system even a number of freely agreed upon value standards could be utilised, with ease, among the members. By 1990 a major Australian Bank, like Westpac, was prepared and, apparently permitted, to keep accounts not only in Australian dollars but also in gold weight units.)  None of the account holders could demand payment in gold grams of all the clearing credits he had accumulated and the bank could not demand of its account debtors payment in gold grams, but merely payment in his own and also gold-weight valued IOUs, perhaps only with a fair discount, and then his acceptance of his own IOUs, from anyone to whom the bank or its customers might have transferred them, at par, as if they were gold grams in the stated quantities. - Naturally, bad debtors could go bankrupt in this system, too, although not due to a faulty payment and clearing system. They picked the wrong trade or did not conduct it properly or got careless in some large transaction or wasted capital and earnings instead of improving their business, etc. Many other problems than payment problems, do require many other solutions. If they accumulated too much of a debt and had to pay this back in their own IOUs at such a large discount that they could not recover their costs, then they would be out of business, soon. The charges levied by the bank on the clearing accounts it holds, would include an insurance premium to cover this risk. - Seeing that all these accounts are only intended as turnover and clearing accounts, and perhaps also as an insurance premium, to cover bad debts, those who accumulate large debits on their accounts and do so for more than a few days, might be charged a considerable interest rate as an additional inducement to reduce their debits fast. - One kind of low prices would be avoided by the system: emergency sales prices due to money shortages. - Depending on the tax situation, the clearing bank accounts might be open to inspection, et least to potential buyers and sellers, who then could, perhaps even by phone, verify for instance the current clearing account status of the buyers. - The members of this bank would all, ultimately, and more obviously than usual in monetary transactions today, pay for all their purchases with their own goods, services and labour. The accounts and their figures at the bank would just keep track of all these free exchanges - and facilitate them in a monetary or ideal clearing way. Their own accounts would be deducted and those of their suppliers credited or they would be credited with whatever their customers paid them through this system. The bank would charge a small percentage of the total turnover as its fee. The members would at any time have to let their own debts be accounted against themselves. These deductions would be made with or without their consent, if any genuine debt is involved. - They might also be put under obligation to use any outside means of payment received towards the abolition of their account debt at this bank. (The bank would then sell this "foreign exchange" to those who had built up a large credit with it and wanted to use it in this way.) The bank would explicitly and publicly state: These accounts have not been established through cash deposits, rare metal coin reserves or a reserve fund made up of some capital assets. They do not entitle to any cash withdrawals or rare metal redemption. They are merely current and clearing accounts. The clearing bank merely helps to transfer the mutual credits and debts of its customers and keeps account of them. It does not grant any credits and cannot grant any credits from these current accounts. However, to the extent that some of our account holders want to make some of their credits on their accounts contractually available, for medium and long term credits, it would be willing to mediate these, too, amongst its customers. - To that extent such a bank would be safe from any time risk and means of payment or ability to pay risk or difficulty. (Naturally, sickness, accidents, catastrophes, insufficient business sense or business mistakes excluded. Thus the bank might insist that its customers insure themselves, as far as possible, against such risks.) - Such clearing and "deposit" banks (of current trading credits transferred from others of its customers) should be open to inspection by their members, or representatives of their members, but do not constitute institutions that threaten the payment and value accounting situation in any country. On the contrary. Without legal tender, subject to a free market rate against a sound value standard, these means of payment or clearing could not depreciate from the money side - unless they had picked a value standard that was not really as sound as they thought it would be and at the first sign of this they could change over to a better one. The elasticity of the system would be unlimited. It could precisely fit all the output of and trade in wanted goods, services and labour (among its members). It would not distort exchanges but, instead, greatly facilitate them. For small transactions, not worth any writing efforts or electronic checks and transfer costs, such a clearing bank could issue token coins whose only foundation would be their ready acceptance at par in all its clearing accounts. To avoid the charge that thereby it would "levy a loan from the public" or "create money out of nothing", it could be quite correct on this, too, and debit each of its accounts with e.g. $ 30 (or the gold gram equivalent) and pay out that amount to each of its customers in small coins, less the cost of producing them. - The general assumption for such a service is, naturally, that monetary despotism could not effectively outlaw & suppress it. - Secondly, such a clearing bank should, naturally, possess no monopoly and should be free to clear with all other clearing banks. - This is as simple a free exchange system as I can imagine, free of all the ordinary flaws and wrong assumptions and imposed requirements, supposedly necessary controls and safeguards. Mind you, I have not described a savings and short to long term credit bank. The credits mediated by this clearing bank would be explicitly confined only to those means which the own customers would make explicitly available for this purpose, with all loans to members confined to these means and their terms. Credits invested and lent out should be kept in separate accounts. They would not have to be run by a separate department of the bank, although it would probably appoint one or several investment specialists if there were many such funds available for investments. - One should add, that the loans given by the bank would be given only by its credit transfers and they would also be repayable by those credit transfers. Terms and interest rates would have to be haggled out among lenders and borrowers, with the bank merely acting as a mediator. It might e.g., publish the funds available and under which conditions they are available and the funds wanted and under what conditions they are wanted and then act as a broker to achieve as many mutually satisfactory agreements between these customers as possible. Part of the interest payable would serve for credit insurance purposes. In this uncomplicated model I see no need for any outside interventionism or any suspicion that the bank or its customers would thereby be given any special opportunity to cheat or defraud others, to "create" any money or value out of nothing, to appropriate what really belongs to others, a chance to deflate, inflate, stagflate, or tax the economy, to speculate at the expense of others, to establish a monopoly or any coercive power to intervene with any productive or creative activities, with any individual rights or liberties. It would be a contractual self-help project. I see no need or justification for government control or supervision or guaranties for such institutions. They would and should operate quite separately from the government, more independently than the present churches and sects are from them. Ideally, they should not be subjected to any taxes & licences and regulations and official supervisory boards and inspectors at all, either. However, once governments began to operate as competing business organizations and for voluntary customers only, then they and their members should be free to open clearing accounts there, too, or establish their own clearing banks. - When dealing with all other models and notions of deposit, note-issuing, savings and investment banks, we should, first of all, keep this simple model in mind and check whether any added features are really rightful and necessary or, rather, wrong and self-defeating or risky and distorting, leading to panics, failures, booms and busts or would be too inelastic and deceptive or coercive or all of these combined. - What would happen, e.g., if any credit established in such a simple clearing bank did go astray and were used as a credit in some other banking institution, which might consider it as a valuable foreign exchange and, based upon it, using it as a reserve and blow up its deposit volume or note circulation in an inflationary way. - Imagine that the other banks would do so. Would our clearing bank have to be blamed for their actions? Would it suffer from this? To make it easier to answer this questions, let us assume that our clearing bank, instead of establishing clearing certificates or accounts with gold gram value accounting, had possessed some  gold coins and issued gold certificates and that these gold certificates would have got into the hands of some other banks of issue and were there used as "currency reserve" for a fractionally covered and over-issued currency that is monopolised and made legal tender. Would you, then, blame the gold weight clearing bank for the wrongs and mistakes of that foreign central bank? If not, then you would have not right toblame the gold clearing bank, either, when its credits were somewhere else so used. - But, we should also consider that not only the credits of our clearing bank would go astray but, those of other banks, too. Our clearing bank could insist upon note exchanges or mutual clearing and thus get the own credits back, soon. If, as we assume, our clearing bank adheres to stable value reckoning, i.e., does not engage in an inflation, with its clearing media and all the prices of its customers would continue to mark their market prices etc. out in the agreed upon stable value units, while all around it central banks would engage in monetary inflations. Then, most likely, many more foreign exchange media would be offered to it than notes of its own would have gone temporarily astray - by arriving at central banks in other countries. So our clearing bank could easily pay for the return of its credits, even before their stated validity has expired. The exchange rate for the foreign currencies would fall and the clearing bank would tend to refuse them at all if it would not need them to buy back its own exchange media or debts gone astray.  If central banks began to imitate is value standard reckoning, then this would also not impose any risk for our clearing bank. A mere clearing or accounting standard can be shared with an unlimited number of other people. Nor would the establishment of clearing credits at this bank by foreigners or even foreign central banks bring any risks or problems. The accounts are for clearing purposes only. No gold or cash withdrawal claims can be raised. They can only be used for purchases or sales among the members, the more, the better. Loans to foreign governments would no more be granted by it than to the own - unless the own government would turn into a bank robber against it, using all kinds of pious or cover-up or confidence trick phrasing in the process. Naturally, this system could not function freely and without frictions and problems if it were forced to use a fiat paper money standard (forced currency: compulsory value & compulsory acceptance), were subject to quantity regulations on the totals of its turnovers, had to redeem all its debts upon demand in gold coins or legal tender paper money, had to keep part of its accounts with a central bank, were severely taxed or not permitted to freely clear the accounts of its customers, had to turn over any foreign exchange received at a fixed rate, payable in legal tender, to the central bank, had to purchase government "insecurities" or private capital assets. Freedom from all acts of monetary and financial despotism is presupposed. Its business is the liquidation, balancing or settlement of debts of its customers, payable for the sale of goods, services or labour, or their purchase, i.e. daily turnovers of what holds body and soul together in a society based upon division of labour and free exchange. It would not make any promises it could not keep - if not governmentally prevented from doing its job. Up to the limits of the productive and trading capacity of its members, to provide goods, services and labour to each other, it could increase its business turnover, total of accounts, total of debts settled, its short term clearing credits granted. Both terms, "overdrafts" and "credit expansion" are misleading here. The customers started with a zero account and did not have to deposit any rare metals or legal tender to establish at first a disposable credit account. They might merely have a personal debt limit on their clearing account, as is also practised with credit cards. Such a bank would not and could not "expand credit" but its customers might increase their exchanges among themselves and grant each other credits, timed one, through the mediation of the bank. - But it could become involved in international trade clearing to the extent that it could issue, with the consent of exporters among its customers, clearing certificates upon their ready for sale export goods, sell these, via account transfers to importers among its customers, to the extent that these can use them to pay for their imports, and could stimulate the rapid returns of these clearing certificates in payment for the export goods, which would redeem these clearing certificates. - I try to deal here with economics not with anti-economics or neocomics, as Dr. H. G. Pearce used to say. To grant credits to foreigners would, again, be a matter for its customers. The clearing bank would only help in the process. By allowing foreigners to pay with clearing certificates upon their export goods, to the extent that the clearing bank's internal importers would accept these, it could, in most cases, make the granting of credits to foreigners by the own exporters,  unnecessary. In other words, it would act like a bench (origin of the work bank) or special market for the transactions of its customers. This market institution would neither have the power nor the interest to inflate, deflate or stagflate the transactions of its customers but, rather, to make them as easy and fast as possible. All accounts would represent real goods (services and labour included) and real sales. Or the bank would anticipate sales of its customers, who are ready to sell, by allowing them to spend themselves into debt, up their personal limits. The bank would EXPRESS or RECOGNIZE that turnover credit of one of its debtors. It would not CREATE it. The acceptors of the clearing bank's transfers would CONFIRM that turnover credit by their acceptance of the transfer at par. No arbitrary credit "creation" or "money creation" would be involved. Its turnover credits would not promise any more than could be delivered at anytime: the ready for sale goods, services and labours of its debtors. Especially gold or silver coins or legal tender would not be promised. - Those who would not merely desire the par value of the clearing bank's clearing accounts, clearing certificates or tokens with their nominal gold weight values, but, instead, gold metal of the corresponding weight total, instead, would be referred by such a clearing bank to the free gold market, especially its local representatives, with access to all the gold reserves in the world - and the best knowledge of the clearing bank's par value and the par value of any other local currencies that might exist aside it. The clearing bank itself should not be in the gold metal storage and trading business. That is a business for other specialists. The only connection would be the gold weight value unit used by it for accounting and clearing purposes only. - If the clearing bank were paid in gold coins or gold certificates it should use these to buy back its certificates from whoever wants to buy gold or gold certificates with them. If it saw its accounts or certificates suffering a small discount somewhere, then it should make such gold coin and gold certificate exchanges especially then and there. But it should not accumulate any gold coin and gold certificate "reserves" for this purpose or promise to supply them upon demand. To that extent its proclaimed fractional gold "cover" would be expressly "zero"! It would only promise clearing AT GOLD WEIGHT VALUES. No one would be granted any right to claim gold metal from it, except in the deals in which it sells all gold coins received for its certificates, at par. All foreign notes and credits received would also be used to speed up the reflux of its own clearing certificates and account credits of foreigners.
CLEARING BANKS & NOTE ISSUING BANKS : Clearing banks are the same -as note issuing banks in principle. Only the metal redemption- does not apply to them. - Ulrich von Beckerath, in- correspondence. - That applies only to clearing banks that- operate by clearing only, not to cheque banks, that authorise -their cheque account holders to withdraw either a rare metal -deposit or legal tender, upon demand. - J. Z., 7.4.97.
CLEARING CERTIFICATES & CAPITAL SECURITIES: See: APHORISMS ON- THE MONEY PROBLEM.
CLEARING, CLEARING HOUSES, CLEARING PROCESS, CLEARING- CERTIFICATES: ARE THERE BETTER NAMES FOR IT, NAMES MORE EASILY- UNDERSTOOD, LESS LIKELY TO BE MISUNDERSTOOD? - Mutual settlement, -balancing of accounts, set-offs, mutual payment adjustments,- mutual , writing off of debts, mutual cancellation of debts, -non-cash payment, trade-off money or methods, transfers of accounts only, book money settlement, balancing of debits against- credits, numerical money, symbolic money, accounting money. In -German: Abrechnung & Verrechnung. Perhaps from other languages more suitable- terms could be taken?
CLEARING, CREDITS & DEBTS ON SHORT TERMS: Short term credits and- debts that represent turnover transactions amount mainly to -clearable credits and debts that would and could almost always be -settled by clearing, if only the creditors were not given the -authority to demand cash payments instead and would not, sometimes, be inclined to demand them. Thus the assumption or -legal presumption that all short term non-cash credits, deposits -and cheques are to be claimable in cash ought to be done away- with and replaced by a right to clearing only, in as convenient- and just a way as can possibly be arranged by private and- monetised notes and clearing certificates. Capital savings should -not be used to finance such turnover credits. They are -unnecessary for them. Such transactions are inherently -self-liquidating if only no form of monetary despotism interferes -with them. - J. Z., 7.12.92 & 15.4.97.
CLEARING: A man who can properly clear his own labour services and products against those he wants, is no longer unemployed. His danger would rather be over-employment - since the wants of most men are rather unlimited. - J. Z. 7.8.75
CLEARING: Clearing needs no official organization or regulation -nor any official or private funding - no more so than e.g., -postage stamp or coin exchanges for collectors do. But what it- does need is freedom to organise itself under its own statutes,- independent of all repressive legislation, regulation & jurisdiction. - J. Z., 19.7.91,-26.4.97.
CLEARING: If it is true that all exchanges can be settled by -clearing and, lastly, are settled by clearing, even if only- indirectly so, with the help of currencies, paper monies or coins -or banknotes, then there is INHERENTLY no need to give such- clearing media any other backing or cover or redemption other -than their clearing function. At the same time, seeing that- clearing means the cancelling of mutually owed debts, it is -obvious that forced and artificial values for clearing media- would distort clearing transactions and so would the compulsory -acceptance of such fiat currency and legally turning it into the- exclusive coin and note currency for a whole country. Thereby, -and inevitably, the monopolist and coercer could shed his own -debts, by unilateral action and authorise all other debtors to do -the same, to the extent that this monopolist has inflated his- currency. Creditors and debtors ought to be freed to agree upon sounder value standards - and means of payment - that suit both of them. Through private and free clearing and note issues we should make ourselves independent of the wrongful, flawed and limited options that are the only ones which the governmental central banking system offers us. Free choice of exchange media, clearing facilities, credit instruments and value standards, all of them optional and market rated - except for their issuers, towards whom a juridical legal tender should apply, since they ought to recognize and accept their own debt certificates at par from anyone. Everything else would be fraudulent. - J.Z., 7.9.97, 10.9.02.
CLEARING: Let's clear the air about clearing. With people free -to clear their labour, services and goods, all ready to be- supplied, for the labour, services and goods of others, there -could be no unemployment or underemployment or sales difficulties -for any labour, services and goods that are still wanted at- market prices. All being supplied with either sufficient sound- exchange media or clearing avenues, to facilitate all these -desired exchanges (settled, even when paid in "cash", simply by a convenient form of clearing-), all could be cleared against each other, provided only that- all people concentrated on supplying labour, services and goods -that are wanted rather than on those that are not wanted or not -at prices that would more than cover their production costs. -Moreover, under this condition, all ready for sale labour, -services and goods could be liquidified & then utilized as purchasing -power - redeemable in these wanted things. Whoever puts any -obstacle in the way of the free and competitive private or- cooperative supply of sound exchange media or of clearing avenues -and banking institutions and payment centres, does thereby assure -unemployment, underemployment, depressions, inflations and- stagflations. While a single and very efficient clearing centre- for the whole world could, theoretically, arrange for all possible and desired- exchanges, keeping all willing to provide labour, services or- goods busy, producing them and exchanging them through this clearing centre, it remains true that coins and paper notes, do facilitate clearing-, e.g. in the purchase of a newspaper or a book. Thus, -fully freed clearing should always be accompanied by the free -issue of optional and market rated and competitively issued -exchange media in form of paper notes and coins. The sum of clearing exchanges and the total circulation of notes required -can be no more rightly and efficiently prescribed or limited than- could be the sum of labour, services and goods which people are- able and willing to provide for each other in a division of- labour process that depends upon free enterprise, free exchanges- and free trade. All attempts to centrally manage and limit- exchange media and clearing facilities have led to abuses and- economic crises. Only full monetary freedom can prevent them - as- far as is humanly possible. - J. Z., 3/97.
CLEARING: We are all each other's debtors and creditors, with- the totals of debts and credits exactly balancing each other.- Consequently, if only we organized a perfect clearing system -between us, one not disturbed by any legally or juridically- authorised demands for rare metal cash or monopoly- paper money that is legal tender, then we could clear all our transactions. All the notes- we would still use for the sake of convenience need be nothing- more than clearing certificates to facilitate this free exchange -via free clearing. We should no longer tolerate any law, regulation, juridical decision or administrative authority which -prevents this from happening freely, naturally and fast, doing- away with and preventing all monetary crises, especially inflations, -deflations, stagflations, with their involuntary mass unemployment, expropriations, bankruptcies due to this despotism, general impoverishment and their trends towards despotism, terrorism, civil wars, and wars. - J. Z., 24.7.93,- 24.4.97, 8.9.02.
COIN AND MONEY COLLECTION HANDBOOKS: They should be perused and- partly abstracted or extracted for precedents.
COIN OF THE REALM OR LEGAL TENDER PAPER MONEY: Allow people to- pay and be paid in other monies than the "coin of the realm" or -the government's exclusive and forced currency - and most of our -economic problems would be over. - J. Z., 1989, 8.4.97.
COLES/MEYER SHOPS IN AUSTRALIA AS POTENTIAL ISSUERS: Their -annual turnover according to news of 2.8.93, was 15 billion.- (Currently around 20-20 billion A $'s. - J. Z., 12.9.02.) Assume that they could keep in circulation ca. 10% of this. This- would mean that at any time they could issue and keep in- circulation A $ 1.5 billion worth of their own shop currency. This -amount alone suggests they should take an interest in this aspect- of their own business. Moreover, if they could issue that much of -their own currency - assured of its reflux in sales, then their- total turnover could probably be increased considerably. Moreover, they- might also use a stable value standard in their currency and in -their pricing, thus making their own notes still more widely- acceptable. Furthermore, they could grant wage payment loans with -them, to that extent of their "shop foundation". Such extra short term loans could- greatly contribute to reduce the current unemployment,- officially above 800,000, unofficially probably considerably -above that number. (By exerting an extra demand for productive labour and also turning over more goods and services than before. - J. Z., 12.9.02.) Unemployment for young people is sometimes as -high a 20 - 40%, depending upon the location. But they are not -interested in or free to ask for payment in shop currencies and- the potential issuers are not free to offer them such payments. -- J. Z., 30.4.97.
COLLECTIONS OF MONEY TOKENS AND PRIVATE ISSUES: It could start- with the hand books for coin and money collectors but could be- supplemented, for research purposes, with good photocopies of- other specimens, not mentioned in these.
COMMITTEE FOR MONETARY RESEARCH & EDUCATION: Seeks to promote the -public understanding for monetary processes and the vital value -of a healthy monetary system for a free society. Pamphlet series, newsletter MEN & MONEY. Pres. Elisabeth R. Currier, POB 1630,-Greenwich, CT 06 836, USA, Tel. 203-661-2533.
COMMODITY MONEY, REDEMPTION, COVER & CONVERTIBILITY TERMS SHOULD- NOT ONLY BE APPLIED TO RARE METAL CURRENCIES: These commodities -are not the ones consumers usually want but only in-between- commodities or arrangements in attempts to assure that their -holders or claimants can get the satisfaction in the commodities -and services they really want. Originally, there seemed to be no -better way, than this important step-up from primitive barter. -But since then, in millions of transactions easier, cheaper and -more direct means have been found and used, illegally or legally, -to achieve consumer satisfaction, to balance the variety of- commodities and services with a variety of commodity and service- vouchers, and in thousands of cases the interest in value -preservation has also been served by rare metal commodities not- serving as exclusive or even frequent means of exchange but,- merely, as value standards, by weight, in more or less free- exchanges. For free transactions the barter value of gold can be- abstracted whilst the reckoning or accounting value of gold--weight units can be preserved. For this purpose gold does not- have to be physically present. Nor does it have to physically back up each transaction, nor do even gold certificates have to be -backed or covered by gold or be redeemable or convertible by the -issuer himself. He has only to see to it that his "paper gold"- remains at par with its nominal gold weight value. Then the- convertibility of his notes or certificates can then be transferred to- the world wide gold market, embracing all gold stocks and all- current gold production. Most of the commodity money advocates -never dreamt of such a huge redemption fund for their supposedly- ideal gold standard currency. They considered only the tiny -fraction of the total which their kind of commodity currency -issuers could mobilise for their purposes. Goods warrants with -local shop foundation could liquidify most currently wanted goods- and services while still preserving gold weight pricing and- reckoning, independent of the local supply of gold. When private, no-exclusive or forced paper money has been supplied, which is optional and free market rated but kept at par with its nominal gold weigh value, then it is "as -good as gold" and it was usually preferred to gold as long as- people expected this goodness of paper money to be continued.- Monetary freedom would permit gold coin and gold certificates,- whether 100% or fractionally covered, for all voluntary payment -communities and at their risk and expense. After having been long outlawed, they would probably blossom for a while but then shrink in their occurrence and volume, -in free competition with cheaper and better alternatives, which -would preserve what is good in rare metal currencies and certificates but would eliminate their drawbacks. Say's Law would- then get fully realized: All suppliers of daily wanted goods and services, suitably associated, could then -issue the required purchasing power for them to achieve the sale- of their goods and services within a normal consumption period. - J. Z., -22.4.97, 7.9.02.
COMMODITY MONEY: Commodity money, as usually understood, in form- of gold, silver, platinum or copper coins and of certificates- that are 100 % or, quite openly, only fractionally covered by- them (preferably with precautionary redemption clauses that would- cover the risk of sudden redemption demands), represents just a -few of the numerous options for monetary freedom. Sometimes and quite without justification or necessity, such issues would be granted legal tender status. - If it is so -good, why insist upon it being legal tender? And it would still constitute an exclusive or monopoly currency, unless freedom to issue & use other kinds of exchange media and value standards is introduced. If it is so good,- why insist upon such a privilege? It would limit value accounting -to these standards and this in the face of hundreds of different- value standards that have been proposed and that are believed in- - at least by some. It would also limit exchanges to those that can -be covered by ready availability of these commodities. It would mean that a few or even one selected commodity only would have to -cover the exchanges of all other commodities, as well as of all services, not- merely as mere standards of value but as means of payment, too.- This means the establishment of a very tight bottleneck for all- transactions. Prices in exclusive rare metal currencies went- never so low that the available rare metal coins sufficed to make -monetary transactions penetrate universally, everywhere. Even -primitive barter continued to exist, to a considerable extent, even in developed countries, even into the 20th century, at least in some- spheres, with e.g. some agricultural workers being partly paid in- wheat, potatoes and firewood. Under monetary freedom the ultimate- redemption fund that most currency holders are interested in, -namely, ready for sale goods and services, in millions of- varieties, would be the kind of commodities that would back and redeem or- provide the convertibility for the most common, competitive and optional monies of monetary freedom. Once these have been -widely issued and accepted, rapidly streaming back and being replaced by new issues, and when they have a relationship to commodities like gold, or other rare  metal weigh units, only as their accounting- and clearing value units, in the competitive notes and- certificates of private currencies and in the prices of all goods,- services and labours, then the idea of confining all exchanges to those coverable by rare metal commodities will come to appear ridiculous. To take an example from today: Do you -imagine that railway, bus-, cinema or lottery tickets or postage -stamp, to preserve their value and to measure it accurately, would -have to be convertible, by the issuer, at any time and upon -demand, into a rare metal? Neither does a shop foundation money- need such a cover to give it value - measured e.g. in gold grams- and keeping it at par, in a free market, with such a value,- perhaps even above par (among those who do not want to carry gold- coins around or do not want to confine their earnings to those -that can be paid in 100% covered gold certificates). All other -ready for sale consumer goods (commodities) and even daily wanted consumer services should be considered -as suitable "commodities" for redemption, cover & convertibility,- by those desiring it. And the specialized convertibility desires- of some, who do want to turn their "tickets" into rare metals, should be referred to the greatest -redemption and convertibility fund of all, namely the free and- world-wide market for gold and other rare metals. Notes that are- locally accepted at par with their nominal gold weight value can- also be used to purchase gold metal from a local representative- of the world-wide gold market. Even now most banks do also sell- gold coins to investors or collectors, but not because they are legally or juridically obliged to do so. They are not. - 1.8.94, 17.4.97, 7.9.02.
COMMODITY RESERVE STANDARD OR CLASSICAL GOLD STANDARD? MONETARY FREEDOM: Competition would provide better money than- would government. I believe we can do much better than gold ever -made possible.  Governments cannot do better. Free enterprise,- i.e. the institutions that would emerge from a process of- competition in providing good money, no doubt would. There would -in that event also be no need to encomber the money supply with -the complicated and expensive provision for convertibility which -was necessary to secure the automatic operation of the gold- standard and which made it appear as at least more practicable- than what would ideally seem much more suitable - a commodity -reserve standard.... - Hayek, Denationalisation of Money, 83.
COMMUNISM & CENTRAL BANKING: Communism lives on, e.g. in central banking, also in compulsory taxation and the collectivist ownership claim upon "national" territories that I call "territorialism". It is also preserved in "protectionism", social insurance legislation, legislation on industrial relations and in numerous other State interventions with the economy and our work and private lives, even in the supposedly non-communistic or even anti-communistic countries. But the worst aspect is central banking. From it either the other evils arose or have greatly grown through it. Since it is preserved by a faith it cannot be abolished or effectively outlawed. But what is achievable is tolerance for dissenters, freedom for them to opt out of central banking and to do their own things for themselves, i.e., making use of monetary freedom, as part of the whole range of exterritorial autonomy options for volunteer communities or of freedom of action or exterritorial autonomy or minority autonomy. Since popular majoritarian faiths are not directly challenged by it, as they are e.g. by terrorists, and since monetary freedom is not appreciated by most, that is an aim that is attainable, even as a "fool's" liberty. It can also be claimed under the right to make mistakes, at one's own expense and risk. So much about freedom of action contrary to central banking beliefs. But that does not mean that central banking should no longer be intellectually attacked. One of the most promising attacks in our times could very well be to point out its communist connection, unknown to most of the victims of state schools or state controlled educational institutions. Even those who can't be bothered to study monetary freedom options might thus come to reject central banking as a mainstay of what remains of totalitarian communism, even in most supposedly free Western countries. - J. Z., 11.5.97,14.5.97.
COMMUNISM, CENTRAL BANKING AND LEGAL TENDER: Why did and do all -supposedly anti-communist parties and non-communist parties -support both central banking and legal tender even after the fall -of most communist regimes and economic systems? Why is that- system still preserved in the countries supposedly liberated from -communist regimes? Karl Marx and Engels in their platform in the- Communist Manifesto of 1848: "5. Centralization of credit in the -hands of the State by means of a national bank with state capital- and an exclusive monopoly." In an 1848 leaflet this was further- clarified in point 10: "A state bank the paper money of which is -legal tender, will replace all private banks." - In the Communist -Manifesto they called their programme themselves one of "despotic -inroads on the rights of property and on the conditions of- bourgeois production, by means of measures, therefore, which -appear economically insufficient and untenable." - So, why is- this despotic, insufficient and untenable system still legally -and coercively upheld everywhere and hardly even criticized? -- J. Z., 20.3.97.
COMMUNISM, COLLECTIVISM, MONETARY DESPOTISM, CENTRAL BANKING, STATE SOCIALISM, RUSSIA & THE "FREE WORLD": The institutions and conditions of Russia as well as those of the supposedly free Western world will remain largely collectivistic and communistic as long as the coercive and monopolistic central banking system and its monetary despotism are upheld. - J.Z., 26.8.91.
COMMUNIST MANIFESTO & UNEMPLOYMENT: Did you ever read the 10 Points Platform in the Communist Manifesto? - It was expressly drafted to create an economic chaos, by economically untenable methods - a disorder in which the Communist Party could flourish and finally take over power. - Its point 5 runs (from memory): "Centralisation of credit in the hands of a State bank with State capital and an exclusive monopoly." A leaflet that followed soon after explained that the intended exclusive currency was to have the legal tender characteristic. - We know by now and through bitter experience that neither the ALP nor the LP or CP nor the DLP have a workable employment programme. If either of them had it, it would be firmly in power. All of them, in spite of some lip service to anti-communism, support at least point 5 of the Communist Manifesto, i.e. a system expressly designed to create disorder and further the cause of communism. They do not even apologise for this but consider their behaviour as self-evidently justified and necessary. - The supposed anti-monopolists in the main parties did thus establish the largest and most dangerous monopoly of all, the money monopoly. - All Western and, supposedly free and anti-communist governments did legalise this communistic (or state socialistic or State capitalistic) proposal and outlawed all free market alternatives. (I find this communist idea in almost every mind and, almost, "under every bed" - and more or less hotly defended by most of its adherents.) - Frederic Bastiat once said: "Society Is Exchange."  If this statement is correct then the socialists and other dictocrats, who raised exchange difficulties in this form and others, are thereby and to this extent revealed as anti-social elements, as enemies of society. - Full employment is something NO government can PROVIDE. Not even a libertarian government could. A libertarian government (severely limited government) would just leave the unemployed free to supply themselves with work - and to take all the monetary, financial and organisational steps required for this purpose. At most it would provide advice and would see to it that none of its own measures would continue to create and maintain unemployment. - J. Z., 1985 & 21.5.97.
COMPETITION UNDER MONETARY DESPOTISM & UNDER MONETARY FREEDOM : -Instead of a severe competition (which has given competition a -bad name in public opinion) among suppliers of labour, goods and services, largely free to compete with each other as such- suppliers, for a monopolised and thus scarce or unreliable or- depreciating exchange medium, upon which all their exchanges -depend but which was, obviously, not competitively supplied,- nevertheless, under monetary despotism - there would be, under -monetary freedom, the easy competition of not only supplying- one's own goods, services and labour competitively but, also,- competitively supplying money tickets for their acquisition and- use and for paying all one's debts with them, to the extent that such money tickets or purchasing vouchers etc. can be issued at -par with their nominal values (expressed in whatever value -standards are found acceptable under free choice of value -standards). Not only the goods, services and labours could be- almost endlessly varied, as wanted, but the means to pay for them -could be, too, by those who have the wanted consumer goods, -services and labour to offer. Each certificate would only have to -offer that degree of variety of local goods and services -as its redemption fund which would induce potential acceptors to -accept it at par. Thus severe competition in goods, labour and- services supplies would be ended through an easy competition in- the supply of goods-, service-, and labour vouchers, issued by -their local suppliers, within the limits of their supply and- labour capacities. No more monetary bottleneck or excess friction -would result. Each supplier could also supply the purchasing -power to turn over all his supplies and could do so over and over- again. The quantity of goods, services and labour could be freely -brought into balance with the quantity of purchasing media for- them, by the providers themselves, rather than by outside -monopolists, who have other priorities and even contrary -interests to these suppliers and no rightful claim to dispose of- the goods, services and labours of others by means of exclusive- and forced currencies. Monetary emancipation would fully realize -or emancipate competition, too, as well as free cooperation on a -free market. - J. Z., 14.4.97.
COMPUTER OR ELECTRONIC MONEY, PRIVATELY SUPPLIED AND MANAGED, FOR -CLEARING PURPOSES ONLY: This kind of clearing money would have -to be hacker proof. Forgery would also have to be prevented. -Ideally, a computer of a participant would be permanently -connected to this centre. All his spending should provide his identity, assured by scanning, codes, pass words,- whatever. The system should also be pre-programmed to sound an- alarm at the account holder's computer and a security check- computer at the clearing centre, whenever any tampering with an- account seems to occur, e.g. by repeated tries to hit upon a code- number, flawed scanning etc. E.g., the credit card, holding the -phone clearing credits of a participant, might be associated with -a beeper that would indicate to the card holder any attempt to -spend from his account. Then he should have the option to press a -button leading to the message at the clearing centre: I am not- trying to spend anything now. Apparently, a fraudulent attempt is -in process to use my account. - Then such payments attempts, -at the expense of others, without their consent, should not be- completed until the matter has been clarified via checks with the account holder. Whoever made the attempt to break into an account- and rifle it, electronically, should also become automatically- and electronically traced and identified. - We may not be there- yet but we might not be very far from that situation, either. I- am less worried about this than about governments, especially tax-d departments, getting access to this kind of private trading.- Security against this should become close to 100% before I would- prefer that system to cash payments. - Some claims have already -been made for a large degree of security for private payment channels. I do not know how true and how costly these security- avenues are. - Perhaps as an experiment, libertarians and- anarchists could set up such a system among themselves, for the- exchange of printed, disked, microfiched, on-line literature or- literature compilations on hard disk drives, ZIP disks and -CD-ROMs of the cheapest kind, that offer only text files. -Expensive multimedia are not necessary to convey essential -freedom information. - I still think that e.g. 5,000 active -microfichers in the world, producing and reading microfiche actively, could use their fiche between them to set up a clearing -bank, using a microfiche of acceptable quality of reproduction and -legibility, as a value standard unit and also quantities of them, -as media of exchange. If each participant deposited a few- duplicates of his issue at that central bank of freedom- microfiche, then he could there get a corresponding credit, in -form of the other freedom microfiche that he wants.  The centre -might also act as a literary agency for the participants and- offer their fiche for sale, directly, on a commission basis or by -mediating subscriptions. Thus it could cover its costs and make- some profits - provided only that microfiche would have been- already as widely accepted as that. Indeed, that might never -happen, in spite of all the advantages this medium offers. But -the potential is there.  - J. Z. - 1.5.97.
COMPUTERISED MONEY MARKET DEALS, INTERNET MONEY: How sound can they be, or how soundly can you judge the currencies involved, if all you see and can know about them, through the computers, are figures on a screen? All face to face evaluations, knowledge of particulars, trades, goods and services involved are abstracted in the process. Moreover, the prices quoted are often prices artificially and wilfully manipulated by governments to give a wrong impression. Such money manipulations can occur, as despotic actions, almost at any time and at any degree. The monopolise and forced currencies traded, as well as those which are offered on the Internet, are all too separated from goods, services and labour exchanges and their conditions. The exchanges and exchange media offered by monetary despotism and to a large extent also those offered only electronically, via the Internet, are all too anonymous, not immediately visible, touchable or testable. Too much has to be accepted upon legal commands, faith, advertisements and reputations. It is almost as if one considered only the markets established by powerful criminals, organized crime, pirates, highwaymen, with their loot, their fiat money, their requisitioning certificates, their regular and irregular tributes and levies, and from them tried to judge the economy in general and come to rational decisions. Indeed, the government securities traded in the money markets are investments in tax slaves. When and where and to what extent these tax slaves will finally rebel or simply refuse to pay or evade or avoid taxes can't be safely predicted. To the extent that credit claims to cash or gold are traded, and lead by its system to of an immense non-cash payment and clearing structure, upon a comparatively small gold and legal tender basis, with creditors entitled to demand rare metal cash or legal tender paper money (of which there is never enough to pay all the current non-cash payment and clearing claims), the whole system is very unstable and subject to panics and collapses at any time. Consider also the huge stocks of U.S. paper dollars hoarded all over the world because the other national currencies are, usually, even worse. As soon as the other national currencies improved or became more stable than the U.S. dollar, then these huge amounts might suddenly flow back to the U.S., leading there to a strong paper money inflation, since there they still have legal tender purchasing power. Who can predict when that will happen? - The whole embodies all the uncertainties of the old court watchers, the Kremlin watchers of recent decades and of the Washington and Tokyo watchers etc. - While the government is still despotically involved with finance - this market cannot be free and sound, either. - J. Z., 12.4.97, 18.5.97.
COMPUTERIZED MONEY SYSTEM: Can any electronic system, no matter how extensive, and how often it is changed or reformed, but a full substitute for the inventiveness, creativeness and ingenuity of free participants in a free market for exchange media, value standards, foundations, clearing and credit methods etc. and the subjectivity of values for different people or is it merely another instance of the "one size or one utopia fits all" notion? Especially libertarians should be wary of computerizing all their transactions, making them thus more or less open to government snooping with the most expensive and extensive decoding equipment, software and manpower resource for that purpose. While in a quite free market computerization would offer many advantages, under the rule of territorial governments it also offers many disadvantages. Computers, software and their networks are not and may never the panacea that many people expect them to be. I find that indicated by the way libertarian computer users neglected and still neglect e.g. their microfiche, floppy disk and CD-ROM publishing options for libertarian literature. -J.Z., 27.8.02.
CONFIDENCE & TRUST: The present banking system of monetary -despotism does not deserve the maintenance or restoration of -confidence or trust but, rather, the solid establishment of -permanent doubt and distrust and the replacement of this -despotism by the individually chosen alternatives of monetary freedom. - J. Z., 15.3.97.
CONFIDENCE: An honest currency is not a confidence game or -trick. It can be as honestly offered and accepted  as goods and- labour services can be. - And its quality could be as rapidly- checked: E.g., would it be accepted as "as good as gold", or at- its other par value, to a different standard used in it, in the- next shop or service station? If it is, any suspicion, distrust- and lack of confidence would be rapidly dispelled. - One might -even say that it is a self-interested confidence game of -advocates of an exclusive and either 100% or fractionally covered- gold certificate currency, to insist that "confidence" would be -required for banknotes. Such nonsense is simply thoughtlessly copied, from one author or lecturer to another, over generations.  - J. Z.,- 61.11.91, 26.4.97.
CONFIDENCE: Confidence as the basis for the value of a currency?- Nowadays you can only be confident that a government paper- currency will NOT be redeemed by the government issuer (or its- central banking system ) in gold or silver or by any private bank- forced to deal only in the government's forced and exclusive -currency - or forced and exclusive currencies of other -governments. - You can also be confident that you can pay your -taxes with it and that the government will mostly back you if you -use its currency to cheat your creditors with it for part of your -repayment obligation.  At most you remain somewhat free to try to purchase with it, at current paper prices for gold weight units, -and often taxed, gold on a somewhat free gold market. - J. Z.,- 16.3.97.
CONFIDENCE: Only that confidence is needed for a currency, to be -widely enough accepted, at least locally, that consists in the -assurance that one can buy with the currency all one's wanted- consumer goods and services and pay one's debts with it. When -this confidence is assured then it comes close enough to a -certainty. A further guaranty by the issuer: a promise to -deliver gold or silver for the currency, too, upon demand, is- then not required and thus metal redemption will be renounced by- competitive issuers and not asked for by most users of such a- currency. If they really want to buy gold, they would remain free -to do so on a free gold market. - J. Z., 16.3.97.
CONNECTION, THE, PUBLISHED BY ERWIN S. STRAUSS: On and off it- discusses monetary freedom options, too, e.g. Dio in TC141p48,- Jim Stumm in TC142p29. Stumm, in TC133p115 sees Gresham's Law- correctly: Without legal tender & money monopoly, good money- drives out the bad. Some of the usual objections are raised by D.- Ust, in the same issue, p. 52. Strauss offered some comments to -them in TC134p6. I marked 3 free banking contributions in TC143,- on pp 8,9, 38/39. - I would like someone to provide me with good -photocopies of all such contributions for microfiching. - J. Z.
CONSIDERATION FOR OTHERS: A system of monetary despotism is hardly considerate towards the rights and liberties of others. It does not learn from its mistakes. It does not allow its victims to opt out from under it. It does not permit competition by others. It is the product of totalitarian fanaticism. Under the pretence of providing the greatest possibly public services it manages to provide, actually, some of the greatest possible public disservices and this not only for a moment but, for years and decades even, and this with the consent of most of its victims, while suppressing the free actions of a few enlightened individuals and groups, that could clearly show up its wrongs and defects. - J. Z., 11.5.97.
CONSPIRACY THEORY AND CREDIT-, MONEY- AND DEPOSIT "CREATION": To- assume that all accountancy and trustee companies and directors of -banking coops are unanimous members in an international conspiracy, to "cover up" an endless "creation" of deposits and- credits out of thin air, goes a bit too far for me to take on- credit or faith, just upon the assertion hot air or written assertions that such things would- occur. Some accountants have written detailed reports to prove -that such frauds and cover ups do not and cannot occur (although- many other culpable acts do happen), and that we have here -merely one segment of the many sectarian and popular beliefs on -money and credit. - J. Z., 3/97.
CONSULTANCY OFFERS FOR MONETARY FREEDOM EXPERIMENTS:
CONSUMER COOPS & MONETARY & FINANCIAL FREEDOM:
CONSUMER PRICE INDEX: How can one achieve the transformation of -a politically determined and correspondingly fraudulent CPI to- one or several ones that are economically determined? Full -publicity on the details of its determination would be essential.- Without them one cannot criticise its foundation. A debtor, as -large as the government, with its CPI committed payments, should- not be permitted to manipulate the CPI under the pretence of- properly measuring the inflation which it causes in the first- place through its monetary despotism, and thus, too, diminishing- its debt burden through unilateral and fraudulent action, under- the pretence that it would fully undo the inflationary effect, at- least at annual intervals, for some people, so "protected". (That would leave, for instance, the losses through the degrees of weekly and monthly depreciations, for those receiving regular weekly or monthly payments, like wage and salary recipients.) -Naturally, the abolition of monetary despotism would be a more- fundamental solution. But honestly compiled indexes, well -publicised, could be among the first of the required steps to -reveal monetary despotism for what it is. - One wonders why the- creditors of the government, so defrauded, do not speak up and -defend their interests. Also, why supposedly free economists do -not speak up against this fraud. - How much does the government -owe its CPI indexed creditors, every year still, after it fraudulently determined the CPI in its favour? - We do let- governments get away with all too much, against our own -interests. J. Z., 14. & 18. Dec. 93, 2.5.97.
CONSUMER PRICE INDEX: How honest or dishonest is e.g. the- Australian Consumer Price Index (CPI)? E.G. Superannuation -payments are determined by it. Personally, observing the prices -that I have to pay as a consumer, I was always of the opinion -that it understated the inflation rate - because that was -opportune for politicians and saved them money in indexed- payments. I was also assured by several economists that in the- determination of it, in Australia, some price controlled items were- intentionally included. That is an obvious absurdity and wrong and fraud. To -measure inflation one should use only prices that are not- controlled, or artificially kept low or perhaps subsidized.- Details on which of hundreds to thousands of possible indexing -methods are used in Australia to determine its official CPI, are -not known to me. Unfortunately, the mass media and associations of employers, employees, retailers and wholesalers not- supplying or sufficiently publishing independent and other CPIs, to my knowledge, that would help to throw doubts upon the official one.- - J. Z., 6.7.91, 30.4.97.
CONSUMER PRICE INDEX: The official CPI seems to be an at least -annually repeated malicious and self-interested lie of officials- entrusted with its calculation and application. It harms -millions, whose incomes are thus wrongly indexed in the inflated -and forced currency of the government. The culprits involved seem- to remain anonymous and immune from prosecution and even from -public censure by genuine economists. So far no investigative journalist has tackled -this fraud, as far as I know. No one has been brought to court -for it, as he should be, by a class action. The top rulers and- politicians do not depend upon CPI increases. They seem to- legislate salary increases for themselves and various perks -almost as they please - and then even cheat in their declarations -on their recoverable expenses. When one was recently found out,- an Australian Senator, he first blamed mere accounting mistakes.- But, apparently, there were dozens of them and almost all in his -favour. (No full reporting on this took place but the matter is- supposedly under full police investigation.) When he pointed out -that most of his colleges did the same, he earned their wrath, risked his future and was called a traitor. Indeed, he betrayed their -all too common frauds and dishonesty. They did not like that. -But this hue and cry is likely to be soon over and the rorts will- go on and on, in one form or the other, usually far beyond an -honestly determined CPI, which they have so far not managed to- provide for poor retirees like myself. The State Superannuation- Fund, to which I was forced to contribute at least a minimum amount -annually, was once bragging that it provided cheap, i.e. very low- interest housing loans to other than public servants. The -representatives of the thus "insured" remained silent. Moreover,- the employer's half of contributions were not paid together with -mine, earning interest over the years, but, in nominal and- depreciated amounts, only when I retired, after 28 years.- Economically, these contributions were part of my wages and as my- wages, if invested, would have earned interest over almost 3 -decades. Another fraud in this old age security system that is -passed over in silence by most. At least part of this -superannuation fund's accumulated reserves had, probably, to be -invested in government insecurities - repayable largely by the -same people in form of taxes, although in depreciated money. -Rorts upon rorts. And at the same time quite honest and safe old -age security arrangements are outlawed and the existing systems -are frequently interfered with and taxed and regulated contrary -to the interests of the thus "insured". I was not at liberty to- opt out of that system, while I remained a public servant in NSW -and to adopt an alternative old age security option not government regulated and controlled. Even if I -had been allowed to opt out, all the others would be just as much meddled with and -none of them was free to offer value preserving clauses, except -to the extent that it was also investing in CPI indexed government securities. Flawed as this CPI is, to the advantage of -the Fund, or its favored borrowers, and to my disadvantage, at least I am somewhat protected by -it against the results of further inflations of the Australian governmental paper dollar. What is misnamed social or old age- "security" has actually forced many people into involuntary -poverty, who, under full monetary and financial freedom could- have become rich in their old age on no higher contributions than -they were forced to contribute to achieve a low pension or -superannuation in their old age. Never trust any government to -get or do anything right. - J. Z., 30.4.97.
CONVERTIBILITY: Convertibility is a safeguard necessary to -impose upon a MONOPOLIST, but unnecessary with COMPETING -suppliers who cannot maintain themselves in the business unless -they provide money at least as advantageous to the user as anybody- else. - Hayek, Denationalisation of money, 84. - Some have argued -that there would be a competition to provide the best possible- convertibility and that would be a 100% convertibility by the issuer upon demand of the note holder.  But, under free- competition it would surely revealed that the ultimate liquidity- or guaranty that people would like to receive upon failure of a -bank of issue is less important to the current value and use of a- currency than is its acceptability for goods and services in -daily demand. Consequently, and in order to save the outlay for a -gold redemption fund, many issuer would proclaim merely that they -are always ready to provide for convertibility of their notes -into goods and services that are in daily demand but that they would not supply themselves their equivalent value in gold- weights, too. Instead, they would merely price their goods and- services and their debts in gold weight units and accept their -own notes at par with their nominal gold weight value (and other -notes only at their gold weight value in a free market). In- other words, they would only try to preserve the par value of -their own notes with gold weight units but without obliging -themselves to supply the gold weights. Those who would then rather -than collect their goods and services at par with them, purchase -gold with them, would be referred not to any stocks of gold- that the issuer might posses, for other than currency purposes,- but, instead, to the greatest gold reserve & redemption fund of all, that of the- whole world, of all of mankind, the one available to all buyers of- gold, to all fans of convertibility, metal cover, gold value guaranties and redemption, namely to the free gold market. They cannot demand more than that -the notes which they hold of any issuer are accepted there at par (or as good as gold). With- the maintenance of that par value the rightful obligation of the -issuer would be ended. Nor would the issuer be obliged to- maintain the par value of his notes outside the locality where he- issues them as turnover or clearing media. He is not under any -obligation to maintain them at par in the whole world. At the- place of issue no only the issuer but most of the whole local -trading community would treat his notes as good as gold and so- would the local gold sellers. But, ultimately, only he would be obliged to accept them at par from anyone and that would tend to keep it locally at par in other transactions as well. What more can one rightly ask for -from any as convenient paper means of exchange than -its local purchasing power and value being at par with its nominal value? It would- then be considered as superfluous and unnecessarily expensive to -try to provide each note holder with a 100% or fractional gold metal redemption -fund as well. Those who do not offer it and declare that they will not so -cover their notes, would win out in free competition. Their -prices will be lower and their exchange media and their value -standard will be just as good or even better and less subject to fraud and deception and runs upon the remaining gold hoard of an issuer. - J. Z., 18.4.97.
COOPERATIVE BANKS OF ISSUE:
COPYRIGHTS FOR MONETARY FREEDOM WRITINGS: Seeing the -catastrophic consequences of monetary despotism - and how often -they occurred and for how long, should we still insist upon- copyrights for all monetary freedom writings, when this might- obstruct their publication or republication? Or should we try to- promote their duplication and publication by any means, in any- medium that we can afford, fully aware that at least at this- stage it would be almost impossible to acquire any riches or even -to recover the costs of such publishing efforts? Or can you -imagine any such writings becoming best-sellers, soon?  - J. Z.,- MFNL&MF 3/4, 2/89.
COPYRIGHTS RENUNCIATION FOR MONETARY FREEDOM CONTRIBUTIONS, AT -LEAST UNTIL THIS BASIC LIBERTY IS FINALLY ATTAINED :
CORRESPONDENCE ON MONETARY FREEDOM:
COSME, PARAGUAY, Cooperative Colony, had a Labour Exchange Bank, -according to TIMES, Aug. 31, 1897. Source: A. Menger.
COST-PUSH & WAGE-PUSH INFLATION: These notions are based on the same fallacies as those of the wage-price-spiral. They ignore the monetary factor or assume merely the degree of monetary mismanagement that is normal for monetary despotism, in which politicians depreciate the currency in the effort to maintain their own power by buying votes with inflated paper money (inflation tax) and with other taxes founding their "government-spending" programs. - J. Z., 24.3.97, 30.8.02.
COST-PUSH INFLATION: In the strict sense, there is simply no -such thing as a 'cost-push' inflation. Neither higher wages nor -higher prices of oil, or perhaps of imports generally, can drive -up the aggregate price of all goods UNLESS THE PURCHASERS ARE -GIVEN MORE MONEY TO BUY THEM. What is called a cost-push inflation is merely the effect of increases in the quantity of -money which governments feel forced to provide in order to -prevent the unemployment resulting from a rise in wages (or- other costs), which preceded it and which was conceded in the- expectation that governments would increase the quantity of- money. They mean thereby to make it possible for all workers to- find employment through a rise in the demand for their products. -If government did not increase the quantity of money, such a rise -in the wages of a group of workers would not lead to a rise in -the general price level but simply to a reduction in sales and- therefore to unemployment.- Hayek, Denationalisation of money, 75.-- See : WAGES, PRICES, QUANTITY THEORY, INFLATION.
COUNTERFEITING  The biggest counterfeiters have been- governments. - Jack Allen Horrigan, article "Inflation Island",- 10/1971. - One can hardly "forge" one's own notes but, under -legal tender and the money monopoly, one can multiply them, still -force these multiples into circulation and thus depreciate them- and drive up all prices expressed in them. In each transaction -the creditors are not cheated out of the whole value, as by the -use of a forged note, i.e. an entirely invalid payment, but- instead, merely by the inflation percentage. - Advocates of -monetary freedom should try to avoid inaccurate terms. They- should leave that activity, as a monopoly, to the advocates of monetary despotism and attack these lies and false pretences with- properly expressed truths and correct terms. - J. Z., 18.4.97.
COUNTERFEITING & INFLATION OF LEGAL TENDER PAPER MONEY: If you- do it it's illegal. - From a Workers Party leaflet: Something's- Wrong in Australia. - A forger does not forge his own notes but -those of others. At most he could water down his stock or issue -more of his own notes secretly than he has promised to do or recorded as having done. But all his notes would still be -genuine. Only their value would be reduced. Not a single one of- them could be declared to be a total forgery and quite invalid,- although the purchasing power of all of them would be reduced. --J. Z., 19.4.97. - Alas, I had subscribed to the same error myself,- when I wrote on 14.11.73 : If you want to engage in- counterfeiting legally, join the central bank.
COUNTERFEITING, FORGERIES: Counterfeiting is a crime which politicians -monopolise. - Stormy Mon, TC121, 29.7.84. - CAN one "counterfeit"- one's own notes? - The issue-monopoly of central banks and the -legal tender coercion and monopoly of its nominal paper "value- standard" are by themselves criminally wrong and harmful enough- without adding the false charge of "counterfeiting" the own -notes. - When other governments counterfeit the notes of the own -governments, or when private forgers do so, or when private banknotes are forged by criminals, then that is- counterfeiting. - J. Z., 2.8.89, 29.4.97. - The wide circulation area and long circulation period as well as the uniform appearance of government paper money makes large-scale and prolonged forgery of it easier and more difficult and slower to find out. - Thus some people predicted that some day government currencies might become destroyed through forgery. Usually they manage self-destruction well enough on their own. - J. Z., 9.9.02.
COUNTERFEITING: When Block discusses counterfeiters, even his- economic arguments falls apart. His protestation that paper money -is already counterfeit is irrelevant. The counterfeiter, whether -government or private, is an aggressor, defrauding others of -rightful value. The real crime of the counterfeiter is not that- he copies worthless government notes but that he passes on his -own worthless notes to innocent victims. To say that government -theft justifies private theft is an argument worthy or the New- Left, not a self-styled defender of liberty. -  Sharon Presley,- where? when?
COURT CASES AGAINST MONETARY DESPOTISM? - I think them too costly -and having much too low  chances for success. Most likely only -the lawyers would benefit. The time and energy involved for the -litigants and the costs, would be better spent upon research,- studies and publishing efforts. - J. Z., 7.4.97.
COURTOIS, French economist who opposed the note issue monopoly - according to Rist.
COVER & REFLUX ARRANGEMENTS THAT ARE POSSIBLE & ADVISABLE :
COVER & RESERVES: Security provisions or guaranties in case of- bankruptcies, when the circulation efforts of banks of issues -have failed, should be distinguished from securities, safeguards,- covers, reserves, clearing and reflux arrangements that limit- the quantity of exchange media issued, assure demand for them,- make certain that they stream back to the issuer and preserve, as -far as humanly possible, the par-value of the notes with a sound- and acceptable value standard. These latter precautions are -necessary to the sound functioning of alternative, optional, privately or cooperatively issued local currencies. When these precautions have all been taken, then the former precautions for the day of liquidation of the note issue -business, would not be necessary at all - at least not for such sound banks -of issue. (What kind of "securities" would be necessary for banks -that issue capital securities is another question. Some might -merely issue securities to make the real capital assets - as well- as capital expectations of their customers  - more liquid and- transferable, as liquid as one can make capital securities. They can't be made as liquid as currencies have to be - upon this- foundation alone.) - Back to note issuing banks and e.g. shop -associations issuing local currencies with shop foundation: -Unlimited liability for the directors of such banks would not cost- anything, could not do much harm and might do some good. Also -some common sense rules, like a limited area for loans and- circulation, a limited circulation period, the obligation to use -other exchange media received to purchase the own notes at par, -the acceptance of other exchange media only upon payment of a- small fee, whenever the own notes have suffered a small discount, -publicity for all issues, the stopping of further issues upon any -but a trivial and temporary discount, contracts with the debtors -of the issuing bank that bind them to acceptance at par, the -discounting with notes only of "real bills" (sound commercial bills) or their equivalents, -that are short-term and do represent goods already produced and sold- and on the road to the retailers, if not already in the- retailers' shops. - A currency is accepted as a "current" -currency, at least as a local currency, not because in case of a- bankruptcy the creditors would be able to resort to a guaranty -fund but because there is a current use for it, either for the -note holder himself, or indirectly, through a current demand for -it by others, for their consumer satisfactions and other debt -obligations. This and the final readiness to accept them, in debt -repayments to the bank of issue, and its debtors, who would- mainly be suppliers of goods and services in daily demand, and -the demand for the notes to pay wages, salaries, and one's own -profits etc. with them, constitutes the essential debt, demand, clearing, -reflux or shop foundation for sound local currencies. Without it- even gold coins would only be of some use to some. If these few -could not convert some of their gold coins readily into food,- drink and shelter, they would perish. Without this shop -foundation small money tokens would be no more useful than e.g., -shares are as means of payment. - Which other local covers -than shop foundation could and should be mobilised by a single or- competing local currencies? E.g. the services of professionals -and tradesmen, also that of local restaurants, pubs, coffee--shops, all kinds of eateries, entertainment centres, bus- companies, taxi services, the local rail connection, and the local rate -credits, and fees, legally granted to or extorted by the local government, the local- suppliers of gas, electricity, water, sewage and garbage disposal -services. As long as any shortage of exchange media is still- perceived or expressed in a premium for local exchange media over -their value standard, no monetary payment sphere, which could -issue its own sound exchange media, should "poach" all its means of -exchange requirements from those who have provided their own- media of exchange for their own purposes. Custom and ethics on -this might, one day, become as strong as e.g. the condemnations of -cheating are, when gambling. If you can help yourself in this respect, -then you ought to help yourself in this respect. Mature adults- mostly feel strongly the urge to become self-supporting, not a burden -upon anyone else, if they can help it at all. (Welfare States have greatly diminished that feeling for self-support and self-responsibility. - J.Z., 8.9.02.) That aspiration- should become extended to becoming monetarily independent as far- as possible and convenient to do so. Naturally, nobody would be -obliged to issue personal notes that could have only a limited- local circulation among a few and that only at a considerable- discount. But as soon as proper discounting facilities are- locally established, combined with proper clearing services, then- even individual issuers of IOUs, known to be honest, industrious and productive, could issue their own IOUs, in standardised- denomination, not for general circulation, but bring them to a -local discount or exchange office to get them there exchanged into one- of the local currencies. That discount or exchange office would- then have the task to put these IOUs into the hands of the few- who, with them, would want to purchase the goods and services of -the issuer of these IOUs. Upon purchase, they could then present -these IOU's in full payment at their par value to the issuer, themselves or through their bank - for at least- towards the issuer any note must have, juridically, a full legal- tender, i.e. debt-dissolving power at its nominal value. The- issuer cannot rightfully and unilaterally repudiate such a debt. If he tried to-, then he could be criminally prosecuted for fraud. - J. Z.,-25.4.97.
COVER FOR MONEY ISSUES: As money cover can serve anything that- is found acceptable by well informed acceptors of a paper money -in a free market. - J. Z., 77 & 97.
COVER FOR NOTE ISSUES: Goods already sold to wholesalers or -retailers are a better cover for notes than merely speculatively- warehoused goods of manufacturers or speculators, withheld from -sales in the hope for higher prices coming up or of goods -that are can be sold not for normal market prices at all but- merely for emergency sales prices, i.e. at huge discounts and, -possibly, only at a loss. That there can be "illiquid" goods, -stored in hopes of future buyers, I know only all to well - as the- producer and distributor of libertarian and anarchist microfiched literature. -- My microfiche have certainly not yet acquired currency or- bestseller status and are not even suitable as yet for inclusion in e.g. LETS exchange lists, for lack of demand for them and not -yet included in many literature exchanges, bibliographies and abstracts. - Microfiche are -illiquid assets and others than libertarian microfiche publishers and readers, like myself might not -even consider them as assets at all. - But they do last and are available upon demand while, apparently, much of the Internet- information stays there only temporarily and only a fraction of -the temporary appearances is so far being archived by some,- probably of all whatever it may offer in the monetary -freedom sphere, so far. - Only some literature and address lists- have reached me so far from that source, thanks to some -correspondents - and some disks which my systems won't accept or -read at all! - J. Z., 4.7.91 & 12.4.97.
COVER: See: APHORISMS ON THE MONEY PROBLEM.
CPI & INFLATION: The official CPI (Consumer Price Index) is intentionally full of misleading figures, because the government has a vested interest in not letting it represent the real and much higher inflation rate. It is obliged to pay CPI-indexed pensions and the real inflation rate would make a bad impression high during elections. - It also has largely pre-empted the market for other price-index calculations. If they are compiled at all, by compilers not salaried or subsidized by the government for their labors, then the government largely sees to it that their divergent figures are not widely enough publicized. The mass media do not want to offend the government, which is one of their biggest advertisers. I would like to see a tabulation of the official CPI rises over the last few decades, side by side with the real prices of some of the standard consumer goods and services for the same periods. Not even the rise in the A $ note and coin circulation is regularly announced, nor are the rising figures for both, for the last few decades, put together and published. It is much easier to defraud people who are kept in ignorance. - J.Z., 23.1.01, 27.8.02.
CPI: See : CONSUMER PRICE INDEX.
CREATION OF CREDIT & CHEQUES: The creation of credit is made possible by issued cheques not being redeemed immediately. - Popular opinion. - If and to the extent that this would be possible, we would than have a part disposal of cheque account funds by the banks, for a short time, without consent of the cheque account holder and at his expense and risk, not a "creation of credit" out of nothing. - The total circulation seems temporarily increased but each of these seeming increases is followed by a corresponding decrease. Moreover, the very delay in cheque credit availability to the receiver of the cheque, still 5 days in Australia as far as I know, in spite of computers and considerable competition between banks, does slow down the spending of the cheque credit correspondingly and thus balances out the "multiplication" of means of payment that may be temporarily involved, if banks disposed of these funds for these periods. The basic rule still applies: The same amount cannot be spent by two people at the same time. One should also take into consideration that the establishment of a cheque account, 100% covered in cash, has correspondingly hoarded cash. And this cash becomes then mobilised or may be demanded from the recipient's cheque account, only after a cheque is issued and credited. In other words, a considerable hoarding is involved - to facilitate cheque payments, which should be taken into consideration when one imagines that cheques would multiply means of payment, not only facilitate payments. - The "mysterious" nature of the seeming" creation" of cheque credits "out of nothing" lies in the very nature of the clearing process, if one considers merely the payment side of it and not the goods and service side, which is thus cleared. Assume 1000 cheque account holders in a self-sufficient economic community, each with $ 1000 on their cheque account and all producing for each other, and providing each other with goods, labour and services, all that they require and are capable and willing to supply to each other. Within that limit of their physical capability, willingness and productivity, each of them could spend their whole cheque account every week or even daily and, nevertheless, in the average, all would end up with ca. 1,000 on their accounts again, through the goods, services and labour they would have sold to the others. Since real exchanges of wanted goods, services and labour would be involved, no price increase would have taken place even when, from one week to the other or within a day, they would have bought double as much from each other in this way than they had in the week or on the day before. Their account total of 1 million value units would not have been increased by a single value unit. All their cheque-mediated transferrals from their accounts, would, in the average, have their equivalent in cheque payments received from others. The used cheques would be cancelled and new cheques would be issued all the time, to be cancelled in their turn. The cheque credits transferred would be mutual, not unilateral. They would represent genuine trades and exchanges not robberies or embezzlements or "creative" financing. Each account would be liquidified by cheques but not multiplied. But the number of possible, desired and agreed upon exchanges could and would be easily multiplied in this way, limited only by the ability and willingness to supply wanted goods, services and labour. - Since many costs are fixed, regardless of the number of transactions that take place, an increase in transactions could even lead to some price reductions. Certainly the kind of extremely low prices happening in emergency sales or bankruptcy sales, would become much rarer under such a system, especially, when all the participants would renounce any claim to cash payments and declare themselves satisfied for all their transactions with the mutual clearing of their cheques through their clearing house cheque accounts. - In a world where natural science knowledge is not yet general or wide enough, in which still many still believe in a God as a loving father, in a devil or in demons, in which libertarian gold bugs consider all means of payment not made of gold or 100% covered gold certificates, one should not be surprised when this clearing process is by them interpreted as a "creation of credit" out of nothing or "out of thin air". - Thin air is, by the way, not nothing, either. Otherwise people living in high altitudes could not breathe. And even a vacuum is not something that can be produced or found very cheaply on the surface of this planet. That is one of the reasons why some industrial processes could be profitably carried on in space. - I guess this kind of discussion of pop notions on the subject will have to be carried on until quite striking and convincing refutations have been formulated. - J. Z., n.d. & 29.3.97, 31.8.02.
CREATION OF CREDIT & MONEY? Credit or notes are not created "out- of nothing" and do not only require paper, ink and printing -presses. As a rule, credit certificates, banknotes and- clearinghouse certificates are not "created out of nothing" but -are temporarily produced IN EXCHANGE for other kinds of credit--notes or assets which are less suitable for general local- circulation. These exchanges of bills, unsuitable for general- circulation, into bills that are suitable for at least local- circulation, represent clearing processes in progress and the- movement of already produced goods, that are already sold, at -least to wholesalers, if not already to retailers. And these goods are the real -redemption fund for such notes and cut up bills, as they are for -any kind of currency. Such turnover credit or bill discount is- not given for nothing but only to genuine producers and- suppliers. And it is necessary to provide sound wage and salary- payments to workers and employees, which they bring to the -stores, spend them there, so that they stores can repay their -debts to the wholesalers and these redeem their real bills (or -equivalent short term debts) to their suppliers. Such clearing -notes and clearing house notes, by their very nature, do -not need any rare metal cover at all to keep them at par with- their nominal gold weight face value. Their par value is assured by a strong reflux or demand for them in debt repayments. If the -debtors cannot pay their debts they are thrown out of business. -This is a strong enough incentive for them to serve others with- their goods, services and labour for banknotes and clearing house -certificates (or with equivalent book or electronic accounts). This -kind of money can always be freely and competitively issued to -the limits of its goods, services and labour cover - and not -beyond it. Readiness to accept a money in payment for daily- wanted consumer goods and services and in payment of any other -debts due, is a sufficient cover for any sound exchange medium.- The best value standard for any kind of exchange medium,- purchase and sale, for any kind of traders, at any place and time- is precisely that which they consider to be the best or good -enough for them, as long as they do. No third party has a right -to prescribe a standard for them, which they do not like or- distrust. - Especially labourers and employees must be free to- accept "cut up real bills" and employers must be able to offer -them to them in payment and stores and store associations must be -free to issue them and to accept them and to pay their debts with- them - on via their bank accounts at banks of issue. - The free- exchange of one type of paper claim for other kinds of paper- claims, more suitable for their purposes, does not amount to a- creation of some value out of nothing but merely to a -transformation of one suitable resource and matter into another one, one- claim, into another. It does not interfere with transactions. It- does not cheat and defraud or confiscate but facilitate. It- increases transferability of goods, services and labour and of exchange media like real or sound commercial bills. It is -transferability which gives any goods, services and labour their -market value. In a division of labour economy we all depend upon -it. The easier any value can be transferred, the higher its- exchange value will be to its owner. No exchange medium needs -universal acceptance or is universally accepted. It takes brute- and wrongful force to make a single paper money acceptable in a -whole country. Competitive and private and non-coercive and freely market-rated paper exchange media need only a sufficient- local acceptance to be a good enough local currency, that can -locally widely circulate at par. In the next town or market it- may already have a discount. So what. That applies also to all -national forced currencies, whose legal tender and monopoly end -at a national border. - Compare the circulation charts in PP 41.
CREATION OF CREDIT, CENTRAL BANKING, CONTROL OF MONEY, MONETARY CONTROLS, SOCIAL CREDIT: Private creation of credit is inflationary and must be controlled. For this central banking is required. - A monetary despotism and social credit notion. - Before central banking, with its note issue monopoly and legal tender, was introduced, there was never any evidence for this - and afterwards, the only one that could "create" money was the central bank. Credits not granted in additionally issued legal tender (or short term or instant claims to legal tender  are just credit TRANSFERS, mediated by banks or by other private contractors, and as such they cannot have any influence on prices and wages, no more so than any clearing transaction could. Consumer goods and services are still largely paid for in legal tender cash - and only the Central Bank can legally multiply that. There are, indeed, many credits that are ultimately, upon demand, to be paid in cash. All credit transactions are speculations over time on the availability of that cash. When it does not become available, the credit collapses to a fraction of its former volume. It required, for its granting, as well as its repayment, the availability of cash or of claims to cash. Especially when payment through clearing options is not generally recognized as an alternative, i.e., when the creditor's legal and juridical claim to payment in cash is continued - and the cash supply remains monopolised.  No creditor can create his credits out of thin air. None of them is a magician. But myths that are widely believed in are hard to kill by mere facts - in economics, or what passes for economics, as well as in religion or in "political science". How can one prove the non-existence of something that does not exist? - All credits are limited at present by the creditor's right to demand cash in repayment. And debtors who are not cheats know that they do have to somehow acquire the cash - or claims to cash - or try to acquire them, to repay the credits received, if they do not want to be driven into bankruptcy and few want that. Once this legally demanded cash backing for all credit and non-cash payment contracts does fail or is insufficient, then, credit collapses correspondingly - and even more cash is wanted from then on for many to all transactions that were previously carried out without cash.  During such currency famines - under a money issue monopoly and a manipulated value standard, in which all prices and wages are marked, prices and wages tend to fall in a deflationary way and there is then a negative feedback effect involved: While lowered prices encourage buying, falling prices discourage buying. Thus, once a deflation has set in and is not stopped by the introduction of monetary freedom, much more money hoarding takes place than usual - as much as people can afford to hoard, and the effect is that a deflation accelerates. Only those purchases are still undertaken by most that they cannot avoid. Those lucky enough to be in possession of considerable cash stocks can then acquire otherwise expensive capital goods very cheaply, and may do so in the expectation that sooner or later the inflation will end and that they can then sell these capital goods much above the forced sale prices at which they acquired them. - Prices marked in stable value units are not influenced by the amounts of cash or credit available. But they can become reduced through the deflations made possible by monetary despotism. When they are marked in unstable and manipulated "value standards" then they participate in all the instabilities and manipulated effects of that "value standard". - All cash transactions have a large clearing "overhead", 10 to 20 times as large as the amount of cash available, because they are easier and faster to arrange and, in normal times, they can, upon demand by the creditors, be changed into cash, because in normal times this is rarely wanted - because the clearing and non-cash-payments are so convenient. Whatever effect this "overhead" is presumed to have upon prices (I would deny any, since real exchanges are behind most of the payments, if not zero sum speculative games), have already taken place. For centuries the non-cash transactions have far exceeded the cash transactions. More credit than the market requires and can be paid, in normal times, ultimately and upon demand in cash, cannot be created out of nothing or upon a too tiny cash basis. Debtors do indeed often defraud their creditors, spend or waste what they have been granted in loans and become unable to repay. But such cases do not blow up the total volume of credit. Instead, they make more potential creditors more careful in granting further credits. Such cheats, well publicised, rather lead to a degree of voluntary credit restriction by the potential creditors, i.e. their cash holdings and current account or deposit holdings tend to increase. Whereupon then many wrongly conclude that no deflation has taken place because there is an abundance of short-term funds accumulated at the banks. Part of these may be frozen - with the banks unable to pay them out in cash (because they had lent them out on long terms) - and part of them being kept there intentionally because the deposit holders want them there and because the banks see no liquid and secure enough investment opportunities for them, while sales and orders are down. At the same time private cash holdings, by those who have altogether lost their faith in banks, would increase as well. - J. Z., n.d., & 29.3.97, 31.8.02.
CREATION OF CREDIT: "Creation of credit or money by the banks leads to inflation. Banks can create credit or money out of nothing or can multiply any deposits or money they receive by a factor of ten. - Popular opinion. - 1.) Credit is not created by any bank but, rather, through the mediation of a bank, given by its customers, its depositors, to the extent that they do not dispose themselves of their deposits for their own purposes and, especially, to the extent that they grant the bank time deposits or buy its securities for a certain period. - 2.) Inflation could take place only when there is "refinancing" by the central bank with newly printed legal tender money (when under free market rating and monetary competition it would suffer a discount and widespread refusals to accept), in case the first, secondary and following depositors want to utilize their deposit accounts for their payments at the same time. But then we would have a coercive inflation of paper money and not "credit creation". When not supported by fictitious deposits from the central bank or additional fiat money issues by it, private banks can only transfer and not multiply accounts. For each credit they have to account an equal debt, for each debit an equal credit. As long as their computers do not malfunction - and correct bookkeeping checks would soon reveal that, no multiplication of credits takes place and a corresponding multiplication of debits would soon be protested by the victims. Credit and money creation by private banks is entirely imaginary, a false doctrine of Social Credit ideologues. - Without this "refinancing" by the Central Bank, when any private bank has over-extended itself, e.g. by wrongly investing short term deposits in medium to long term loans, or in other cases of fraud, embezzlement or careless investments in the irresponsible spending of some more or less despotic foreign regimes, or in the wasteful projects of the own governments, corresponding bankruptcies would and should occur. Banks should never give their short term or instant withdrawal creditors the impression that they could at any time fully withdraw their funds - in all cases in which they have been invested, at least in parts, in illiquid funds. - But if there is an agreement between short term depositors and a bank that specifies that their money is repayable only e.g. in instalments, as it becomes available from the repayment of loans, i.e., as soon as possible, then no run can and will take place and the transaction can be honest on both sides, with spare funds, from the repayments of due loans, used as best as they can be used. I doubt that under free competition such banks would be very successful but, at least, they would avoid the term or timing risk. Medium and long-term loans should always be financed only by corresponding medium and long term deposits or savings, best by the issue of corresponding securities. Otherwise, the banks would sell to the short term depositors only the illusion of having liquid funds while they have in reality only a claim upon the medium and long term debtors of the bank. If the governmental bank supervision or governmental juridical system and governmental auditing or government approved auditing system worked, then such abuses would not be possible in most cases or on a very large scale or for long. But, in the absence of fully free banking they are likely to occur often. - Money or credit can no more be "created out of thin air" than can anything else - except the constituting elements of thin air and even that process is not cheap. (Example: Nitrogen production out of the air for fertilizer production.) - Credit cannot be created by cheque issues, either. In Germany cheques must be presented within 8 days. Receivers of cheques use them fast for credits on their accounts and do not leave their accounts idle as a rule. People are not only savers but spenders. Borrowers, especially, are more spenders than savers, at least when spending their loans productively, to enable them to repay them when due and to make a profit in the process. When workers or clerks are paid in cheques then they do not, as a rule, put most of the amounts received into savings accounts. And if they did this on medium or long terms, then such savings could not act in an inflationary way, either.  When banks rightly or wrongly assume that call-deposits will continue to increase then many of them will be misled into investing part of these total deposits into other than short-term liquid funds. A liquidity risk is thereby taken up, not an inflation risk - unless the central bank helps them out, with additional legal tender paper money issues, whenever they need it in one of the inevitable future liquidity crises that will then occur. - No one but the central bank can increase the cash or near cash purchasing power of an economy under monetary despotism and only this tends to increase legal tender prices when legal tender is inflated. - To the extent that non-cash transactions can be freely settled by clearing, without being suddenly disturbed by cash demands, for which no equivalent cash exists, genuine exchanges are settled by clearing, in which the clearing settlement always is equal to genuine transactions. Then, under sound value standard reckoning no inflation can take place because the clearing settlement is always equivalent to the purchases and sales of the goods, services and goods involved. But if all prices, services and labour are coercively priced-out in an inflated fiat "value standard" then all clearing transactions, that also use that fiat standard, are also participating in its depreciation - but, merely genuine exchanges of present goods, services and labour, do not CAUSE this depreciation although they participate in it PASSIVELY. - If banks could create credit and money out of nothing then they would possess divine powers. But even the world was not created out of nothing, or was it? What those believing in credit and money creation do not seem to understand is the time factor involved in credits. Over a long period many more loans are granted and become due than is available in cash at any particular time to pay all of them. A cash amount of $ 1,000 may well serve to repay 3 or more different loans at different repayment dates.  But what they might refer to is the dishonesty or negligence of banks borrowing short and lending long. Most business men try to keep at least a small and positive balance on their accounts for emergencies. If the banks do not respect that requirement sufficiently then this can lead to the demand deposit owners one day finding out that they have no have money at the bank that is ready to be paid out to them in emergencies, or that they can dispose of with cheques, but that, much against their intentions and trust, the possess, in effect, merely something like a mortgage, bond or share - a part of the long-term investments by the bank of their short term funds or on demand deposit claims. Even though such bank actions may be habitual, going back to the tradition of fractional reserve gold certificates and although it may be quite common and legalized practice, somewhat insured by central banks demanding minimum deposits with them, it is still basically a dishonest, negligent and false business practice. That central banks, when the minimal deposit with them is not enough to cover withdrawals at the bank that borrowed short and lent long, are insufficient to cover their obligations, then issues additional legal tender note to cover this wrongful and careless action, means that then it is the central bank, once again, which causes an inflation, not the original and wrongful lending short term deposits, without the explicit permission or instruction of these depositors, on long terms. Without this inflationary backing of this practice by the central bank, the holders of "on demand" deposits would simply find out that they do not longer have such deposits but merely long-term claims against the bank and its long term debtors. The use of terms like "money creation" and "credit creation" does not explain but rather cover up such relationships. - One of the major troubles of this kind of dishonesty, carelessness or fraud is that the central bank might refuse to cover this flawed borrowing and lending process by additional note issues, while upholding its money issue monopoly. Then a currency famine would result without its natural cure or preventative being a permitted. Cash being already short and supposed cash deposit having become illiquid, i.e., long-term investments, more and more cash will be asked for . The non-cash payment sector will shrink fast, since they still grant creditors the right to demand cash and thus the demand for cash will greatly increase while the supply is already short. - The cure lies then in abolishing the right to demand cash and replacing it by the right to demand only clearing. In this clearing certificates issued by the debtors must be negotiated at terms satisfactory to both sides. And the cash shortage should be overcome by the issue of exchange media based on ready for sale goods, labour and services. - Otherwise all economic transactions will come to shrink to a fraction of their former extent. -  J.Z., 3/97 & 31.8.02. - See: TAYLOR, DAVID; MEULEN, HENRY; SOCIAL CREDIT.
CREATION OF CREDIT: Credit creation is possible because the owners of bank accounts do not dispose over all of their accounts at any particular time. - Pop opinion. - Every embezzler has the same notion, hopes that he will not be found out or not before he gets away safely. But he still does not create anything by his "creative bookkeeping" but merely steals, defrauds or embezzles. If the whole bank engages in this then it is still not a creative act but merely stealing. If it "invests" these funds in lottery tickets or horseracing tips, or medium or long term investments without consent of the owners of short term funds, short term or immediately and without asking them for permission, giving them the impression that their on-demand deposits remain immediately withdrawable, then this is still not "creating" values but defrauding others of them. To the extent that the long term investment of on-demand deposits is, otherwise, sound, they could then ultimately be repaid from the winnings or repayments of the long term loans and dividends from them, when these payments are finally made, but the on-demand deposits could not be immediately paid out (except in additional notes produced by the central bank, if it is prepared to cover this fraudulent action). Otherwise, the hopes and expectations of the depositors of the on demand deposits cannot be instantly fulfilled. The depositors may still imagine they do have these funds at their disposal - while others have already disposed of them. These imagined credits should not be added to the wrongfully and long term "invested" ones. The total of credits has not been increased. On the contrary, such "investments" frequently lead to losses, so the account holders and the bank may end up with less than they had before. Other gamblers or betting addicts, or suppliers of those who were thus wrongly granted credits and spent them wastefully rather than productively, would benefit correspondingly. - While at any time an honest cheque drawer (or one not granted a current account credit - which has its own inherent limit in the current funds available from others) cannot spend, in cheques, more than the amount on his account upon it, he may, in the average, in his usual business, get so many cheque payments into his account, as a result of his sales, that within a short period, based upon these cheque payments to him, he can spend much more than the average account balance through this account. But he can do this only through him buying and selling real goods, services and labour in this way as others buy real goods, services and labour from him in this way. That "credit creation" would be involved in this is nothing but a creative fiction. - J. Z., 29.3.97.
CREATION OF CREDIT: If banks could create money and credit out- of nothing, I would like to be a banker under these conditions,- and so would almost everybody else. Why doesn't everybody make use of -this opportunity? An Aladdin's Lamp for everybody! Nobody need to -produce or sell anything any more to acquire purchasing power. We- could simply multiply it at will and live all from -the proceeds, a form of unearned income! Please, tell me, why do the banks still ask you to- supply them with your savings, to deposits them with them and why do they mind if you withdraw them from them? Under the asserted- conditions they would not need you and your savings at all. They could e.g. input- a single dollar of their own and multiply it endlessly, with- only the trouble of spending the riches thus gained by them. - -That such beliefs can still be widely held in our century is almost unbelievable. - J. Z., 5.7.94, 18.4.97.
CREATION OF MONEY & CREDIT: De nihilo nihil. Lucretius, Ueber- die Natur, I/149. (Aus nichts wird nichts. Nothing grows from -nothing.)
CREATION OF MONEY: But you can't MAKE purchasing power. You can- only TRANSFER it. - Terry Arthur, 95% Is Crap, 209.
CREDIT & BANKERS: Credit is extended only to 90 year olds who come -accompanied by their grandparents. - Note I saw years ago on a -cash register. - J.Z. - Have our present banks really practised the common sense rule: No credit to those who are not credit-worthy and credit to all who are? - Have they managed to utilising the "banking principle" to properly finance turn-over credits with their own banknotes? At present they seem even unable or unwilling to incorporate all kinds of fees and insurance premiums in a single interest rate. Moreover, even their extensive use of computers has not enabled them to reduced their charges and fees but has rather driven them up. - They still take 5 days to credit you with the sums of a cheque you deposit with them. - Even small credit unions are often able to undercut the service charges of large banks or to pay higher interest to depositors. - Their inabilities, unwillingness or bureaucracy has also been a great aid in the growth of numerous other kinds of finance companies. - J. Z., 7.9.02.
CREDIT & CLEARING SUPERSTRUCTURE, BUILT UPON A SMALL CASH FOUNDATION: HOW DID IT ARISE? WHY WAS IT CONTINUED OR WHY WAS THE RIGHT OF CREDITORS CONTINUED TO DEMAND CASH INSTEAD OF CLEARING? There was never enough cash around, or could easily be produced, under current legislation, customs and beliefs, to mediate all wanted and possible exchanges. There were never enough sound or unsound physical exchange media, currency, coins or banknotes etc., provided for this. Under a monopoly or oligopoly for their supply nothing else should have been expected. Moreover, there were risks and costs involved in transferring large amounts of cash. So, for a long time, at least for trading between experienced merchants various negotiable instruments were utilised instead of cash. They were nominally and when due still payable in cash. But in reality most of them were settled by clearing of such debts and credits against each other, in internal as well as external trading. This kind of trade and payment facilitation goes back at least to the time of the crusades and, most likely, much further. Whatever cash was available was utilised largely only for wage, salary and tax payments. With regards to the large formal cash obligations arising out of e.g. sound commercial bills of exchange, cash was kept only for the settlement of the usual small balances remaining, after clearing, and, perhaps, in many cases even these were settled by short-term IOUs, which went into the next clearing. This extensive clearing became traditional, customary, habitual and influenced monetary thinking and is still present in the current right of creditors not to demand rare metal payment but payment in the exclusive and forced governmental legal tender money. The total volume of non-cash transactions is usually ten to twenty times that of cash transactions. Thus all non-cash transactions could not be readily paid in cash, instead, if this were demanded. The full potential of clearing and clearing certificates and electronic settlement of mutual debts is still not being realized but insistence upon the right of creditors to be paid in cash, upon their demand, instead of via clearing or non-cash payments, as usual, remains upheld with, often, disastrous and prolonged consequences. The long experience with banknotes that were 100% or fractionally covered by rare metal coins and the right granted to the note holders to demand their full redemption at any time, continued this practice and the theory behind it - and it led to frequent runs and monetary famines, under fractional covers, when as a result of suddenly increased cash demands the volume of non-cash transactions was rapidly diminished and the demand for cash rapidly correspondingly further increased. But even in normal times, the cash demand right of creditors limited the number of transactions that could be carried on via clearing, to a limited multiple of  the normal amounts of cash reserves and the normal demands upon these. Trade, exchange via clearing, could not proceed, without limits, beyond these cash reserves, while the right to demand cash, at any time, remained. And they could not, as gold coins, and were not, as monopoly paper money, always and rapidly enough increased in volume, in a sound way, to satisfy a rapidly increased demand for cash. The possibilities of unlimited clearing of due debts against due credits were theoretically realized only by some, during the 19th century and are still not fully realised by most people, even experts, today. Thus many of the libertarian money reformers merely want a return to gold and silver coin circulation and banknotes, or electronic accounts that are fully redeemable in rare metals. Under full monetary and clearing freedom, the non-cash options available to merchants, already for a long time, would be extended to the man in the street, especially to wage and salary payments to employees and their consumer spending, which would mean, in the absence of a "right to cash", the possibility of an unlimited growth of the volume of exchanges. At the same time, the clearing certificates used or clearing accounts, could become as convenient, at least for local sales and purchases, as are cash notes and cash cheque accounts now. - J. Z., 6.9.02.
CREDIT & MONEY CREATION & TOKEN MONEY & EMERGENCY MONEY, DEPOSIT -INFLATION, CREDIT EXPANSION, etc.: In system of the forced and- exclusive circulation of legal tender paper money and the limited -non-cash transactions that can be built upon this, always under- the risk of sudden legal and juridical cash claims going beyond normal cash requirements, the resulting chronic- shortage of rare metal cash (sometimes even merely a shortage of small- change cash, so incapable was the centralised issue in many cases),- as well of legal tender paper money cash, at least in some circles of the economy, led always to degrees of sales difficulties for goods, services and labour. These have- persisted, to some extent, even in "normal" or "boom" times. Traders, manufacturers and desperate employers have always felt forced or -induced to try to bypass the prohibitions and supplement the- cash money supply somehow in more or less primitive and advanced ways,- with token money and emergency money issues, accommodation papers -etc. For the alternative was bankruptcy or unemployment. (One of the easiest and soundest way to extent the cash supply for wage payments by employers was to get their sound commercial bills, representing their sale of goods to wholesalers, discounted by a bank in banknotes. Even though the real bills were nominally payable in rare metal coins, as well as the bank notes issued, in reality most of the discounted bills were either settled in clearing against other bills or paid for in the bank notes issued, and to that extent neither the real bills nor the banknotes issued for them in their discount, required any gold redemption. What the bank notes required was the shop foundation, i.e. the readiness to accept them for wanted consumer goods and services, rather than for gold coins. The retail shops could pay the wholesalers with the banknotes and the wholesalers used them to pay their bills issued to the employers, their suppliers. The employers used the banknotes to pay wages with and also their suppliers. They could not have paid wages with large and uneven commercial bills, due in one to three months. Thus the non-cash payment options were extended as far as they could, -but always under the risk of the imposed (customary and- prejudice supported) delivery obligation of debtors for cash, upon demand- by creditors. (The banknotes were usually not legal tender and, for a long time, were not considered to be cash, again out of the prejudice in favour or rare metal redemptionism that considered only rare metal coins to be real money.  Even forced and exclusive legal tender, while not extremely short supplied or rapidly depreciated,  remained widely and for long times- preferred to all too primitive, not only to other dishonest substitutes for it. -The private substitutes for official coins or paper money, no matter how rightful and efficient -they were already, at least sometimes, were never sufficiently -studied in the official literature and lectures. Nor were they- granted experimental freedom and thus the chance for gradual -development and improvements. Only the prohibitions against them -were more and more developed, detailed and improved, until they wove so- tight a net that it seems almost impossible to find a legal way- out of this monetary despotism. The government was almost never -blamed for its monetary despotism or, if at all, then usually too- late, after it had done all too much damage, for months and even- years. And it found apologists even decades after and these form -the majority everywhere, still, even among the professionals, the -supposed experts. In ten-thousands of ways did practical men try -to get around the money monopoly and its effects, without -theoretical understanding or it and of its inevitable consequences and without understanding all the monetary freedom alternatives. -Often they did not even realize their limited self-help actions were- illegal, because they could not imagine any government being so -evil or misled or ignorant to have anticipated and be willing to- suppress their self-help attempts and thus to have outlawed them by very- detailed legislation. Ignorance in this sphere (promoted by- governmentally arranged or supervised and examined and certified miseducation) -is so great that Big Brother is always appearing as the shining -hero while Big Business and Big Labour are cast as the villains.- Under these conditions government money, even though unsound, was- usually much more widely accepted and sought after than it would -be under freedom conditions. Usually just a better and different management of monetary despotism was demanded rather than its abolition  Even under the supposedly best -management of central banks monetary crises, inflations and deflations persisted or got worse and more prolonged, -and people had either to give up or try to help themselves, via- various token money, emergency money and clearing arrangements,- no matter how outlawed these were. In that situation all kinds of- unsound schemes could also temporarily flourish and spread, -before they were suppressed by the government. Even now sound- issue and reflux principles and practices remain largely unknown -and unpublished, even within the circles of money reformers and- among these even among those few who do favour one or the other degree- of monetary freedom - whilst condemning others. Sound money and- credit arrangements require a development period in practice and- also a preceding or following development of monetary, clearing and credit- theory. That was never granted under the official religion on -money, clearing and credit. Under these conditions most of the theorising and illegally practising monetary reform sectarians never reached sufficient enlightenment-. - J. Z., 14.4.97, 6.9.02.
CREDIT BANKING: It is possible without fractional gold reserves- or short sales of gold, without the risks of runs upon gold -metal or legal tender cash or reserves of legal tender at a- central bank. Matter of fact, it works best when purely based on -credits and debts and their free clearing, using any value -standard which the participants find acceptable for their -accounts. There is no fixed limit for the total productivity of -people, at least not in the long run, in spite of obvious present -limits, due to presently known and accessible resources, -scientific knowledge and technology and available capital. But -under full freedom each can only exchange the products and -services of his own productivity for those of others. That is his- present limit. Credit merely bridges some time spans, during- which he can develop his potential. But, apart from insurable- risks, all credits and debits cancel each other. And a small-insurance charge on all transactions can cover that risk. We- should credit all participants in credit-money transactions with -the ability to select for themselves better value standards,- under freedom, than governments provide them with under monetary- despotism. See: ISSUE LIMITS, CIRCULATION, LIMITS, REAL-BILLS-DOCTRINE. - J. Z., 3/97.
CREDIT CARDS & CLEARING: As easily portable proof, or easily -and automatically checkable proof, of the existence of an account -with a more or less regular income and a credit remaining, it -makes the acquisition and carrying of large amounts of cash- unnecessary. But it does not as yet make its holders independent -of the supply of cash, as a pure clearing account would. Cash- spent with the cards has to be replenished with legal tender from -bank accounts or by cash. So far they are spending accounts- rather than accounts to directly receive non-cash payments from -others. A pure clearing account would have to have that facility- and should be made independent of cash by not being redeemable in- cash upon demand of the credit card holder, when he has acquired- a positive balance. Moreover, so far to high costs were- associated with the use of most credit cards, thus I rarely found- it convenient for myself to use them, except when travelling, to- withdraw cash now and then. With cash I could usually make better -bargains. It is, as someone once said, "a poor man's credit- card." - But the varieties of credit cards in existence are a -good precedent for a multiplicity of competing currencies and -they could become ID's for pure  clearing accounts. The smart -cards could even carry the balance and all recent transactions- electronically. I see no great advantage for them as cash cards,- except e.g. in the use of automatic ticket machines, turnstiles- and in public phone payments. If government supplied coins were -not relatively scarce, and prices for e.g. rail transport and phone use would not be frequently driven up through inflation,- i.e., could be paid with standard coins, then these cash cards -would be less popular. - If you could pay everything with a -credit card and received all your payments in a credit card- account, then cash would not be necessary at all. Alas, under -present conditions, it would then become still harder to avoid- paying tributes to the tax gatherers. So far they find it much -more difficult to trace cash notes, even their own numbered ones.- Sooner or later they will use computers to do that, too, removing -that cash payment advantage. - J. Z., 1.5.83, 4.5.97.
CREDIT CONTROL: Credit control by governments? The sheer -impertinence of it: A robber organization setting itself up as- controller over something as voluntaristic and productive as- credit! - J. Z., 12/84, 18.4.97. - I would like to control the- credit of governments - and have the right to control my own -credit and accept the private credit arrangements I like. - J. Z.,- 12/74. - Credit control is in principle as much an interference -with individual liberty as sex control would be. - J. Z., 30.5.75.- - The use of the term "control" in the expressions of "experts" -and of the man in the street is OUT OF CONTROL. It serves as a- cover for almost any kind of despotic meddling and mismanagement, -always under the pretence that thereby "everything is under control!" -- Only self-control is real control. Human beings that are- controlled by others are no longer free men but puppets or -marionettes that dance more or less to the tunes of their -masters. - Granting them what is supposed to be "THE" vote, but- which disfranchises them in most important respects, does not- change the situation much. - Without full monetary freedom and of the -right to secede from the State and to become exterritorially- autonomous, together with other secessionists, also the right to bear -rightful arms for rightful self-defence and to organise in- volunteer militias for the protection of individual rights, and the full spectrum of the other basic individual rights,  man is not enough in control -of his own fate. - Monetary emancipation is a very good starting -point. Let us individually vote government paper money out of- existince and sound alternative currencies and value standards -in! - J. Z., 18.4.97.
CREDIT CREATION OR SOUND BILL DISCOUNTING OR CLEARING?: What is usually called "credit creation" is -nothing but false pretence, fraud or robbery." - J. Z., 5/73. - When -only short term credits are involved, that are self-liquidating, -like in the discounting of real bills, then merely an advanced -form of clearing takes place, spread over a short period, in- which the IOU of the buyer, being unsuitable for general- circulation, is "cut up" or temporarily replaced by small bills, -suitable for circulation, with which workers, retailers and, -finally, wholesale buyers are paid, who redeem with them their -IOU or real bill, which they gave to the manufacturer and which -the manufacturer got discounted at a sound bank of issue. Who really gave the credit here was the manufacturer, for the payment- of the goods he delivered to the wholesaler, products that are thus on their road to the -retailers and the consumers. He merely got the IOU or the bill of exchange, he drew upon the wholesaler, TRANSFORMED, by the bank, -into a more suitable means of payment, especially for paying his- wage and other suppliers' bills for his production. That -transformation is "creative" only insofar as any artist -transforms some materials in one way or the other, -to make them more suitable and attractive. It is in neither case- of a "creation out of nothing". - To say that it is "created out of- thin air" is misleading, insofar that valuable elements, like oxygen, -nitrogen and helium are precisely thus produced. - J. Z., 18.4.97. - Not is the term "thin" being appropriate in this connection, since neither mountain or near-space nor sea-level air is used for this purpose. - J. Z., 7.9.02.
CREDIT CREATION, MONEY CREATION, DEPOSIT CREATION, SOCIAL CREDIT-: To Robert de Fremery: Your own preferred monetary system is -based on some of the premises of Social Credit people - followers- of Major Douglas' teachings. They are split in many different- schools and sects but  do share some common premises or prejudices and false observations, especially that on the supposed- "creation" of money and credit out of nothing. It is- fundamentally and especially false when ascribed to those private -banking institutions, which are otherwise privileged but not in -this respect. "Ex nihil nihil!" ("Nothing comes from nothing!") -Even the greatest artist, chemist, physicist or biologist cannot- create something from nothing. He can only reshape and rearrange- existing materials in a better way. When the government "spends" -its additionally printed legal tender notes, then it does not -create anything, no more so than an officer of an occupation army- does, who issues "requisitioning certificates" in a supposed- "payment". I.e., he appropriates the values of others. He doe s-not "create" new values. When a cheque forger forges cheques, he- does not "create" anything, either, but, instead, wrongly -appropriates some money that rightfully belongs to others. When a -government issues directly or indirectly its currency notes,- those needed to finance its spending as well as those which an -economy has to have, in the absence of monetary freedom, as some form of money, even if it is a monopolized money, then it does- not create and offer something that is currently wanted, to the -extent that it is supplied, but it rather makes war on many to- most of its subjects and charges them the costs of this warfare -under all kinds of illusions, lies and false pretences. It -requisitions rather than produces. It can rightfully act only for -those of its peaceful citizens who have given their consent to -all its actions. And that is often only a small minority. Least- of all is it able to provide peace, justice, prosperity, freedom,- security and stability. Parodies of each are offered instead and- contraries. Please consider: For many decades now we have seen the growth not only of privileged commercial deposit and savings- banks but also of cooperative and credit union banks, even banks -specially of and for women and for the ecology and conservation -movement. How happy would all these people be, and how fast their -banking enterprises would have grown, if they had "discovered" -that merely by putting on the hats of bankers, they could, thereby, -suddenly and arbitrarily multiply their deposits, at will, between them, "creating" wanted values and becoming rich, "out of- thin air". How nice it would be for them if they could "create" -most of the funds they need for a new car or a new house in this- fashion! How come all these millions of cooperative people did- never discover THESE supposed banking advantages and privileges -for themselves? Are they so dumb or blind? Berthold Brecht must- have had a similar prejudice in his mind, when he suggested, in- one of his left-wing propaganda writings: "Do not rob a bank! -Start a bank!" - If that kind of "something for nothing" scheme -were possible, then everybody, especially the already rich and- powerful, would love to get into the act and all barriers against -it would have been broken down, long ago in their general rush for unearned riches. How come so many rich people, skilled- businessmen and entrepreneurs and innovators are still satisfied- with making an average of 5 - 15% in interest and profits on- their productive capital investments, when they could thus, and- much faster, multiply their riches without any effort or ingenuity- or investment and risk? What could hold them back or away from- this supposed "pot of gold at the end of a rainbow"? - I have- reproduced 2 books critical of Social Credit ideas and also some- writings by David Taylor. A third book title of this kind did once see but did not buy. - J. Z., 3/97.
CREDIT CREATION: Credit is never created but merely -transformed. Goods and services capacities are liquidified, -freely transferred in liquid form and finally settled against -each other in clearing all the claims arising out of turnovers of- goods and services (including labour).  - J. Z., 5.10.88 &-15.4.97.
CREDIT CREATION: There is no room or possibility for "credit--creation" in a monetary freedom scheme. It does not even exist in- the present system of governmental monetary despotism and- government privileged banking - although many other mistakes are -made in that system, many wrongs committed and many abuses do- occur there. Government monetary and financial activities are- never "creative" but, rather, confiscatory. - But can one prove that something non-existent does not really exist or exists only- in the imagination of some? That is as impossible as to "prove" -the non-existence of God or the Devil or of  "evil spirits" or of fairies.
CREDIT CREATION? Many merchants do offer their goods on credit,- with payment due only in 30 days, and without interest, at least- for 30 days. Often such offers go now for much longer periods, -even 6 to 12 months, interest free, if instalments are paid and- often without an initial deposit. This also might be called a- credit "creation", offered upon private initiative, offered quite -publicly and to many members of the public. But what is actually- offered on credit is the goods of the seller, which he could also -repossess upon non-payment. If it were true that privately- "created credits", seemingly out of thin air (but here granted in- goods values transferred, to be repaid later, on agreed terms, in- cash or non-cash), were inflationary, then all such actions would -be inflationary. In reality, they indicate rather a deflationary- conditions, in which sellers are desperate for cash and do not- flee into goods but still want money, even when the full money- payment is postponed for a long period and even when no interest is- paid. At the same time, the government inflation may go on, so -that, in combination, we have here a symptom for a stagflation. -Closer still to home: If you were to grant me a credit in form -of your literature, postponing repayment for it and if I were to -grant you a credit in my literature, mostly microfiche,- postponing payment for it, would we then have to add up both -these credits as our contributions to the existing money-inflation? Or would exact equivalents of valued goods-deliveries- exist? Could not out mutual debts, be completely cancelled, if -they happened to come to the same amounts, without a single cash- or non-cash Australian or U.S. dollar being set into motion in -the process, even without effecting the statistical GNP, although -both of us might feel information-enriched? - Would any woman, -who in a baby-sitting exchange accumulates some baby-sitting credits against other participants, thereby contribute to the -supposedly credit creation and credit inflation? - If you are- short of cash, so short that you cannot buy a beloved grandchild- a present, and promise to buy it later, after your next pay day- and he grants you a credit for this, does he thereby contribute -to the supposed "credit creation" and "credit inflation" or would we -rather have a deflationary situation, at least one confined to you? - Try to envision a private bank of issue, one designed and for discounting short term real bills or other promises to shortly pay for goods received, or for keeping current accounts with cheque and clearing facilities and imagine it as having the worst possible intentions- but, at the same time, not enjoying the privilege of legal tender for its notes, or- the chance to hide its over-issues, in the absence of a free -market for exchange media and value standards and also not-enjoying the privilege of keeping as "business secrets" the facts- of its short term cover and reflux arrangements and of the number -of its notes in circulation at any time and of the degree and- speed of their reflux.  Under such free and open conditions its- notes would very soon get a discount upon any over-issues and would then encounter -wide-spread refusals, that will extend to its future issues, too,- which it might have reckoned upon. Any holder of its notes, with a- wad of them in his hands and, finding that he has no debts to pay -to the issuer nor that there is anything he wants or can purchase- with them, because there is an insufficient "readiness to accept" -foundation for them, especially, an insufficient shop foundation, -might find his own wad of notes depreciating in his hands and cursing himself to have accepted so many of them merely upon- confidence or trust in them, which were very much misplaced. But- few will be so foolish to accept many notes from such an issuer. -Notes they do not know or are suspicious of, or against which- their friends have warned them, or the mass media did, will- simply be refused. His only remaining option will be as a- creditor with a claim against all the remaining assets of such a -fraudulent issuer. The same applies to any cheque account credits- obtained with such a dishonest bank. If the courts were just, efficient and competitive, the "banker" involved would loose his -car, his house, the shirt on his back and would be forced, for a-long time, to work in possibly menial jobs to pay his restitution- obligations. But it is unlikely to come to many such cases. They -were rare even in the cases of "wildcat banking" (with all the -flaws and fraud options of metal redemptionism), as several -recent researches have shown.  Already William B. Greene, in his- classical work "Mutual Banking", pointed out, the notes of- supposedly failed U.S. banks, unable to fulfil their formal gold-redemption obligation, often continued to circulate at par, until- all the local short term debts, they were based upon (in- discounting), had been settled by paying them with these notes.- Some circulated even at par beyond such short term periods, kept- at par by longer running debts with their reduced current demand- for notes. Via the repayments of debts to the banks the notes- disappeared from circulation and no note holder was economically- harmed by notes thus kept at par, even though he did not get any- gold coins from the issuer. He could have got them, if he wanted- to, on the free gold market. Under freedom conditions a- unilateral "creation" of credit, deposits or money, at the expense of others, is even less likely or possible than it is- now. - J. Z., 3/97.
CREDIT EXPANSION & INFLATION: Credit expansion is as much inflationary as e.g. paying public servants with additionally printed paper money. - Popular opinion. - If you grant somebody a credit from your bank account, in a consumer or an investment credit, with your own funds, or those entrusted to you for this purpose, then you do not multiply means of exchange and do not drive prices up but use he existing exchange media and do trade or sell over time, as usual, hoping to make a profit in your sales on terms, as well as in your sales for cash or cheques. - No creditor who wants to get all his money safely back, plus a profit, will be expansive with his credit.(But if he is allowed to gamble with the money of others …) - When a savings and investment bank or a current account and cheque bank grants a credit, then they tend to do the same as you would do - only on a larger scale and for more people at the same time (provided they are honest and competent). Through its mediation - and for the fees and charges involved, creditors and debtors still do their things for each other but, usually, anonymously as far as their total payment transactions are concerned. They are aware only of their face to face and order and invoice trade relationships, not of the mutual settlement process behind them. When "credit" is granted via additionally issued forced and exclusive currency, printed for this purpose, or via government "spending" in additionally printed legal tender, then and then only and to that extent, can the general price level be permanently increased, i.e. inflated, because these price increases are the only defence left to the recipients of these "payments". (I still remember, in times of rapid inflation, my public service salary being paid in freshly printed notes, still with consecutive numbering, i.e., having come straight from the note-printing presses of the central bank. This happened for several consecutive months. Alas, I did not keep a record of these payments.) - What is overlooked in the very term "credit expansion" is the fact that at the same time a corresponding "debt expansion" is involved. The "expanded" credit cannot be created out of nothing. It must mobilise already existing funds and assets. Otherwise the recipients could not spend these loans. E.g. a furniture or car sales firm might mobilise thus part of its unsold stock, cramming its warehouse or parking space. And the debtor, for each repayment or part-repayment of his debt, must correspondingly restrict his purchases. In the whole notion of credit expansion, if no inflationary expansion of the legal tender circulation is involved, then all the fallacies of "credit creation" or "money creation" are involved. - Even if in reality a "credit expansion" were possible, it would always only be temporary, not permanent. A paper money inflation is reversed only exceptionally - and then also with catastrophic effects. But a credit expansion is always and automatically reversed by the repayments of the "expanded" debts, which would have to correspond to it. It is negligent, to say the least, to speak only of a supposed "credit expansion" and not of the accompanying "debt expansion." Prices might then rise at most temporarily - to decline correspondingly when the credits are repaid. But any expansion of the paper money circulation would be permanent. However, I would deny that a real "credit expansion" can take place - otherwise than in the imagination of some. Just because one coins a word for something does not mean that the reality will automatically and certainly conform to that new word. Otherwise, I might say: Abracadabra: Turn into a frog, NOW! - and you would turn into a frog - or whatever I had wished you to turn into. - When debtors can't repay their creditors then both tend to go bankrupt and nothing but a myth remains of "credit creation". Only in a system of monetary despotism can practices arise which some interpret as "credit expansion" or "credit creation" but which, in reality, are fraud and coercion of quite a different kind than the one imagined. - It is particularly absurd when under the system of monetary despotism some of its victims, namely private bankers, forced to deal only with the forced and exclusive currency of the central bank, are then accused of depreciating the currency of the central bank by their manipulations - while the central bank is assumed to be a defender, protector or stabiliser rather than an inflationist of its currency. - No decrease in the percentage of hoarded funds for the granting of credits should be termed a "credit expansion". -   See: INTEREST, DISCOUNT RATE, OPEN MARKET POLICY, CENTRAL BANKING, CREDIT RESTRICTIONS.
CREDIT EXPANSION? Attention should remain focussed not on the dishonesty involved in fractional reserves used to promise 100% redemption at any time, while much of the cash or deposits is lent out, but, rather, upon the additional turnovers so achieved, which could also have been achieved merely by honest clearing, using no exchange media, or actual deposits at all but merely sound value standard accounting. To the extent that this happens, the supposed credit- or money- or deposit-expansion or "creation" merely represents more trading and does not disturb the total balance between exchange media and goods, services and labour exchanged. There is also a time factor involved. If the first depositor really leaves much of his deposit, in practice, not by the terms of his deposit contract, on long terms with the bank and if the bank then dishonestly lends that money out, e.g. on short terms, several times, and is several times repaid, then the total of these loans and their repayments, seems to some to indicate a credit expansion, one that is unjustified. But others see a) the repayments and b) the additional turnovers thus achieved. The same dollar, over a short to long period, can change hands hundreds of times, promoting exchanges of hundreds of dollars worth of goods, services and labour, without being thereby depreciated. Naturally, sound value reckoning rather than paper standard reckoning and free market rating of exchange media against the sound value standard and the option to refuse and exchange medium and resort to a competing one, would help in this process. Monopoly status, compulsory acceptance and compulsory values do disturb all exchange relationships and cover up essential details that are required for sound and self-regulating issues and reflux of the issues. - When short term deposits are invested on long terms, when fractional reserves only exist but promised are 100% redemption at any time by the issuer, upon demand of the note holder, then there is much talk about the dependency upon confidence and trust while, in such cases, distrust would be deserved and correct. No one should be allowed to get away with promising more than he can fulfil, with the excuse that merely confidence and trust in his actions were ultimately lacking. - The central banks try to reduce this malpractice by insisting that the banks keep part of their cash or demand or short term deposits with the central banks. I do not know whether they pay the banks - and thus the depositors - interest on these accounts. Certainly, that interest would not be earned through the most productive investment of these funds. Nor do I know what the central banks usually do with these accounts, i.e., whether they keep them frozen or lend them out on short terms - or even on long terms, especially to governments, since they are more or less at liberty to print exclusive and forced currency cash when calls for cash are made upon them. - When it keeps these bank reserve accounts frozen, then it would have initially issued these amounts, with compulsory value and compulsory acceptance - and then compulsorily retired them, for at least prolonged periods, from circulation. When, instead, used for government spending and then compulsorily withdrawn by taxes, the money is usually not frozen (apart from inefficient and too slow handling of government accounts, that leave funds unused for prolonged periods and can thus cause deflations) but spent again, since governments are rather inclined towards spending more than they do coercively extract or confiscate. - To the extent that banks are forced to keep reserves with the central bank they can, almost without risk, lend equivalents of these amounts out on long terms, since the central bank could always back them in cash. To that extent the dishonest practices of long term lending out of short term funds deposited by one's customers, is encouraged rather than discouraged by these reserve deposit practices. The central bank would then be an accessory or even an abettor or guarantor for such dishonest actions of the banks, supposedly under its supervision and control. - Tempted by its option to issue more additional legal tender notes in "repayment" of these reserve accounts, when needed by the banks, the central bank may also be tempted to lend out the reserve amounts on long terms, most likely to the government. Then, when the reserves are called upon and paid out in additional forced currency notes of the central bank, this guaranty against credit expansion will guaranty an actual inflation. - If the central bank paid no interest on these "reserves", then the banks would have to charge correspondingly more on their other loans or pay less to their depositors. - By the way, I have still to find a clear statement by any bank on how it can justify the large differences between the interest rates it pays and those it charges. In the age of computers these differences seem to have become larger rather than smaller. - Let us assume, instead, that the banks were free to issue bank notes and clearing certificates for turnover credits. Then the volume of their issues would tend to rise and fall with the requirements of trade. More goods and services would be produced and sold, at least to wholesale traders, and the debts of the wholesale traders to the producers would be monetised upon the banking principle or real bills doctrine, temporarily, by notes more suitable to circulation, until the short term debt falls due and is repaid in the notes or clearing certificates (or deposit accounts) issued upon it. That would not be a process that could unilaterally increase the exchange media out of proportion to the goods production, sale and consumption, but reduce it to the offer and use of means payment corresponding to the quantities and values of the services, goods and labour supplied. Under stable value reckoning, optional acceptance, freedom to refuse acceptance, freedom to discount a suspected or really over-issued exchange medium, and with only the issuer obliged to recognise and accept his own exchange media at par with their value standard, enough exchange media could be freely issued, not over-issued, and the repayment obligations involved would keep them at par. Over-issued exchange media could not be forced into circulation and could not be given a forced value. They would all remain clearing exchange media, even if the clearing were not instantaneous but spread over 30-90 days. These currencies or current account deposits or clearing accounts could be as elastic as they would need to be. When no one is legally or juridically or customarily obliged to supply rare metal coins or, likewise monopolised, legal tender paper money cash, while all he can offer by his own efforts are often only efficient means of clearing, then the risk of inability to would largely be removed. - Instead or using the clearing process for turnover loans, which can provide out of itself, via sound bank note issues and clearing certificates, all the exchange media required for it, bankers do now usually grant turnover credits out of savings invested with them. Such practices are based on the old models of bills of exchange redeemable in rare metal coins and of rare metal deposit certificates, with all their inherent risks of cash payment disability, while the clearing payment ability would have remained undiminished. By now we should be able to think and act beyond these models and to reckon in gold weight values without having to own or pay in a single rare metal coin. - When rare metal deposits are required then the depositors should be prepared to pay the costs of keeping them, 100%  of them, in storage or mobilising them only via 100% covered and redeemable rare metal certificates and in case of fractional covers then only with any of several precautionary clauses that would abolish the risk of a run. When bankers and depositors would have to agree upon such clauses and contracts that would remove the occasional impossibilities of fulfilment and replace them by a number of options that remain possible for mutual satisfaction. (For instance, the bank might pay out its deposits in banknotes with a clearing foundation only, based upon acceptance by the bank in all payments due to it. - J.Z., 14.9.02.) They could reduce repayment or withdrawal claims by requiring timely notice of withdrawals, limiting them to the amounts becoming available in repayments or allowing only fractions of the deposits to be withdrawn immediately. Whenever bankers and their customers realize that they do not need rare metal stocks or legal tender paper money to trade, then they should be free to provide and use their alternative means of exchange and clearing options, both using alternative and freely chosen value standards. Then bankers would not need any rare metal coins or legal tender paper money cash or cash accounts of that type to finance any turnover credit loans or current exchanges. - When the savings and investment market is quite free, then bankers and customers should also be free to determine the terms and to remove any term risks by their contracts, apart from the insurable risk of bad debts not due to money the monopoly and its manipulations. Any risks the bankers take, in speculative investments, should be, quite openly, done only with funds entrusted to them for this purpose. To assure that, full freedom of contract, full publicity and full personal liability should be introduced and the futures risk involved in all payment contracts should be clearly stated and withdrawal premium and the clearing alternative for all such contracts should also be pointed out. Confinement to monopoly exchange media, an exclusive value standard, privileged banks, restricted clearing options, to coin and legal tender cash redemption models should be abolished as a constitutional, legal and juridical imposition (except among exterritorially autonomous volunteer communities). Upon contract and at the own risk and expense any payment system, from internal monetary despotism to full monetary freedom, should become permissible for voluntary payment communities, at their own risk and expense. - J. Z., 5/97. - We should be given the chance to learn as much as possible from the mistakes and errors of others. - J. Z., 14.9.02.
CREDIT EXPANSION? Those believing in almost unlimited credit expansion as a result of every credit granted by one deposit bank and the credits then being deposited in another bank and serving as a cash security basis for much larger credits there, do forget that people do not borrow and pay interest on their loans in order to leave the money in the bank. They borrow to spend the money, and this rather sooner than later. Further, most of what they spend is not ending up in savings accounts of others but is spent on current consumption of those who supplied them. However, the clearing effect, which does not need any quantity of exchange media at all but merely a sound enough value standard, does often give the impression (if all the turnovers achieved by clearing, are added up), that an expansion of deposits or of currency has taken place. - REFERENCES TO SOCIAL CREDIT REFUTATIONS in the PEACE PLANS series: 2 books, by F. J. Docker & John Lewis, in PP 1042. Criticism of Social Credit ideas can be found also in PP 242, 656, 740, 793, 906 & 1074. See also under John Logan & David Taylor. - J. Z., 21.5.97.
CREDIT INFLATION? Isn't it strange that people frequently speak of a credit inflation but rarely of a credit deflation caused by repayments of credits?  Actually, during inflations debtors are more eager to repay their debts in inflated money than they are to repay them with sound money. Should we call this a deflationary phenomenon? One quite common in the middle of a raging inflation! Without free market rating of currencies we have no reliable measures to find out whether the circulation is oversupplied with exchange media or under-supplied or just sufficiently saturated. A real inflationary effect of what has been called "credit inflation" can only result with legal tender currencies, issued not only in short term loans but spent into circulation or in medium and long term loans, i.e. without sufficient reflux arrangements to balance the issues at any particular time and thus maintain their value. When a medium can legally be forced upon anyone, not only the issuer, then there is frequently not enough reflux to the issuer, even when the State or its central bank is the only issuer and reflux arrangements are as high as the current direct and indirect taxes are. The inflation tax acts otherwise. It gradually or destroys the purchasing power of the exclusive and forced cash in the hands of everyone, without most people becoming fully aware of this destruction. All they notice, to some extent, is the rise of all prices expressed in this medium - and that their medium and long-term debts are remaining nominally the same and that interest rates are rising. - J. Z., n.d., slightly revised.
CREDIT INSTRUMENTS: See: APHORISMS ON THE MONEY PROBLEM.
CREDIT INSURANCE: It can be a real insurance business only for ordinary business risks, spreading them among its subscribers or premium players. It cannot insure anyone or all participants against the risks of inflation, deflation and stagflation, due to arbitrary and at least in their degree unforeseeable government interventions and in their total harmful effects these are much too large to be insurable risks. It can also not insure against the abuse of this cover by careless investment bankers and companies that think that they can skim off the high profits of extremely risky investments and let the insurer (or involuntary taxpayers) bear all their losses. To prevent that effect the insurance companies must examine the credits to be insured more thoroughly than those lenders do, who want their credits insured. - J. Z., 24.3.97. - See: Deposit Insurance. - When incompetence, carelessness and corruption waste or make money "disappear" by the millions and billions, as has happened too often in recent years, then this is simply not an insurable risk. Only a much better, more public and much faster and thorough accounting and court system prevent or reduce such losses or recover much of the funds that went astray.The hierarchical forms of enterprises do also multiply, maximise and prolong such abuses and so does the relationship between employers and employees, capital owners and employees, managers and shareholders.  - J.Z., 30.8.02.
CREDIT OR DEPOSIT EXPANSION OR CREATION & THE RISK OF INFLATION- & DEFLATION: This kind of expansion or "creation" is nothing -more nor less than the "expansion" of non-cash transactions upon- a limited amount of available cash (in form of rare metals or legal tender), while all non-cash credits or deposits are still- claimable in cash upon demand by a creditor. In all cases the- on-cash transactions could actually stand on their own, without -"cash" backing by 100% or fractional reserves. The cash would -merely be used as accounting units or value standards. It would- not be required as means of payment, since clearing can, in most -cases, provide that much better. But while creditors are legally and juridically authorised to demand cash, when a debt is due, rather than merely a settlement by clearing, this possible and sometimes more than usually actualised demand exists as a risk factor for  the -additional non-cash, clearing and short-term credit and debit payments that have become customary upon a relatively small cash basis. Thus the non-cash or clearing side of the economy could only grow somewhat but could never grow, on its own, to the requirements of- trade, to finally cover all possible and desired turnovers. Via the cash demand option for creditors it remained still tied -to the old-fashioned (rare metal coin) or modern cash (legal tender by a monopoly issuer) redemptionism. The cash -demands of creditors fluctuate and thus affect the much larger non-cash transactions built upon them - and thus can lead to cash and credit crises, while the cash supply is monopolised & thus slow to expand and while the larger volume of non-cash transactions depends upon the available cash. E.g., -when a bit more cash than usual and than expected and -anticipated, was suddenly demanded, a large overhang of possible -and desirable credit, deposit or clearing transactions had to be- withdrawn or became illiquid and their collapse increased the- demand for cash further and that additional cash demand, when cash was already short-supplied, led to further -collapses of non-cash transactions because of that legal or -juridical claim granted to creditors. That currency famine risk could be -largely abolished (apart from abolishing the issue monopoly for cash) by not -granting creditors the right to demand cash and replacing it by a- right to demand clearing only. (This in as convenient a form as- possible, including private IOU issues in money denominations -that only oblige their the issuer and, by contract, his debtors.) - In the extreme case of a thought example, all immediate and short-term payments could have become have become payable only through a very efficient clearing system. Cash might thus have become as unusual or absent as are now gold coins in most transactions. Under these conditions the sudden introduction of the right to claim cash would certainly lead to difficulties, not foreseen by the well meaning dogmatists who wanted to introduce e.g. an exclusive and 100% covered or coined gold standard currency. The very extensive and free exchange economy, based on clearing, would then largely collapse. Fractions of such a general collapse occur through the still habitual, legal and juridical authority of creditors to demand cash and the fluctuations in these cash demands, especially for wage and salary payments and consumer spending. -There is another risk factor in the non-cash or clearing payment sector, -while it uses for all its payments not only optional cash demands by creditors for an exclusive cash exchange medium but also the exclusive and forced paper money standard of the central bank.- (Formerly the more or less depreciated coin of the realm.) Then, and to the extent that they do so or are compelled to do so, these transactions participate in the depreciation of that exclusive and forced standard. But the clearing transactions, no matter how large they are, do -not cause that depreciation. For short term transactions, if that depreciation is not yet very rapid or even galloping, it does not matter greatly. But it does matter when considerable time periods pass before a payment is due, still to be made by using the exclusive and depreciated value standard. Using a sound value standard and if their productivity permitted it, clearing would permit them to double, treble or increase tenfold their turnovers paid for by clearing, without depreciating that sound value standard used in all their clearing exchanges. Simply more goods and services would be produced and turned over, through a higher volume of clearing transactions. But no corresponding increase of prices and wages would take place, one corresponding to the higher volume of clearing. Greater productivity and ease of clearing exchanges would rather tend to increase wages, salaries and service charges while lowering the prices for consumer goods. If they physically could, people could via automation in production and clearing in exchanges, -increase their turnovers a hundred-fold or a even a thousand-fold. Always -assuming that they would not have to pay up, upon demand, in scarce gold coins or exclusive -government legal tender. But these additional exchanges, on their- own, and by their quantity, could not depreciate the forced and -exclusive value standard of the government, or any other, but sound value standard adopted but they might -INDICATE A DEPRECIATION THAT HAS ALREADY TAKEN PLACE, when a depreciating value standard is still being used.  People -might then finally find out that they could do better for themselves by choosing themselves one or even several different but -sound value standards, those which they prefer for their own contracts. Consequently, they -might do all their clearing with that or these. As means of -payment they would have already by-passed the government's paper money.- They would already have excluded it as means of- exchange. - What would be left to the government paper money -would be a much reduced circle of voluntary acceptors or cash notes and coins -of the government that could readily circulate - but only among among- taxpayers and other debtors of the government. And these voluntary acceptors of its notes and recipients of its spending might become further reduced to voluntary state members by reducing its service supplies and charges as well to free competition by other organizations in the same territory, among people who have opted out and re-associated quite voluntarily and under exterritorial autonomy. All governmental or central bank notes would then be reduced to their own voluntary payment circles, used for their spending, their budget items only and their voluntary taxes or subscriptions. Under full competition governments would be reduced to exterritorially autonomous volunteer associations, competing like e.g. insurance companies, for customers, and to the volume of transactions they can build up under competitive conditions. And that smaller -circle of acceptors would reduce the circulation options for any -government to its own backing or cover or reflux, to its "tax foundation" or clearing foundation, i.e., to its -market value. When a government had previously, due to legal- tender and the issue monopoly, over-issued and forced its currency -at least potentially (seeing the extent of non-cash transactions -even now) into every channel, it would then be excluded from -most private circulation channels or payment communities and from what ever "official" payment circles  other volunteer communities have established for themselves. For its remaining economic or anti-economic activities the former volume of its circulation would be too large. The- quantities that it could formerly force upon others, would no -longer be accepted or needed as exchange media. That would mean- it would depreciate and could pay for goods and services of those -outside its payment circles only at inflated prices, even while- the same goods and services, if paid for in competing, optional private exchange and clearing media with sound value standards, would remain priced at- the same level. (Apart from changes at the goods side.) Obviously, this would also be a situation in -which the former territorial and exclusive Central bank's issue monopoly and other privileges and- its legal tender would not longer be enforced or fully -enforceable in the private and cooperative self-help and free- clearing and value accounting sector of non-members. The blame for any- depreciation of its currency would then lie entirely on the side of the issuers and acceptors of the State- paper money. It would be the bad money that would be driven out -by wide-spread refusals to accept it at all or by discounting it- down to its remaining foundation, e.g. to tax foundation, while -that would still exist and be enforced. The government could- then no longer use the goods, services and labours of all people -within its borders as its redemption fund. They would express -their monetary demands in other, better and safer ways,- independent of the government and would reject its paper as means- of exchange and as standard of value as far as they could. The -freer private and cooperative clearing would become, independent- of a territorial  government's cash and its legislation and paper standard- and their manipulation, the more likely would sounder value-s standards be adopted, too. - One should also take into -consideration the short-term turnover credit transactions, in- which creditors are satisfied with being paid within 7 to 30- days. (Under present stagflationary conditions they are often -satisfied by being paid, interest free, after 6 months to 2 years only.) -Such short term credit settlement should also be considered like -the "instant" clearing settlements. After all, all transactions, -even credit card and cash transactions, do take time, especially if one includes pick-up and delivery as well. If ready sellers are prepared to grant more time then it should be up to -them. (The delays that are involved even in consume shopping do have their equivalents on the current mass production and distribution side and, also, in the delays in receiving payment for production and distribution activities and for the spending of earnings received from them. Not all these earnings are, usually, instantly spent. Mostly the consumer spending is spread over a period, the period of wage or salary payments. Thus the balance between the exchange media issued and the ready for sale consumer goods and services could also be spread over a short period. - J.  Z., 6.9.02.) However, the more widely monetary and clearing freedom will be -practised, the less there will be a need to postpone payments for -purchases and the easier it will become to obtain real credits, -for medium and long term investments, on a stable value basis, with these term credits paid and repayable as well in shop foundation money circulating only for a short period. -The whole process might be gradual or proceed in steps. At first only private alternative exchange media and clearing certificates might be introduced. Then monetary emancipation might be advanced further against the remaining government paper money. For instance, taxpayers might insist on their -taxes being determined in a sound value standard and so might public servants for their salaries and other groups of wage and salary recipients and other groups of creditors. Then tax payers might insist upon the -acceptability in tax payment of their private clearing -certificates and clearing or money tokens, but only at their market value. Moreover, they would then begin to insist -that depreciated government paper money be accepted at the tax- offices at par with its nominal paper value, while they, not being its issuers, would refuse -to accept government paper money at par with its nominal value -whenever it had been over-issued or refuse to it altogether in all their -transactions. But at present the government has their throats -still in the sling of its exclusive and forced currency and can- pull that string tighter or depreciate its paper value standard at any time.- It will also always tend to blame private exchangers and- their exchange media and channels and their value standards, and speculations in them, for the depreciations that -follow over-issues of its own exchange media. - J. Z., 14.4.97, 6.9.02.
CREDIT REFERENCE BUREAUS, CREDIT & PRIVACY, INFORMATION REVOLUTION, COMPUTERS & CREDIT REFERENCES: Australia-wide credit reference bureaus were planned in 1989 and also opposed under privacy claims. - Those with a good credit rating want it rather known than hidden. Those without debts will not be interested. Only those with a bad credit record have a motive for hiding it as much as possible.  All their potential creditors have an interest in finding out how good and reliable their potential debtors are. Not debtors have a right to cheat their creditors. The general economy will be better off if bad debtors become known as such. That would lead to less bad investments, fraud, embezzlement and waste of scarce capital. If debtors are wrongly treated by one credit reference bureau then they should be able to set up their own in competition, supplying all the evidence required for their credit-worthiness. If there is no single credit reference bureau and compulsory register in it and if there is also the option for a debtor to see the record on himself and to make comments and refer e.g., to more accurate reports in other credit reference bureaus, then few debtors would have any right or cause to complain. - The most accurate records would probably be compiled by a bureau which not only supplied credit references but also engaged in credit insurance. Then it would have no interest in providing a good reference to a bad debtor and a bad reference to a good debtor. On the contrary. - When there are competing credit reference bureaus then the more accurate ones will also get a larger share of the total business. Uniformity, centralisation, a monopoly for a credit reference bureau for the whole of Australia are not required. E.g., debtors might come to declare towards their potential creditors that such and such would be their credit reference keepers. And a special credit reference bureau might then be established that would point out how reliable the references of various credit bureaus have been, in the past, according to the reports sent in by creditors. - Alas, credit bureaus can only supply information on honesty and ability, not on the disabilities that are the results of government interventionism, especially monetary despotism and compulsory taxation and changes in taxation laws & regulations.  - J. Z., 13.3.89, 15.5.97.
CREDIT RESTRICTIONS ARE A MEANS TO FIGHT INFLATION: - A popular opinion. - What ought to have been restricted, long before credit restrictions are officially undertaken, is the issue of government monopoly money with legal tender and that very often to inefficient and dishonest debtors, sometimes on a vast scale, and sometimes also to very wasteful governments. When, as a result, many private and public debts become bad debts, then general credit restrictions are sometimes imposed, while monetary and financial freedom remain suppressed. This means that then honest and efficient or productive debtors will get less credits than they need, i.e. the economy will be forced to shrink, while dishonest and inefficient debtors get some or even all of their debts cancelled and depositors lose some or all of their deposits or taxpayers are forced to subsidise bad debts or the losses made in grating them. Reckless loans ought not only be restricted but done away with altogether. Sound loans should be expanded to their optimum, rather than restricted. Naturally, this should not be done on the bases of an almost continuously deteriorated value standard but at least under general use of value preserving clauses, better still, under competitive sound currencies only. - In the absence of free market rating for sound and competing currencies there is not obvious limit that prevents over-issues. Thus the forced currency leads always either to deflationary, inflationary or stagflationary effects, at least in some sections of a national economy. To apply it evenly means quite different situations in different parts of the country of segments of its economy. Those which were over-supplied with exchange media may be thereby reduced merely towards a normal supply of exchange media. Those which were already under-supplied with them, as agricultural areas, for instance, often are, would be even more deflated than they were already before. Honest and productive debtors and sound credits to them should never be restricted. Dishonest and unproductive debtors should never be granted any credit and unsound types of loans should also not be made. But when loans are granted upon "connections", "reputation", "power", or supposed "securities", often quite speculatively and negligently, in millions and billions, without even thoroughly inspecting the account books of the debtors, what otherwise can one expect than large accumulation of bad and largely uncollectable debts? - To try to reverse a prior inflation by deflationary steps does not undo the wrongs and damages of inflations but adds the wrongs and damages of deflations. And the restriction upon sound credits does not undo the damages done by the granting of unsound credits. Credits granted and taken only in the expectation of further inflationary price rises, which would enable debtors to repay their loans with more and more worthless paper money are also fundamentally unsound and ought not only to be restricted but abolished and prevented. Nor should governments, at the expense of tax payers or depositors, ever bail out dishonest or incompetent debtors or those who granted bad loans. Credit restriction should be complete in all the monies of monetary despotism : exclusive and forced currency. They should no longer be permitted in or imposed on any transaction. - Trying to counter the effect of a previous inflation of forced and exclusive (legal tender) currency by its deflationary reduction via credit restrictions, while at the same time not permitting any competitive currencies, is like driving over a pedestrian and then trying to revive him by reversing over him. - If that example is too gruesome for you : Envision how easily it is to squeeze out a toothpaste by hand and how difficult, without special equipment, to reverse the process. - One of the major wrongs of credit restrictions or credit squeezes is that ALL credits will be reduced, directly by government authorities or upon their pressures, not only those of governments and their authorities, although these were the only or major offenders, and not only foul credits by sound ones as well. -  J. Z., 28.3.97, 30.8.02..
CREDIT RESTRICTIONS, RECESSIONS, DEPRESSIONS, DEFLATIONS, SALES DIFFICULTIES & SELF-HELP AGAINST THEM: The best answer to credit restrictions is to provide your own honest and efficient note issue and credit institutions, and means of payment and value standards and turnover credits paid in them or in establishing pure and free clearing facilities for this purpose, legally, if it can be done, illegally if it must be done, in rightful self-help efforts and in the realisation of basic economic rights, never mind that governments have so far not recognised them. - See: MONETARY FREEDOM, SELF-HELP, MONETARY REVOLUTION, RIGHT TO SUPPLY ONESELF WITH WORK AND SALES. - J. Z., 1985 & 21.5.97.
CREDIT SQUEEZE: See : CREDIT RESTRICTIONS.
CREDIT, ESPECIALLY TURNOVER CREDITS. IS FUNDING ALWAYS REQUIRED?- Your system would permit credits only with already pre-existing -monetary funds, with savings that are invested. Such notions were natural for advocates of a an exclusive rare metal currency- or of 100% covered certificates of gold, silver or platinum or of any other commodity-based currency, based on e.g. stored coal or wheat reserves. In this whole host of -opinions, preconceived notions and convictions, the clearing- options are usually overlooked, especially in the sphere of turnover--credit. These options have been extensively discussed by Ulrich- von Beckerath, Prof. Heinrich Rittershausen and Dr. Walter-Zander, to speak only of the most advanced representatives of the- German monetary freedom school, particularly with regard to the -inflation, depression and mass unemployment risks of the present system.  (I have tried to illustrate the turnover-credit and- clearing money issue options in my circulation charts in PEACE- PLANS 41, to supplement their theoretical texts and those of- others.) Turnover credit, like medium and long-term production- credits, also benefits from a sound value standard, preferably -one chosen or agreed upon by the participants, but it does not -need any external provider of exchange media or any uniform and- externally prescribed value standard. It can provide its own -self-liquidating and inflation- and deflation-proof clearing -media or banknotes and did so, traditionally, for a long time and- well, limited or interrupted and sabotaged, sometimes, only by -the prejudice in favour of metallic reserves and redemptions. It -could have functioned much better and undisturbed without these- unjustified and unnecessary impositions, "precautions" and -"reserves" or "guaranties". Especially under full freedom of- choice of value standards, if the participants are sufficiently -enlightened on this and on the freedom to issue and refuse to accept or to discount (or to- free-market-rate or price) any currency (that was not issued by them or which they are not, by contract, obliged to accept at par) and thus are habituated to compare & choose, rationally and well informed, all exchange media and -value standards. These two should not be coercively and- monopolistically combined because then the pricing mechanism of a- free market cannot function with regard to them. This tradition -is sometimes known and described as the essence of the "banking -principle" (especially in Beckerath's writings, and in the -English and US tradition as the "Real Bills Doctrine". Alas, it, -too is largely still misunderstood even by most "free banking" -advocates, even 200 years after this principle and practice was -seriously but not yet fully discussed. I had a long  exchange- with Kevin Dowd on this, which I will not repeat here. It is -filmed in my series. Considerable controversy on this subject- exists still. Most of it overlooks some monetary freedom -traditions or options. I will here only shortly describe, in one -instance, what is involved. Even after centuries sufficient- enlightenment in this sphere is still as rare as it is e.g. on -free trade, land reform, cooperative production, rightful- revolution and liberation and defence efforts: Assume a local -productive and exchange and payment community, free to help -itself and insufficiently supplied with government cash currency -to pay all wages and to enable all potential customers to pay for -their wanted and needed purchases, e.g. a depression condition. -Under freedom the local factory owner, for instance, who might- employ most local people, would be free to sell his goods, as -usual, to a wholesaler, for a short term promise to pay, which -the wholesaler hopes to make good by the sale of the goods to -retailers. So he pays the factory owner e.g. with a sound -commercial "bill of exchange", sound, because it represents a -real commercial transaction, a sale of goods already produced and -on their way to the final consumer. But the factory owner cannot -pay his labourers or his suppliers with this large bill. It is a single -certificate for a large amount owed to him. So he needs it- "broken" or "cut" up into small bills, in money denominations, -running for the time until the large bill is due. Thus he takes -the large bill to a local bank of issue, which does provide this- service for him. For the bank's discount of the bill it does not require -any savings or rare metal gold reserve. It can and should- "discount" the large bill by exchanging it into its own -standardised and typified bills or bank notes, in money -denominations. (It should not utilise any exiting legal tender -paper standard for this, for then it would be involved in any -inflation or deflation of that paper standard, by the third party "authority".) Now, neither the large bill nor the small bills -need carry any promise to pay gold coins or bullion or government- currency but merely the promise to accept them in clearing and -payments like ready cash - using such and such a value standard, -one agreed upon. With this discount the employer gets the small- bills or notes he can use to pay his labourers with. (If these -are not prejudiced against any private payment alternatives, -misled by their union functionaries, as usual.) Alternatively, -he can establish corresponding deposits at the bank for them,- which they can dispose of with cheques or credit cards. Those- hesitant to accept the alternative private bills or deposits could be informed and shown easily that the local shops are ready- to accept them like ready cash. Perhaps an insufficiently -prepared group of employees hesitates or refuses at first such an- alternative payment. Then someone might be sent by them, -immediately, to the nearest store to try this new payment method- out, while the others still wait, refusing to accept the- alternative banknotes or accounts until their messenger returns. -He could be back within minutes with his important message: It's -as good as cash at the nearest local store! Thereupon the -labourers will be, most likely, willing to be paid in this way,- or so we will assume here. As usual, they will spend their cash -or cheque accounts fast, mostly in the local stores. These return -the notes, directly (or indirectly via their bank), to the- wholesalers, to pay with them for their previous or new orders.- The wholesaler uses the notes - or the corresponding account at -the bank, to redeem his large bill of exchange, now held by the -bank against him. Then, ideally, all the small notes and the -large bill should be cancelled. They have fulfilled their -functions. This process can be endlessly repeated and paralleled -by other such turnover-credit facilities or, accordingly applied, -in other circles, too. Such bills or notes will be readily- accepted, at least locally, only if and while they are running at -par with their nominal value, e.g. a certain gold weight unit, -initially probably the government's paper or rubber "standard".- They will be and should be widely or altogether refused should -they suffer a considerable discount, making further issues -impossible or costly to the issuer and beneficial only to his- remaining debtors - if he has not contractually obliged them to- always accept his notes at par. Obviously, they do not require a -gold cover or reserve or redemption by the issuer in order to -function well enough. Such a single issue transaction does not- describe sufficiently the mutual dependence between local firms -and others. But, historically, it has often happened that notes -of well known local firms were locally circulating like ready -cash. Some of these local firms did even later turn into local -banks of issue. - The law in most countries and most- theoreticians and reformers would not permit a local payment- community such a freedom or freedom for essentially similar -mutual clearing experiments. Almost all -rely on father State or Big Brother doing his best and on his best being good enough. Even at their best they are mostly not good enough, nor can they be, for several -inherent reasons. To illustrate one of these, shortly, Ulrich von Beckerath used to say: A single bakery cannot supply a whole- country sufficiently with fresh bread, either. For more arguments on this see under CENTRAL BANKING. The banking -principle or real bills doctrine, as applied above, is not -and cannot be inflationary - if a sound alternative value- standard is used. If, uncritically, an inflated government -standard is used, then it would, naturally, participates in the- general inflation - but not by adding to it. Remember, it merely -mediates local genuine, wanted and necessary exchanges. It is -self-liquidating. It does not put additional notes permanently- into circulation, by giving them a fictitious, exclusive and- forced tender "value" but it sees to it that the issue is in- correspondence with the goods produced and already sold to the -wholesalers and on their way to the retailers or on their shelves-, waiting for the consumers and also that these additionally- issued notes, achieving additional turn-overs, are extinguished- again, soon, with the consumed products. Often they may already- disappear from circulation or their representation in deposits,- before the worker - consumers have used up all the perishable -food items they may have bought with these private notes or- accounts. Without this option to provide wage payments, the factory owner might have to close the factory, the wholesaler -could not redeem his bill, the retailers might  go bankrupt, the- workers would go hungry - to the extent that the governmental- central bank system does not supply the local community- sufficiently with cash - or clearing facilities. Even in the best -of times under the despotic central banking system a number of- manufacturers and wholesalers and retailers do go bankrupt merely -because of the unjustified and unnecessary frictions and- difficulties introduced by this anti-free-exchange system. -Tradition and sound theories insisted that only sound commercial -bills be so discounted, because they are self - liquidating, not "financial bills" or long-term or habitually extended bills,- because these would at least postpone their redemption, for a- longer period and would be much less certain to be redeemed by -their debtors at all. FINANCIAL bills, if discounted with- banknotes that are  not covered by gold reserves,  would- inevitably lead to a depreciation of these bank notes (unless -they are given the legal tender privilege and can thus drive up-prices) in a market in which they may be freely rated, refused -or discounted against sound alternative value standards and other -currencies. Their "reflux" is not assured, in time. The same -amount that was issued is not soon due, exerting a corresponding -immediate demand for the notes. Moreover, they do not represent -additional goods added to the market, which act as their -redemption fund. On the contrary, they exert an additional demand- for the pre-existing goods, thus driving prices up. Only already -sold goods, ideally consumer goods, not stocks of presently- unsaleable ores or grains, or ready for sale goods (of shop--associations acting as note issuers) can form a rightful and- efficient basis for private currencies, local or shop currencies, -that are truly "current" and readily acceptable because of this -foundation or "readiness to accept" for daily wanted consumer goods and- services. All other kinds of issues are mostly attempts to thus -acquire the goods and services of others without immediately offering them goods and services which they do want. Assignments -upon accumulated wool or wheat or coal stocks or blocks of land- have only a speculative value to some consumers, with some -capital to invest, more or less speculatively, for prolonged -periods. They cannot satisfy their "current" or "currency" -requirements and they do not oblige those who have ready for sale- goods and services to offer. Only when the issuers are -monopolists will the suppliers of consumer goods and services be- more or less forced to sell for such monopolistic issues, if they want to participate in monetary exchanges at all. - The "Real- Bills Doctrine", as practised above, does not fulfil the- requirements of Rothbard's "100 % Gold Dollar" or of Robert de- Fremery's "Population Standard." But it can satisfy the exchange -requirements of a local community, no matter how productive or -unproductive it may be and quite independent of the payments- system desired by a State, State federation or world federation. -No monopoly for such issues is needed nor any coercive powers but- merely the right of the believers in them to practise them among -themselves. To prevent forgeries or discover them sooner and to -keep better track of the issues, returned bills used to be -regularly cancelled or destroyed. But in order to save printing- costs this practice was largely discontinued and the same paper--bills were issued over and over again, as long as they lasted, in -new such limited and self-liquidating issues. Beckerath suggested -a return to the cancellation practice after the reflux. He also-suggested a limited and short circulation period for the issue of- each series. Now there exist even automatic machines that check -for forgeries. Duplicate numbers in short and often issued series- of notes, that circulate only shortly and locally, in most -instances, before they return, would be very rapidly discovered by -the use of such machines. Then, in many instance, the forger -could be traced very rapidly, too. - J. Z., 3/97.
CREDIT, HONESTY, GOOD & BAD MONEY: No man's credit is as good as -his money. - Ed. Howe, 1855-1937. - A man's credit may actually- be much better than the scarce and exclusive currency that he is- forced to use. - Alas, he is so far not free to express his good -credit in his own exchange media, nor are honest alternative note -issuing banks at liberty to do this for him. - The saying applies- only to good money cash, which is usually, but not always, preferred to credit -arrangements. - J. Z., 18.4.97.
CREDIT, ULTIMATELY GIVEN IN GOODS, SERVICES & LABOUR: Credits are ultimately given in goods, services and labour, made available for an agreed upon period via certified claims upon them, which, by rights, should be issued or subscribed by the owners of the goods, services and labour. - J. Z., 30.4.97.
CREDIT: You should not be surprised when not getting credit in -this world. Credit is monopolised and tied to an exclusive and -forced currency, beyond which it cannot be much extended upon a- free clearing basis as long as this monetary despotism remains in- existence. As long as creditors are authorised to demand payment -in legal tender cash, it cannot be extended as far as free clearing transactions could and should be, to multiply production and exchange, using sound value standards for honest accounting of- the values of all trades. Under completely free clearing neither -inflation nor deflation nor stagflation would be possible. All -debts and credits would be only different sides of the same- coin. All could be settled against each other, for all turnover- transactions, for which payment is immediately due or within a short period.  - J. Z.,- 22.8.76, 18.4.97.
CREDITWORTHINESS IN THE EYES OF PRESENT BANKERS: Customer: "How- do I stand for a five-thousand dollar loan?" - Bank Manager: -"You don't - you grovel!" - THE LION MAGAZINE, quoted in READERS' -DIGEST, 9/86, p.97. - Is this only a joke or is there at least- some  truth in it? - J. Z.
CRIMINAL MONEY ISSUES: The issue of monopoly money or of money that -is otherwise coercive and confiscatory or fraudulent towards third parties, who -have not contracted for it or were not at liberty to contract, for- themselves, payments in alternative and better currencies and may- not freely refuse or discount the monopoly money, is quite wrong, -even criminal and harmful. - J. Z., 1.2.96, 20.3.97. - That, at the -same time, it does provide a uniform currency for a whole territory, cannot make up for its -wrongs and the harm it does. - J. Z. 20.3.97.
CRISES & MICRO-ECONOMIC DECISION-MAKING & MONETARY FREEDOM: Micro-economic- decision-making is the primary device for keeping crises on a -micro-level. - Gary North, THE FREEMAN, 2/74. - Especially the -micro-economic decision-making of monetary freedom! - J. Z.,-7.7.94.
CRISES, GOVERNMENT & MARKETS: Crises, as opposed to simple- scarcity, result from market disruptions; and the only sector of- society which possesses the power to disrupt a large market is -the government. - Henry G. Manne,  REASON 4/74. - Crises are -unknown in an unhampered free market economy. - Dick Sabroff, THE-FREEMAN, May 74.
CRISES: First governments, by coercive interventions, cause crises, while coercively suppressing self-help measures that would prevent or end crises, and then, under the pretence of fighting or managing or mitigating crises, they do, instead, by their methods of monetary despotism, make them worse and prolong them, sometimes into a total collapse of a monetary economy. Then they do have the cheek (impertinence) to do this while blaming others for the results of their actions. Alas, their victims usually accept their excuses and blame price extortionists, exploiters, capitalists, financial conspirators, coercive unionists, greedy landlords, speculators, foreigners, immigrants etc., i. e. people who do nothing else but protect themselves as best as they can against a government caused inflation. - J. Z., 17.10.89, 16.5.97.
CRISES: See: ECONOMIC & HUMAN RIGHTS ASPECTS IGNORED BY MOST -MODERN AUTHORS.
CRISIS MANAGEMENT: To most of the ruling bastards this seems to -amount to: Manage affairs in a way that the crisis is kept going- or even increased. - J. Z., 3.4.95. - Not only communists have- often tried to make an existing crisis worse and to prevent- genuine reforms, in an attempt to gain or maintain power thereby. -- Politicians are always ready to declare an emergency and then to -demand emergency powers for themselves, to deal with the crisis.- (Compare Pres. Bush's "war on terrorism" then extended to "war against the Taliban forces in Afghanistan" and now to the planned "war against Iraq", not against its despotic ruler, after the 9/11/01 terrorist attack on N.Y.C. and Washington, an always upon the same wrongful principle that the terrorists apply in their actions, namely: collective responsibility, and upon the same "ideal" that they hold, namely exclusive territorial rule.) As a rule the crisis persists, in spite or because of their -efforts, even much longer, as a result of their "counter-measures" - and the emergency powers tend to be continued afterwards or not completely abolished. The extreme -case of this is indicated by Randolph Bourne's statement: "War is the- Health of the State". Compare the growth of the "New Deal"- statism under D. Roosevelt, which was extended, at least in- parts, from the Great Depression to today. - In most instances -"crisis management" means "crisis mismanagement" and "crisis- prolongation", largely through prevention of common sense and -economically effective and morally justified self-help steps. - -The only thing that monetary and financial despotism, in -combination with other forms of central planning and dirigism or -dictocracy, can manage to supply is - one crisis after the other, -in which they can always demand  and all too often are all too-readily granted, more power to themselves, in spite of a -continuing record of failures for all their A-Z "reforms" and "measures" and "plans", which repeat all the old wrongs and- mistakes over and over again - but under ever new cover-up names -and propagandist "justifications" and "explanations". But- sometimes they do reveal their empty-headedness, e.g. when they- merely hope to reduce mass unemployment and rapid inflations by a- few degrees in a few years, or when they have nothing else to -propose but changes in the budget and in the official interest -rates. Thus, obviously, they neither see nor admit the real causes -and possible cures.  - J. Z., 25.4.97, 8.9.02.
CRISIS THEORIES: Decades ago over 140 were listed once,- somewhere. Probably many more do exist. They are so numerous that -all should be listed - and confronted with the facts and contrary -theories as far as is possible, in order to enable the patient -researchers to finally sort the wheat from the chaff. - J. Z.,-19.3.97.
CRISIS: A Greek work for judgement or penalty of nature. - Dr. -H. G. Pearce, one of the few Georgists who was a clear advocate of -monetary freedom, too. I reproduced some of his writings but not -yet the manuscript of his Introduction to Economics, being the -notes to his lectures at the Aquinas Academy in Sydney, for a few- years. - I still seek the hand-written final notes for this book- manuscript, which was incompletely duplicated without them. --J. Z., 18.4.97.
CURRENCIES & GOVERNMENTS: The dishonesty, coercive and -monopolistic nature and the vested interests of governments are -today largely expressed also in their forced and exclusive- currencies, their depreciations, stagnations and manipulations. --J. Z., 25.1.90, 29.4.97.
CURRENCY BACKING BY ALL KINDS OF VALUABLES, WEALTH, CAPITAL & -ASSETS? - Not all real values and capital assets are a really -good or sufficient cover for sound currencies. - Our health is very valuable to us, but we can hardly turn it into an acceptable backing for our- currencies. Our ecology is most important for us, so are sunshine- and rain-bringing clouds, but they are a bit hard to coin. We -have valuables like large stamp and coin collections and can even -sell them for much - but we can hardly turn them into local or -national currencies. Each productive individual, is worth- hundred-thousands of dollars in a somewhat developed economy, in -the course of the decades that he is productively active,- sometimes even millions. But we can hardly turn this, our -personal capital asset, into an immediately useful currency, no more so than "the" labour hour. It -happens to embrace goods and services we will only produce in -years if not decades. They are not on the market as yet. Just try- to issue and circulate the total production of your life's- productive efforts in form of a personal currency right now? How -many acceptors would you find? And at what discount rate? If you were a recognized genius or -inventor, film star or pop star, you would find a few fans and- sponsors accepting your notes. But what could they buy with them?- Your autographs? - At most you could anticipate your near future -earnings through private clearing scrip or through share certificates and bonds. - What we can somewhat -monetise right now are our labour and services capacity now, and during the- next few days and weeks - no more. - It is true that all capital -assets have some value in a free market. One can even sell them -for currencies available on the market.  But one cannot -effectively turn them directly into currency and give them- thereby much purchasing power towards daily wanted consumer goods -and services. But one can SELL them for the currency of others, -IF others are prepared to buy them. - Currency is not like the -leaves of grass on a beautiful lawn, although that lawn is also a- capital asset. Nor can it be grown, like leaves on trees,- although trees are also valuable assets. It is only capital -securities that can freely mediate capital transactions, and it is only soundly issued (as well as re-called, in a natural reflux) -currencies that can mediate the daily turnover of consumer goods and- services quite naturally, rightfully and effectively. If asset "currencies", without a monopoly and legal -tender power, were issued side by side with shop currencies and- service vouchers and clearing certificates, they would have some -value only among some investors. But no provider of goods, services and labour or creditor of short term debts would be obliged to accept them. These -providers would, under freedom, rather issue their own sound- currencies. Why should they give any purchasing power to -thoughtlessly issued "asset currencies".  Not much of any asset- currency could be put into circulation. What is the recipient to -do with it? Extract some bricks from the building of the bank- which issued it? Claim some wheelbarrows full of dirt from the- farm which had monetised its capital value? Cut off some wires from the transmission wires, or take a turbine apart of an -electrical power plant that had not issued notes acceptable to -pay electricity bills with, but had, instead, issued an "asset- currency" based upon its valuables, like dams, turbines and electricity cables? Capital assets -have value only among users and buyers of capital assets. - If, on top of soundly issued currencies, based on consumer goods,- services and labour, daily ready for sale, all capital goods were -suddenly transformed into money denominations, why should anybody- but investors accept them at all? The daily wanted goods, -services and labour would not be increased by this multiplication- of private notes. Thus they would not be exchange media for such goods. All you could buy with them would be the capital assets -they were issued upon. No one else would have to accept them or -value them when he is already supplied with sound exchange media- for his purposes. Thus they would greatly depreciate below their -nominal value and that would lead to their almost general -rejection - except among some speculative investors, who might, -by purchasing them very cheaply, get some capital assets very cheaply. - Historically, I know of no instance where it was ever- successful as an asset currency. Almost all vastly inflated -government currencies were fully covered - by government- "securities". That did not secure their value. Ultimately, not even -their issue monopoly and legal tender power could secure them -acceptance. Asset currencies are not rally currencies but just a- few among the numerous misconceptions on money, currency,- exchange media etc.  - J. Z., 12.2.86, 2.5.97.
CURRENCY BOARDS: I see in them only a variation of central- banking. They may be the best form that central banking can take -but that would not be enough for me. Morally and economically -acceptable to dissenters would be only such currency boards which -confined their activities to the voluntary payment communities- which believed in them. Since the faith in monetary despotism is- still very popular this would give them a very wide sphere to -act in, at least for a while. More and more the successful -monetary freedom activities would deprive them of their followers- and participants - through one-man monetary "revolutions" or secessions. - -J. Z., 22.4.97. - The statutes for any competitive and- voluntaristic currency board should carry a preamble like the -following: We do no longer recognize the rightfulness of -monetary despotism via any central bank over any groups of- dissenters. We do not claim a territorial monopoly for our -transactions and powers. Our uniform exchange media will -be exclusive only for our members (provided they agreed on this) and accepted at their face value- only by contract. And these contracts can be terminated, at least- at frequent intervals. Our exchange medium and value standard is- legal tender only within our payment community and towards its issue centre. - J. Z., 22.8.93,- 22.4.97, 7.9.02. - See ON PANARCHY in the LMP PEACE PLANS series. See: -CENTRAL BANKING, MONETARY DESPOTISM, TOLERANCE, MONETARY FREEDOM, -FREE BANKING.
CURRENCY MANAGEMENT & CENTRAL BANKING, MONETARY POLICY, MANAGED- CURRENCIES:  Whether inflation, deflation or stagflation or a -temporary and relative boom prevails, it always means merely that the government or its central bank is still in charge of the- controlling position in the economy and that, sooner or later, it- can and will mismanage it even more, although, perhaps, otherwise -than it did before. Mismanagement is inevitable in any system -that is not foolproof, that is monopolised, coercive and without -free pricing or the discounting and rejection option of competing currencies, one that has no -competition among different note issuers and no stable standard to measure its exchange media- against it. It might try to impose circulation limits - that are ever increased, again and again. It might try to counter an evil -like inflation with deflation - only to arrive, most of the time, -at a degree of stagflation. It has not inherent limitations. It is, in this respect, like- an unlimited government. To be fully limited, all government- services and disservices and charges for them must be refusable -by individuals. The same applies to the money of monetary -freedom. All but the issuers themselves must be free to refuse it-, as well as free to issue (print) and offer alternative exchange media -and value standards, if they can find any takers for them. Only -monetary freedom can provide sufficient quantities of exchange -media and sufficiently stable currencies. To each the exchange -media and value standards of his or her dreams and to each the -government or free society of his or her dreams. Central- management of an exclusive and forced currency means mismanagement most of the time in most countries. Only -accidentally and then only for short periods, does it hit upon -the supplies that are correct, at least for its particular -circulation channels. (Not necessarily for all of a national economy.) Others it cannot correctly supply at all.- Imagine trying to supply everyone with sufficient fresh water from a single dam in a large country, or with sufficient electric -power from a single electric power station. Similar difficulties- exist for any centrally managed currency and it is high time that- they are recognised and abolished together with the whole central banking as an imposition upon a whole country and all its people and all its trading.  However, -central banking would not have to be prohibited or outlawed. It- would be enough to open it up to fully free competition or to reduce it to the members of a volunteer community that is only exterritorially autonomous.  -- J. Z., 14.12.92, 29.4.97, 9.9.01.
CURRENCY PRINCIPLE: Its advocates are still predominant among -money reformers and advocates of degrees of free banking.- Moreover, they still misunderstand the "banking principles" (-several versions do exist) and the "real bills doctrine" -involved in some of them. Partisans of both schools still believe -that they have already refuted each other. How could that -controversy be finally brought to a successful conclusion. It is -about time, after nearly 200 years. First step would be a- complete publication of all their relevant writings. Secondly: -All their arguments should be confronted. Thirdly, all needed -additional arguments, so far left out, should be added to the- debate. Fourthly: This might perhaps be best done via flow chart- discussions on paper or with the aid of flow chart computer -software on computers.  - J. Z., 9.4.97.
CURRENCY REFORM OF THE GERMAN UNIFICATION: The one on one exchange rate of one West Mark for one Ost Mark was absurdly wrong and false. The wages thus paid in the same amounts in West Marks were no longer earned by the sale of goods and services. Most people in the West and in other countries refused to buy these goods and services, as being of inferior quality, while the wage and salary earners spent their West Marks, no earned by them but credited to them, not for the goods and services of Eastern Germany but large on those of Western Germany. With many less sales for their own goods and services, many to most employees had to be dismissed. The unemployment benefits working couples got, in West Marks, made them economically much better off than they were before, when earning only East Marks and so they did not mind becoming unemployed but rather went on an extended holiday through Europe. By rights they should only have been paid with claims upon the goods and services they had produced. That would have been a strong incentive to produce more and better goods and would have largely solved the sales problem for their output. As it was, they were, to a large extent, made unemployed and turned into welfare recipients. To the extent that their wages were thus subsidized and the production of largely unwanted goods and services went on, the collapse of the enterprises they worked in was only postponed. Their goods and services could only be sold at emergency sales prices. Moreover, for decades, the work ethics in Eastern Germany was largely absent. For instance, bookshops that were run in West Germany by 1-3 people, were run in East Germany by ca. 12-20. Inefficiencies in other jobs was probably corresponding. After all, all of production and exchange was bureaucratically run. This change-over was not a change over from a state socialist economy to a market economy but from one kind of state socialist economy to another kind of state socialism, although not as totalitarian. But in one respect statist centralism was even worsened: The former two central banks became one. The very limited currency competition between East Mark and West Mark was eliminated. The natural connection between earnings and labor was even more separated than it was before. Those employees, who continued "working", did no longer work to satisfy consumers among their countrymen but to receive hand-outs from the West instead of earned wages and salaries. Moreover, these additional payments in West Marks, also legal tender monopoly money, as recommended by the Communist Manifesto, led to an accelerated inflation of the West Mark. Could their products and services still be sold to anybody in the world market? Possibly to people in underdeveloped countries, if claims upon these goods and services had been issued and utilized, at free-market exchange rates, to purchase goods from underdeveloped countries, that could not afford the quality goods of West Germany and did not have the purchasing power in their own currency, at free -market rates, to buy these goods in West Germany, not had they earned enough West Marks by sales the West Germany, to pay for imports from West Germany in West Marks. However, if they had been paid in East Marks, redeemable only in East German goods and services, and this at an exchange rate favorable to them, then they could have become customers for East German goods and services, leading to corresponding exports. These goods and services could have been sold - even if only at emergency or low quality prices, instead of remaining largely unsold. And the earnings thus achieved should have been shared as wages, salaries, returns upon capital and for suppliers. Productivity and earned wages and salaries would have fast risen from low levels to higher and higher levels. Capital could have been obtained in sufficient quantities with e.g. gold clause guaranties and tax and regulation exemptions, to utilize the numerous productivity increase opportunities from a low level of output to a standard high level of output. And employees would have had to pull their socks up, with the elimination of most bureaucratic featherbedding for them. Then they would soon have become as productive as the employees in West Germany. The "currency reform", as practised, prevented the natural adaption and development of the East German economy. It amounted to State socialism, the mixed economy type, of the Western model. - J.Z., 1990, 27.8.02.
CURRENCY REFORMERS, INTOLERANCE & MONETARY DESPOTISM: Most are -like statist tax reformers, i.e., they just want to replace -one monopolistic and despotic evil by another. - J. Z., 19.8.92.
CURRENCY SHORTAGES & CURRENCY FAMINES: They and their effects- are largely denied by theorists of the Austrian School of- Economics. They assume that the price mechanism will completely- and immediately adjust to any reduction of credit and cash and- thus render them completely harmless. Historical experience has- refuted this notion, in practice, thousands of times. -Ten-thousands of times, if one includes all the issues of- emergency monies and trader's tokens, as well as the truck -payment and truck payment tokens that occurred in monetary history and that are pretty well documented by coin and money- collectors. - Generally, one cold simply refer to the proverbial- "cursed hunger for gold" which does not indicate any saturation- of the circulation with gold coins to mediate all desired- exchanges. One could refer to the often complained about "greed- for money", which would hardly exist if it were always easily to -be obtained in any market, just by offering one's goods, services -and labour for it. The phenomena of the several "gold rushes" did- also indicate that the world was not yet sufficiently supplied with gold so that hundred-thousands braved hard circumstances and -worked hard and often in vain for small returns, always hoping- that, like a few others, they might finally strike it rich. -Lotteries, gambling and betting do also indicate a kind of- persistent currency famine and the lack of faith in most people that -they can ever earn enough ready cash through honest and -productive efforts - under present circumstances. - J. Z., MFNL-3/4 & 8.4.97.
CURRENT ACCOUNT, TRADING, CHEQUE BANKS OR CLEARING BANKS: -Apart from the difficulties which monetary despotism can cause -them, via sudden cash demands, when all due credits are demandable -by the creditors in cash, regardless of the cash supply of the- debtor by the monopoly issuer, all such institutions should be-able to settle all their accounts against each other. (The losses due to the minority of unable or fraudulent debtors could be- covered by the insurance fees that are part of the interest rates or due to special credit insurance arrangements. Extensive incompetence or corruption in the lending institutions, running up debts by the millions to billions, until these criminals are found out and stopped, cannot be covered by insurance. Incompetence or dishonesty among auditors cannot be insured against, either.) To each credit -there would be a corresponding debt. To each debt there would be- a corresponding credit. The total balance of all debts and all credits -should come to zero. They should balance each other out - unless- there were some mistakes make in the book keeping or electronic -accounting. Furthermore, to the extent that clearing transactions -are almost instantaneous, they do not suffer, as a rule, under a- depreciating value standard. Moreover, if the law does not- prohibit this, they would be free to adopt whichever sound value -standard pleases them most. And with regard to the profit margins -involved, in the average, for the participants, a slight- variation or loss in the value standard, reduced to that fraction -of the loss that occurs in the period of the almost instant or -very short term transaction, comes to very little. Furthermore,- to the extent that such clearing transactions represent real- exchanges of goods and services (or of debts representing goods- and services exchanges), the increased number of freely arranged clearing -transactions does not drive prices up but merely indicates more- trading, not "overtrading" or "over-production" or -"over-consumption" and it cannot reduce the value of any value- standard - merely by using it, in accounting and reckoning, more- often. - However, trouble will occur when some clearing accounts,- so far reckoning in a sound gold weight clearing standard only, can suddenly be closed- down by the creditors with their legal or juridical demand that debtors pay them in gold or legal tender, -although the clearing system may not and need not possess even a single gold coin or gold bar or any legal tender cash. When not gold or cash redemption is demandable but merely a gold clearing standard then, even when no gold coins or bullion were available in e.g. Germany, all such German transactions could still use the gold price of Zurich, -London, New York or Tokyo for all their gold-clearing transactions. Any clearing system can be prevented from -operating freely by the creditors being authorised to demand the -pay-out of all or any of their clearing credits in cash,- regardless of how much or how little cash is currently available -to that clearing system or made available to it by its debtors. -It is one thing to be allowed to pay in (acceptable and sound- cash), if one possesses it,  and quite another thing to be allowed to demand cash (sound or -unsound cash), or, for debtors, to be obliged to pay cash, when the debtors do not possess it, cannot easily obtain it and can offer only clearing options. A clearing-house or clearing bank should always remain free to settle all -its debts by clearing ONLY. Only when it can no longer do this,  -then it should be driven into liquidation and the creditors- should then be free to try to extract whatever credits or cash -they still can manage to get from the clearing house, not from its remaining debtors. For these debtors,- again, should not be obliged to provide any cash - as long as they- can still provide acceptable clearing options. Only if they cannot do this, either, should one be able to drive them into bankrupcy with one's cash or clearing claims against them. -  J. Z.,-11.4.97, 5. 9.02.
CYCLES, ECONOMIC, CRISES, BOOM AND BUST PERIODS, INSTABILITIES, -FLUCTUATIONS, IMBALANCES: Economic cycles are largely the result -of economic interventionism, especially monetary despotism. In- former centuries, without a world market and abundant transport- facilities, natural catastrophes could lead to local starvation. -Now only economic, political and military or revolutionary- interventionism can provide for such artificial poverty and- starvation periods, keep them up and prevent their abolition, -sometimes at the price of the lives of millions. Under true free -market conditions, including full monetary and financial freedom, free trade, free property rights and free enterprise, economic- cycles would largely disappear and natural catastrophes could soon be overcome for their survivors. Only price fluctuations -would remain, e.g. corresponding to harvest or demand -fluctuations, e.g. due to fashions. Nature as an enemy becomes -more and more bearable. But when one's own government and foreign -governments and all their military, education and tax slaves and -all their bureaucrats are turned into enemies of peaceful and -productive persons - then the situation of the latter becomes often- desperate. Once they come to realize that monetary and financial- freedom can be used as their Archimedean leverage, then they could- soon emancipate themselves from all internal and external- oppressors and exploiters. E.g., then they could make their -separate peace with millions of military slaves sent against -them, setting them free to support themselves productively,- within a short time, in the country against which they were conscripted, much against their will, in order to conquer it for their masters. Monetary and- financial freedom ideas could be exported into the heads of -revolutionaries everywhere, who do fight any despotic government. But- first we have to come to generally realize that monetary and -financial freedom options and techniques are rightful and valuable services -and also an exportable or commmunicable ones. - J. Z., 4.12.92,-29.4.97.
DEATH PENALTY FOR THE REFUSAL TO ACCEPT DETERIORATED GOVERNMENT PAPER MONEY: Governments could not, of course, pursue the- practices by which they forced bad money upon the people without -the cruellest measures. As one legal treatise on the law of money- sums up the history of punishment for merely refusing to accept- the legal money: "From Marco Polo we learn that, in the 13th -century, Chinese law made the rejection of imperial paper money -punishable by death, and twenty years in chains or, in some cases- death, was the penalty provided for the refusal to accept French -ASSIGNATS. Early English law punished repudiation as- LESE-MAJESTY. At the time of the American revolution, -non-acceptance of Continental notes was treated as an enemy act -and sometimes worked a forfeiture of the debt." - Hayek,- Denationalisation of Money, 28.
DEBT CRISIS, ABILITY TO PAY & INTEREST RATES: In most cases it- should be seen as a means of payment problem that requires, for -its solution, monetary-, clearing- and financial freedom. - In- most cases the per head debts, of a private or a public kind, are- not so high that they would be really unpayable. Payability of- private debts is usually already calculated into them. Once -public debts are considered to be too high by tax payers, they -should not only see to the repeal of all compulsory taxation laws -but also to the repudiation of all public debts. The only indemnification for all the losers in this case would be on an -equal basis with all present taxpayers, through their share in- the remaining public capital assets. Investments in future tax- slaves, all too long considered as acceptable, as formal slavery- was for all too long, and as the education and military slavery- still are, all to widely, should no longer be considered as -morally justified and enforceable assets or credits. - Payments of debts with -the own clearing-, goods- and service-vouchers would also be much- easier and more honest in most cases than would their payment in- exclusive and depreciated legal tender paper money. - The degree of the interest "burden" or "exploitation" involved in monetary- despotism would also disappear with it. For turnover--credits it could be reduced to close to zero. For longer term- credits on an agreed upon stable value basis, more secured -through monetary freedom repayment options, it would also tend to -become reduced. Full employment and the permanent boom- conditions that would be made possible by monetary and financial -freedom, would also increase savings and their offers in form of -investments, which would tend to reduce the interest rate. An -interest rate reduction is also to be expected through credit -insurance, no longer subjected to the extra risks of monetary- despotism. - But, at the same time, many more highly profitable- investments in innovations, including self-management -innovations, would take place, that would drive the interest rate -up, without being a burden to the debtors. If fixed interest -rates were largely replaced by rates that are "partnership- earnings" of "pre-done labour" in extra profits made, then the difficulties in paying -even high interest rates would disappear because they they would- merely be a share in high earnings. - J. Z., 13.1.93.
DEBT CRISIS, INTERNATIONAL DEBT CRISIS, LOANS TO GOVERNMENTS, -REPUDIATION OF GOVERNMENT DEBTS, GOVERNMENT GUARANTIES OF FOREIGN- LOANS, DEVELOPMENT: "First, there is no serious doubt that the -bankers of this country from 1973 on have made a lot of- incredibly stupid loans. These loans are never going to be -repaid. The debtor developing countries now owe a staggering $ 2- trillion." - Indemnifying the Debt - A Special Kind of Fraud,- MULTINATIONAL MONITOR, Washington, July 86. - Firstly, not only- "the bankers" are involved but State guaranties for foreign loans -and often also straight government to government loans and these -mostly on a mere paper money basis, i.e., repayable, if at all, in -inflated currencies. Moreover, all the bankers involved are -privileged, by special legislation, protected from competition- and via governmental deposit insurance at least to some extent- against the results of some of their own worst mistakes and dishonest actions. - What can one expect in such a situation? -- Private and government loans to governments ought not to be -repaid, since they are immoral investments in future tax slaves. -In principle, they are morally no better than former investments in slaves -were, bought from African slave owners and then used, largely or -mainly in the Southern States of the U.S., as enslaved plantation -labourers. Alas, I have not heard many of their descendants protest against tax slavery, too. - Now consider the figure- given, assuming it to be correct. I would estimate that at least- 2, if not 4 billion people are involved in developing countries.- Thus this debt comes to only $ 500 - $ 1,000 per head. If all -these funds had been productively invested, then their repayment-s should not really have been very difficult, especially if spread- over a number of years. But this would also have required, among- other things, that their sales problems for goods, labour and- services would have been solved via monetary freedom. They could- have repaid their international debts e.g. with clearing- certificates based upon their export goods. - J. Z., in old MFNL- notes, & 30.5.97.
DEBT FOUNDATION & CLEARING: Since clearing is the essence of any -monetary exchange and since all clearing is the mutual- settlement of debts, any money has, in essence, a debt- foundation. It does not need any other foundation but only a- value standard chosen, contracted or provided by the- participants. - J. Z., 28.5.95, 16.3.97.
DEBT FOUNDATION: All debtors, to enable them to pay all their- debts more easily, should become free to offer in debt settlement standardised assignments upon their own goods and service- delivery capacity. None should be driven into bankruptcy before -this potential is exhausted. Creditors would not be obliged to- accept them at par, as if they were legal tender, but remain free- to accept them only at a market-rated or arbitration-determined -discount, so that both parties can be satisfied with the debt -settlement. The automatic legal and juridical assumption that a creditor may demand (if not, in our times. gold or silver coin or certificates to them, that "right" has already been abolished)- government legal tender currency should not be upheld, -unless it has been especially agreed upon in advance. Since -creditors are also debtors at the same time, in many ways, no- one-sided interest or privilege is involved here but just a -facilitation of the payment and clearing process that was often -interrupted  by inherently unwarranted demands for cash which the -old system of monetary despotism could not sufficiently and fast -enough satisfy whenever the non-cash payment system partly broke -down and thus, & quite suddenly, the demand for cash was increased, precisely when cash was already somewhat short and this lead to the part-collapse of the non-cash payment system. Sooner or- later the debtors' clearing certificates and those of other local -providers of goods and services will become recognized as local -currency cash, which is in some ways more risk free and more- helpful to attain and maintain local boom economy conditions. especially when enough of these potential local issuers combine their capacities and issue, between them, their own local currency. - -J. Z., 19.3.97.
DEBT MONEY OR DEBT-BASED MONEY UNDER MONETARY FREEDOM: For the- purposes of this discussion one should distinguish between short--term debts arising out of goods and services exchanges and medium- and long term debts that represent existing or hoped for capital -assets or even debts imposed upon tax slaves, confiscated assets,- forced loans etc. As an advocate of monetary and financial -freedom and free exchange,  one can advocate the monetisation of- the former, the issue of capital securities upon real or expected -capital assets but not the monetisations of wrongful capital -claims against the victims of imposed tributes, called taxes.- (However, as long as taxes are still tolerated, one should- insist that these forced payments become as far as possible- facilitated by the mutual clearing arrangements involved in sound tax foundation money, rather than extracting means of payment -from other payment communities or imposing unlimited, -monopolised, legal tender tax foundation money upon the whole- economy as an exclusive and forced currency. The least unjust and - east harmful tax foundation money would be one that would use a- sound value standard and that would be optional, refusable and- discountable in general circulation but would have full legal- tender power towards the issuer, i.e., there and there only, compulsory acceptance at- par with its nominal value, no matter how much it had become depreciated in general circulation. (That would constitute a strong disincentive for over-issues and also lack of opportunities to engage in them, since the potential acceptors could discount them.) - Monetary freedom promotes and utilises currency based on short term, private or -cooperative and voluntarily undertaken debt and credit arrangements, arising out of the -production and sale of consumer goods, also debts based on- readiness to supply services and labour, as opposed to the- so-called "asset currencies", based on capital assets, under the- wrongful assumption that such valuable assets could also give -currency value to currencies supposedly based upon them, instead -of merely a capital market value to capital securities like shares, bonds, mortgages -etc. - Under full freedom the suitable debt foundation money, -e.g., shop foundation and railway or bus money, would drive out of- circulation the bad debt foundation money, based upon capital -assets for which there is only a relatively small demand among most consumers with their currency. To maximise the -transferability of both consumer goods and services and of unused- or under-utilised labour, this kind of readiness-for-sale can and -should be "monetised" with its kind of competing currencies, -ticket money, purchasing or goods vouchers, clearing certificates- etc. To mobilise, as far as possible and desirable, the -transferability of capital assets and their accumulation and- repayment, for purposes of production and development credits, -the corresponding financial securities should be freely issued- and marketed, i.e., not among ordinary consumers, in most -instances and for most of these securities. No supplier of -consumer goods and services and of labour is OBLIGED,- automatically, without any special contract, to give his values -in return for the offer of any capital security. What they want -or are obliged to accept, are currencies that are suitable and -usuable immediately for wanted consumer goods, services and- labour. These two sound valuables, running in different- circulation channels, largely among different groups of the population, one facilitating daily turnovers of consumer goods and services, the other facilitating capital -transfers, should never be mixed up or used interchangeably, as -far as their issue and reflux are concerned. Only via voluntary- subscriptions should shop currencies be exchanged for capital -securities and through voluntary trades should capital securities- be exchanged for shop currencies. Their issue and reflux are -different. So is their circulation sphere, their purpose, their- life span and the circle of their most common issuers and users, as well as their inherent cover. -Both run all too often under the all too general term of "money"- or "capital" but that does not mean that in theory and in- practice they should be mixed up with each other. To use another analogy: The obligations- arising from one night stands are different from those of -long-term or life-long marriages, although both are appreciated by -many and sex is involved in both types. It is true that capital- assets are built by investing consumer goods and services in -them, on long terms, and that those who are holding securities for them are -ultimately mostly turning them into shop currencies and spend -them. If they do not, then their heirs will tend to do so. It is also true that capital assets are used for the- production of consumer goods and the provision of consumer- services. But the only currencies that can rightly and efficiently be issued as a- result of the existence and use of these assets, are those based -upon the consumer goods already produced and sold and the- services offered ready for sale - provided both are also sufficiently wanted by- local consumers. Their relatedness, similarity and- exchangeability under certain circumstances, should never induce -them to consider them as identical. Vive la difference! - here, too. They are different tools for -different purposes and outside of their purposes they do not have -the same if any value as they have for the purposes they were intended- for. Under freedom the currencies with suitable debt foundations- will tend to drive out currencies with unsuitable debt -foundations. E.g., a "currency" based upon the building value of -a shopping centre complex, does not entitle the holder to a brick- or other segment of that building. He would have to acquire all- the "currency" securities based upon the value of that building -before he could claim more than an interest payment: ultimately the  ownership of his investment. With all this capital scrip in his -hands he would, naturally, soon become the new owner. But fragments of- that total would have no currency values for him or for many other people, to whom he might try to use them as means of payment, who do not want to invest in that capital. The savings and investment market is different- from the daily production and consumption market. And so are- their securities or transfer tickets or clearing certificates or- property promises. - J. Z., 3.4.90, 30.4.97.
DEBTORS & INFLATION: The debtors win by an inflation. - Popular opinion. - "For the sake of completeness, one should also mention that they have also disadvantages from it. Those renting flats, for instance, have only an advantage for a limited time. At last the creditors, rightly, fearing a continuing inflation, are no longer prepared to lend their money for building flats on long terms. This is compounded by the fact that most tenants are at the same time also creditors. The employers, e.g., owe them wages and salaries. The advantages they derive as tenants are thereby neutralized. The debtor has the advantage only once, in the beginning. In all his attempts in the future, to obtain a loan, it will become more and more difficult for him to obtain it, especially if value protecting clauses are not permitted. - U. v. Beckerath, n.d. - Rents and interest rates will also rise - and so will all prices for consumer goods and services which all debtors will need, as before. And in a stagflation all do lose, obviously. - J. Z., 29.3.97.
DEBTOR'S RIGHT TO SETTLE BY CLEARING RATHER THAN BY HAVING TO PAY- CASH: See: FUTURE'S DEALINGS WITH CASH.
DEBTS & MONEY: Many people are strongly and at great length opposed to "money based upon debt". But there are hardly any other foundations possible for most kinds of money, Even gold coins or gold bullion owe much of their supposedly inherent values to the debts that had to be paid in finding, extracting, melting, refining and shaping them. Sound money is a convenient medium to pay debts with. Contrary to the opinions it cannot be arbitrarily "created" out of thin air. Its issuer owes the holder something, legally or contractually. Thus money based on debt is not a curse or an abomination but rightful and a necessity. What must be conceded, though, that not all kinds of debts are suitable for transformation into money. Obviously, bad debts are not. Secondly, debts expressed in an unsuitable value standard are not. Debts that impose too difficult payment conditions are not, including really usurious interest charges, based upon an artificially and legally created money shortage. Debts that can be repaid with inflated money are not a sufficient foundation, nor are "asset currencies" that are supposedly "covered" by capital securities. The kinds of debt certificates that are suitable to base money issues upon, in combination with the inherently required "shop foundation", i.e., readiness to accept notes for daily needed and wanted consumer goods and services, is rather limited, to e.g., commercial bills or equivalent short term promises to pay for goods already produced and sold. The debt involved in tax foundation is also a rather doubtful debt, one based on the imposition of tributes or tax slavery. So there is some sense to the objection - if only it is not generalized but sufficiently specified.  - How many transactions would take place if the debts involved in them would always have to be paid immediately and in full in some form of cash? And do not most forms of cash involve in their issue and reflux and in their real cover, debt-relationships and contracts? Long term debts are unsuitable as a cover for currency but at most can provide note holders some guaranties in case a note-issuing bank fails. Debts are required to achieve the counter-part to issues, namely a sufficient reflux for the issued currencies, a demand for them that reduces their quantity in accordance with the reduced availability of goods and services, which their payment for them has caused. A wide enough acceptance for an exchange medium can only be achieved if there are sufficient suppliers under obligation to accept it, i.e., who owe its acceptance and debtors are free to pay them their debts to them with the exchange medium at par or close enough to par. To want to eliminate all debts from all money and clearing transactions is as wrong and irrational as wanting to abolish all money and all clearing as well as all credits, which always and obviously involve their counterparts in debts. - J.Z., 12.12.90.
DEBTS INTO CURRENCY: There are many popular prejudices against -turning debts into currency. They are based upon insufficient- discrimination between various kinds of debts. To the extent that- they oppose the turning of government debts or government "-securities" into currencies, their objections are, as a rule, -fully justified. To the extent that they opposed even the turning of the enforced debts of tax payers into tax foundation paper money, market rated, using a sound value standard, that had to be accepted only by the government at par with taxes stated in a sound value standard, opposition to such debt- or credit-base paper money was misplaced. It made life much easier for the tax slaves, although not as easy as would have the abolition of compulsory taxes or the competitive supply of all public services to voluntary members of all kinds of communities and societies. To the extent that they oppose the debts that- are involved in any sales of anything, mediated in money or -clearing tokens, they are uninformed and quite wrong. There is nothing -wrong for a debtor to turn his debts into a currency, at least- for clearing purposes or limited local circulation, to the extent- that he has goods, services or labour to offer, at market prices,- which are in local demand. Then he could offer assignments upon -these, in money denominations, to the creditor in payment - as -long as the creditor would not be forced to accept them at par. -At some or the other discount the creditor would most likely find- it profitable for him to accept the debtor's transferable notes, -in money denominations. The alternative, especially in times of a- deflation or credit restriction, of creditors insisting on being paid in the "coin of the realm" or in the -monopolised and forced currency of the government, might to them getting -nothing at all or only a small fraction of their credit returned to them, -with the debtor being driven into bankruptcy. With the debtor still being able -and willing to supply goods, services and labour, any sensible- creditor would rather have his debtor stay in business and pay -him off, even if only belatedly or in instalments and with extra- interest for late payment, or, alternatively, when due, in the debtor's own- clearing certificates which the creditor would know how to use or -could soon find out how to use, if not directly against the- debtor then against any debtor of the debtor. No exclusive means -of payment should either be forced upon a creditor, at a nominal- value, nor demandable by the creditor, no matter how scarce it is -- unless debtors and creditors has contractually obliged himself to do so. -Even then it should be considered as a speculative dealings in -futures: the selling of monopolised currency before it is- earned. Thus hedging or a withdrawal premium should be agreed upon. - Even the rare metal coins would be of little value to -their owners, in most instances, if they could not be redeemed in -ready for sale goods and services. If a creditor would find a- debtor's clearing certificates not acceptable enough, even at a considerable discount, then he should suggest to the debtor that -he gets them discounted at a free local bank for its local- currency. Such a bank would be in the business of discounting -personal securities, representing immediate and near future- readiness to accept capacity, and should know who, among the local -members, could use the debtors IOU's in payments against him, -better than a particular creditor of the debtor would. Thus for -the debtor there would be a personal issue of money and clearing- tokens and a discount option, using the greater issue and circulation potential of a local bank of issue, e.g., an -association of the local shopping centre members. The convertibility obligation of the debtor for his notes or- securities would only consist in his readiness to convert them at -par into his goods, services and labour, at par, any time, during- business hours, no matter who presented them. Any honest and- capable debtor would always be able to do that. Most note -holders do not want or need any other convertibility. One might- also assume that a number of debtors in any locality would be in- the same situation: Insufficiently supplied with government- paper money or coins or any other currency that already widely- circulates and is thus popular with debtors. Then these debtors- could combine and mutually guarantee their issues, by issuing their debt certificates, in money denominations, using a sound- value standard, free market rated and with all the other issue -precautions of sound issue centres, to temporarily circulate their debts in -much more acceptable common notes. In other words, they could- also form a bank of their own, to improve their ability to pay- their debts, by accepting these debt certificates in all payments due to them. No creditor should be allowed to drive any debtor into bankruptcy before all such clearing and payment options are- exhausted. If he had, e.g. drunk or gambled or speculated far -beyond his capacity to give values in return, immediately or -soon, then he should be driven out of business and his function- should be taken over by more sensible businessmen or tradesmen- or professionals. Monetary freedom will not be able to help- dishonest, incapable, negligent, lazy debtors or frauds and- con-men out of their self-caused financial difficulties. Nor is- it capable of monetising government medium or long term debt certificates into sound currencies. At most in can anticipate the- government's near future tax grab, allowing the government to -issue tax foundation money upon it, without legal tender power- and a monopoly status and reckoned in a sound value standard.- Some debts are rightful and necessary, some are wrongful and- unnecessary. Only some of the former could and should be -monetised. See: ASSET CURRENCIES, REFLUX, SHORT TERM COVER,- CLEARING COVER, CLEARING. - J. Z., 22.6.91, 2.5.97.
DEBTS, DEBTORS & THEIR ABILITY TO PAY OFF THEIR DEBTS: Having a- debt that is payable in the own notes or clearing certificates, -i.e., lastly in the own products, services or labour, is- very different from being forced, by law, to pay one's debts in the -notes issued by others, which one had to earn first. If at least -the others were competitively supplied with notes or free to -issue them themselves, then the situation of a debtor would not- be too bad but he still would not be monetarily quite independent- or quite free to clear. His situation becomes very different and- sometimes desperate when the notes of others are monopoly notes,- issued only by a central bank, subject to its policies, interest rates -and manipulations. Any central bank may officially AIM at -supplying each individual with sufficient and sound exchange -media for his purposes but that does not mean that it is ABLE to- do so or actually follows such a legally declared program. Politicians and a monopoly post office may AIM at providing all kind of good, wanted and competitive services, but -that still does not mean that they are ABLE to do so. Obviously, -a Minister for Health cannot supply every individual with Health -nor can a minister for economics supply us with wealth or a -minister for employment, supply us with full employment. And the -transport services that a minister for transport services could- supply would be limited to giving lifts to friends or hitchhikers -or to e.g. to a taxi or bus service service that he might run -privately, or, at last, "generously" allow to be established. Ministers for trade have no goods or services to trade- with. Who would buy their knowledge and skills in an open market? At most they can officially or unofficially trade with favours or disfavours. And no minister for defence or deterrence -has so far delivered peace, security or effective and affordable -defence in the long run. At least governments were not cheeky- enough to appoint a minister for peace, too. - So why should we -assume that any central bank CAN do what ALL central banks ASSERT -to be able and WILLING to do - but which they have never as yet- delivered? - - - Debts in inflated money are not as much of a- burden to a debtor as are debts payable in notes of a deflated -currency. For the creditor the reverse applies: He hates being -under the legal and juridical presumption to have been fully paid when -he has only received a nominal payment of his debt in a much depreciated paper money. And he is unfairly advantaged, during a- deflation, when a debtor has to pay up the full nominal amount of- his debt and this in money that has been severely deflated, i.e., whose- purchasing power, on the deflated market, has been greatly -increased. - - - The debtor's position is often rather -unsatisfactory, too, when both, inflation and deflation occur at -the same time, as happens always more or less under a forced and- exclusive currency - and sometimes quite obviously and severely so.- He could pay off his creditors more easily, in inflated money, if- only at least part of the economy would not be deflated at the -same time, so that he may not be able to earn enough of the- stagflated currency. The most severe stagflation occurs towards -the end of a galloping inflation, when goods and service prices -have raced far ahead of the capacity of the capacity of the note printing- presses. - Debtors and creditors can be fully and easily- satisfied only once both are quite free to clear, including the -freedom to issue, accept and use notes & clearing certificates in- convenient denominations and both are also free to choose value- standards they do trust and free to refuse or discount any- exchange media or clearing certificates that they have not issued -themselves. - J. Z., 19.5.90, 27.4.97. - See: MONETARY FREEDOM, MONETARY DESPOTISM, FREE -BANKING.
DEBTS: Debts must be normally - that is, reserving exceptional- cases due to passing circumstances - paid in goods or services. - -E. Milhaud, A Gold Truce, 46. (More entries can be found in the -SLOGANS FOR LIBERTY, file D1.)
DEBTS: The borrower is servant to the lender. - Bible, Proverbs. - The lender is dependent upon the borrower! - J. Z., 12.1.82. - One of the few Jewish jokes that sticks in my mind ran somewhat like this: Isaac: What is the matter Abraham? You look as if you haven't slept! Abraham: That's true! Tomorrow I must pay a large debt & I can't. So I can't sleep. Isaac: The solution to your problem is VERY simple. Just go to your creditor, right now. Tell him that you cannot pay. Then he can't sleep - while you can! - Alas, he did not give him advice on how to best pay his debt via personal clearing certificates. - By the way: According to Ulrich von Beckerath, the TALMUD is the only religious book that recommends honesty in currency dealings. A debtor is supposed to repay his debt in the same kind of full value coins that he has been credited with, or in coins of the same metal value. The only exemption that would release him from this religious obligation would occur if his own debtors had cheated him with their coins, thus making him correspondingly unable to pay. - Alas, the monetary system of Israel is just another form of monetary despotism or central banking. SOME of the few Jews who are bankers may be more skilful than other bankers are in dealing with MONOPOLY money. But I do not know of any who are clearly advocating today full monetary freedom. I doubt that Dr. Walter Zander is still alive and Ayn Rand and Murray N. Rothbard, for instance, were just fractionally favouring monetary freedom, still being bugged by the traditional gold bug. - Marx knew very little about monetary freedom and became for a long time the most successful advocate of monetary despotism - as a means to establish a totalitarian dictatorship of an elite over the proletariat and all its other victims. Nevertheless, most conservative anti-communist and anti-socialists could think of nothing better to do than copy his proposals for central banks of issue with an exclusive monopoly and legal tender powers. - Monetary wisdom isn't a matter of race, nationality or religion or ideology, as a rule. But lack of it leads o much racism, nationalism and religious or ideological fanaticism and their consequences. - J. Z., 16.5.97.
DEFENCE & MONETARY FREEDOM:
DEFICIT FINANCING: The essential point about it is that it is- NOT financing but offers merely the pretence of financing. Austrian creditors- coined a joke on this: "Governments never go bankrupt. Only -their creditors do." When a government issues securities and -offers them for sale, to cover its deficit, then it offers -investments in tax slaves. Since slavery is wrong, so is this. If -it makes forced loans, then it confiscates, it does not finance. -If it increases taxes, it levies a tribute, i.e., it steals or -robs, threatening you with its armed might if you refuse to pay -up and resist its collection procedures. If it issues its -monopoly and forced paper currency beyond the point of voluntary -acceptance at par with a sound value standard, then it -confiscates and robs to that extent, too, with is notes then- being no more than requisitioning certificates. Under freedom,- voluntary acceptance, and free refusal, and under monetary -freedom competition, they would then be refused, except by a few- remaining tax "debtors". - J. Z., n.d. & 3.5.97. (Objectively and morally, no one "owes" any taxes unless he is a voluntary member in a taxing community, free to drop his membership and thus to leave its financial arrangements or subscription charges, when they become to irksome or burdensome or useless to him. - J. Z., 13.9.02.)
DEFICIT SPENDING & INFLATION: "The only cause of inflation is deficit spending." - J. Almblad in INQUIRY, 10 Sep. 79. - If the government succeeded, in case its budget is not balanced, to induce its subjects to buy sufficient government securities or could even induce foreign investors to do so, then it could cover its budget shortage in this way, without inflation. - It could also levy a forced loan or increase taxes, as it has done so often in the past. However, it often finds these opportunities to have political penalties, while few voters have ever condemned it for abusing its monopoly money issue and legal tender power. So it often resort to inflation for which it finds all legal and institutional preconditions provided. Without these preconditions it could not inflate its paper money, not even if it had the worst possible intentions. Thus these preconditions are the real causal factor, not the flawed motives of the "big spenders". Many of them have even persuaded themselves, not only their voters, that they are doing "good works". - The term "spending" is also misapplied here. The government is living beyond its means, since all are obtained by taxation or other robberies, including inflation. So, in "deficit spending" it imposes simply another robbery upon the whole country, all its people, the inflation tax upon the money circulation, which depreciates its value. Since few comprehend it, few do object to it and when they begin objecting then they usually blame someone else than the government and its monetary despotism, which allows it to abuse it. - If A owed something to B and could not pay out of what it had previously robbed from B & C and then proceeded, via an excessive note issue, of its monopolised and forced currency, to rob B & C, to enable it, with the loot, to "pay" B., should we call this then "spending"? - Is it rightful to call a bankrobber's use of the stolen money "spending"? If so, then what does the bank engage in regarding the stolen money? Negative spending, while that of the bankrobber is positive spending? One can rightly spend only what belongs to oneself, i.e. what one has rightfully earned or otherwise honestly acquired, in voluntary transactions, e.g. as a gift or inheritance. A government's distribution of its loot is merely the completion of its act of looting. We should not honour ANY of its tribute gathering and distribution of its loot to some of its favourites or creditors by calling it "spending". Proprietary terms for honest actions should not be used for goods or money not rightly acquired or issued, i.e., not for dishonest and coercive actions. The terms of voluntary transactions should not be applied to monopolistic and coercive ones. - J. Z., 20.5.97.
DEFICITS, BUDGETS DEFICITS CAUSE INFLATION : One might as well say that the deficit in the budget of a bank robber causes bank robberies. - J. Z., 24/3/97.
DEFINITIONS OF MONETARY FREEDOM AND FREE BANKING: A short list- of them, alphabetized, to precede the book.
DEFINITIONS, TERMINOLOGY, BASIC MONETARY FREEDOM CONCEPTS: Those -considered, so far, to be accurate or close to accurate, to be especially marked, somewhat. But refutations or supposed -refutations should be invited for them, too.
DEFLATION & CHEAPNESS: Deflation and cheapness are completely -different concepts. Deflation is caused exclusively from the -money side, cheapness exclusively from the goods side. -  Ulrich- von Beckerath, 25.1.52.
DEFLATION & UNEMPLOYMENT: Under freedom of note issue and- freedom to clear, all deflations and their mass unemployment can be easily and very fast prevented or ended. A historical check of -this assertion is possible. One will always find deflations -associated with this monopoly - and ignorance of, disinterest in -and prejudice on monetary matters, which sometimes can take the- place of legal prohibitions. But neither state universities nor parliamentary committees nor pressure groups of the unemployed -and businessmen are so far likely to undertake such research,- although objectively they have a vested interest in it. How could- one motivate them to promote such research or undertake it -themselves? That should be easier than trying to induce them to -compile and read shelves of books and papers discussing the -monetary freedom options. Seek and you shall find. But how to get- them to seek? Businessmen might be motivated by pointing out to -them how vast the amounts are, that they might issue, in combination, in short-term money tokens, based on their delivery -capacity for goods and services. It would be in the interest of- any politician trying to become popular, to fast to unearth and prove -that connection. But, do they have the intelligence to try this- path towards success in their career? - J. Z., 3/97.
DEFLATION IS THE WORST POSSIBLE ALTERNATIVE TO INFLATION & THIS MAKES SOME DEGREE OF INFLATION ACCEPTABLE. - Popular opinion. - It assumes also that there are only the hard options: Inflation or deflation, and that both can be ended only in "hard" ways and not in "soft" ways. - I would rather say that a monetary system which continuously fluctuates between inflation and deflation and which often has both together, in stagflation, is unacceptable for moral and rational people. - J. Z., n.d.
DEFLATION THEORIES: They are so numerous that all should be -listed - and confronted with the facts and contrary theories as -far as is possible, in order to enable the patient researchers to -finally sort the wheat from the chaff. - J. Z., 19.3.97.
DEFLATION, DEPRESSION, RECESSION, CRISES: The moderation of inflation was accompanied by a recession that raised unemployment to 6 %. This was unavoidable: I know of no nation at any time that has been able to stop a serious inflation without a recession, and generally a severe recession. - NEWSWEEK, 15.3.71. - See: HARD OPTION, SOFT OPTION. - Perhaps it is usually unavoidable under the present system - i.e., as long as free banking and its automatic monetary adaptation are outlawed. Interferences with the free market just don't work smoothly. - J. Z., n.d. - Compare my Sep. 1976 16 pages booklet: THE SOFT OPTION, in PP 19, now attached to my main website. - J. Z.
DEFLATION, INFLATION & STAGFLATION:  Inflation and deflation are opposites and thus cannot coexist in the same country and at the same time. - Popular opinion. - In stagflations they do. Stagflationary effects are found in many galloping inflations but are usually not recognized as such. E.g. when cashiers line up before a central banks opens, so that they can act as fast couriers for the wage payments required for daily wage payments - fresh from the printing presses. - Deflation and inflation are insofar not opposites as both are despotic interventions with payment, clearing, credit and value standard measurement agreements.  - J. Z., 29.3.97. - During the big German Inflation of 19144-1923, in the end most printing shops in German were busy printing notes and could still not keep up with the demand for them, since prices jumped ahead of the note printing capacity, in the expectation of further depreciation. In the end the printing costs came to about 48% of the rapidly decreasing purchasing power of the notes. Employees were given time off in the middle of the day, so that they could spend their earnings before they had further depreciated. - J. Z., 31.8.02.
DEFLATION: "Every price rise can be safely and sufficiently countered by reducing the note circulation." - Popular point of view. - You might as well say that when you have become obese by over-eating that you can then simply reduce your weight by eating less. Ask those who have that problem whether they find it easy to adopt this simple advice. Also ask a unionist whether he is as ready to accept a wage reduction as a wage increase and a shop owner, whether he as readily decreases his prices and as fast, a she is ready to increase them. - J. Z., 24.3.97. - And if you have the misfortune to drive over and kill someone, try to revive your unfortunate victim by reversing over him! - Rejuvenation is still largely only a dream and a hope. - Not all processes are easily reversible. - J.Z., 30.8.02.
DEFLATION: A deflation policy, undertaken in an attempt to undo -the damage done by an inflation, is like running over a person- with a car and then, to restore him to health, to reverse over- him. - J. Z., 15.3.97.
DEFLATION: All the wrong and misleading statements on, explanations and cures of deflations, depressions and mass unemployment and of all their euphemisms, like recessions, that have been proposed or tried out, should be sufficiently recorded, in alphabetized listings, with the best evidence and arguments against them that have so far been found. It was, I believe in the German "Zeitschrift fuer das gesamte Kreditwesen", in the fifties that an article appeared that listed over 140 different crisis theories or hypotheses. With world under-employment and unemployment having reached by now ca. 1 billion people directly, and their dependants indirectly, it is high time that we should take it seriously enough for such a collaborative effort. Otherwise we might still be stuck in the ignorance and prejudices that cause depressions, deflations, stagflations, recessions and inflations - in another 100 or even 200 years. - J. Z., 29.3.97. (In Henry Meulen's THE INDIVIDUALIST, there is a reference to two estimates of the total number of crisis theories.)
DEFLATION: Deflation, according … is a condition in -monetary transactions in which there is a shortage in typified- and standardised exchange media (so that workers have to be- dismissed because banks cannot or will not advance the means of -payment for their wages) and at the same time, nevertheless, -typified and standardised exchange media (e.g. typified clearing- cheques and goods warrants etc.) cannot be issued because a -certain authority, e.g. a central bank, has the monopoly for -note issues.  -  Ulrich von Beckerath, 25.1.52.
DEFLATIONARY DEPRESSIONS: See: DEPRESSIONS & CAPITAL; EMPLOYERS -UNDER MONETARY DESPOTISM, TURNOVER CREDIT, DEPRESSIONS,- DEFLATIONS, MONETARY DESPOTISM, PURCHASING POWER, QUANTITY- THEORY.
DEMAND & DEBT- OR REFLUX OR READINESS TO ACCEPT FOUNDATION FOR- CURRENCIES: The demand expressed in ready-for-sale goods, -services and labour - for any kind of competing and freely issued -and otherwise refusable and not convertible currency, can give it- a value that is precisely at par with the nominal value,- expressed in one of the other value standard, for a currency. The -most suitable issuers for such currencies are the owners and- providers of these goods and services, including employees. This- demand ought to be expressed in sound value standards, used in- free market pricing of the goods and services. The readiness to- accept must be at par for the issuers themselves or for the- members of an issuing association, e.g. the shops of a shop -association that issues its own shop currency. They issuers must- also be prepared to accept it in all other payments due to them. E.g., when they have given a short term loan with their goods and- service vouchers or shop foundation currency, for the payment of -local wages and salaries, then they must not only immediately -accept their own IOUs at par from the thus employed and paid -employees, but must also accept the repayment of that loan in- these private exchange media, at par with their nominal value.- When they let out premises, then they must accept their own "rent money" in payment of -rents, etc. - When an institution and a service, as important as -a local shopping centre, does issue its own currency, then it- becomes voluntarily accepted and this at par not only at that- shopping centre but among most other local businesses, e.g. -hotels and restaurants, too. As service providers they other acceptors might be -included in the local shopping centre's issuing association, but -they need not be. They could also issue their own currency. All local debts could be voluntarily settled- with a local currency - or, possibly, one of several local currencies, if there is an issue and reflux opportunity for several of them.- If the community is large enough, it might also find acceptable e,g., a- transport and petrol money, an electricity money and a gas money,- perhaps even an entertainment service money and one for its education- services. They market, i.e., sovereign entrepreneurs, traders, consumers and free acceptors and issuers would have to decide their currency issues between -them. As long as they feel that their local communities are not -already sufficiently supplied with exchange media, they will attempt to issue -more. As soon as they feel that there is an abundant supply of sound exchange media already, additional issue attempts or- attempts of existing issuers for higher circulations, will not- succeed but be rejected instead. - Demand and supply will -regulate each other automatically, here, too, by free pricing -being applied to exchange media - and their value standards. Only- those supplying real values, at acceptable market prices and transaction costs, will succeed. Others will fail. Good monies- will be free to drive out bad ones.  - An occasional or panicky -conversion of convertible banknotes into gold coins would not- regularly supply as strong a demand for them, as the daily demand- does which arises from a) the readiness of local suppliers who -offer their goods, services and labour for them, and b) the need- for the local consumers for an exchange medium to acquire their- daily needs for consumer goods and services, added c) by the -demand of local debtors for an exchange or clearing medium to pay -their debts with. - Free market rating of competing exchange media -is the essential indicator for any need of further issues or for -stopping issues and acceptances. Such exchange media could then- not rise far above their par values nor far below them. That -becomes easier to understand if one considers them as a form of- ticket money. Who would accept more tickets than he wants to use? -Who would sell more tickets than he can supply seating for? -Publicity, sound value standards and free rating against them -would be essential, as well as the right to refuse acceptance. -- That latter right should now be especially practised against -government paper money - as long as we are ready to immediately -issue sound alternative private or cooperative -currencies, in free competition with each other issuers, thus supplying the exchange media and value standards -required by the market for an almost friction-less turnover of- all its wanted consumer goods and services and the utilization of all its underutilised or unused labour power. As long as -unemployed would then persist in being paid only in the money of -monetary despotism, they would have to accept the continuing- unemployment which results from this demand for all too many of- them and for all too long. Freedom for employees and their -representatives and the employers and their representatives to agree upon other and better -means of payment, of the kind that can always be kept sound and- abundantly supplied, so that wages can always be paid and goods -and services always be readily sold, both at market prices. --J. Z., 7.12.92, 29.4.97.
DEMAND & PRICES: Demand must be held down so that prices don't go up any more. - Popular opinion - Demand and prices are best and also self-controlled when governments are kept away from all note printing presses and monetary issues and value standards except those few associated with its own VOLUNTARY & COMPETITIVE exchanges that optional governments (only exterritorially autonomous, for their voluntary members) might still manage to sell to their willing victims or customers under CONSUMER SOVEREIGNTY that is extended to GOVERNMENT SERVICES as well. - One cannot hold a fictitious, fraudulent and forced monetary "demand" down when governments remain legally authorised to print and force upon unwilling creditors their exclusive and forced currency via an issue monopoly, associated with legal tender (forced value and forced acceptance), i.e. when government alone is removed from all market restraints and this in the most important economic sphere, upon which all the others depend. - It is absurd to try to discuss this topic apart from the question of monetary despotism. - Demand control is as absurd as price control. Both amount to people control - and to uncontrolled controllers. Who guards the guardians? The guardians of the currency are out of control - precisely because they were appointed as exclusive guardians for currencies that should never be exclusive and enforced. - Hold down the issuers of exclusive and forced currencies. Repudiate all such issues totally - as an essential part of a general tax strike against our overlords - the greatest criminals and parasites. - J. Z., 2.4.97.
DEMAND FOR LABOUR & WAGES: To fight inflation one should reduce the demand for labour. - Popular opinion.  - Why authorise anyone to interfere with free contractual relations between employers and employees? All the interventionist laws and authorities that were established in this field are the result of the prior interventions of monetary despotism. By further measures of monetary despotism one will not abolish the previously & legally established wrongs and evils and their consequences. Demand for labour should not be confined to the government's fiat money. Labourers should not be so foolish as to demand to be paid only in "the coin of the realm" or in a forced and exclusive currency, which is either inflated or deflated or stagflated. Free enterprise and free consumer choice in currencies and value standards. Then one will not have to fight inflation - because it simply will not occur. - Imagine that the government would be the only issuer of shares and bonds upon all industrial assets. Then, too, either under-issues or over-issues would have to be expected. We should not entrust our labour remuneration, our property, our wealth, our exchanges, our security, our peace, our health or anything at all to any government, judging by the historical and present records of all governments in these spheres. Least of all should we appoint it as an organiser and guardian of all our monetary exchanges. For in this way it has failed and wronged us even more than in all others. - J. Z., 2.4.97.
DEMAND FOR LABOUR UNDER MONETARY FREEDOM & MONETARY DESPOTISM: -The demand for labour, services and goods should at any time be -as large as are the accumulated values, immediately available for sale or very soon, mainly daily wanted labours, other services and consumer goods. Not- only the immediate offers are important but also the short-term -possible and likely offers (e.g. the consumer goods that can and will soon be delivered to restock the shelves) - for the holders of money do not intend to spend- all their holdings on a single day, at least not as a rule. Some- of their consumption requirements are not as urgent and thus- purchases can be postponed and some shopping money is thus held -back. But the two sides, the money side and the goods side (including readiness to labour and to serve) should be kept in- a rough balance, indicated by the par rating of such exchange media.. This balance cannot be best achieved and maintained by- an outside issuer and administrator of the current circulation -and its reflux, least of all by a central bank of issue for a whole- country, with a money issue monopoly and legal tender power for -its currency. Instead, it is best entrusted to the local -providers of goods, services and labour and the issuing centres -they form and run for themselves and their potential acceptors. They know their assets bests -and their limitations, also the characters and flaws of all their -members and potential borrowers. Thus they are least likely to- make careless mistakes with their issues. A distant centre of- issue could only prescribe general rules for the credit-worthiness of a local producer or businessman. The local shop- association bank would KNOW its debtors and customers and apply different rules and better knowledge of local conditions and local credit applicants. Apart from that it would enjoy the benefits of- currency competition, voluntary acceptance (for all but the- issuer - and by contract his debtors), stable value reckoning, -free market rating against them, full publicity for all details- of the issues. It would also enjoy the instant note-testing- facility for local note holders or potential local note -recipients: They would simply have to bring a note, whose value- they do doubt, or are not quite certain about, to the nearest shop and ask whether it would accept -the note at all and at par. They would not depend upon foreign- exchange markets, open market policies of a central bank, trade- and price statistics to find out, somewhat and often belatedly, -whether their currency has been depreciated. Moreover, the issuers and-their acceptors would not have to depend e.g., upon the successful- accumulation of a large enough gold reserve to give their private -paper notes a par value with gold weight units, i.e., to make -them, for payment and clearing purposes, as good as gold. All the -ready (or soon ready) for sale goods, services and labour could be turned, privately, competitively and cooperatively, into effective -monetary demand (up to the limits set by market rating and voluntary acceptance), thus abolishing mass unemployment and sales -difficulties and preventing most bankruptcies and establishing a- steady boom economy, one that would know no other crises than -natural or politically brought about catastrophes. -Free issues lead to sales and employment - and more savings and investments as well, but only indirectly and in consequence. It would also be able to overcome -or prevent both, natural and political catastrophes, more- effectively, by flood, fire and drought prevention measures,- easier to finance as a result of extra capital savings following -monetary freedom.  Political stability and freedom would also be directly or indirectly promoted in this way. Even military -security could be greatly improved - when whole armies of- deserters and prisoners of war could be rapidly turned into free -producers and consumers. - Furthermore, just try to imagine what effect- voluntary taxation (or subscription to competitively supplied public services), which would -follow as part of financial freedom, would have upon the- behaviour, spending habits and numbers of politicians, -bureaucrats and their measures and programmes. - J. Z., n.d. & 30.4.97. - See: TURNOVER--CREDIT, POTENTIAL ISSUERS, EMPLOYMENT, FULL EMPLOYMENT, BANKING--PRINCIPLE, CLEARING, VOLUNTARY TAXATION, FINANCIAL FREEDOM, -NATURAL CATASTROPHE INSURANCE OR CREDIT LEVIES, PAYABLE IN SHOP- CURRENCIES.
DEMAND MANIPULATION: "Shave the top off demand." - Prime Minister-Keating, on interest rate rise, 14.12.94. - I would rather have -had the top shaved of this impertinent meddler. - What little is left of our earnings, after direct and indirect taxation and inflation, deflation or stagflation, after exploitation by xyz -government legislated monopolies and restrictions, is then to be -further reduced by artificially increased interest charges! - -Only extreme ignorance and prejudice can permit such mismanagers -to get away with it for years. - No matter how wastefully and -self-interested this great "leader" (he called himself, when he was -treasurer, the greatest treasurer ever!) acted, he was allowed to- stay in power for years and years. Has any criminal ever done as- much damage as some of these "great leaders" have done? - First -they inflate their monopoly money. Then, when some of this money, -after taxes, remained in your pockets, they introduce credit- restrictions, deprive potential debtors of the chance for credit -for  productive investments, thus throw people out of work,- deprive them of earnings, all, supposedly, in the interest of the -public but in reality merely in an attempt to permit them to persist with their misconceived and misguided- policies for a while longer, under the pretence that they would- be doing something positive. - No one has the right to coercively -or deceptively "shave off" anyone's earnings, property, -purchasing power or demand, not by interest rate manipulation, by- devaluation, by inflation, by credit restrictions, by forced loans, artificial interest rates ("discount policy") by "open market" sales of government- securities, to reduce the circulation of its paper money, or by "covering" exclusive and forced paper- currencies, additionally issued, with government "assets". - Not only bad debts (-investments in tax slaves, under inflation risk) of the own -government are sometimes used as "cover" for further issues of -legal tender money but even bad debts of foreign governments, even despotic, dishonest ones, that are already in an economic- crisis, as a result. - At the same time, those who treat us and- shear us like sheep, prevent sound tax foundation from- immediately withdrawing tax foundation notes from circulation -again, shortly after they have been spent, so that they help to -honestly clear government spending against government tax claims.- They commit immense crimes and then try to cover them up with -some "smart Aleck" remarks which the media simply report without -tearing them apart and refuting them. And the man in the street- and voter and victim and even most of the supposed experts, meekly and thoughtlessly accept them, for all too long, without any -protest. - J. Z., 14.12.94, 25.4.97. - I still remember a public and uncontradicted remark by another former ALP Prime Minister of Australia, Gough Whitlam, in which he declared his readiness to reduce all Australian to recipients of pocket-money, with all other "necessary" goods and services becoming allocated as hand-outs by his socialist government, a situation which also implied forced labour for all Australians and 100% taxation for their output. In other words, he wanted to treat all Australians like convicted criminals, kept in a nation-wide prison. And I did not hear or read even one word of protest about this utterance! A nation of sheep, indeed! Just one anecdotal evidence on this: During one election and not far away from the election urns, I had once a short discussion with an old and long term Labor Party supporter. His envy of higher earnings than his own made him favour highly progressive taxation. So I asked him, would he oppose 80& taxation? No! 90% taxation? No! 100% taxation? No! - So at least he was explicitly ready to vote himself into 100 % enslavement to a territorial government. - J. Z., 98.9.02.
DEMAND: An over-full demand for labour acts inflationary. - Popular opinion. - How else could an "over-full" demand for labour ever come  into existence except through a central bank and its legal tender paper money? - Why allow anyone to establish a forced demand for labour by fiat - while preventing the monetary mobilisation of all ready-for-sale goods, services and labour by the owners of these goods, services and labour? - My salary was quite a few times paid for with notes fresh from the printing presses, still with consecutive serial numbers. Why allow anyone to do that - without him offering, at the same time, equivalent and wanted goods, services and labour in return? Why allow anyone to unilaterally issue money tokens as claims upon the goods, services and labour of others? Why be so foolish to grant him a monopoly, too and his tokens a compulsory acceptance and forced value - and to suppress, at the same time, all sound, honest and competitive money issues? Under legal tender and the issue monopoly we will never and can never KNOW whether the money circulation is sufficient, just right for the moment or over-full, because such a despotic money removes all self-regulating factors.  It leaves no "division of powers" or "checks and balances". It outlaws free contracts, self-help, self-responsibility, property rights, free trade, free enterprise, free exchange and free pricing in its sphere. And then it wants to set up "laws", "rules", "controls", "regulations", upon such a wrongful and harmful and shaky "foundation", without even discussing that "foundation".  - J. Z., 2.4.97.
DEMAND: He could not put an extra resource demand on an already fully employed economy without producing inflation. - Dr. Paul A. Samuelson, on his advice to president L. B. Johnson, THE NATIONAL TIMES, 26.4.l71. - An abuse of the term "demand" is involved that is associated with monetary despotism. In a free exchange economy demand is only established by monetised readiness to deliver wanted goods, services and labour. Such a readiness does not exist for the government's forced and exclusive currency, apart from government services paid for with paper money that has a sound tax foundation. For all other exchanges the government's paper money is an intrusion of a third party with its monopoly money, which prevents the private exchangers from producing or using currencies of their own. It is, in its first issue, and in its continuing issues, a confiscatory or requisitional act that has nothing to do with free exchanges. As for the quantity of forced and exclusive currency, that would act inflationary: Under forced acceptance and forced value that is not known via refusals and discounting of this currency, i.e. by its free market rating. What remains to its acceptors are only rises in the prices of their goods, services and labour which tend to express the deterioration of this paper money indirectly but not very accurately, either. Moreover, this depreciation by flooding the market with monopoly money does also create deflationary and stagflationary effects. Even the degree of unemployment and of full employment are not accurately observable and measurable under these conditions. A degree of unemployment always tends to remain under centralised and monopolised note issue, especially when it is at the same time subsidised by "unemployment insurance" and this unemployment, under pressure by potential voters and the political "representative" system becomes then a pressure and motive for another Keynesian spurt of inflationary issues. During a galloping inflation the unemployment caused by it becomes large and becomes again a motive to inflate more and more, to the limit of the capacity of the note printing presses. Samuelson's unchecked premise is thus the continuance of the existence of the exclusive and forced currency of monetary despotism. - This abuse associated with fiat money is not possible under monetary freedom. Under it only private resource owners (of resources daily in demand by average consumers) can issue monetized claims or IOUs upon these resources, to the extent that they find voluntary acceptors at par or close to par, who use them to buy the goods, services and labours that they want of them. Then and thus they would  do nothing but facilitate a goods, services and labour exchange among their providers to the limits of their productive ability, readiness to supply, serve and labour. Such IOUs would always be fully covered by goods, services and labour and they could not become over-issued and cause a general inflation of prices, fees and wages reckoned and contracted in stable value units. At most some issuers might make some mistakes in their issues, which would lead to a temporary discount of their issues and their issues only and to their widespread refusal in general circulation. If they made such mistakes repeatedly then their further issue attempts would encounter general refusal and they might be driven into bankruptcy, losing all their property. However, under full publicity for all details of private and cooperative money issues, it could rarely come to that state of affairs. Then small and well publicised disagios or discounts would make further over-issues impossible. His remaining debtors would tend to profit, at his expense, unless they are contractually obliged to accept his notes at par - up to the limit of their indebtedness to him.  But no matter how depreciated the notes of his further issue attempts might become, they could not inflate the general price level, expressed in stable value units, since his notes, without legal tender, would not have a forced value and forced acceptance, except towards him. At worst he might issue himself out of business, home, car and all other private possessions, which would have to serve as redemption goods in bankruptcy proceedings against him. But under monetary enlightenment, combined with full publicity on monetary issues, it would rarely come to that. E.g., a plumber, a barber and a cinema owner would find it difficult to get more of their service tokens into circulation than corresponds to the quantity and values of their services which local consumers want. The same applies to any combination of local suppliers and their combined private or cooperative issues. Issuers and acceptors would only have to watch the market rates for local currencies. They would not have to become involved in macroeconomic statistical measuring attempts and decision-making for others. - J. Z., n.d., 2.4.97.
DEMAND: Liberate demand and make it monetarily and financially- effective - through monetary-, clearing-, and financial freedom, based also upon free choice -of value-standards. - J. Z., 7.12.93, 26.497, 8.9.02.
DEMAND: The government has a duty to control excess demand in the economy.  - Popular opinion. - First it asserts that it has a right and a duty to flood the economy with its paper money. Then it asserts that once that money is in your hands and depreciated, it ought to control your spending of this money, which you and not the government earned. In other words, it wants to hold you responsible for its actions and calls this its duty. Its only rightful duty in this sphere is one of hands off - off any forced and exclusive currency and of all private and cooperative currencies that are issued in its stead. Competing exchange media are always tied to their goods, services and labour backing and thus cannot establish an "excess" demand for the goods, services and labour of others. They rise freely and fall with them, having a steady reflux to the realisation in their "redemption" values, offered by their issuers.
DEMAND-PULL INFLATION, DEFINITION: "When too much money spending is chasing after a limited supply of goods producible at full employment and maximum plant capacity, the resulting bidding up of prices is called demand-pull inflation. Demand dollars "pull up" prices. Economists know how to handle old-fashioned demand-pull - you stop turning the monetary printing press. That is, the Federal Reserve slows down the rate at which it lets money supply grow. We, the public, find ourselves with less currency and demand deposits and with less savings deposits and with less values in our common-stock and other asset holdings. Eventually, we spend less when our liquid balances get depleted relative to the soaring costs of living. Reinforcing this tight monetary policy and keeping it from raising interest rates sky-high and precipitating Wall Street and Main Street financial panics and crises, is the modern tool of stabilising fiscal policy...." - Samuelson, THE NATIONAL TIMES, 26.4.71. - Legal tender is, again, presumed to be inevitable and, likewise, the issue-monopoly. It is like discussing despotism without discussing any alternatives to it, democratic voting, military insurrections, revolutions etc. - J. Z., 2.4.97.
DEMAND-PULL INFLATION: It is absurd to attempt to discuss this apart from legal tender and the issue monopoly for the central bank, i.e., only from the position of monetary despotism. - Under monetary freedom each issuer can only try to establish a circulation for his notes by providing sufficient reflux for his notes - their streaming back to the goods, services and labour he offers for them. Then his goods, services and labour pull his notes back to him, for he is the only one who has to accept them at par at any time from anyone. They have no other value. He exerts a demand-pull for them, with the satisfactions he offers to his potential customers. And they exert a monetary demand for his goods with them, corresponding to all of his issues. And this demand-pull for his goods etc. pulls his notes also out of circulation. Legal tender notes, on the other hand, with an exclusive monopoly for their issue, and for monetary circulation, under its compulsory acceptance and value, tend to remain in circulation and to be over-issued, with each additional over-issue tending to drive up, even further, all prices and wages that are, under these conditions, compulsorily expressed in its depreciating paper "value standard". The monies of monetary freedom have no political pull, there is no fiat giving them any demand power over the goods and services of others. Only the own readiness to supply and satisfy consumer needs can give a value to the own currency, can turn it into a currency that is voluntarily and readily accepted, at least as one competing local currency. Only if its goods, service and labour backing is very well organized can it become an almost exclusive local currency in practice but it can never become a legally exclusive local currency. Open entry for other potential issuers would remains. - J. Z., 2.4.97.
DEMONSTRATIONS FOR MONETARY FREEDOM & AGAINST MONETARY DESPOTISM? Berlin friends, back in 1980 or 1984, reminded me that,- apparently, there was never as yet a public demonstration or- march in which the demonstrators demanded e.g.: Repeal the Legal -Tender Acts! and: Abolish the Central Bank! The few cases of- monetary revolutions or at least radical monetary protest actions- that did occur in monetary history ought to be carefully compiled- and publicised. In the French Revolution, at last, the printing- presses for the Assignats had to be publicly burned. Nothing less- would have satisfied the public at this stage. In 1923 Germany -was close to a monetary revolution and several secessions were- prepared, just to get away from the regime of the vastly inflated official Reichsmark paper money.  I believe that it happened at least once in ancient -Chinese history that the main culprit of a paper money inflation- was beheaded. See: GALLOWS CURRENCY. - J. Z.,-11.4.97.
DENATIONALISATION OF MONEY & CIVILISATION: The reform proposed- is not a minor technicality of finance but a crucial issue which- may decide the fate of free civilisation. What is proposed here -seems to me the only discernible way of completing the market -order and freeing it from its main defect and the cause of the -chief reproaches directed against it. - Hayek, Denationalisation- of Money, 100.
DENATIONALIZATION, FINANCIAL & MONETARY FREEDOM:
DENOMINATIONS, APPEARANCE, SIZE & MATERIALS OF COMPETING- CURRENCIES: The choice of the most suitable denominations, sizes- of notes, appearances, designs, numbering, texts, paper or other -materials used and steps to prevent forgery and to achieve a fast -reflux - can also be left to the free market, its competitors and- consumers to decide upon, and this with much more certainty of successful- outcomes than when they are decided by the central bank or -treasury as monopolists and coercers - if experience is a -reliable enough guide. - J. Z., 24.4.97.
DEPOSIT CREATION: The arbitrary creation of deposits, out of -nothing, is a myth that is almost as frequently repeated as -do Christians repeat, in their writings and preachings, the myth -of Christ as the universal saviour for all our lives and all our "-sins", and "God" as a caring father for all of us, as supposedly- his children - if only we adopt full faith in this supposed- father and son and children relationship. Child murders and- sacrifices are generally abhorred only in other relationships. No -matter how often such  irresponsible assertions are repeated, -they still remain untrue. But they can lead to irresponsible -accusation of and persecutions of inherently innocent people, doing their things to, for and with each other, voluntarily, but- classed by dogmatic Christians, who do not love their neighbours, -as incurable sinners that ought to be punished or at least -slandered, if not exterminated. This false dogma has turned many- people into enemies of monetary freedom. While otherwise they may- think and act as defenders of freedom, right and justice, here -they are in reality upholding one or the other version of- monetary despotism. Repent, if you can, before it is too late.- The future holds only "eternal damnation" for such doctrines. "Adore what you have condemned, condemn what you have adored", at -least in this respect. I sincerely doubt that many will do so but- am convinced, nevertheless, that they ought to. - J. Z., 3/97.
DEPOSIT CREATION: When deposits, like cash, have also a separate- value standard and are valued against it, daily and publicly and- can thus suffer a discount against that standard, then any -imagined and large scale "over-issue" or "creation" of deposits or- credits or non-cash money, becomes as impossible as it is for- free market rated and competitive cash issues. - What actually -happens in deposit banking is a more or less efficient use of the- term deposits of others to grant corresponding term loans to- people, in anticipation of their future ability to repay them.- Banks would love to be able to "create" bank deposits out of- "thin air". Then they would no longer have to advertise for -depositors and to pay them interest. Fixed and strange ideas like -that are earnestly advanced like the most advanced wisdom and- even a few free market libertarians have fallen for them. The- "creationists" in that sphere manage to overlook the credit- transaction that is involved and the security given or provided- by the debtor for the loan received. They also ignore the origin- of the funds for the loan. Perhaps a deposit game should be -developed that would help to drive out this silly notion when- played among the converted. One of the fallacies involved is that -the loan recipients would have nothing better to do with their -loans than to put them into a savings bank, as if their intention -had not been to spend the borrowed money productively. Especially- since electronic funds transfer has become possible, all these- debts and credits should balance almost instantaneously. - Let's -over-simplify, in a thought experiment: If any Bank could -suddenly increase, tenfold, the nominal value of all its depositor's deposits, by unilateral and administrative action, -then that part of the total purchasing power of its customers -would be increased tenfold (unless that supposed additional - value or purchasing power were confiscated or embezzled by the- bank).  With anyone but the bank and, by contract, its debtors,- not being under obligation to accept this multiplied deposit -"currency" like cash, at its face value, and, seeing that the -total of goods and services has not been increased by this paper-value multiplication, the inevitable result would be that these -paper tokens or accounts could buy less and often nothing. Their- depreciation would be rapidly noted by the mass media and would -lead to massive refusals to accept them at all. Lastly, a "panic"-would might occur or might be imagined as happening, among those -debtors of the issuers or "creators" of paper credits, who have -still plenty of these paper "values" on hand, after having paid- all their debts to these issuers or "creators" and among the- consumers, who find the shop shelves empty and their own hands or- wallets still full of deposit certificates with which they cannot- buy anything. In reality, the discount of such paper accounts or -certificates would occur very early, some would always know or- find out what is going on, and their discounting and refusals- would tend to be well and widely reported would lead to- wide-spread and larger discounts and refusals and these would -make further issues soon impossible and also make it impossible -for that issuer or "deposit creator" ever to engage in such -actions again. - However, you do consider only the command- economy and exploitation of an exclusive and forced currency with -legal tender (forced acceptance and forced value) and, under -these conditions, not only all cash but also all credit and- deposit and clearing arrangements are severely interfered with.- They are only allowed to ride on the inflation paper tiger and- participate in its crashes into reality, even when such a crash -may be considerably delayed because such a system makes people- very ignorant and prejudiced on money and supports beliefs like- those which assert that mere confidence and trust, government- controls, coercion, guarantees and "insurance" arrangements  can- maintain a currency and the security and value of on demand- deposits fully and indefinitely. - J. Z., 3/97.
DEPOSIT GUARANTEES & INSURANCE: I would protest government- guaranties and insurance offers and organizations that pretend to -cover the risk of bad loans being made. They do only encourage a -growth of bad loans, that in the short term offer high interest -and in the long run and average rather lead to capital losses.- The careful lenders should not be made to pay for the careless -lenders, either. Nor should their depositors be so victimized - or the taxpayers. - One should not -forget, either, that many people, including investors, are born gamblers and speculators. They are sometimes prepared to take - large risks in the hope for great returns. And, as gamblers, they -must also expect losses. Thus people who want to gamble and- speculate with their funds or want others to do this for them, -ought to put up with the inevitable losses, too. Such activities- should not be prohibited for them or rendered impossible. - J. Z., 3/97.
DEPOSIT INFLATION: If deposit inflation were possible, both depositors and deposit bankers would only be too glad. Their assets could me multiplied without any efforts on their side. Then under competition between deposit banks, the banks should be able and willing to pay a tenfold increased interest rate. In reality, my deposit interest rate on deposits up to $ 5,000 (in the average, on my savings and cheque account, is presently only 1/2%. This does neither cover the inflation rate of at least ca. 3% nor does it cover all the charges and taxes I am forced to pay on my account.  And my bank was close to broke a while ago and may go broke still.) - Compare all the nonsense said on the supposed CREATION of money and credit. Even the government, when, due to its constitutional or legal or juridical powers, issues a monopoly and forced currency, by its own unilateral fiat, does not really create something valuable but, rather, prevents the establishment of sound alternative currencies and value reckoning and partly expropriates all those whom it thus forces to accept its official requisitioning certificates as if they were real and well preserved money, with a sound value standard and based upon extra and wanted services and goods provided by a government. - J. Z., 24.3.97.
DEPOSIT INFLATION: See CREATION OF MONEY, CREDIT, DEPOSITS. - Banks can lend out 10 times as much money as they receive in deposits and can thereby cause an inflation. - Popular opinion. - They wish that they could. They know that they can't. - The only bank that could do that in every country is that country's central bank because, quite wrongfully, it has been given a monopoly on the issue of paper money and also legal tender powers for its issues. - The superstructure of non-cash or clearing transactions is based on a small amount of cash and it may give uncritical observers the impression of a multiplication of exchange media, which, based upon the same amount of goods and services, and its exclusive and forced currency status, could drive up all prices and wages that have to be contracted and expressed in it. But clearing and non-cash transactions are representing genuine exchanges and, as such, additional exchanges cannot drive prices up. Only when they, too, have to be expressed in an exclusive and forced currency, which is inflated, do these exchange prices become correspondingly inflated, too. One should distinguish cause and effect here. - The second misleading impression that many people have and mix up with monetary circulation, is that of the numerical excess of the total of medium and long term loans and of their repayments, over the cash in circulation. Moreover, at any time in a somewhat developed economy there are many more non-cash or clearing transactions than there are cash ones. Precisely because the legal right or creditors to ultimately demand cash from all their debtors, this system functions well enough as long as only a few make use of their claim to demand cash. Then a relatively small amount of cash and or current accounts (demand deposits) allows a multitude of short-term turnover credits, non-cash or clearing payments to take place. Likewise, then a small amount of cash and demand deposits permits, over a period, the payment and repayment of much larger medium and long term loans than the amount of cash circulating at any time. Instead of comparing the total of all timed loans and loan repayments, one should only compare the total of today's due loans and repayments with the total of the daily available cash and current account or clearing repayment options. Over a long period the same cash or clearing certificate or clearing account or electronically accounted dollar can settle hundreds to thousands of dollars of debts without the daily circulation being multiplied and without driving prices and wages up. Every day, every hour, only as much cash and clearing options are required to settle all debts due on that day or by a certain hour. But when cash-redemptionist "thinking" or thoughtlessness is still very strong, i.e. the assumption and the legal and juridical right of creditors persists to demand, at any time, a debt settlement in cash (rare metal coins, gold certificates or legal tender), rather than by settlement or clearing, while, in normal times, much more is settled cash-less, i.e. by clearing, then a risk and panic factor is built into this situation. Each credit becomes then a futures dealing in cash and each sudden growth in the demand for cash can set off further cash demands at in place of more and more of the normal non-cash transactions. Then, whatever amount of cash is available will not suffice to satisfy the increasing demands for cash and the monopoly cash supplier can, usually, not supply the additional cash required when and where it is needed. - One should not try to discuss this topic without referral to a survey of the increase in cash circulation of the central bank's forced and exclusive paper currency over the last few decades, a survey of the correspondingly increased prices and wages, compulsorily expressed in this currency, and one of the normal total of daily non-cash transactions and their growth over the last decades. And one should add to that the fact that legally and juridically the much larger amount of daily non-cash transactions is claimable by the creditor, upon his whim, in legal tender cash. Then it becomes clear that this monopoly system, with its inbuilt cash claims, is prone to inflations, cash panics or currency famines, quite suddenly, extensively and repeatedly. - Even if the monopoly issuer were able and willing to rapidly satisfy any cash demand of creditors with additionally printed notes, as legal tender these notes would tend to stay in circulation even after the cash crisis is over. The deflationary crisis would thus be "overcome" only by an inflation, as soon as the amount of non-cash transactions is back to normal. - J.Z., 2.4.97.
DEPOSIT INFLATION: The assumed automatic growth and -multiplication of deposits assumes that to deposit owners the -deposits are purposes in themselves, which they never utilise and- thus rapidly reduce by withdrawals. (As if they loved paying interest on loans which they would refuse to use in order to make a profit from them, even after interest and taxes and other costs are deducted from their returns.) Alas, our expenditures tend to equal- and often even exceed our incomes, if we do not severely check- our spending habits. And borrowers do not borrow as a rule to- establish savings deposits but to pay their current and up-coming -bills - by becoming more productive. - In the all-over picture all debts are equal to all- credits. They do balance each other. Neither debts nor credits- can be unilaterally decreased or increased except for force or fraud, which correspondingly reduces the credits of the victims. - No one can rightly and unilaterally multiply his assets. That is- wishful thinking or part of the "thinking" of conspiracy-theory -believers. - If you combined all the balances of all the deposits- and credits and debts and did so correctly, for any given moment- in time, you would arrive at a complete balance. But, as I stated- above, only current debts and credits ought to be so balanced and -the same should be done for tomorrow, the day after and any day -in the future, to arrive at the correct balance. All future due- debts should not be confronted only with the ready cash and- the on-demand-deposits available to the debtors right now but- only with their corresponding medium and long term securities. - In your proposals you want to see to it that short-term deposits- are not long term invested, to take care of the time factor and- reduce the risk. Apply that kind of precaution to your general -notion of the supposedly "exploding" or arbitarily multiplied- deposits, too. A merchant with a current balance of only $-20,000, might, indeed, be given a book credit of 200,000, over,- let us say, two years. But that credit would have to come, to be- realized, from other accounts. He would have to EARN the repayments, gradually, over a period. And to be fully useful it would- have to be fully used-up by the borrower, too. and his total -repayments would come from his current account, in instalments,- although this current account, from then on, in the average, -might never exceed $ 20,000 at all or by much, immediately after- the deposit-loan of $ 200,000 is more or less productively and profitably spent by him. No "deposit creation" is involved but- merely a temporary current account credit, granted from other -deposited funds. Indeed, these should be correspondingly termed- deposits. When short-term funds are used for short-term credits, -then, as a rule, short-term or immediate clearing or non-cash- transactions are involved. In a more primitive and obvious way, -the merchants wanting short term credits could grant it to each- other via a common pot, with the transactions going in and out of -the pot being fully recorded, with the records available to all -the members. Such a pot need not be full of rare metal coins.- Instead, paper IOU slips could be used by all the members and- cleared against each other. They would all be covered by the- known or checkable delivery or short-term production capacity of -the members with their goods and services. - J. Z., 3/97.
DEPOSIT INFLATION? Unless banks are VERY inefficient, in spite of- electronic communication channels, the reduction of one deposit -account and the corresponding increase of another, via a bank--transfer, will be almost instantaneously, preserving the total- balance between credits and debts. And the trail of such payments- can at any time be checked via computers. Bank secrecy has often- been broken by computer fans. None of them has as yet reported- having found any evidence for the assumed "creation of credit or- deposits or money". Nor has any honest accountant. - J. Z., 3/97.
DEPOSITS, FICTITIOUS ONES, UNILATERALLY & ARBITRARILY CREATED?- Claims against deposits (via cheques ) or note issues without -sufficient, immediate and short  term reflux arrangements, e.g.-, shop foundation for their redemption and short term repayment- obligations for loans granted with deposits or notes, i.e. -without debt- foundation, or readiness to accept or  readiness to -accept them in clearing, would suffer the same depreciation and encounter the same refusal and suits for fraud which any ticket -vendor would encounter who cannot offer seats or enough seats in- exchange for them. An angry crowd might even beat them up or burn -their premises or vehicles. And they would lose their chance to- become issuers again. - Over-issues and deposit or credit--inflation are not as easy and without consequences as especially -believers in "Social Credit" assume them to be. I believe such- "creations" to be almost entirely imaginary, the result of a- miscalculations or false book keeping or wrong observations or -interpretations of observations. - Naturally, under conditions of -monetary ignorance or prejudice, where culprits like the central- bank and its inflationary policy, get away unblamed and can- manage to blame instead, even in the mass media and supposedly -more expert channels, e.g., the trade unions, employers, traders and general- greed  or speculation and, naturally, private banks, for their supposed credit -"creation" and where they find the "sanction of the victims" for -such self-serving propaganda assertions, then real culprits can- get away with fraud, deception, embezzlement and corruption for a-long time and still do so, remaining unpunished and -not under obligation to indemnify their victims. Often the -taxpayers are forced to make good such losses. Even people who -have pondered such questions for decades, do rather blame -innocent private enterprises for crimes they did not and cannot -commit, than hold the government and its monetary despotism- responsible. - J. Z., 3/97.
DEPRECIATION OF THE GOVERNMENT CURRENCY THROUGH PRIVATE NOTE -ISSUES AND CLEARING? People who mutually offset their debts did- not, do not and cannot depreciate the official currency but- simply ignore it by this action and leave it to its own merits or -demerits. They are not under any moral obligation to use the -government's currency. The government has no right to demand such- a use. Moreover, they have all too much experience with- government caused inflations. Thus they will tend to avoid the- current and government-caused depreciation of the government's -current paper money by contracting alternative value standards,- e.g. gold or silver weight units instead, whether such reckoning is government policy or permitted or not. - Assume that almost- all people in a country thus refuse to use government currency- and made their own payment, valuation and settlement arrangements -instead. Assume also that they would refuse to pay taxes and -rather pay themselves the policemen, judges and soldiers- mobilised against them, as unwilling tax victims. Then and thus -and otherwise they could turn these executioners from- enemies into neutrals or even allies. Then government paper money -issues would become almost valueless. Could the refusers be -blamed for having CAUSED this depreciation or would they merely- have REVEALED the INHERENT valuelessness of the government's- currency, by refusing to grant it their own support, at the own- expense? - J. Z., 3/97.
DEPRECIATIONS, DEVALUATIONS, INFLATIONS, DISHONESTY AND MONETARY POLICIES OF GOVERNMENTS: Now, there are two types of "dollar shrinkages" - official ones and unofficial ones. On December 18,1971, and February 12, 1973, we had two official ones called "devaluations": The former was 8.57 % and the latter 10 %. Almost daily, as the dollar shrinks in value, causing prices to appear to be going up, we have unofficial devaluations. When the government reported, for instance, that the Consumer Price Index for '74 had risen by 12.2. %, it should have reported that government monetary policy has "shrunk" the dollar by another 12.2%. But by asserting that prices had gone up rather than accurately reporting that the dollar's value had gone down, the government is able to mislead the public as to what is really going on. - Schiff, The Biggest Con, 35. - Add to this, that the CPI is determined by a government institution and this is under constant pressure by the government to "measure" with it less inflation than does actually take place, e.g. by including price-controlled items. That is one kind of scandal, happening at least in Australia, which no "investigating journalist" has so far bothered to investigate and publicise. - J. Z., 24.3.97. See: MONETARY POLICY, CONSUMER PRICE INDEX.
DEPRESSION, DEFLATION, WAGES & PRICES, ARTIFICIALLY SUPPORTED & -MARKET RATED AS FACTORS CAUSING UNEMPLOYMENT: "...LIONEL (now- Lord) ROBBINS's theory (in The Great Depression, 1934 ) that -the government had been prolonging the Depression by propping up -prices, wage rates, and unsound enterprises, and that that had to -stop. Specifically on unemployment, Garraty notes the view of- Robbins, Ludwig von Mises, and Jacqes Rueff (a long-time- economic adviser to the French government) that wages must not -be artificially kept above the market level, an action which- generated massive unemployment. So far, so objective - except -that Garraty cannot resist appending a snide sentence: 'Their -proposals thus required further deflation, although by early 1933 -prices had been falling for over three years.' - It is true that -prices had been falling since 1929, but - remarkably in the -history of depressions - they were falling faster than wage -rates. This meant that REAL wage rates (wage rates corrected for c-hanges in the purchasing power of the dollar or pound sterling) -were going up, thereby generating massive unemployment. None of -these hard-money economists advocated further deflation, in the -sense either of further contractions of the money supply or of- general price levels. On prices, they called attention to the- fact that keeping a specific price artificially high can only -lead to the piling up of unsold inventory on the shelves and the- possible bankruptcy of firms in the industry. On the question of- unemployment, they were making the same point with respect to- propping up wage rates." … Murray N. Rothbard, in a review,- Theory & History, INQUIRY, May 29, 1978, P.22. - Note, that his -experts did not insist upon any "FURTHER INFLATION". The existing- one, was, indeed, bad enough and they had nothing to propose to- abolish it than the adaptation of prices and wages to it. To that -extent they were wrong. Since attempts at keeping prices and -wages above the market level are permanent in "Welfare" States, -depressions should be permanent, and certainly, TO SOME EXTENT- they are. - Alas, Rothbard (and all too many others) ignore monetary despotism as a major factor or recognized only spurts of- government caused inflation as starting points for further inflations and- later deflations. Against inflations they recommend merely- 100% or fractional gold convertibility banking. Against deflation -they recommend nothing, since they believed that everything- beyond that kind of exclusive currency would be mere "fiat"- currency. There lies their major mistake. But, to the extent that they observed price effects they were right. In Germany wage -rates did also fall slower than other prices. Unions and -government propped them up, artificially. One of the by-products -of that was the Hitler regime, WW II & its aftermath. So it is- high time to attempt to examine ALL the factors that were- involved, not just one's own favourite depression theory - among- dozens of others that one tends not even to mention and consider. -- J. Z., 27.5.97.
DEPRESSIONS & CAPITAL: During a depression it is not more -capital that is required to end the depression but a better -condition for the existing capital. In the main, the normal -turnover of daily wanted and needed consumer goods and services -has to be restored to normal by free clearing or alternative -sound exchange media, used and issued just to the extent required -to mediate the turnover of all the goods, services and labour- that, due to the depression, remain unsold. The same amount of- capital is about that existed before and will appear again, quite openly and effectively, when really needed, after the depression. -During a depression capital still exists but it is no longer as- extensively used as before and after the depression in -turnover-credits. It is there, but not used as before. It is -hoarded or kept in highly liquid accounts only, because of them -depression. Worst of all, there is no freedom for or knowledge of- or interest in - overcoming this turnover credit shortage through- monetary freedom. Capital is then kept rather unproductively in- cash or in short term money market speculations, as liquid as- possible. (Capital will not be invested in turnover credits, either, while turnovers are hard to achieve, due to a deflation. Anyhow, saved up capital should not be used for turnover credit but rather for productive investments. - J. Z., 8.9.02.) It does then not make sense to invest it in loans for- wage and salary payments, in productive industries that would- further increase the seeming glut (hard to difficult to sell- goods) in the market, due to the deflationary conditions. Penal measures for such capital (as e.g. Gesell's stamp scrip) are -neither justified or necessary. Rather make the use of capital -for turn-over credit unnecessary. Allow all turnover-transactions -to be mediated by special self-liquidating banknotes, on the -banking principle or real bills doctrine, instead, or via- clearing house certificates, with both expressing a sound value- standard rather than the forced paper standard of legal tender. -Precisely the unsold goods, services and labour are needed and- are all that is needed to make these alternative turn-over loans- and clearing arrangements. They are their "redemption fund",- cover or reserve - under monetary freedom. - Don't blame, expropriate, prosecute or hang the "capitalist". Rather, make- yourself independent of them. Workers largely associated in- consumer cooperatives, for instance, could then appear as bankers- towards their employers, granting them wage payment loans and- giving them orders for further supplies of consumer goods. They- would no longer insist that their bosses somehow come up with- the required ready cash, even under monetary despotism, which -puts this supply largely out of their hands. By this action they- would enable the employers to act as employers towards them,- rather than rejecting them as job applicants. - J. Z., 24.9.91,- 28.4.97.
DEPRESSIONS, FREE BANKING & UNEMPLOYMENT: End all depressions- through the introduction of full monetary and financial freedom, -as most important parts of freedom of contract, free enterprise,- free trade, freedom to exchange, and of the right to supply -oneself with work, without depriving anyone else of it - in order -to support oneself and one's dependants, honestly & productively.- - Once that freedom and its technical details are fully understood, by a sufficient number of activists, then it could be- realised within hours to days at most. - Governments, on the -other hand, do not know how to end any economic crises within -months, years, or sometimes even decades. They can only enlarge- or prolong them and hope for the best. Within the system of- monetary despotism there is no cure for depressions or -inflations. It is the cause. And markets that are distorted by -this despotism can only very slowly and painfully and, to a -limited degree, adapt to it. And even in this they are hindered,- as a rule, by further economic interventionism. No rulers or -their advisors have any solution to offer - only false promises- and hopes or measures or further restrictions. Sometimes they do- even admit this. But even then they are still not prepared to get -out of the way after first having removed all legal obstacles to -self-help. - J. Z., 19.12.92, 29.4.97
DEPRESSIONS, RECESSIONS & THE COVER-UP LANGUAGE USE OF -POLITICIANS: How many million unemployed will there have to be -in Australia before any of its politicians will admit to have -caused not merely some economic difficulties or a minor and -temporary recession but a lasting depression, instead? - J.Z.,- 10.3.93, 27.5.97.
DEPRESSIONS: Many thoughtful people are more and more aware that- industrial depressions are caused chiefly by faulty control of- money and credit. Most "reformers", or those who recommend- measures to remedy this, turn to government for issue and control- of money. It is my purpose here to briefly present an analysis- and "cure" in the light of economic liberty. - Laurance Labadie,- The Money Question in the Light of Liberty, in THE STORM, 4 & 5, -1977.
DESERT IRRIGATION & FINANCIAL & MONETARY FREEDOM: Compare the relevant article in PEACE PLANS 20.
DESERTION & MONETARY FREEDOM:
DESOVIETIZATION, COMMUNISM, ANTI-COMMUNISM, LIBERATION,- LIBERALIZATION: Let us finally start de-sovietising and- de-statising our economy, starting with the abolition of monetary- despotism and financial restrictions and their replacement by -monetary and financial freedom. - J. Z., 12/92 & 15.4.97.
DICTATORSHIPS REMAINING: I assert that e.g. the Red Chinese,- Cuban & North Korean regimes cannot be easily undermined, or- overthrown by a military insurrection or revolution or as a- result of massive refugee streams, of as talented and productive- people, to the rest of the world, as long as their monetary- despotism, nay even monetary totalitarianism,  remains largely -unquestioned in East and West, including Taiwan and South Korea. -There are an estimated 120 to 200 million unemployed in Red China- alone! And close to 1 billion unemployed and underemployed in the- world. Consequently, refugees and deserters are hardly welcomed -anywhere. The communist regimes do not know how to employ and- exploit them otherwise than as slave labourers. And the- "democracies" or "free" countries tend to deport the escaped modern slaves -back to "their" masters, exploiters, oppressors and mass murderous- regimes. The realisation of monetary freedom could put all of them to work - to-morrow! It, could almost immediately, provide -full and paid employment for millions and millions of refugees -and of deserters. It would make them welcome rather than feared -or hated. It would increase the division of labour and, with it, prosperity for everyone. It could provide full and harmless -employment e.g. for former employees of the nuclear weapons and nuclear -power industries, former soldiers and bureaucrats and even for -politicians. It could also help to properly finance -insurrectionist armies. Most libertarians are not yet ready for- such discussions and subscribe to contrary myths, including some- very prominent people that I could name but will not, since they share in this simply some of the all too popular prejudices. -Most "employers" still consider themselves to be professionally "employers", although they are, under present conditions, quite obviously unable to employ millions of unemployed and- although they do not even understand all or many of the- interventionist legal causes of involuntary mass unemployment and -how they could prevent or end them. - J. Z., Free after MFNL 5.
DIS - COLLECTION: Entries from notes towards an Encyclopaedia of -the best Refutations so far found, to popular errors, myths and -prejudices, to the extent that they deal with monetary freedom -and monetary despotism, should be included. Some batches have- already been extracted but not all of them.
DISAGIO OR DISCOUNT OF NOTES, CANCELLATION OF RETURNED NOTES ETC.: A temporary and small disagio of otherwise quite healthy and competitive medium of exchange, i.e., its free pricing and market rating in a free market for exchange media and a lasting and practically irreversible deterioration of a monopolized and coercive (legal tender and central bank issued) currency by the government are two very different things, The sound disagio, a free price effect or discount in a free market, will drive the competitive exchange medium to wherever or to whoever will have to accept it at anytime at par, i.e., at their nominal value. It will thereby remove these exchange media from circulation having sped up the reflux to the issuer. In the process it will have brought about corresponding sales of goods or services, if not a speedier repayment of a debt to the issuer. Insofar it would be harmless for the holder, as longer as the issuer remains in business and able to deliver his goods and services or has some outstanding debts. - It was long practice at e.g. the Bank of England, that returned notes were destroyed and replaced by new ones. This might still facilitate checking series of issues and their reflux. But their electronic scanning and accounting might make this less necessary. The reflux of the discounted notes will make them disappear and with them their disagio or discount, as long as they remaining offers of the issuer remain solid and wanted. The debtors of the issuing centres might also be obliged to accept their notes at par, at least to the extent that their debts or due or soon due, so that they could immediately settle their debts with them. - An artificial and legal inflation, depreciation or devaluation of an exclusive and forced currency is quite another matter. Although by means of it and temporarily, the sale of goods and services will also be furthered, this happens only under illusions, false guidance and reckoning, and at the expense of all those receiving payments in such a currency. Prices rise not evenly but unevenly. Prices for the same goods become even more different in different shops. In chains stores price increases often differ in their different branches or even sales rooms. Buyers notice such differences rapidly; even women and children show skill in finding price differences for the same goods in different stores and go for the relative bargains. The urge to purchase is spurred more by simultaneous price differences in the same locality than through generally low prices, that are everywhere the same. In an extreme case, I saw once one particular kitchen knife offered in the same department store, at 3 different locations and at 3 different prices. Through the unequal rise in inflated prices, the sales in those stores which have least adapted to inflation are increased most. Their stocks are then rapidly depleted and lead to reordering. But that will usually be possible only at higher prices. - What is most important in all this is that a naturally occurring disagio in a competitive and market rated currency  is temporary and does not expropriate anyone. Each holder can still present his note to the issuer at par and thus the disagio in general circulation will rapidly disappear, together with these notes. (Generally, exchange media with a discount are widely refused, their issue is either stopped or greatly reduced and the circulation of the discounted notes is rapidly reduce via reflux to the issuer at par. - J. Z., 30.8.02.) But when legal tender forces notes into circulation and they remain nominally of equal value in debt payments, although already depreciated, and they have depreciated because their reflux is insufficient, then they tend to stay in circulation and their depreciation tends to increase more and more and can be continuously forced upon every creditor in the country by his debtors. A temporary disagio of a healthy paper money in general circulation, will not prevent or reduce long-term stable value investments and the production of long lasting goods. It will also not reduce the turnover of daily wanted consumer goods and services but, temporarily, even speed it up. - J. Z., transcript of p.11 of some undated notes slightly revised, 24.3.97.
DISCOUNT OR DISAGIO OF PRIVATE NOTES & THEIR EFFECTS UPON FURTHER -ISSUES & ACCEPTANCES: Obviously, an issuer would not have to or want to- issue his notes at 10% discount and the next moment have to accept them at- 100% from one of his debtors. Some percentage of discount for his note issues exists, that HE would be willing to put -up with, during their issue, seeing the normal profit margins he has when someone- buys goods or services from him, provided only that such- discounts do not reduce the number of acceptors for his issues -and his chances for future issues. But it takes two to -tango. His potential acceptors have another opinion towards his- discounted notes. Thus, as a prudent issuer, not wanting to lose -face, risk the reputation of his business and his ability as an -issuer, he would stop further issues at the first discount- occurring and take up further issues only once the discount has- disappeared (together with the discounted notes, because he has accepted -them at par in payments due to him and cancelled them or has not -re-issued them). Potential acceptors, unless they are among the -few who immediately could use them against the issuer at par, -would hesitate to accept any notes not standing at par. They- would rather accept notes by his competitors, as long as they- remain at par. Thus, even if the issuer were prepared to issue- more of his notes, while they have a discount, he would find only a- limited market for them. - Then there are the media and his- competitors, eager to point out such discounted notes. And note exchanges and clearing centres would fast- discover any real over-issues if they had caused a justified discount - -instead of merely a temporary discount expressing an unwarranted distrust towards his -notes. The note exchanges would have more notes by this issuer -than he could offer in exchange in form of the notes of others. -The same applies to clearing accounts. Others would have a -clearing credit with him, in balance. He could not settle it with -his clearing claims against them. That would not only be fast- noticed but also fast publicised by the others. However, if only a mere small and temporary discount for other reasons, -although his goods and service cover are still sound, i.e., his goods -and services are still wanted, at their prices, then this fact would tend to- bring the discounted notes very fast back to his shop, for- redemption in his goods and services at par. Thus, some "smart"- businessmen, not yet satisfied with the speed of the reflux of- their notes to them, might try to decry them, to speed up their -return. But however unfounded the resulting and merely temporary -suspicions might really be, repeated experiences of this kind- would stick in the memory of many people and lead to refusals to- accept his notes or to more wide-spread discounts and, perhaps, ultimately, to- a total rejection of his notes. People would tend to prefer notes -that do not depreciate below their par values even if only upon -rumours, not real inability to cover them with fully with the goods- and services of the issuer. People prefer stable values, to the- extent that they can get them. They do not want to be fearful or- panicky regarding the means of payment in their hands. Even upon unfounded suspicious, they will tend to reject exchange media of -others and this is their right. An issuer would be foolish to -upset and lose many to most of his potential customers just to provide a -few of them with bargain opportunities at his shop. - With stable -currencies having driven out most unstable ones fast, prices- would tend to be more stable, too and represent, due to easier- and more certain sales, a lower price level, too. Thus we should expect less discount sales than now, and lesser profit margins -in sales. When profit margin are low then issuers could even- less afford to issue his notes at a discount, even if he were to -find enough ready acceptors for them under this condition. - -J. Z., 16.6.94, 17.4.97. - According to some reports, some supermarkets are so efficiently run and have such a large turnover that their profit represents only 1/2 to 1 1/2 % of the retail prices and, nevertheless, the total amount of their profits is large. But, obviously, at such profit rates they could not afford to issue their shop currency at a considerable discount. - J. Z., 7.9.02.
DISCOUNT POLICY & INFLATION: A sound discount policy of the central bank can stop inflation. - Popular opinion. - It is easy to inflate a legal tender currency by several hundred or even several thousand per cent p.a. but it is not so easy to stop or reverse this over-issue of forced currency by increasing the discount rate to several hundred or several thousand per cent. - Usually the discount rate of the central bank is raised only somewhat and only after the central bank has already over-issued its legal tender or fiat money. But no degree of deflation or credit restriction can make any degree of inflation harmless. It can only add to the difficulties already created by the inflation. Stagflation is one frequent result - the inflation goes on and so do the depression and unemployment.  - See my old German notes on this subject. - J. Z., 2.4.97.
DISCOUNT POSSIBILITY IS ESSENTIAL: The possibility of suffering- a discount is a necessary feature of a free monetary system. It- would draw depreciated notes quickly out of circulation. They- would be rapidly paid back to the issuer who has still to accept -them at par. This discount would thus be welcomed by his debtors.- The more the notes are discounted the more rapidly they would- return. With the returned notes the circulation and the discount would be reduced. It is obvious that, while the discount continues,- new issues will be hard to impossible to achieve. People will -simply refuse to accept them - unless they owe the issuer -something. - J. Z., 77 & 97.
DISCOUNTS OF GOODS & SERVICE WARRANTS, VOUCHERS & CERTIFICATES:  If goods warrants were to suffer a small, local and temporary discount. then their issuers and the debtors of these issuers could counter this discount not only by continuing to accept the discounted notes at par from anyone and at any time, pointing this out and thus assuring to themselves more and more rapid sales while contributing towards the removal of the discounted notes and thereby their discount, from circulation. They could even go beyond this and accept the own notes at a premium, or, alternatively, all other means of exchange offered to them only at a discount or demanding a small premium for payments in them or a small penalty payment when their own notes are not returned to them in payment. Thereby they could more rapidly remove their somewhat depreciated notes from circulation and enable themselves to undertake further issues at par. Naturally, while the discount persists, in their own short term interest and in their long term interest as well, as reputable issuers, they would stop further issues. It would be foolish to continue offering the own notes at a discount, which most potential users would refuse to accept at all, since they would rather be paid in par-notes and par note payments are available from others, and then be satisfied with issuing them at a discount to a few, who, at the next moment, could use them at par against the issuer. - However, offering a premium on payment in the own notes or charging a fee when paid in foreign notes, will rarely be necessary to keep or restore the par value of the own notes. Perhaps it will be practised only in some emergency situations or during the introductory period. - But it is an additional measure available to speed up the reflux of notes and to restore them rapidly to their normal par value. The possibility of a discount, as a warning signal, is a necessary factor in this payment system. It is a sign that something might be wrong with the issue or its reflux and that some counter-action is required. For instance, if it happens, the issuers might arrange for a special sale to speed up the reflux of their notes. They might also charge a higher fee for short term loans they grant in their own currencies, for wage payment purposes or increase the discount rate when they discount sound commercial bills of their members. Another option would be to shorten the reflux period for all newly issued notes, until they have achieved a reflux period which would keep their notes at par. E.g., if they used a reflux period of 10 years, then many of their notes might become discounted because they are not rapidly enough streaming back to the store in repayment. A reflux period of 1 day only (like for cinema or theatre or sports events tickets) might maximise reflux but would be rather inconvenient for a local currency. Thus, somewhere between at least a week, if not a fortnight and 3 to 12 months, is the optimal circulation period for any competitively issued exchange medium that is to retain its par value while it changes hands locally. - J. Z., 28.11.92,16.5.97. Not all of them would, necessarily, have the same period for their validity.
DISCOUNTS OF PRIVATE OR COOPERATIVE EXCHANGE MEDIA: While a- first discount for a competitively issued private exchange medium- or current account (possibly and, most likely, happening only in wholesale trading) is still rather small, let us say, 1%, the -few, who would still owe something to the issuer and would get- access to a corresponding quantity of the slightly discounted -private notes or bank accounts, would gladly buy them up in order -to instantly pay their debt to the issuer with them. They could -thus, at a discount of 1%, make saving of 1% of the remaining- debt, thus repaid, on that day. Reckoned annually, their saving -would be at the rate of 365% of the debt amount! Debtors would- often jump to so reduce their debts. -Whatever reflux option would still remain open would thus be- quickly exhausted. If the discount was unjustified then it would- quickly disappear, with the discounted notes and accounts being -used as means of payment against the issuer and account holder.- The larger the discount, the more widespread would be the refusal-s and the faster the still accepted notes would be returned to the -issuer in payment at par, because he would be the only one -towards whom they would, juridically, have "legal tender".  - J. Z., 3/97.
DISHONESTY OF GOVERNMENTS: The dishonesty of governments can be- best seen in their laws on coinage, exchange media, value- standards, credit, clearing, banking, exchanges and securities.- Almost no government has ever remained honest in these respects -for very long. See : MONETARY DESPOTISM. - J. Z., 6.7.91, 26.4.97.
DISINTEREST IN MONETARY FREEDOM, APATHY TOWARDS MONETARY -DESPOTISM: At present there seems to exist not even a single -periodical or newsletter, in the whole world and in any language, -that is exclusively devoted to monetary and financial freedom.- That seems to indicate to what extent we are mentally still slaves of monetary despotism, unaware of the havoc it wreaks and- of the rights, liberties and economic benefits achievable only- through monetary and financial freedom. Look also at the- overflowing shelves of periodicals in news agencies. Almost all- the other and more or less trivial to comparatively unimportant- interests are covered, often by quite a number of periodicals,- and almost all but these scholarly interests are catered for in -special scholarly quarterlies, annuals, etc., of which- ten-thousands are published. Look also at the bulging shelves of bookshops and libraries. Hundreds of millions of books were -published, hundred-thousands more are added annually - and yet -there are only very few titles among them which deal somewhat with -the monetary freedom options, although almost all people do daily- handle the money of monetary despotism and suffer some or the -other of its evil consequences. Moreover there are hundreds of -millions of unemployed who do not comprehend why they are -unemployed, and do not seriously try to find out the cause or -causes and show no interest in the monetary freedom solutions- offered to them by a few. - J. Z., 1.5.97. Then there is the fact that practically everybody, even the debtors, do somewhat suffer from inflations and yet the serf or slave mentality prevails in this sphere, with not even a small minority being properly organized to achieve monetary freedom. - J. Z., 12.9.02.
DISTRIBUTIONISM, PURCHASING POWER, CAPITALISM, SOCIALISM, -MONETATARY FREEDOM & MONETARY DESPOTISM: "Einstein's biographer- reports that Einstein regarded it as obvious that 'human reason must be capable of finding a method of distribution which would- work as effectively as that of production.' (Clark, 1971:559).... - ... even a sensible philosopher .... stated approvingly that -"Einstein is clearly aware that the present economic crisis is- due to our system of production for profit rather than for use,- to the fact that our tremendous increase of productive power is -not actually followed by a corresponding increase in the purchasing -power of the great masses.' (M. R. Cohen, 1931:119) - We also find- Einstein repeating (in the essay cited) familiar phrases of socialist agitation about the 'economic anarchy of capitalist- society' in which 'the payment of the workers is not determined -by the value of the product', while 'a planned economy... would- distribute the work to be done among all those able to work', and- such like." - Hayek, The Fatal Conceit, 59. - Almost all, here -Einstein, Hayek and some reviewers, and the main schools of -economic, or rather anti-economic thoughts fail to distinguish between supposed free market- and propertarian distribution under monetary despotism and the- real free market and propertarian distribution under monetary- freedom. In the former case they come, therefore, to demand even- the abolition of the more obvious property rights and rights to -freely exchange products. The second case would help to enlighten -them but it is not freely practised and not even freely and -widely taught, because it is outlawed. - Shop foundation and- service foundation money, ticket money and clearing certificates -would, much more obviously and quite sufficiently, distribute- goods, services and labour but upon property, free trade and free enterprise -principles, giving everybody the chance to use his capabilities,- education, training and resources productively, to the own advantage and that of his fellow citizens, with each being- rewarded in accordance to his contribution to the total wealth. --J. Z., 30.3.94, 26.4.97.
DIVERSITY, VARIETY & UNIFORMITY OF MONEY: The concurrent- circulation of several currencies might at times be slightly -inconvenient, but a careful analysis of its effects indicates -that the advantages appear to be so very much greater than the- inconveniences that they hardly count in comparison, though -unfamiliarity with the new situation makes them appear much- bigger than they probably would be. - Hayek, Denationalisation of- Money, 84. - Under full freedom to refuse acceptance and free- market rating and through the existence of alternative -currencies, no more currencies will be locally issued and- accepted by most potential acceptors than they will find- convenient and profitable to issue and accept. The process is -continuously self-regulating. Suits that don't suit and shoes -that don't fit won't flood the market, either and thus will not- be an inconvenience to most people. - J. Z., 21.3.97.
DIVISION OF LABOUR & THE PRESENT REMNANT OF FREE CLEARING: As a -young man, still involved with career decisions, I- thought once that a handbook was missing that would describe the- great variety of different jobs then existing: ca. 100,000.- Somebody else produced such a reference book in Germany, before I- got around to it. Then, in the 80s, I saw in the window of a -closed bookshop, in an airport, late at night, another guide, in -English, to close to 400,000 jobs. So much has the division of- labour increased in about half my lifetime, so far. What significance has this with regard to monetary freedom? Division- of labour depends upon free exchange. The more free exchanges- are, the easier becomes division of labour. No one need be -unemployed against his will or should be merely because some -people want to uphold monetary despotism. I wonder, how many -different kinds of jobs can and will be listed once full monetary- freedom has been introduced and practised for, let us say, 10 -years? And how much of all the successes of division of labour and of -advances in technology, science and management, was due not to -the money of monetary despotism but to the largely unmanageable -freedom to clear that still exists even under monetary despotism- and in a mixed economy with all too many interventions and- controls? To the extent that one can use today's value of a paper -money standard merely as a standard for almost instant clearing -of mutual debts, it is good enough, its depreciation from day to-day does not matter very much. And to the extent that via the degree of clearing options that one can take up even today, one -is independent from the availability of the government's forced- currency notes and coins, one is also independent from monetary- despotism. Alas, creditors are today authorised to demand,- whenever they want to, cash or legal tender rather than clearing.- And that does create difficulties. The existing clearing banks- are also licensed and controlled by the government and its -central bank, to a considerable degree. If they were not, the n-one could altogether bypass the issue monopoly of the central -bank and its banknotes or paper money and settle everything -freely - by clearing only. But deals in negotiable securities,- especially those with a monetary character, are still legally -restricted. Possibly no one in any country knows fully how many -legal monetary, currency and credit restrictions do apply. -Moreover, they are constantly changed, at least somewhat - and -all but black market exchanges are subjected to the tribute gatherers.  - J. Z., 9.4.97.
DIVORCE, FROM MONETARY DESPOTISM: Let us have freedom to divorce ourselves from the- government's monetary despotism, i.e., especially its monetary -legislation, its central bank with its issue monopoly power and regulatory powers, , its legal tender paper money, but also e.g.-, from its compulsory taxation, protectionist policies, post- office, railway and road monopoly, its wars against the poor and- on drugs, its police and prison and jurisdiction monopolies etc. -Let everyone be free to opt out of any or all of them - without -being prosecuted for this, and let him then act at his own risk -and expense - for his own benefit, in every sphere. Starting- exterritorial autonomy for volunteers in the monetary sphere,- during a severe crisis, might be a good start towards a general liberation effort. - J. Z., 18.4.97.
DOCUMENTARY HISTORY OF BANKING AND CURRENCY IN THE U.S.: See:- KROOS, HERMAN E.
DOLE:  WORKING FOR THE DOLE, UNEMPLOYMENT INSURANCE & BENEFITS, FORCED LABOUR: Michael Cobb, M.P., "Working for the Dole", in "The Optimist", March/April 86. - Cobb's article, like many others, proposes that the dole recipients should give something in return for the dole. He does not propose that the dole should be "returned" as a loan, that it, should only be paid, in the first place, as an interest-bearing loan, one to be guaranteed by family and friends. He suggests, rather, that the unemployed be directed to do some community works - road works, gardening etc., to continue their entitlement for the dole. The dole representing roughly the pay for two day's work of unskilled labour, they should have to supply 2 day's worth of community work. - Assuming that they should not have to repay the dole, granted only as a loan, with interest (as they should have to, in my opinion) and assuming that the necessary self-help steps to abolish unemployment, even within a day, are not permitted, undertaken or even considered (I hold that monetary freedom offers this option), one should consider which is the most suitable "community work" for unemployed: The most important task for unemployed - and of all those concerned about unemployment - is obviously the abolition of unemployment. It could rightly be argued that the unemployed are not experts on the abolition of unemployment. But then who is? Their task would initially be a simple clerical job, a compilation, study, discussion and learning job. It is a job that is much too large even for a large bureaucracy. During the Great Depression, there were over 100,000 submissions on how to overcome the depression. There was no machinery to deal with such proposals and in such quantities. There is still no such organisation, in any country, according to my knowledge. I hold, therefore, that the unemployed are probably the most suitable "labour pool" for this task. It is correct that among the unemployed, too, most people are not the studious type. But most of them can read and write, can't they? So they can search for and compile relevant information, even if they do not understand all of it. - So much has been written on the subject of unemployment that no single person can survey all of it in his lifetime. Consequently, this job has to be tackled in a division of labour process. At least for the initial stages and the intermediate ones, if not also for the final ones, no academic degrees and skills are required for this job - just reading and writing ability. - Instead of providing gardening or road labours, for 2 days a week, I would expect each unemployed to provide at least 4 pages of notes and references per week on the subject of unemployment. (Those with considerable education might have to supply, perhaps, 40 pages.) - These notes ought to cover a very wide sphere: Some unemployed might start with their contributions towards compiling a comprehensive bibliography on unemployment, others might start on abstracts, reviews and indexes, others on collecting, integrating, transcribing, translating and editing such contributions. Some might compile lists of unemployment subjects and research jobs already somewhat dealt with, while others might list of subjects and research jobs that have not yet been tackled or completed. - Some might just collect opinions, ideas, arguments and theories on unemployment - and related ones on economic crises, inflation and stagflation. - Who could or should show a higher interest in such questions? - After the legible transcription of all contributions (the job of some of the participants, each taking up a self-chosen job in this sphere), all contributions ought to be microfiched and duplicated, with a set to be available for viewing in ever Australian Employment Office. They should also be digitised and made available on floppy disks, text only CD-ROMs and on-line. The costs involved should be footed either by a levy upon all of them or by the Departments of Labour & Trade, or by the unemployment "insurance" systems. (Better still, by a self-help organization of millions of unemployed, with each paying a membership fee of at least, day, $ 10 p.a. - J.Z., 15.9.02.) - No copyrights are to be claimed for such contributions, i.e. other media are to be free to copy them. But each author should be at liberty to state name and address - and the type of work he or she is looking for, so that their contributions could also serve as advertisements for themselves and those reproducing their material should be obliged to mention their names and addresses and the jobs they want, unless they have made certain that the authors are no longer unemployed. Then the author's name would suffice. - Imagine the ca. 800,000 unemployed in Australia, or the by 1996 ca. 1 billion unemployed and under-employed in the world, collaborating in this job. That number would be enough, although, ideally, all the unemployed of the world should be activated in this way. - I think that the job could be tackled and finished fast enough by the unemployed of Australia alone. Between them, they could survey, copy, extract, abstract, index and discuss all the relevant literature, all arguments, theories and facts, in all languages and make them easily, fast enough and cheaply accessible in at least one of the affordable alternative media. - All their input, after eliminating duplications of labour and integrating the material properly and alphabetising this collection, would form a comprehensive encyclopaedia, archive or data bank on the subject. It should also be computerised in the end, to make its information available on-line, and in COM microfiche, not only on optical microfiche, on floppy disks, on text-only CD-ROMs and on other media, like giant hard disk drives. - In the initial stage some duplication of this kind of study work would occur but this would not matter greatly. Later such duplication could be reduced through lists of study & collection etc. jobs already done and remaining to be done and through making these lists available to the participants. - Many small circles of unemployed could and should be formed to help them in these labours. Other people, who are interested, economists, students of economy, high school pupils, social workers, teachers, etc., should, naturally, be in no way prevented from contributing their bits of information: observations, ideas, theories, proposals, opinions, criticism and references. Some might merely compile QUESTIONS like: What individual rights are involved in tackling the problem of unemployment? - For instance, do people have the right to supply themselves with work, without depriving anyone else of work, by undertaking all the organisational, technical and economic steps required for this purpose? - What defence implications would full employment have? - What is the relationship between unemployment and inflation? - What is the effect of minimum wages, maximum wages, of wage control? - What effect have unions had on employment, labour legislation, monetary legislation? - Is there a relationship between machines and automation and computerisation and unemployment? - What theories do exist on the cause of unemployment? (These should perhaps be numbered for easier reference.) - What cures have been proposed for unemployment? (To be numbered, too.) - What answers and refutations have been supplied to each of these theories and proposals? - What doubtful points remain on any of these? - Is it possible that a whole army of conscripts of a dictatorial regime could desert - and employ itself productively or be integrated in the process of production, within a day or two? - What steps are required for this? - Could hundred-thousands to millions of refugees undertake the organisational, monetary, financial, entrepreneurial steps, if freed to do so, to support themselves by their own efforts and become assets to, rather than burdens to the guest country, and this in a very short time? - Are there other writers than Ulrich von Beckerath who have studied this problem for deserters and refugees and made detailed proposals for self-help for them? - What role could well organised workers' coops play in the abolition and prevention of unemployment? - What role could Theodor Hertzka's "open cooperatives" play? - What would be the effect of Henry George's reform - and of other land reform proposals, if realized? - Would any kind of land reform have really very much influence upon the rate of mass unemployment? - Which employment programmes can be realized tolerantly, voluntarily, as experiments? - How fast could self-help employment schemes of different kinds be realized? - Must full employment cost money? - See the monograph of that title by Ulrich von Beckerath. - Should prize money be collected by public subscriptions, for the best employment programme? - By what standards should it be judged? - Who should be the judges on such questions? - The unemployed themselves, or those chosen by them for this purpose? - How should these programs be tested? - Only by theoretical discussions or also be free experiments among volunteers?  - Is there such a right as the right to supply oneself with work? - Should there be full freedom to experiment, among volunteers, at their own expense and risk, with measures to provide additional employment? - Should the unemployed and their dependants be at liberty to opt out of any present legislation (enforcing e.g. compulsory unionism, compulsory licensing, wage and price controls, protectionism, monetary despotism) that prevents them from supplying themselves with work? - Are all the unemployed, most, or many, or, anyhow, too many, just lazy, i. e. unwilling to look for work - "dole bludgers"? - Should unemployment be subsidised? - Is it an insurable risk? - Can there be such a thing as a sound insurance against unemployment? - Are charities or tax levies the best responses to help the unemployed? -  What definitions do exist of unemployment? - Which ones of them are false or only partly right and which ones are true? - What slogans and catchwords exist on the subject? - What is their truth contents? - What doubts and questions remain on unemployment? - Is there a relationship between central banking and exclusive and forced currencies by central banks and unemployment? - What laws and regulations, if any, cause unemployment? - A listing of such questions could, by itself, employ many and be challenging to many others. - All ideas on the subject of unemployment and all counter-suggestions and arguments should be systematically registered, together with their references, all criticism of them, all refutations and all supporting arguments and discussions. - Everything worthwhile that anyone has written on the subject should be registered not only under suitable headings and cross references but also under his or her name, at least in abstract form - and while the problem of unemployment is (at least in the opinion of most people) still unsolved, every opinion on this subject should be considered worthwhile, no matter how hare-brained or absurd it may appear to some others or supposed experts. - There are at least 150  theories on depressions. They ought all to be registered, together with their references - and counter references. - Since inflations do also cause mass unemployment, all theories on the cause and cure of inflations should likewise be gathered. - When hundred thousands work on such a task, it becomes solvable, not in further generations but in months to years at most. - Why pick on the unemployed for this task? - They have got the time! They ought to be interested in their own major problem or ought to be induced to interest themselves in it. Moreover, they are being paid so far, without giving value in return, not even any thought. All the reading and writing they are presently expected to do consists in filling out some forms. - I hold that the first responsibility of the victims of any abuse is self-help and the first requirement for self-help is self-enlightenment. For an individual full enlightenment is almost impossible to attain in this sphere - or the person would have to be very lucky. The jewels of truths on unemployment are buried in the muck of Augean stables. - If they unemployed could, by this method, be induced to tackle the problem of unemployment systematically, spending as much time on it as on their entertainment, sports and hobbies, then, I believe, they would soon no longer be involuntarily unemployed because then the problem of unemployment would soon become solved or discovered as having been solved already long ago, in some or the other obscure writings. (I hold that my PEACE PLANS series has published most of these.) Either new methods to overcome unemployment would be developed, or, much more likely, long existing proposals on how to solve this problem would finally be sorted out, like wheat from the chaff. - Leaving the problem to "authorities" and "experts" will leave it unsolved for another few centuries! They merely pile expert reports upon expert reports - each ignoring or misunderstanding the contributions of others, with no serious attempt being made to integrate all their contributions - and to confront contradictions. - Book-length treatments are, obviously, not enough. A scientific approach is needed, one that would include every bit of relevant information and most books on the subject have so far excluded much more relevant information than they included. - I hold that every layperson can and should here make his or her large or small  contribution to this comprehensive and, therefore, scientific approach and be it only by registering some more prejudices and myths on the subject. After all, most of the legislation, which according to the evidence that I have seen, is behind most of the unemployment, is based on myths and prejudices and most of the volumes written by "experts" are full of them. - Even after the greatest possible effort has been made to clarify the situation theoretically, contradictory theories, predictions and observations will remain. Thus the experimental method will, ultimately, have to decide: Those who can agree on any particular employment programme will have to claim and realize the right to practise their programme among themselves and tolerantly, that is, at their own expense and risk, while others would engage in their own chosen experiments. All these experimenters are to be exempted, upon their demand, from all laws, regulations and court decisions that would limit their experimental freedom and are not required to preserve the same freedom for others. - The unemployment offices are to be obliged to help in the process, e.g. by allowing unemployed to write their contributions there, by covering the filming costs, by exhibiting the microfiche etc., containing all previous submissions and making at least one microfiche reading machine and computer  available in every office for this purpose. After all, these small extra expenditures are to make the huge costs for their services soon altogether superfluous. - This process does not only require knowledge as input but also ignorance, myths and prejudices - and who doubts that the unemployed, as well, have to offer these in large quantities? Their suffering would only be increased and or prolonged by these, their errors, myths and prejudices (and those of most other people) remaining unrecorded and not systematically challenged and refuted in the process. - As my personal contribution, I refer to Peace Plans Nos. 9-11, 19C and 40/41 and others of my monetary freedom series as containing most of the insights and proposals required to overcome involuntary mass unemployment fast, in my opinion. But these solutions are unlikely to become widely enough recognized until all proposals and ideas on this subject have been thoroughly examined and the examination results for all of them have become easily accessible to anyone interested - which can be achieved via microfiche, floppy disk, CD-ROM, DVD & online publication. - J.Z., 9.6.1986 & 21.5.97, 15.9.02.
DOUBLE CURRENCY, BOTH LEGAL TENDER: In one of the mini States,- Andorra? the Spanish Peseta and the French Franc circulate, under- legal tender, side by side. I do not know whether this is under a -fixed or controlled exchange rate against each other or under a- freely fluctuating one. In my hometown, West Berlin, for a few -years, there where also two currencies used, the Eastern Mark -(Ostmark) and the Western Mark (Westmark). Their exchange rate -fluctuated daily. The daily rate was determined and published by- one authority. Many exchange offices exchanged them for each- other and prices were often marked in both currencies. The exchange rate fluctuated around 1 Western Mark for 5 Eastern -Marks. Many West Berliners worked in East Berlin and were paid in- Eastern Marks. Some were partly paid in Eastern Mark and partly in -Western Mark. Both currencies were legal tender and on both sides- competing currency issues were severely outlawed and all too- effectively suppressed. - J. Z., 19.3.97.  Compare: BIMETALLISM.
DOUBLE EARNERS & UNEMPLOYMENT: Many unemployed are opposed to there being 2 or more wage earners in a single family. They want these jobs to be shared out, reducing all families to one earner only, under the assumption that there are only a limited number of jobs and that these should be more fairly distributed.  -Unemployed are or should be aware that for each of them there are many people who would gladly employ them in one way or the other - if only they would not have to pay them for their labours. They could keep them at work, sweating, for 8 hours or more a day. There is no shortage of jobs that people want done. But few of these people can, under present conditions of monetary despotism, afford to pay full or any wages for these labours or can, through sales on a market restricted by the money monopoly, easily recover the wages and salaries they paid for productive labours. Thus the tacit assumption, that there is not sufficient work to be done, that work opportunities are only available in a fixed quantity and that this quantity ought to be fairly rationed, and that therefore "double earnings" within a family ought to be outlawed, while there are couples of whom both are unemployed, is quite wrong. Not an insufficiency of opportunities for productive work is the cause of unemployment but the  insufficient supply of sound exchange media is, to potential employers, which does not allow them to employ and pay for all the labour they could productively employ - if only they could readily sell their products or services. But they are in difficulties with these sales and thus have to cut down their  operations and the number of their employees. Lastly the consumers pay for the jobs and if the consumers as well, and largely for the same reasons, are insufficiently supplied with exchange media, partly because they have been made unemployed, too, then they cannot keep the production process going at or close to its full productive potential, with full employment, in paid work, at market rates, for all able and willing to work. - The consumers themselves are not, as producers, supplied with exchange media to the extent of their willingness and ability to work, at market rates, producing goods and services at market rates. The central bank functions, in practice, as a nation-wide network of barricades against numerous possible and desirable exchanges. - Only those exchanges can take place that it is able and willing to mediate with its monopoly money and its arbitrary and mismanaged paper money standard, plus those exchanges that are made possible through non-cash and clearing transactions that are permitted to be built up upon this monopoly cash, but which can at, any time, be made largely impossible through sudden and additional cash demands for the central bank's monopoly money, while the debtors are not free to pay with their clearing options instead. - The need for goods and services is, essentially, quite unlimited. For instance, each unemployed needs and wants numerous goods and services - but has not got the purchasing power to buy them. X suppliers would only too gladly sell them these goods and services - if only they would be paid for them. The potential for producing more of these goods and services is there - but not sufficient effective demand, i.e., needs and wants supplied with purchasing power. - Almost everyone could fill out a long shopping list for goods and services he would like to buy, if only he could afford them. For most such lists would run up to thousands, if not ten thousands of dollars per annum, to more than they have saved or expect to earn in extra funds in the near future. To produce these goods and services requires labour. But that labour will only become employed, in market-rated and paid jobs when those with the ready for sale goods, services and labour can express their needs and wishes for this available labour with money-like claims upon the own ready for sale goods, services and labour. Both sides, those who want things and those who want to supply things, have unlimited wishes but only limited work abilities and working time and energy to produce all these things. The natural condition should, therefore, be overwork for all people whose wants are not yet satisfied, not lack of work. One does not have to share existing jobs or invent new goods and services in order to keep the present workers fully employed towards the satisfaction or their wishes for goods and services. Almost no one feels that he has quite enough of those presently offered. - Workers in the US earn about double as much as workers in Germany do. They do not feel over-supplied with goods and services. Their wants have simply increased. That means that more must be produced for them to satisfy these wants. Nevertheless, presently (ca. 1958/59) ca. 2 million of them are unemployed. - One should also take into consideration that most American consumers are in considerable debt. This means that their current earnings were insufficient to pay immediately for the goods and services they wanted. Thus they acquired them on credit. To repay their debt, they will have to work for a considerable time and much of their earnings in the future will have to be used to pay their debts. In other words, they need to produce goods and offer services to clear their debts, since all debts can lastly only be paid in goods and services. (That is, from monetary earnings from the sale of their goods and services, including labour.) Here, too, is a large work opportunity, for these creditors want to be paid. - In Asia and Africa the average standard of living is much lower than in Europe and in the U.S. In other words, their needs for goods and services are much higher than ours, in Europe or those of the people in the US.  Certainly, there is no shortage of jobs that needs doing in these countries. Nevertheless, millions of their people are unemployed. Consequently, unemployment is not due to lack of jobs that need to be done. - The difficulty lies not in finding work that needs doing or workers able and willing to do it but in arranging for and achieving the monetary payment of work that needs to be done, that is wanted and that ought to be done, as fast and as efficiently as possible. - The problem lies not in insufficient needs but in insufficient effective demand, i.e. the lack of purchasing power. Only needs that are supplied with purchasing power can act as effective demand on the market. - If everybody could pay for his needs with sound money, then all unemployed would soon be employed, at market wages. - Everybody's supply with means of payment ought to be restricted only by his ability and willingness in the past, present and near future, to give equivalent goods and services in return - corresponding to his role in the division of labour process. Then his spending would provide income or work for others and would, at the same time, mean work for himself. People wanting to spend more would have to work more or would have to work more productively. Neither case would lead to unemployment. Only the leisure periods of very productive people, who limited their wants, might become larger. - What is limited in our system is effective demand, i.e., needs and wants supplied with purchasing power. The hungry person is not hungry because there is not enough food but because he has not the money to pay for it. He has no money to pay for it because there is insufficient money to pay him for the labour that he would be able and willing to give in return. - Translation of some German notes by J. Z., most likely from the end of the 50's, on double earners, slightly changed 11/85, 21.5.97, 15.9.02.
DOUBLE TO MULTIPLE ENTRIES ON THE SAME SUBJECT: The topic is so -important that they should not be avoided at least in a first -collection, made as complete as possible. Editorial volume- reductions should be postponed or invited from anyone, at any- stage.
DOUGLAS, MAJOR, & GESELL, SILVIO, were, like Marx and Engels, -totalitarians with regard to the monetary "reforms" proposed by -them. Instead of exploring and extending monetary freedom- options, they merely aimed at making monetary despotism complete- and everlasting, all in the name of "reform". Social Credit- people were and are so blinded by their wrong model that they -imagine that private banks enjoy now monetary freedom and are abusing it and that therefore the State ought to acquire and -practise a severe money monopoly - often combined with price- controls, to prevent inflation and to enable it to provide a -"social dividend" for all, out of the money issue privilege. While- they taught this nonsense the money monopoly of the central banks -had been on the statute books for many years to decades and it is -still firmly established there and in the minds of all orthodox- economists.  - Marxians made a similar mistake, by seeing "monopolists" in- competing capitalists and by aiming to abolish this "monopolism" by the legal or revolutionary establishing a super-monopolism,  with -the State as the only employer, capitalist and financier. - While such nonsense still- spooks in thousands of millions of heads, many with the right to- vote and thus to impose their views, attempts at monetary reform have a- chance to be accepted and realized at least at first only among -small groups of interested and sufficiently enlightened- volunteers, or in certain revolutionary situations, where a few- enlightened monetary freedom advocates become suddenly monetary -freedom practitioners, providing extra jobs and sales to those -who so far had no knowledge of or interest in monetary freedom.- In a crisis situation they might accept its fruits, as they have -previously accepted, at least temporarily, emergency monies. If the monetary freedom thus practised is locally complete, remains uninterrupted long enough and is thus- obviously successful, then it will not only temporarily be practised by a- few but will come to spread, fast, even among those who do not understand or- do not even want to know why it works and who have still numerous prejudices against it in their heads. A successful- practice can advance beyond theoretical understanding and -prejudices in the heads of the men of the street and even most of -the experts. So can unsuccessful practices and ideas. Compare e.g. the inscription on banknotes: "pay to- the bearer...", which persisted on newly issued banknotes for- years to decades after their rare metal convertibility had been- abolished. Compare the revival of mercantilist and protectionist -notions and restrictions -  even after decades of experiences with large degrees of- free trade. - Religious or ideological nuts of one kind or the- other will probably be with us if not forever then for a long-time. Thus we ought to establish a "meta-utopian" (Nozick) or panarchistic- framework within which each "money reformer" and "political -reformer" or ideologue or true believer can have the money system -and the governmental or non-governmental free society of his or- her own dreams, at his own expense and risk. That would leave- also the various groups of more or less enlightened monetary- freedom advocates to their own ideas, devices and practices. -"Thou shalt recognize them by their fruits!" - J. Z., 20.4.93,-1.5.97.
DOUGLAS, MAJOR, ERRORS IN THE MONETARY SPHERE:
DRUG LAWS, MONETARY DESPOTISM, RESTRICTIONS OF CASH TRANSACTIONS, -MONEY LAUNDERING, HOARDING & DEPRESSIONS: Seeing that much cash- ends up in the hands of drug dealers and that for them cash -deposits and normal bank transactions are made difficult and- could lead to their prosecution, the drug trade promoted by -anti-drug laws and corrupt politicians, who benefit from them,- combined with monetary despotism, may lead to so extensive -hoarding of cash that this could lead to deflationary effects- like sales difficulties combined with mass unemployment or- depessions. - J. Z., 13.11.92, 15.4.97.
DUEHRING, EUGEN: His teachings are a mixed bag, quite apart from- his irrational antisemitism. In some passages, for instance, he -is in favour of panarchism and in others against. In some he is- for monetary freedom and in others against. Sometimes he favours -Free Trade and sometimes Protectionism. Sometimes he favoured -trade unions and sometimes he opposed them. Sometimes he wrote- like a statist and sometimes he opposed statism.  Ayn Rand would- have charged him with inability to make up his mind. -- Nevertheless, his writings are often thoughtful and -thought provoking. One can somewhat benefit from them by reading -them very critically. He was vehemently attacked by Marx and- Engels. Some would consider that to be a recommendation. - J. Z., 3/97.
DURELL JOURNAL OF MONEY AND BANKING: In 1989 it started out in a- very promising way, under the leadership of Dr. John W. Robbins,- who would have steered it into the direction of an institute, -library and seminars for the study of monetary freedom options,- too and would have freely accepted articles on the subject for the D. J. He even invited me to submit an article on the older -monetary freedom advocates. However, I dallied, being involved- with x other projects, and before I could get around to this, he- was already somehow "eked" out, as I merely suspect, from this -rich, $ 10 million foundation, by others, probably more skilful- in power and position grabbing. The best people rarely succeed in- such struggles. As a result, and judging by the index of articles published in the Winter 93 issue of this journal, its articles of -some monetary freedom interest have already greatly diminished, from 16 during 89 - 91 to a mere 2 during 92 - 93. Good luck to -anyone trying to reverse that trend. The journal is- supplied free to those who ask for it in the U.S. and for $ 10 -p.a. to foreign addresses. Quarterly, from the Durell Institute -of Monetary Science in the Harry F. Byrd Jr. School of Business- of Shenandoah University, 1460 University Drive, Winchester, VA-22 601-5195. Tel. (703) 665-5432. Fax : (703) 665-5432. - Let me -stress again, that I do KNOW nothing about its internal power -struggle but that I SUSPECT a lot merely from its $ 10 million- foundation resource & the change of staff and contents. The same -could have happened under present conditions to any other such -institute and publication in any other country. The "Zeitgeist"- asserts itself - no matter what ignorance and misery and -bloodshed it helps to support. New countervailing institutions- and channels to liberty, have to be established, like the microfiche path, or the CD-ROM one. Finally, they would have to be fully and optimally used. Begin your- freedom to issue notes and clearing house certificates etc. with- your present freedom to issue fiche, floppies or CD-ROMs containing monetary freedom- information. Or, even with mere local tokens for the tourist- trade. - J. Z. note in MFNL 5, amended 5.9.02.
DURREL JOURNAL:
EARNINGS DRIFT, WAGES & INFLATION: The key, long-term objective must be to cut out "earnings drift", which is the rate at which over-award payments accelerate. - Pop opinion or opinion by "experts". - They would be harmless, non-inflationary and just if they merely represented increases in productivity. - J. Z., n.d. - Wages can only "drift" upwards, beyond their productivity and nominally, when paid in exclusive legal tender. If productivity and total exchanges remain the same and the central bank does not issue additional legal tender notes, where do the additional notes come for, to pay for the "earnings drift"? - Whenever sense and comprehension are lacking, another senseless word is coined as a cover-up or merely verbal "explanation" or "justification". - J. Z., 2.4.97.
EASY MONEY, EASY PAYMENTS, ABILITY TO PAY: The BALTIMORE SUN -jocularly observed that 'the word 'easy' means 'easy', except- when used in connection with the word 'payments". - E. Haldeman-Julius, The Bunk Box, p. 72. - As a rule payments will -be easier when you are free to offer your own means of exchange- or clearing certificates in payment rather than being obliged to- acquire first of all sufficient notes of a monopolised money -which the issuer keeps for the time being in short supply or out- of your own channels of circulation. - J.Z., 17.4.97.
EASY MONEY, IS IT A PRELUDE TO A RECESSION, DEPRESSION OR- DEFLATION? - Nonsense! Coercive, exclusive and fraudulent money -is easy for the issuer but hard on his victims. It does, at the -same time, make it hard to impossible to get or issue sound- alternative monies easily and cheaply. Easy and hard are false -and misleading alternatives, that wrongly assume that all paper -monies are easy monies, or some are even easier than others (in the laxity of their issues or in ignoring the required reflux arrangements) and really only all rare metal currencies are- hard monies. Paper money can be "hard" (as good as gold, or even better, although made out of a softer material) but at -the same time easy and cheap to issue. Or it can be easy and- cheap for a fraudulent and coercive issuer to get into- circulation and very hard upon his victims. Easy and hard, or- scarce and cheap, fiat or commodity money, are all- over-simplified generalisations, that do not distinguish enough -all the exchange media & value standards of monetary despotism and- all the exchange media and value standards and clearing options -of monetary freedom. They are rather attempts to avoid thinking -realistically and thoroughly enough on this subject, by making -all the necessary distinctions, not just choosing two wrongfully polarised ones, as if they could fully represent the reality and the possibilities. Easy and cheap things are not- necessarily useless. A cheap digital watch might last you a year- or two and cost you no more than a new battery for it would. Instead, you might spend hundreds or even thousands- on a quality watch, that might not give you that much more -accuracy in timing and that might last you only a few decades. It -might look better and is much more expensive but you might be able to- save considerably by buying annually a new cheap and disposable- watch. The same applies to an electronic calculator. I have a- cheap one, still on its first battery, after at least 10 years. -It is a Sharp, Elsimate, Model EL-8159. A very expensive one -could hardly have served me better. The most comfortable shoes I- have ever had are also some of the cheapest, costing only $ 12-14- and each pair lasts me for many months. Because they are so- comfortable I do wear them till the fall to pieces or the soles- are worn flat and become slippery on sloping lawns. Good money- can be as easy and cheap. It is just a tool. It does not have to -be gold-plated, gold covered or studded with diamonds. It does not have to have any artistic value, either. It need not be- beautiful at all, just sufficiently useful and always ready on -hand when needed, just like e.g. a cheap plastic ruler or -measuring tape. - J. Z., 28.1.94, 2.5.97. - See: INFLATION,- CREDIT EXPANSION, MONEY EXPANSION, CREATION OF MONEY, CREATION OF CREDIT, CRISES, SOUND & UNSOUND PAPER MONEY.
EASY MONEY: Easy money is not necessarily coercive or fiat money or depreciating money, although it might be cheap money and money not redeemable by the issuer in rare metals. It need not be fraudulent or inflatable money. It can be an honest and stable money, easily and cheaply issued, by the owners of goods and their own labour capacity and providers of services, to facilitate the sales of what they have to offer, to those who want them, market prices using value standards that are agreeable or previously agreed upon. The cost of providing it need not be higher than that of printing tickets and vouchers for goods and services. It can be the easiest way in which producers and distributors can bring their goods and services to the market and assure their sales, to the extent that they can use their own notes, tickets, clearing certificates, IOUs, etc., as means of payment for the goods and services of others or in payment of other debts. Without legal tender power and an issue monopoly, it would NOT be an EASY money to FORCE it upon UNWILLING creditors AT ITS NOMINAL VALUE, in spite of it having been greatly over-issued and thus depreciated in purchasing power. Under freedom of choice of value standards, it would be easy to issue sound monies and to keep them sound but hard to get a money accepted at par that has been over-issued, uses an unsound value standard or is locally unknown or suspected. It would be easy, under monetary freedom, for the one who has so consumer goods or services to offer to other people, which people want, at his prices, to liquidify these assets and to anticipate their sales and also to assure their sales in advance, by "producing" his own ticket money upon these assets and using them first of all to buy from others the goods, services and labour they have to offer to him and which he wants from them at market prices. Under freedom it would be easy for a productive person to oblige himself in this way while increasing his ability to pay to the extent of his productive and exchange capacity to serve the wants and needs of his customers. He himself could, by his issues, help to turn the wants and needs of his potential customers into effective demand against himself. Without his issue they might not be able to sell their goods and services and labour (unless they became effective issuers themselves) and thus they might never be able to buy from him and able to pay him. To oblige others to accept one's own money at par, no matter how little or unwanted one's offers, or how overpriced they are, is not EASY. It is the hard job and also hard upon its victims, of monetary despotism. By obliging oneself and offering one's obligations at their market value, one does not have power over others. One does not conquer, rob and subdue them, but merely serve them as much as they want to be served. That is a comparatively EASY business and one that makes good business comparatively easy. To issue "requisitioning certificates" upon the goods, services, and labour of others, certificates based at best upon tax slavery and offering merely nation-wide uniformity and the opportunity to  likewise cheat one's own creditors, is not very easy for the issuer, at least not towards the end of an inflation and is rather hard upon the victims.  - It is easy to carelessly play around with terms like "easy" money and arrive thereby at wrong conclusions. It is relatively hard to make all the necessary distinctions which an understanding of reality, instead of seeing merely verbal opposites. - "Hard" money, on the other hand, might mean an exclusive gold coin currency. It would be hard upon all those unable to sell their goods, services and labour, at market prices, for gold coins or gold certificates, who could, otherwise, under monetary freedom, sell them easily, at gold weight prices, for certificates merely gold weight denominated, that are, without gold redemption by the issuers, kept at par with their nominal gold weight values. Central bank powers make it easy for central banks to do the wrong thing to a whole national economy and hard to impossible to service it properly, satisfying every legitimate demand for exchange media, sound value reckoning and clearing avenues. At the same time, it makes it hard for all their victims to help themselves, by their own private and sound issues and clearing arrangements. Easy and hard and soft and hard do mean different things under monetary despotism and monetary freedom, under legal tender and under free market rating, under exclusive currencies and under competing ones, under an exclusive paper value standard and under freedom of choice for value standards, under an issue monopoly and under freedom to issue. So far we have made it all too easy for monetary monopolists and coercers to turn us into their victims and we have made it hard for all those who would turn our minds and our actions towards monetary freedom options for ourselves and for all others. If you try to use simple words and distinctions then do at least apply them to all the possibilities, not only to your favoured narrow range or within an all too limited horizon. - Laissez faire, let people produce and exchange, even in the sphere of providing monetary, clearing, credit or financial services, is easy. Trying to achieve the same by a command economy, state socialism, dictocracy, interventionism, central planning and directions, is hard to impossible, in every sphere. To call a forced currency, based upon compulsory acceptance and compulsory value for a monopoly money an "easy" money is easily misleading for most who have not considered their monetary alternatives or have merely confined their alternative vision to that of the gold bugs and their very limited redemptionism and convertibility that excludes even gold-weight accounting and clearing. - In other words, it is easy to be uninformed, misinformed or even stupid in this sphere and to make the same mistakes over and over again, in one's opinions, decisions and actions. - Monetary freedom for all the monetary theorists and experimenters - that is the only easy way out of our present monetary problems. No one is to be subjected any longer to the theories and opinions and misjudgments of any supposedly monetary experts that he has not freely chosen for himself as his guide in this sphere. Individual monetary rights and liberties for all. - J. Z., 29.6.89, 14.5.97.
EASY MONEY: Under monetary despotism it is easy (via the- money issue monopoly and legal tender) for the debtor to force "easy money" or "soft money" upon an unwilling creditor, who certainly won't- rest easy before and after receiving it. It makes it also easy- for the monopoly issuer to issue more and more of it and to grant -with it carelessly loans to unreliable debtors or to favourites. -For this issuer only the printing costs will have to be covered.- For him they are like ready requisitioning certificates upon much- of the property and earnings in any country, whether the victims- like that or not. - Its initial value to the issuer comes easy- and its value also disappears easily - at the expense of its- victims. - J. Z., 8.11.92, 15.4.97. - See: SOFT MONEY, HARD MONEY.
ECONOMIC & HUMAN RIGHTS ASPECTS IGNORED BY MOST MODERN AUTHORS: -A translation by J. Z. of part of a letter by Ulrich von Beckerath- to Dr. Mann, 29.9.1957: "You say '... that the modern authors -have dealt with the problems of value, price, wages, interest, -rent, money, capital, currency, markets, etc., together with ALL -the questions and problems which belong to them.' - Now - I -believe to have found, indeed, that they have NOT dealt with ALL -the most important and subsidiary questions and problems.- Instead, and essentially, they have been going in circles. -- Every single of these problems will be seen in quite different -light when the following possibilities are taken into -consideration  (I) The note issue monopoly of the central bank- is repealed. (II) The men in power in the world will return to -all human beings the freedom, which existed before 1914, to adopt -in their contracts a value standard of their own choice, whether -it be gold, silver, an index, music records or canaries. (III) -Patronage (i.e. the splitting of most enterprises into employers -and employees) is replaced. The employees constitute themselves -into an association and purchase the enterprises. (IV) Provision -is made that every human being may join any productive- association as a member, as far as this is technically possible.- (Hertzka has up to now best elaborated this idea and I hold that- this ought to apply even if working hours would have to be -reduced to half an hour a day.) (*) (V) The whole population is- sworn in upon human rights - to the extent that it is voluntarily -prepared to undertake such an oath. (VI) For the protection of- human rights an international militia is established. All its -members are sworn in upon human rights. (**) (VII) Freedom to -issue (notes etc.), free choice of value standards, and other -freedoms from a money and means of payment monopoly, are counted -as human and civil rights. (VIII) The principle, recognized -already in almost all constitutions, that the authority of civil- and military superiors to give commands, finds its limits in the -rights of human beings and citizens, will be brought to the attention of all people at short intervals, so that it will never- be forgotten and will be more and more firmly impressed. --- The- crisis of 1932 would have disappeared in less than 4 weeks if- THIS would have happened. ... Do your know of ONE author among- the modern ones who included the above hinted at possibilities in- his calculations? Do not ALL of them consider the absolute power -of the legislator as a truism? Is not for all of them the money -monopoly of the State, the exclusive value standard, the -authority to introduce planning etc., a foregone conclusion? Do -you know of even ONE exception? ... (Rittershausen is one, but -perhaps the only exception, apart, PERHAPS from an American -theoretician of money named Faulkner. I read a very derogatory- criticism of him, written by the money-monopolist (J. Z.: He- favours an exclusive gold standard!) SPAHR. From his objections, -I could only conclude that Faulkner is a very sharp and -independent thinker. Unfortunately, I do not see how I can obtain- F.'s writings.)" - Bth. confirmed that the novelist William -Faulkner was not meant. Perhaps it was R. P. Faulkner, listed as- author of "The Private Issue of Token Coins", in Pol. Sc. Qu.,-vol. 16, on Jackson & Civil War Token Money? A copy of this -article is still wanted by me. (J. Z., 1997.) Since then a few- authors have indeed questioned some of the premises challenged -here - but is there one other author who has challenged ALL of- them and who has made as sensible suggestions on all these points -as Ulrich von Beckerath (1882-1969) had? Please, tell me his -name, his address and give me a list of his writings. For such -people and texts I will always make room in my PEACE PLANS -series. - J. Z., 4.1.86. - (*) I would exempt from this very small -productive associations, let us say of up to 50 members. (**) The- international militia should merely be a federation of local -militias. The human rights they ought to upheld are not those -declared by the U.N. in Dec. 1948 but an ideal declaration of -individual rights, for which a draft has been published in PP 4 &- 61-63. Ca. 100 private drafts of human rights were reproduced in PP 589/590.
ECONOMIC GROWTH: Economic growth policies amount to a positive anti-inflationary policy. They embrace technological and scientific developments, education, training, labour mobility and adaptability, tax concessions, subsidies, protectionist policies etc. - Economic growth may somewhat hide inflation but does not abolish it.  Economic development or growth does have the tendency to reduce prices. When at the same time inflation is just large enough to prevent that price reduction (in the average) then we have no reason to assume that no monetary inflation of all prices has taken place. They have been inflated above their market level by keeping them artificially at their former nominal level! - J. Z., 29.3.97. - See : INFLATION, DEARNESS, PRICE INCREASES, GOODS SIDE, MONETARY SIDE.
ECONOMIC INTERVENTIONISM, REGULATIONS, DIRIGISM, CONTROLS,- CENTRAL BANKING: You can't try to control one side of an -economic system without screwing up some other segment of the -economy. This is because all economic phenomena are at some level- interconnected. - Jim Downard, TC131p40.  - Centralised and -monopolised banking screws up almost everything. - J. Z., 6.10.89.
EDUCATION VOUCHERS: I do favour education vouchers. Not those issued by governments to parents, to arrange for them the payment of the school fees of the schools they have chosen for their children, but education vouchers, in money denominations, issued by self-supporting private and cooperative schools, issued in payments to their teachers and suppliers and accepted by them in payment of school fees, as freely issued, soundly based and fast returning service money or service tokens. Naturally, they should also use a sound value standard which the acceptors of this alternative currency would prefer. To achieve a wider circulation for this school money and to promote the education of their school children better, they should also try to arrange for the part-time employment of their pupils, in which they are paid with this school money. That kind of practice might help most schoolteachers to come away from thinking only in terms of statist" solutions". Actually, when old but advanced teaching systems like Joseph Lancaster's "monitor system are used, where one teacher can indirectly teach, with the aid of his pupil-monitors, 1,000 children at a time, the education costs can become so low that the school children, by a few part-time hours of productive work a week, in jobs they have chosen, because they are interested in them, and paid only according to their productive contributions, would easily be able to pay their teachers, since the combined purchasing power of a 1,000 children is considerable. Naturally such a system presupposes an end to government subsidisation of schooling and an end to monetary despotism or the chance to ignore it safely enough in this sphere. Also compulsory school attendance laws should be abolished. The basic school skills, reading and writing can also be acquired outside of schools and under the monitor system and within such schools it would take usually only weeks to months, at most, to acquire them. It would be up to parents to insist that they acquire, somehow, in schools or otherwise, basic reading and writing skills. From then on, with some guidance and advice, their further education could and should be largely their own choice, following their interests and capabilities, and it could also be paid for by them. For this not only the school curriculum of the local schools should be open to them but all educational events outside the school system, via combined calendar for all such upcoming events. According to a recent study of pupils learning French, where class learning was compared with outside of class learning with some teacher involvement and independent learning, without any personal contact with teachers, using audio and video tapes and computers and educational broadcasting and having only a telephone number to contact a teacher by phone, if any problem arose, those pupils who had least contact with teachers, did best! - If child labour were not outlawed, taxed and subjected to red tape, children could probably work at many local jobs part-time. - J. Z.,16.5.97.
E-GOLD & SHOP FOUNDATION AND SHOP CURRENCIES: To the extent that redemption by the issuer is chosen, the value standard and the exchange medium functions are unnecessarily mixed up. (With legal tender paper money they are not only unnecessarily but injustly and despotically mixed up.) The essential cover for all currencies is not a stock of gold held somewhere and offered for redemption but their convertibility into goods and services. Shops can offer this much more directly and naturally for shop currencies issued by them and their associations than can bankers who have only gold stocks to offer for their notes. Moreover, no one else, unless he has contracted this with the shops, can rightly issue claims upon their goods and services. Shop currencies, issued by shop associations, do automatically stream back shortly after their issues, especially when they have only a predetermined and short term validity. Gold certificates stream back only partly and occasionally, in case of distrust or when metallic gold is needed, i.e., relatively rarely. That led to wide-spread fraud. Shop currency can also be denominated in gold weight value units - but without offering gold weight units as redemption goods. Only the redemption in goods and services would be promised that are priced in gold weight units and the issuers will always be obliged to accept their notes at par, regardless of their rating in the general market. That acceptance obligation for their own issues will keep their issues at or close enough to par with their nominal gold weight value - and would allow them to expand the issue of their sound currencies in proportion to their ready for sale goods and services, thus always keeping a balance between the goods and services they offer and the volume of their currency in circulation. Any small excess issues will lead to a temporary discount in general circulation and wide-spread refusals to accept them, while the issuers would still be obliged to accept notes at par which, at the same time, they could only issue at a discount. Thus they would soon stop issues. They would also want to preserve their business reputation and potential circulation sphere for their notes, which they could lose if they were careless in their issues. The reflux of their notes would be automatic, in payment for their the goods and services. They could issue them in payment of the own wage bill and other debts and also in short term loans, especially to factories and others suppliers, for their wage and salary bills, in the discount of their short term debt certificates and also in payments to wholesalers for restocking.  See under BANKING PRINCIPLE & REAL BILLS DOCTRINE & SOUND COMMERCIAL BILLS. All exclusive and forced currencies and gold redemption notes ignore the natural cover, issue and reflux options for currencies that are truly current for consumer requirements, for their daily needs. The value preservation function of notes can be secured otherwise, better and cheaper than by gold redemption. Competitive notes can be kept at par with their nominal gold weight value, redeemed in gold-weight priced goods and services, and used in payment of other debts so measured. Moreover, on a free gold market they can be converted into metallic gold - from the largest redemption fund of all, namely all the gold that is available on a free and world-wide gold market. But at any time only a few people are likely to make use of this opportunity, those who really need the metallic gold. - j.z., 9.12.00, 25.8.02.
ELECTRONIC DATA BANK ON MONETARY FREEDOM & MONETARY DESPOTISM: -For those not on line it should offer e.g. COM-fiche print outs -and print-outs on paper, by mail, at their prices.
EMERGENCY MONEY ISSUES DURING INFLATIONS: During the Great- German inflation almost every printer and numerous firms were- also busy issuing their own emergency currency, always counting,- until close to the end, in the continuously depreciated legal- tender paper standard. The private emergency issues were- permitted or tolerated by the authorities because of the- accelerating shortage of legal tender cash, even while the note- printing presses of the governmental ran hot, 24 hours a day. The prices -and sometimes wages, anticipating further inflation, rose faster -still than the note production.  In the end, the note-printing- costs came to 48% of the face value of the notes. Then a monetary -revolution occurred and the government was wise enough to put- itself at its head. All accounts reckoned in and transferred in -that very rapidly depreciating paper standard did, naturally participate in that depreciation. They should not be blamed for- it, but, instead, the government's central banking system, with- its inbuilt and intended (for war and deficit financing)  -inflation system. - J. Z., 3/97.
EMERGENCY MONIES: At least some illustrations to be included.
EMPLOYER UNDER MONETARY FREEDOM : The concept of the employer is -likely to change in the future, under monetary freedom. He will -then not only be considered as a provider of working capital,- land, buildings, machinery, raw material and organiser and- manager and supervisor of productive efforts, as a- publicist, sales person and advertiser as well, but, also as one who- either issues sound means of exchange himself, to pay his suppliers and- labourers and staff and his own profit with or who associates- with others, especially shopping centres, for the provision of -sound exchange media, as many as needed. Then he will also choose -one or the other sound value standard for his exchange media and- agree with others that it is used in pricing goods, services and labour. Today, under monetary despotism, employers have failed to- be employers for all the unemployed and under-employed. His job -as a distributor for products and services will be very much- facilitated. Issuing money tokens based upon them, is easier than- offering goods and services for sale only against a monopolised -and forced exchange medium. He will then appear, to that extent of his currency issues, as a cash--paying buyer in the market, instead of a seller, trying to get enough monopoly money. All his- issued notes will automatically and rather soon tend to stream- back to him, in payment for his goods and services (directly, or -indirectly, via his wholesaler and the retailers of this -wholesaler), for they have no other value. His notes will be- recognised as distribution, transport and sales tickets for his -products and services. - J. Z.,- 20.2.93, 23.4.97.
EMPLOYERS & UNEMPLOYMENT: Under monetary despotism and its mass unemployment caused by its deflations and inflations, "employers" have, to a large extent, ceased to be employers - with regard to the unemployed and under-employed and those paid subsidies to remain out of the job market. But the belief exists that a special group of people exists that somehow, miraculously, can provide employment to others. That these employers, in their turn, depend largely of a sufficient supply of sound exchange media is largely ignored. Animosities and coercion are directed against the employers rather than against the real culprit: the coercive and monopolistic central bank behind them, instituting and maintaining a system of monetary despotism and also largely of financial despotism. - J.Z., 24.8.02.
EMPLOYERS UNDER MONETARY DESPOTISM: They can "provide" jobs only -to the extent that the central banking system permits them and- their customers to do so. When the central bank fails in this task then the -employers and traders have to dismiss a percentage of their -employees, since they do no longer earn enough through sales, to -pay the wages of workers whose work they do no longer need under -these conditions of reduced production and reduced sales. Presently, -self-help steps, to overcome their sales difficulties, through -monetary freedom, are outlawed and usually not even -known to and appreciated by them. Like the workers themselves, -they have become victims of monetary despotism - and usually even grant it the sanction of the victims. - J. Z., 28.4.97.
EMPLOYERS UNDER MONETARY FREEDOM: Only under monetary freedom- are employers free to completely fill their niche as employers, i.e. to be- or become or remain employers for all those able and willing to work productively, even for the fractionally disabled, who, within their- limitations, could still be fully employed at whatever rates -their work efforts would still be worth. Already a single -permanently unemployed in an economy, who is able and willing to -work, shows up a condition of monetary despotism that reduces all- employers at least fractionally to non-employers and employed to -unemployed - or people who have to fear unemployment and thus put -up with jobs, conditions and wages that otherwise they would not- choose for themselves and would not have to. - J. Z., 28.4.97.
EMPLOYMENT & INDEPENDENCE: "If you can sell your labour then this gives you independence." - This is a popular view, which at first sounds plausible and has, indeed, more than a grain of truth in it. But is it the full truth on the subject? Firstly, when you can sell your labour only within the framework of an employer - employee relationship, then your personal independence in your self-supporting job activity leaves usually at least something to be desired, compared with various forms of partnerships, self-management, cooperative production or production by autonomous work groups. Secondly, when in times of mass unemployment, you can sell your labour only at emergency sales prices for labour and have to fear unemployment at any time, then your independence is also rather limited. Moreover, with the term "sell" all the difficulties arising out of monetary despotism are glossed over, namely that in practice it allows you to sell your labour and services only for the money of monetary despotism, not the money of monetary freedom. Thus your ability to freely exchange or to pay in a society of free exchange, is greatly reduced and with that your economic and personal independence - even while you may be very much better off than many other victims of this system are. - The terms and language that we use is often our worst enemy. The prevent us from seeing things as they are - and as they could and should be, at least for people interested in their rights, liberties & opportunities.- J. Z., 26.5.97.
EMPLOYMENT POLICIES OF POLITICIANS: Politicians are mad enough to believe that when they take much of our earned money (in form of their exclusive, compulsory acceptance and forced value currency) away from us and then give some of it back to us or our neighbours or countrymen, that then they are providing employment. They are still building "pyramids" and expropriate and enslave us for such public works. - They are also mad enough to believe that when they are monopolising the currency issue that then they can always sufficiently supply the whole economy with sound exchange media and that when they give it legal tender power (compulsory acceptance and compulsory value), which, in combination with the money issue monopoly, permits this  bad money to drive out all existing or possible good alternative currencies  that then and thereby they do provide the soundest, best-managed, modern, scientific, stable and also uniform national currencies and pretend to have reasons to believe to be proud of this "achievement" and the record it has, of deflations, inflations and stagflations, with mass bankruptcies, mass unemployment and an enormous spread of involuntary poverty. They blame everything else and everyone else but their money monopoly and legal tender power (their legalized central banks)  for economic crises. At the same time, they confess their helplessness before the crises their actions bring about and maintain. All their "cures" amount merely to more compulsory transfer payments, in which they get their undeserved large cuts. And we are foolish enough to go on voting for such fools or scoundrels again and again and look forward to a new set of them. At the same time, the distrust of politicians is larger than ever before. But that has not led enough people to take up the study of self-help options in spheres that economically, socially, politically and militarily matter most. - An old proverb says it all: For every tyrant a thousand ready slaves! - How can we achieve their monetary emancipation? How can we even interest them in such questions? The ball is in your court! - J.Z., 5/97, 16.9.02. - See: JOB LEVY, FULL EMPLOYMENT, UNEMPLOYMENT, POLITICIANS, EXPERTS, ECONOMISTS, TEXT BOOKS, INFLATION, DEFLATION, CRISES, LEGAL TENDER, MONEY MONOPOLY.
EMPLOYMENT, JOBS, WORK, LABOR, FULL EMPLOYMENT, EMPLOYEES: The number of jobs is not limited in a free economy, because the needs and desires of consumers are practically unlimited. But under monetary despotism the job numbers are limited by the effective, i.e., monetary demand for labor, goods and services, under that monopolistic and coercive system, which can never work as well as a free market system for money: monetary freedom. Under full monetary freedom, well enough known and consistently practised, the number of workers offering their services is easily exceeded by the monetary demand for workers, which would not only lead to full employment but also better paid employment, paid in sound currency. Then over-work will become a problem rather than under-employment or unemployment. But freedom of contract can cope with that, too, because unemployment is not to be feared by those who refuse to work overtime for still higher earnings. - J.Z., 24.4.02, 27.8.02.
EMPLOYMENT, STRIKES: Jobs need not be and cannot be rightfully -conquered, occupied and forcefully defended against competitors, no matter- how hard and violently one tries. Lastly the remaining free consumer choices -will defeat all such efforts. All one can achieve by coercive -intervention is not job creation but job transfers, from -unfavoured to favoured groups, e.g. from non-unionists to -unionists, from private employment into government employment. -Nor are jobs inherently scarce and limited so that one has to -fight for them, although the conditions under monetary despotism- do often give people that impression and the notion of a "fair" -distribution of the limited number of available jobs and various -forms of "job sharing" do remain popular. But jobs, under freedom, especially- monetary and financial freedom, can be rightfully "created", or rather- financed, as far as wage and salary payments are concerned, by- assuring the sale of their products and services. The products- and services themselves can then be monetised and exert a demand -for or purchasing power for labour. When there is no legal or -miseducational (prejudicial, ignorant) obstruction against -free forms of payment for productive jobs, via competing currencies and- clearing options, all usable to purchase daily wanted goods, services and labour with, then there will always be more jobs waiting than can be filled by -the available workforce. (Adding up all the goods and services that they would want to purchase, if they had the money for them, come to much more than they can earn in a day, a week or a months or even a year. And, since all these goods and services require labour for their availability, the need for labor is always greater than the quantity of labor that can be offered in a day, even if three 8 hour shifts as worked, or even in a week or a months. - J.Z., 8.9.02.) The desire for consumer goods and- services (including labour) is not limited and need no artificial stimulation, e.g., -by advertisements and miseducation. As free producers and -consumers all people can do their things for each other, under -free enterprise (including coops), division of labour (as- extensive as they want it to be and find profitable and enjoyable-) and freedom of exchange (including all monetary and financial -rights and liberties). Even much overtime 3x 8-hour shifts a day (to fully use the machine and building capital available) -by many to most employees, cannot produce at any time as much as-most people want to consume of the luxuries of life that can now -be produced and gradually acquired out of the proceeds of one's daily labours. The good living and the wealth that can be accumulated by productively working for 40 years constitutes, in essence 40 years of demand for one's labour.  The day's labour can supply only a fraction of one's own wants or of those of anyone else. Shortage of labor or the fullest possible employment is the natural condition of a free market - for people not prepared to beg, eat garbage, merely gather natural food - that can be very laborious, too or steal or rob from other people. There is only a limit to the quantity- of e.g. basic consumption, of e.g. food stuffs and clothing that one an consume, without doing harm to oneself. However, when the basics are secured by them, most people then do not want to sit -back and enjoy only these, and more leisure, but are prepared to- work more for increased qualities, advancing e.g., from a VW to a Mercedes,- from a track suit to a tailored suit, from a shack to a mansion.  There is no shortage of- jobs but an artificial and legally upheld shortage of exchange -media and sound value standards to pay for them. That can be -abolished by a stroke of a pen or by the acts of a monetary -revolution. Moreover, from the saved-up surpluses of greatly increased current production over current consumption, an unlimited amount of productive capital can be saved and soundly invested, as long as there are still any unsatisfied wants or needs that people are willing to work and pay for. - J. Z., 6.11.91, 26.4.97, 8.9.02.
ENCYCLOPAEDIA ON MONETARY FREEDOM AND MONETARY DESPOTISM: By now -all the nonsense said and written about money, currency, credit,- value standards, investments, savings, interest, note-issuing -banks, etc., could and should be written down, alphabetized,- computer sorted, and confronted with the correct observations, -theories and laws of money etc. that were so far found. Having a- few pearls of wisdom buried in all too much muck is not a good - enough help for most information seekers. - J. Z., 16.3.97.
ENERGY UTILITIES AS ISSUERS: How much better off would the -plants and distributors be (and the general economy as well) if- they gained the freedom to issue and accept their own oil-, -petrol-, coal-, gas- and electricity token monies?  Why should- they, too, have to depend the either inflated, deflated or- stagflated and always somewhat mismanaged note issues of central -banks, when their own service supply capacities could render them monetarily largely independent from currencies supplied by -others? - They, too, are considered to be powerful lobby groups.- Alas, they did not, so far, to my knowledge, lobby for monetary- freedom for themselves and others. - To that extent they, too, have granted -the sanction of the victims. - J. Z. 16.5.94, 22.4.97.
ENTERPRISES AS ISSUERS: Enterprises could contribute to full- employment and utilise their full production potential up to the- limit of their market and could widen this market to its optimum,- by issuing their own notes, in standardised money denominations -and using them in payment of all their expenses, at free market- rates. Their own obligation would consist merely in their- readiness to accept all their notes in payment for all their- goods and services, from anyone, anytime, at their nominal value. -For details see. e.g., Dr. Walter Zander's "Railway Money &- Unemployment", reprinted in PEACE PLANS No. 9. These enterprises -could pay their suppliers, dividends, profits and wages in their- own notes. Through retailers, wholesalers and clearing the notes -would come into the hands of those who could use the goods and -services offered - or have other debts to pay to the issuer - and- the circle would be closed. - J. Z., in AN ABC AGAINST NUCLEAR- WAR, in PP 16-18. (Now on microfiche in PP 16 &17 & available also via e-mail.) Not many enterprises have to make and receive- as many payments as the railways have to make daily. A single- small workshop could hardly do it - except in an emergency. See- e.g., the example of the Arnold print shop mentioned in John- DeWitt-Warner's The Currency Famine of 1893. But local gas and- electricity suppliers, petrol stations and gas companies could go -it on their own, if they are not associated with the local- shopping association as a local issuing centre. At least whenever- any kind of currency shortage is felt then each potential issuer -should issue notes, clearing certificates, goods or service vouchers, even labour warrants - in his payment sphere. - J. Z., 30.5.97.
EURO & CENTRAL BANKING: The Euro represents a still worse central banking and monetary despotism system because it is still larger than the various central banks it replaced. - J.Z., 3.4.02, 26.8.02.
EURO-CURRENCY: Once it becomes a forced and exclusive currency- for all of Europe, or even a world currency, then it will -introduce Europe-wide or even world wide deflations, inflations -and stagflations and mass unemployment. It will be -more constitutionally, legally, juridically and politically -upheld, with all its inbuilt flaws, corruption, waste, errors and- mismanagement, in the absence of less or any alternatives within or across -borders, so that monetary crises, too, will tend to become- enlarged and prolonged. - Just imagine the green back issue- pressure of the majority of underdeveloped countries upon the- developed countries. There would be less checks and balances upon monetary despotism than existed when it was nationally decentralized -among a number of territorial States. It would exaggerate and -tend to perpetuate all evils of central banking and make it still more centralised and coercive and mismanaged. Local conditions and the interests of particular payment spheres would be even less considered than they are now.  And, generally, the victims- would be blamed again, rather than the real offenders and- the offending despotic system. Just another aspect of state socialism is- involved, on a larger scale. A monopoly is not abolished by being -increased. (Curiously enough, at the same time, across the former iron curtain, precisely the opposite development took place, one away from a single central bank for all of the former USSR to a number of national central banks of the newly recognized territorial "nations".  Excess centralisation is not abolished by becoming -more centralised. Despotism does not become reduced but more -widely and uniformly spread by further centralisation. - The uniformity of means of exchange -and of "value standards" thus obtained would be too small a consolation for all the evils it would further increase. However, -if anyone or any group could manage to issue, administrate and -redeem, with wanted consumer goods and services, a Europe-wide or world--wide kind of money, one that is merely optional, market rated and can be- freely refused, I wish him good luck or success. Theoretically, a- world-wide clearing network could be established that would, e.g.-, use, a freely chosen value standard like grams of gold, for all -its clearing transactions and would not promise any redemption in- gold at all but, refer, instead all those who want gold, to the -free and world-wide market in gold. Such a system, if it remains -non-exclusive and not interfered with by national governments,- would be desirable. Competition to it would remain open. Even- better systems could still be established and numerous local- clearing centres could be independently provided and deal with- it, too. But I fear what national politicians would agree upon- and make a treaty about. That would be ignorance, prejudice and- vested interest in action against public interest and the rights- of every individual. - J. Z., 5.10.92, 14.4.97.
EURO-CURRENCY: Rather than introducing just one central banking- system for all of Europe, we should see to it that as many banks- of issue, and their currencies, could be established in Europe as -Europeans want to establish and use. The exclusive and forced- European currency will lead to even more economic crises,- dictatorships, and civil wars and racial riots and genocide -attempts, than the former national monetary- despotism did. Politicians, bureaucrats and their advisors are- so ignorant and prejudiced that they would rather increase than -abolish an evil - and then attempt to "justify" their actions and -to maintain them - for decades. Allowing free trade, free -migration, the free movement of capitals, freely floating- exchange rates, and economic freedom in general would have -unified Europe, to the extent that this would be desirable, much -more so than unifying its government and its currency. Gold- and- silver coins, in gram units, could also have "unified" the- value reckoning in Europe and some credit cards are already- accepted in payments all over Europe. There is really no need for -imposing any unified paper currency upon all of Europe except the -spleens and ignorance and prejudices of the political planners- for a United Europe, who have nothing better in mind and thus do -not know cause and cure for most of Europe's economic problems. -Thus they respond with expensive symbol building, like the -Pharaohs did with the building of the pyramids, never mind how -many people they had to impoverish or enslave to realize their -"great" building programme. Still the sheep follow their "great -leaders" into the sheering sheds and slaughter houses, because -they have nothing better in mind, either. - J. Z., 22.9.92,-1/5.97.
EUROPEAN CURRENCY: Economic hopes ride on single currency. - Headline in THE AUSTRALIAN, 5 May 92, of an article on European currency, by Wolfgang Munchau. That proposal is as irrationally hopeful and bound for disappointments as e.g. that of a single monarch or uniform or type of biscuit, bread, breakfast cereal, jewellery or shoes for all of Europe. Free trade can be realized without it and other wrongs of artificial borders can also be done away without it. Metric measures have unified Europe for a long time but haven't prevented any economic crises or wars, either. - J. Z., 25.3.97.
EUROPEAN CURRENCY: Free Trade in Europe does not require a -unified currency. Instead of reducing all European currencies to -one we should allow free enterprise and a free market for all- kinds of exchange media, value standards and clearing facilities -in Europe, i.e. we should multiply rather than reduce monetary- options, as many as a fully free market would be ready to accept- and maintain. - J. Z., 30.7.96, 18.3.97.
EUROPEAN CURRENCY: Monetary despotism does not become improved -by practising its monopoly and coercion on a larger scale. Since -already the centralised, monopolized and forced national -currencies lead to inflations, deflations, stagflations,- bankruptcies and mass unemployment and prolonged or perpetuated -them and remained unable to effectively substitute for local- private and cooperative competing currencies, how could we look- forward to a centralised European currency? Let those, who want it, -use e.g. full weight rare metal coins, in internationally -acceptable weight denominations, and credit cards and electronic- accounts in such weight units or any other value standard that -pleases them. Free choice and free enterprise for all exchange -media and value standards. Any enforced unification is wrong and -less efficient than self-help could be, in every sphere. It is especially absurd to try to introduce the communist centralistic -and monopolistic kind of monetary despotism in Western- Europe, on an even larger scale, after the fall of or loss of- faith in State socialism in Eastern Europe. The uniform -imposition of a criminal institution is no solution. - J. Z.,- 16.3.97.
EUROPEAN CURRENCY: Those who really want a European currency should be satisfied with freedom to coin and account in full weight gold coins or silver coins (or any other value standard they prefer) and in OPTIONAL & COMPETING private and cooperative paper note and clearing house  certificate issues that that are refusable, discountable, market rated, well publicised in each detail of their issue and reflux and tend to circulate, mostly, at par with their nominal value or close to it. They might also arrange for one such paper currency which all European governments would be prepared to accept at par in the payment of all taxes and dues to any government or governmental authority, e.g. a European railway or postal network and electricity and gas supply network. But to force any kind of "European currency" issued by some upon whatever limited cover or backing or reflux they can manage to establish for it, if any, and to give this "currency" a compulsory acceptance and value claim upon all goods, labours and services of the dissenters to it, will be and remain an absolutely despotic act and would, most likely, lead to even more and larger abuses than any of the European national currencies did.  - J. Z., 24.3.97 & 30.8.02.
EXCESS DEMAND HAS TO BE SHAVED OFF: Pop opinion by those in favour of monetary despotism. - First they put excess forced currency into circulation and then they artificially withdraw it, both with catastrophic effects. It is as if we were given unwanted and unneeded blood transfusions, which dangerously increase our blood pressure and then, suddenly, when our bodies have somewhat adapted to this intrusion, as best as they can, we are suddenly bled, against our will, no matter what this would do to our bodies in the short or in the long term. The best way to shave of excess demand would be to do altogether away with the money of monetary despotism, its beliefs, principles, lies and myths, its institutions, powers and legislative and juridical backing, its measures, programs, cures, reforms and actions and leave in its place full monetary freedom - and also the knowledge of how to make the best possible use of it. - J. Z., 29.3.97. - See: DEMAND, CENTRAL BANKING, MONETARY DESPOTISM, STABLE PRICE LEVEL, MONETARY POLICIES.
EXCHANGE MEDIA & VALUE STANDARDS SHOULD BE AS FAR AS POSSIBLE- SEPARATED, IN THEORY AND PRACTICE, EVEN WHILE BOTH ARE EXPRESSED- IN ALL EXCHANGE MEDIA: Otherwise most people do not understand -and cannot understand how the pricing mechanism applied to both, -and what effect it has upon the quantities available or issued. -That of necessity they have to be expressed in the same exchange -medium has all too often led to the wrong conclusion that they -are or ought to be identical, as if a transferable security could- not have several different characteristics or clauses. When both- are thrown together via legal tender or monetary prejudices, then -confusion and mistakes do inevitably result. One then tries to -limit e.g. the quantity of exchange media by the number of value -standard units available or imagines that changes in the quantity- of value standard units must affect the number of money -transactions that are possible and desired. One then remains -largely blind to the rejection mechanism that applies to both,- limiting their quantity and use, through voluntary acceptance or -refusal, acceptance at par or at a discount, all based on free- enterprise regarding their production and offers and on consumer- sovereignty regarding their acceptance, rating or refusal. To use an- analogy (limping like all others), let us take fabric and its -colours. Compare the fabric to the exchange medium and the colour -to its value standard. Obviously the quantity of textile colours- available should not determined the quantity of cloth produced and- offered for sale. Nor should all textiles be confined to use one- colour only - as in the "blue ants" totalitarian experiment in- Red China. Textiles could be multiplied without reducing their -value or the beauty of their colours. And a more extensive use of- one colour would not make that textile it is used on less -valuable. Both are needed. Both have their own laws regarding- their quantities and values and both are always used in combination. When more red cloth is produced then this tends to -be in response to market demands for it, rather than against it. -Both have their separate demand and supply effects and the -subjective value theory does apply to both. No one can be rightly -forced to acquire much more in textiles than he could have any -use for, nor should anyone be forced to choose only one colour- for all this clothing. Anyone should be free to use them in any- quantity he likes and in any combination. And if I like blue, -then my blue cloth is not diminished in my eyes or those of others, who also like it, because others may like red cloth and- produce and use more of it. And to force all to use in all their- economic transactions only one kind of cloth as an exchange -medium and one kind of colour as an exclusive value standard- would, obviously, be despotic and inefficient. Perhaps you can- and will carry this analogy or another further - but I do hope -that you have already got my drift. - Not even pure gold weight -units or agreed upon degrees of purity of certain gold weights, -should be turned into exclusive and forced exchange media and exclusive and forced value standards - except among the members- of volunteer communities, who favour such an arrangement and as -long as they do. Moreover, they should remain free to opt out of them. - J. Z.,-11.4.97.
EXCHANGE MEDIA AND CLEARING: Transferable certificates (etc.)-often merely FACILITATE free clearing but they do not change its -essential nature nor are they required for it. Even when gold- coins are used in transactions, then, as exchange media, they do- actually merely function (apart from their use for -jewelry and various industrial purposes, or storage-medium to preserve capital) as clearing tokens or signals, when, where and while -people know of no better and cheaper ones. - J. Z., 3/97.
EXCHANGE RATE CONTROL & INFLATION: "If one holds the foreign exchange rate stable, then inflation will be prevented." - Widespread error. - Compare PRICE CONTROL. Forcefully controlling an official exchange rate cannot and does not stop any inflation taking place. It can only obstruct it being fast revealed through its falling exchange rates. One might as well try to stop a fever by fixing the indication of a fever thermometer below the fever degree. - J. Z., 24.3.97.
EXCHANGE RATES, FREELY FLOATING, FOR INTERNATIONALLY TRADED- CURRENCIES: As long as the central banks of governments do- systematically hoard at least some foreign currencies as- "currency reserves", the more or less freely floating exchange -rates for foreign exchange are prevented from rapidly and- optimally fulfilling their function - even when not other -meddling takes place, like licensing, quotas and stabilisation purchases or "dirty floats" or "managed floats". This kind of -hoarding does also amount to an exchange rate manipulation. What -will happen to the international and internal purchasing power of- certain popular international currencies, like the U.S.A. dollar,- once, upon further depreciation of them, these vast currency -hoards in the hands of central bankers or private black currency -hoarders are suddenly liquidated, in panic sales, and appear as- additional liquid purchasing power on their home markets? - J. Z.,-18.10.87.
EXCHANGE, CREATIVE ENERGIES, ECONOMIC PROBLEMS, FREEDOM TO EXCHANGE: Motto: All solvable problems can be solved if the creative energies of all people are released for their solution. - J. Z., free after: Leonard E. Read of FEE. - Almost all economic problems can be solved, or solved much easier, once the exchange energies (or energy potentials or the exchange potential) of all people becomes fully released. - J. Z., 21.5.97.
EXCLUSIVE & FORCED CURRENCIES, PAPER MONIES, TRADITIONAL GOLD- STANDARD, 100% COVERED GOLD CERTIFICATES, EXCHANGE MEDIA & VALUE- STANDARDS: Both, legal tender in form of exclusive paper money -and gold coin circulation, as well as 100% or fractionally covered -gold certificates, do unnecessarily and misleadingly identify or -combine the exchange media with their value standards. They do- thus lead to a lot of misunderstandings, errors and wrong -conclusions on both, value standards and exchange media and their- effects upon each other and upon the economy. Instead, both ought -to be conceptually, legally, juridically, administratively and -practically separated from each other and subjected, as far as- possible, separately, to free market rating, voluntary acceptance -or refusals and discounting or pricing or rating, and full -publicity on all their details, so that market responses to any- changes in them can be as well informed and fast as possible and desirable. The -full monetary freedom potential, as well as the risks and dangers -of monetary despotism, can only be understood when both, exchange media and value standards, are -sufficiently and openly separated and then and therefore they can be -properly used and help in all voluntary exchanges, with each- being as little abused and mismanaged as is humanly possible. No- multiplication of value standard units should be allowed to- depreciate media of exchange and no multiplication of media of- exchange should be allowed to depreciate sound value standards.- Whenever that happens, then both have become wrongly and coercively- combined instead of becoming useful by keeping each other in -check, both being voluntarily accepted - and rejectable and both -being market rated, both against other value standards and- exchange media, as well as their own. Indeed, sound alternative monies would- EXPRESS & USE BOTH IN THE SAME MONEY OR CLEARING CERTIFICATE AND-ACCOUNT but they would at the same time also account them- separately. Exchange media could gain a premium on their standard -units, as Scottish Notes had over gold coins, and could also -suffer a discount against their standard (and other standards- and exchange media) if they had been over-issued or, -temporarily, if they are merely thought or believed to have been over-issued or -mismanaged otherwise. Any artificial and enforced par between them, any failure to distinguish between them, leads to troubles- and misunderstandings and false judgements, like e.g. the infamous-: "Mark is Mark!" - by which millions of German creditors were- defrauded by their debtors and impoverished. Legal tender for general circulation - not merely towards the issuer) is a legalized crime. So is any exclusive exchange medium. So is any enforced revaluation or -devaluation, any enforced decrease or increase of the "gold price"- and any legal restriction of gold ownership, gold trading and gold -accounting. Freedom to issue, refuse and discount. Free choice of- value standards and full publicity for both! - I consider this- topic to be so important that I rather compile or publish hundreds of- statements on this than none, all in the hope to somewhat promote -monetary enlightenment. -  J. Z., 26.9.92.
EXCLUSIVE AND FORCED CURRENCIES, GOLD COINS & GOLD CERTIFICATES & THE DESIRE TO BE PAID IN WHAT ARE SUPPOSED TO BE EXCHANGE -MEDIA OF THE HIGHEST VALUE AND WIDEST ACCEPTANCE, WITHOUT HAVING- TO SPEND MUCH THOUGHT & ENERGY ON HOW THESE AIMS COULD BE BEST- REALIZED. - Rare metal circulation currencies and certificates- developed naturally, in a way each can easily comprehend. This -model still predominates public opinion. Given a choice or a legal privilege, each will insist on being paid either in gold- coins of gold certificates or in "the coin of the realm" or a -paper currency that is exclusive and enforced over a whole nation, -imagining that it would be as good and as easy as gold payments- or gold certificates or even better. People want not only more -money, almost any kind of money, but also money that saves them- the labour of thinking and decision-making, the worry of initiative, enterprise and discrimination in this sphere. "Decidophobia" was an apt term- coined for it a few years ago. (Walter Kaufmann?) The wrong model of a -supposedly ideal and uniform and ideally managed or self-managed- simple currency, that everybody simply would have to accept,- simply spooks in most heads and has led to monetary despotism and -its catastrophes. People rather think and discriminate and- freely choose when it comes to their clothing, their food and drinks, their -music, sports and entertainment involvement, their cars, their -homes and gardens, but not when it comes to the exchange media and value- standard systems they are forced to use and those they could and- should substitute for them, in order to improve their situations.- In politics the over-simplified and thoughtless to primitive or intentionally misleading  models and terms -of statism have similar got their lives, liberties and rights- within their grip. They leave all too many decisions on their -lives to politicians and bureaucrats and imagine, for instance, that their -political votes would constitute THE right to vote, although it -largely disfranchises, expropriates, cheats and represses  them- via the "representatives" thus chosen. The underlying territorial- totalitarianism of democracies and republics of the present kind (and all other States) -is ignored as much as is monetary despotism with regard to our exclusive and forced currencies. We would rather choose between- hundreds of different drinks than between hundreds of different -monies. And even when confronted by problems like the continued- existence of ABC mass murder devices, we either console ourselves- with "thoughts" like "We never had it so good" or "There is -nothing I can do about it!". We readily accept experimental -freedom in agriculture, science, technology - but not regarding monetary experiments and for volunteer communities that are only- exterritorially autonomous. The wrong and over-simplified models -have us in their power. We grant them the sanction of the victims -and imagine we are good and responsible citizens as a result. -- J. Z., 25.12. 85, 3.5.97.
EXCLUSIVE CURRENCY, MONETARY DESPOTISM LEGAL TENDER & THE- LEGAL & JURIDICAL AUTHORITY FOR CREDITORS TO DEMAND "THE COIN OF- THE REALM" OR LEGAL TENDER, & IN CASE OF NON-PAYMENT, TO DRIVE A- DEBTOR INTO BANKRUPTCY, RATHER THAN PERMITTING HIM TO SETTLE HIS -DEBT THROUGH A CLEARING EFFORT: The legal authority of a- creditor to demand a particular exclusive means of payment from a- debtor is as pernicious as the authority for a debtor to pay in a particular coercive exchange medium. - J. Z., 30.8.74. - The right- to demand legal tender paper money or gold or silver, unless this- has been contractually agreed upon, should be replaced by the -right of creditors to demand only settlement via clearing, to the -full stated value of a debt, accepting in payment of that debt- any means of payment, including IOUs of the debtor, but only at their free market rating. In case of disagreements, that market rating- might have to be settled by arbitration. - This does, naturally, -presume that the debtor is still an able and willing producer or- trader, prepared to recognize and to work and pay off his debts with his goods, services or labor. -Otherwise, the faster he is driven out of business, the better. -All his assets should be claimable by his creditors and he should- never get out of his debts by his bankruptcy declaration. All his -future earnings should still be subject to the claims of his -former creditors. They might just leave him enough to go on- producing. - I do hold that the present bankruptcy laws do much- wrong - to both sides. - J. Z., 18.4.97.
EXCLUSIVE GOLD AND SILVER CURRENCIES & CURRENCY SHORTAGES & CURRENCY FAMINES : In relatively underdeveloped countries like India, as well as in relatively developed countries like France, much gold and silver was hoarded, in form of coins or jewellery, rather than circulating in form of coins or rare metal certificates.  That was motivated not only by lack of sound social insurance facilities and fear of taxes but also because of a perceived shortage of cash. And thereby this shortage of cash was increased so that labour and goods were often offered, in India almost permanently, only at emergency sales prices. In India the property sharing custom may also have been so strong that those with a large gold or silver coin treasure would soon have to share it with a wide circle of relations, who would soon have exhausted it. The same sharing obligation does not seem to have been extended to the sharing of personal jewellery. So they saved up rare metals rather in this form. Some writers have asserted that India could have been abundantly supplied with rare metal coins, greatly boosting its production and trade, if only this habit of investing in jewellery had been abandoned. But that would also have required a change in custom that respected private property claims and reduced hospitality obligations towards relatives. I do not know whether these generalisations are correct. India, more than most other countries, has a large number of diverse and customary societies. But from a country with much religious fanaticism, holy cows and pariahs, one cannot expect very much in form of monetary and general economic freedom, based upon the recognition and practice of basic individual economic rights.  They are little enough respected even in other countries that consider themselves to be progressive, advanced and enlightened. - J. Z., 15.5.97.
EXPERIMENTAL APPROACH TO FREE BANKING & MONETARY FREEDOM, -MISTAKES, GRADUALLISM, DEVELOPMENT, LEARNING CURVE, EXPERIENCE, -ENLIGHTENMENT: We must not, of course, assume that people will -at once act rationally in a new situation. But, if not by- insight, they would soon learn by experience and imitation of the -most successful what conduct best serves their interests. - -Hayek, Denationalisation of Money, 55.
EXPERTS QUOTED IN FAVOUR OF THE MONETARY CREATION HYPOTHESIS: -Many of the official and private supposed experts are merely, as- someone said, the high priests of this popular religion or faith- on money. And this faith is as diversified and as false as the -churches and sects and their belief and dogma systems are. Thus we do need, in the monetary and financial field, too, the- equivalent to religious freedom and tolerance, in form of monetary and financial freedom, not a merely a new and supposedly -reformed Catholic or other hierarchical, exclusive, despotic and- centralised system - upon the neck of every dissenter. Monetary- freedom means monetary panarchism. - J. Z., 3/97.
EXPERTS: See: ECONOMIC & HUMAN RIGHTS ASPECTS IGNORED BY MOST -MODERN AUTHORS.
EXTERRITORIAL AUTONOMY AND EQUAL RIGHTS FOR ALL VOLUNTEERS IN THE -MONETARY & FINANCIAL FREEDOM SPHERE, TOO: This is just one of -the practical applications of the general framework of panarchism-: to each the government or free society and thus also monetary- and financial (saving, investment, securities trading etc.) and- the taxing or contribution system of his or her choice. Single -taxes only for single taxers.  Before we get there we might have- to engage in a monetary and financial revolution and to achieve -that, we might have to engage in a genuinely cultural or -educational revolution first of all, making optimal use of all easily affordable alternative expression and information media,- like microfiche, floppy disks, text only CD-ROMs, audio and video-tapes and disks, e-mail, the Internet, free broadcasting, etc.,- all at their optimal strengths. - J. Z., 3/97.
EXTERRITORIAL AUTONOMY FOR ALL VOLUNTEER COMMUNITIES & MONETARY- FREEDOM, BASED ON INDIVIDUAL SOVEREIGNTY, -INDIVIDUAL SECESSIONISM & INDIVIDUALIZED, THAT IS, VOLUNTARY ASSOCIATIONISM: -Monetary freedom would be one of its many by-products or- part-realisations, since these volunteer communities could, among -themselves, introduce any monetary system or experiment which- they do prefer and as long as they do. Towards outsiders their- money tokens would be more or less appreciated and market rated -"foreign exchange". A territorially imposed, exclusive and -coercive money system (enforced acceptance and enforced value) -is the essence of monetary despotism. Volunteer communities might, indeed, adopt an exclusive currency and one that has legal -tender towards all their members. But since membership is- voluntary and they have no territorial monopoly, their currency- would still be an optional one. They could individually opt out- from under it and thus renounce it for themselves, at least for- all future contracts which they are undertaking. - J. Z., 10.4.97.
FAILURES OF BANKS OF ISSUE: One should use different terms for -different kinds of failures. Some banks merely failed to be able -to redeem all their notes at par upon demand and where, therefore, -legally and juridically driven into bankruptcy - but, lo and- behold, in some instances their notes still continued to -circulate at par - because there were enough outstanding credits -of the bank which the remaining debtors could readily pay with- the notes at par and this demand preserved the par value of these -notes. A single such case should have been enough to question, quite -generally, the need for gold convertibility by the issuer and to -insist, instead, on a sufficient cover of all notes by short-term -debts that represented real trades, like real bills, in combination with shop foundation for the notes so issued. (In competitions between facts and dogmas at least the popular dogmas often "win", i.e., get more support from the general public, the "experts" and the legislators, than the facts. Economics is still far from being a science, at least with regard to many of its schools of thought or certain of its subjects. It has its religions, churches and sects, its insistence upon faith and traditions as well as rituals, even when not at all backed by facts, natural laws and sound reasoning. - J.Z., 5.9.02.) The reflux -in payment of these debts can keep notes at par which were issued -in the discounting of such bills. The old practices of gold- certificates blinded most observers to this option or, just to be- on the safe side, they insisted then that both covers be provided -- and that was not always done and then "failures" occurred which -in reality were not failures. - Other "failures" can, naturally, -arise due to inflations of a government's forced and exclusive- currency, which can partly or completely destroy assets expressed in and repayable in it. Other failures arising out of monetary -despotism are due to its deflations, which can drive otherwise -sound enterprises into bankruptcy and burden the remainders with -taxes to keep masses of unemployed alive. - Other failures are -all too predictable, e.g. when "assets" like real estate or -railways, or buildings or speculatively withheld commodities, in- their warehouse certificates, or even government debt -certificates, are monetized, i.e. confront the current output of- goods or services, without the issuers having provided- any additional goods and services, that provide the immediately claimable equivalent or backing of these issues. Then only monetary despotism can -force the ones providing the real cover (in consumer goods and- services) to provide it and prevent them from monetising it- themselves, directly and fully, for their own benefit, instead of providing -an enforced value for the monies of monetary despotism, which- pretends to be covered by other assets. Sometimes the issuers are- cheeky enough to assert that their issues are "backed" by the- labour and productivity of the nation - but without explaining- what right they do possess to issue such assignments upon it and to -prevent the owners of the goods, services and labour in this -nation to monetise their own assets themselves. - All real capital- assets (I do not consider present and future tax slaves as such-) are gradually built up out of savings of current turnovers of consumer goods, services and labour and they do make possible a -much larger total of production and consumption of consumer goods- and services than would be possible without them. But that does -not mean that their accumulated capital value, invested in real and long lasting assets, is at any time and -in any country the equal to the present consumer goods and- services - when it comes to monetising assets. Capital assets can be cashed in only within the limits and changes of the capital market. Real cash is already real cash. It does not have to be first transformed into cash. With it one can immediately purchase daily wanted consumer goods and services. One does not have to sell, for cash, a house, factory, farm or business first. If one tried to express these huge capital values not -in capital securities, to the- extent that they are profitable or still valuable, monetising them at- once and completely, and, provided all the potential acceptors would not hesitate to accept all such "money" at par, then the current offers of goods and- services would suddenly be confronted by a much larger -circulation of money tokens. If these were optional and market--rated and no one but the issuers would be obliged to accept them (for square feet of land, factory or business space or bricks or rails?) they would soon become greatly depreciated, while soundly-issued and thus widely accepted currencies, those with shop or at least tax foundation, would remain stable. All stable -pricing and accounting of debts, wages, rents etc. could- continue. The asset currency, greatly depreciated, would simply give some investors the chance to buy up the capital securities that are their "foundation", and the real capital assets, which they represent, very cheaply. But even that would take time. It would not immediately withdraw all of this "asset currency" and restore it to par by taking it out of circulation. (Assuming that it had ever managed to achieve a wide-spread par acceptance.)  But, if such an "asset currency" were given exclusive- means of payment status (like that based upon governmental "insecurities"), forced acceptance and forced value (-legal tender status), i.e., alternative currencies and sound value -standards would be outlawed, then a failure of such banks would- be inevitable. This failure would be expressed in inflations, deflations and stagflations, often and for long with high unemployment and business failure rates. - What are good securities for capital assets are -not good securities for currency issues. Nor are the capital -assets themselves good securities for currency issues, although the capital securities - and the real capital assets behind them, can be used to satisfy the investors in a failed savings and loan bank. They are not good enough securities for its current business, conducted in its banknotes. Alas, both kinds of securities, the turnover credit securities as well as the capital investment securities, are marketable, both have some value, both can, normally, be -turned into purchasing power, although at different degrees of immediate "liquidity", and so one concludes, all too often, -and quite wrongly that capital equals money equal currency in all cases, or even that capital could form a suitable, good or even the best possible security (cover, reflux, value guaranty, acceptance or debt foundation) for- currency. Ask yourself about your own rights as holder of an -asset currency note towards the issuer of that asset currency -note: What fragment of his capital values can you directly and immediately claim -from him, now, with his note in your hands. He does not want to- sell you a brick from the foundations of his house or a tile of -his roof or a window pane. No, he wants to direct you to others,- who, he thinks, should give some real purchasing power to his -notes for you. But then, why should they, if they are not legally forced -to do so? And if legally forced to do so, then their supplies of- consumer goods are the real cover - and they are robbed of them, receiving only scrip to shares, bonds or mortgages, far beyond their ability and willingness to invest in them. -Such "money" has only the advantage of being legally authorised to rob -others, likewise, once one has been saddled with it. Thus a mutual plunderbund is established, -mainly for the benefit of the issuer of an unsound, monopolise -and forced currency, issued under false pretences - of which the -literature of economics and lectures on money and banking are- still all too full, in all countries and even the minds of the majority of "money reformers". - Today, when central bank's -issues are no longer directly tied to their gold stocks, nor to a -gold accounting or gold clearing standard, the only exclusive and -forced currency in existence is the government's legal tender -paper money. Thus all the kind failures that happened due to the- convertibility obligation of an issuer to redeem his notes upon demand- in gold, because the law or public opinion demanded such a -redemptionism, is now replaced by the obligation for debtors to supply and -the authority of creditors to demand legal tender in payment of all debts, -rather than possessing merely a right to achieve or to provide a settlement by clearing. Only the central bank can,- via printing or printing in advance of requirements, multiply or -increase its legal tender cash issues. But it, too, is somewhat -tied to laws and regulations, based on slow decisions by -committees, which are based, if on facts at all, then often on all -too slowly available statistics or flawed statistics. Thus their response time to -additional cash demands is slow, often too slow or their response -remains inadequate. Moreover, once they put additional notes into- circulation, they would tend to stay there and with their legal -tender and exclusive currency status, they would tend to drive prices up, -permanently. Any kind of optional additional ticket money or- goods and service vouchers, on the other hand, could not be -issued beyond their requirements and due to their inbuilt reflux-arrangements, they would rapidly disappear from circulation -again and be replaced by new and sound issues of this kind. Furthermore, since they are not legal tender or an- exclusive currency, they could not drive up prices and wages- reckoned in sound standards. Already upon slight discounts - not- affecting most retail prices and wages, they would be widely refused and thus sped- up on their way back to the issuer, via the remaining debtors of the issuing centre. - Alas, banks that have often- failed and often had to fail because of their construction, their -issue and reflux policies, are legally upheld and the fail-safe -banks have been outlawed. For this give thanks to your -politicians and their official advisors and to all too many voices -and texts of academic economists - and to the majority of money-cranks who are even more rabid in their demands for exclusive -greenbacks or forced currencies, than governments are, who are -rather hiding their shameful acts or do not like to publicise the legal -backing of their monetary despotism and the consequences which it- inevitably has. Not one in a thousand academic economists is free- of monetary errors and perhaps not one in a ten-thousand or -hundred-thousand monetary cranks is. The few sound teachers of -monetary freedom are thus easily condemned, as if they were real "money-cranks". E.g., -Hayek, of all people, condemned, of all people, Prof. Heinrich- Rittershausen as an inflationist! - I pointed out this error personally, in a short interview with Hayek, some years before he -died, but, to my knowledge, he never retracted his utterance. - He was an excellent -scholar, indeed, in many respects. Nevertheless, he came across -only very few monetary freedom writings and misjudged even these -and with his remaining research and writing tasks, he did not- even have the time to follow the academic debate that followed- his 1975 & 1976 monetary freedom writings. At first he imagined- even to have been the first academic economist to have advocated- monetary freedom and he never fully realized how many -predecessors he had or admitted that people like Pauline Russell, -Richard King & Robert Carnaghan had pushed him, in public -meetings in England, in this direction. - So, how much can one -expect in this respect from the average economist or politician-, banker or voter? Much less, very much less, as a rule. - J. Z., 11.4.97, 5.9.02..
FAIR GO: Let people issue their own money and choose their own value standard and let them sell their goods, services and labour for their own issues. - J. Z., n.d., 9.5.97.
FALLEN & FALLING PRICES: Fallen prices must not be mixed up with- falling prices. The former tend to encourage buying and reduce -hoarding. They usually originate at the goods side and lead to -corresponding additional turnover, to new orders and employment.- The later tend to deter buying and lead to deflationary hoarding, -sales difficulties, bankruptcies & unemployment. Moreover, the -former tend to fall step by step. according to developments on the- goods side (e.g., technological improvements). The latter tend to o-ccur more generally and evenly because they are due to a- deflationary money shortage. This difference may be statistically indistinguishable but it is of great economic importance. Because -of this distinction price levels cannot rapidly enough adapt to a -deflationary reduction in the money supply - contrary to the -expectations and predictions of most economists of the Austrian- School of Economics. - J. Z., 77 & 97.
FAST & EASY & SOFT MONEY: While governments, through their central bank and its printing presses, , can get their kind of "money" fast and easily and it becomes soon a "soft" money, of diminishing value (due to its legal tender monopoly status, which make over-issues possible and easy, it remains often hard to obtain for all who are not in working in the "public disservices" or are other moochers and parasites or bought or subsidised groups of voters. Those who are not part of the government's budget expenditures might not get any of the government's money fast and easily, not only in credit applications but also when they struggle for it, with their goods, labor and services, in what remains of the free market under monetary despotism. "Hard money" may originally have been a careless use of words for metallic currency, ignoring the fact that for a long time governments had reduced the gold and silver contents of their coins as well, thus turning them into "soft" and "easy" money. Moreover, it ignored that gold is one of the softest metals. As soft money was considered, probably, without sufficient discrimination, all paper money, not only legal tender paper money but also all paper money not redeemable in metal, regardless of whether it was otherwise sufficiently secured and stabilised in its value. - While government is easy to obtain for governments and easy to spend for them, it is not so easy to obtain for members of the "private sector". And when private people invest it in loans they might get it back only nominally, in inflated form, which makes it rather hard on the creditors and only somewhat easier, not very often, to debtors. (Soon they will find such loans harder to get.)
FAULKNER, American monetary theoretician, favouring free banking?- See: ECONOMIC & HUMAN RIGHTS ASPECTS IGNORED BY MOST MODERN- AUTHORS.
FEDER MONEY: See: APHORISMS ON THE MONEY PROBLEM.
FEDERAL FUNDS: A typical statist and political misnomer for -funds robbed from individuals and their voluntary associations and then wastefully -and dishonestly spread among the vast number of favourite federal -programs and their favourites, as determined by the election interests of the politicians spending the proceeds of these robberies, of what is left of them after they had first looked out, directly, after themselves. Federal or State "funds" are the accumulated "funds" or treasures of professional robbers. - J. Z., 4.7.93, 24.4.97, 8.9.02. - See : SPENDING, GOVERNMENT -SPENDING, VOLUNTARY TAXATION, TAXATION.
FEDERAL RESERVE SYSTEM, CENTRAL BANKING & INFLATION: In the 124-- year period of our history, before establishing the Federal- Reserve, prices rose only by 16%. In the 70 years since, prices -have exploded more than 1,000%. - Prof. James L. Green, MM, 1986.
FIAT MONEY: Fiat money - money with no backing, whose acceptance- (and fictitious value! J. Z.) is mandated by the State..." - -David F. Nolan, LP News, March 95. - Most overlook that fiat -money can have tax foundation, even a sound tax foundation, if -one presumes that any compulsory taxation can be sound. Voluntary -contribution or subscription based money is also possible, for -voluntary societies. Is an IOU, readily accepted, representing a private and mere fiat currency or is it an obligation binding- only upon the issuer and accepted only because of that? Those who- cannot imagine any other but a rare metal backing as possible or -honest or trustworthy enough, do either lack imagination or -historical knowledge or theoretical understanding of the- alternatives to government fiat and even the great varieties that- occurred among currencies issued by governments. To equate legal- tender and monopolised paper-money of the State with private and -optional paper monies, that are kept at par, under free market rating, with -their nominal values, and call both mere "fiat money", indicates -lack of knowledge of what one is talking about. Without legal -tender a unilateral fiat attempt or offer by any issuer does not -have to be accepted by any potential acceptor. It takes two to -dance tango. Any contract requires at least two participants -agreeing with each other. It takes an issuer and an acceptor. -Neither can command the other unilaterally and without consent. Neither can "create" a fictitious value and force the other to -accept it. The term, as usually used, is not enlightening but,- rather, misleading. - J. Z., 3/97.
FIAT MONEY: It is "money" unilaterally and either legally or- juridically declared to be money, regardless of its substance or -foundation, backing, cover or reflux arrangement and the -soundness or unsoundness of its value standard, by an order, -command or legal authorisation. Only governments have the power and a -strong motivation to do so. The victims, all debts, including all- employees and pensioners, are not asked for their agreement or consent about this, not even in the supposedly self-governing- democracies and republics or constitutional monarchies. The form -which this fiat usually takes is legal tender legislation, -accompanied by privileges granted to a government-favored -bank, which in turn is forced to support the government, or even -to an exclusive issuer, a central bank, all to rarely questioned- since it was proposed in the communist manifesto of 1848. Most -critics of it consider only the fact that most fiat monies are- not convertible into rare metals and forget about the other part -of the definition: "Money  (such as an inconvertible  paper -currency) which is made legal tender by a fiat of the government." - Shorter Oxford English Dictionary. There would not -be much point for a government in making its paper money legal -tender if it is still fully convertible into gold. But it has a- vested interest in having its money, compulsorily accepted and this at its face value,- in the absence of any sound foundation for it.  Otherwise it could be -freely discounted or refused. The decisive -point about the fiat money is its legal tender. Anything without -legal tender is simply not a fiat money but can exist only on its- own merits, with or without any gold backing or gold accounting. - The fiat makes it a unilateral not a contractual act. In Don- Werkheiser's terms, it is a "single convenience" rather than a "-mutual convenience" relationship that is thereby established. If a- genuine gold coin or gold certificate currency with 100 %-convertibility at any time and 100% cover were made legal tender -then this might clarify some juridical fine point but it would- hardly be necessary. But when a currency is not made out of rare metals or redeemable in them and not even covered by them, then, like any other goods or service in the market, it does not have a -fiat value but only a market value, depending upon its voluntary -acceptance. Precisely here the intention and practice of fiat -money sets in. Not by the abolition of cover and redemption but -by turning it into a forced value or forced currency with a -fictitious value that is, usually, far above its market value and -which also permits the government to go on taxing its subjects -more and more via the inflation tax - which also boost returns -from other taxes, at least until the inflation becomes- galloping. A gold or gold certificate currency, when not legally- declared to be an exclusive currency, is rightful and harmless-, even somewhat beneficial, for those who can afford it. Those who -can't afford it are not helped by it. But they can still use it- at least as an accounting or clearing unit for their own gold-less -transactions, without possessing a single gold coin, far less a- gold reserve. It is also harmless to declare a gold currency to -be legal tender, as long as it is not declared to be an exclusive -legal tender, i.e., as long as people remain free to pay and- account while using other standard of value units. Forcing those who believe that they have some -reasons or sufficient motives for hating gold, to use gold- nevertheless, might be considered as an infringement of their -religious liberty. Perhaps the error on fiat money arose because- the repeal of convertibility and the introduction of legal tender were often coming close together, or were even introduced at the same -time. Those imagining only rare metal money as real and desirable -money and never having thought about alternative monies, -privately issued and without legal tender but market rated -instead, tended then to condemn all paper monies and inferior -metal coins as mere fiat money or fictitious money, regardless of -whether they were legal tender or not. Even now very few -textbooks on economics get the relationship between legal tender- and Inflation and Gresham's Law right. A currency that is neither -made out of rare metals or convertible into them and that does -not have to be accepted and if accepted has not to be accepted at -its face value but may be freely refused or discounted or market--rated by all potential acceptors - the issuer excepted  (for he -must accept his IOUs at their face values, in accordance with -basic principles of justice) - is thus not part of a despotic or- command economy with unilateral fiats but part of a market- economy. People may doubt whether in a market economy anything not -made of rare metals or redeemable in them could successfully- exist and compete against conventional gold standard currencies.- But they cannot rightly say that that if they existed then they -would exist merely by a fiat, a unilateral say-so. Here,- too, it takes two to dance tango. The alternative market money,- without legal tender power, may have some other foundation than -rare metal and redemption in it at any time by the issuer, -whether the gold bugs understand that foundation or not. As long- as it cannot be unilaterally, juridically and legally forced upon -them or other dissenters, they cannot correctly call it a "fiat -currency" although they like to slander it as such - because of- their lack of understanding. Market money can be issued, offered and accepted -as real value tokens or certificates only when and if the issuer obliges himself or- herself to deliver for it, upon demand, not rare metal (That- particular promise might and usually should be explicitly excluded!), but something which most- participants in a free market need, want and are willing to pay -for, namely and especially, consumer goods and services that are in daily- demand. E.g. the money issued by a shopping centre or department -store, a bus company, power plant, a net of petrol stations, etc.- Such ticket or token money is obviously not unilateral fiat - at- least not towards others. It only unilaterally obliges the issuer -to accept it at any time at its face value. The issuer obliges -himself thereby. He does not oblige any potential acceptor to accept it - -except by individual contracts. He might e.g., insist that his debtors accept his tokens at par as long as they owe him money -and their debts are due or close to due, so that they can simply- pay off their debt at par with his tokens. But a unilateral and- coercive action towards others, infringing their rights, is not -involved. It is not "fiat" money but, rather, a responsibly issued real money, representing real and wanted values. Any form of IOU, to have a value, without- being a coercive requisitioning certificate by a government (one with -legal tender powers and an exclusive position), requires voluntary acceptance and market-rating and obliges only the issuer. Thus it is NOT fiat money. It- obliges only the issuer to deliver his goods, services and labour- for it, upon presentation, up to the amounts involved. To call-s such money "fiat money" is an abuse of the term. But to- government paper money, given legal tender powers in general-c irculation and also the status of an exclusive currency, it can -be rightly applied, especially, when it is neither made out of- gold nor convertible in it. But that is the whole point for the -government in giving it legal tender and the money monopoly. -Nevertheless, we should also consider that even the worst kind of- government fiat paper money has still got a limited foundation, -namely tax foundation. You can get rid of it by paying your tax- burden with it. To that extent it is then still having a -foundation, a clearing foundation. In the best case, the taxes- would be determined in weight units of rare metals, used merely as value standards and accounting units and the tax--foundation paper money would be accepted by the government at its -face value in rare metal weight units, regardless of how low- these units this paper money would have sunk against their rare metals in trades in general- circulation and on the rare metal markets. Such degree of honesty, within a system of imposed -tributes, could establish a self-limiting tax foundation paper -money issue, reckoning in rare metal weight units. To function -well enough, its legal tender must then be confined to the tax offices. It must not be given any in general circulation. If it has -legal tender and tax foundation, then it is fiat money towards -those who do not have tax debts to pay taxes to the government. These can -then only make indirectly some use of the tax foundation by using- such paper money to pay those who do "owe" the government the- tribute it extracts from them. One should also concede to this -kind of "system" that the government, by its education, -propaganda and slogans, has established at least a pretence of -representation, self-government, voting and consent to taxation -as well as to the inflation, deflation or stagflation "targets" a government- engages in or has even openly proclaimed. Only towards others than the tax payers does the legal tender paper money become, quite obviously, a fiat money. Their only escape is -then to use such paper money to pay some tax payers with it, for what they have to offer, and thus to get rid -of it and get something of value in return. - There are two aspects to "fiat money": The one is its "compulsory acceptance" The other is the "compulsory value" or- fictitious value given to it. In combination they form a "forced" or "legal tender" currency for "fiat money". If people remained free to discount -it to zero, or to refuse it outright, then it would obviously not be effective legal tender money or fiat money. Imposing a- fictitious value standard and forcing people to accept it at face -value, or "at par" with its nominal value, on the "principle" that "Mark equals Mark" and "Dollar equals Dollar", no matter how different the values of Marks and Dollars -of different issue and indebtedness dates really are and were, -turns a money quite unilaterally into fiat money and causes all the -wrongs and harms of inflations, deflations and stagflations and their serious consequences. These are some of the facts and- truths on the matter which are usually ignored by gold bugs in- their oversimplifications and generalisations and oversights. -They are partisans of a particular monetary scheme and one has to -listen to all their opponents, too. Otherwise, we would allow -them to throw out the child with the bath water. - J. Z., 3/97, 29.8.02.
FIAT MONEY: The term is all too indiscriminately applied to- all, even contractual and well founded alternatives to rare metal- coins and certificates, as if all the alternatives were equal to -the forced and exclusive paper currencies of governments. The -SUSPENSION OF GOLD REDEMPTION should not and need not, by the -nature of things, and according to common experience and based- upon basic rights and liberties, restrict other desired- exchanges, exchange media and value standards nor should these- alternatives be outlawed, taxed or regulated or controlled by any- coercive institution, least of all by any government or its- central bank. - J. Z., MFNL 3/4 & 8.4.97.
FIAT MONEY: This is not a very enlightened and enlightening expression and frequently abused even to condemn honestly contracted alternative exchange media and value standards, even gold accounting and gold clearing currencies, just because they use paper and not the "currency principle" advocated by the "gold bugs", as supposedly the best or only possible and honest one. This in spite of the fact that even an exclusive rare metal currency is the result of contractual and market appreciation and acceptance of a value standard and exchange medium and that gold was not and is not so appreciated and accepted at all times in all countries and was hardly used at all by some people for much of their recorded history. E.g., Aborigines traded all over Australia in some items but, to my knowledge, never used gold as their medium of exchange or value standard, although, by now, Australia is one of the largest gold producers and even very large gold nuggets are still found close to the surface now and then. Enemies of fiat money may believe and predict that non-convertible (by the issuers, into rare metals, upon demand) currencies could not possibly be issued and accepted and circulate and finally stream back to the issuer, all at par with their nominal gold weight value, although they do not promise any redemption by the issuer in gold. But they have no right to usurp monetary legislation in any country and outlaw what they do not believe in, while they should be at liberty to refuse for themselves and not to issue or accept for themselves such alternatives. Gold bugs even ignore that cheques do mostly circulate at par with their cash value in legal tender paper money, although cheques are not legal tender and are themselves not convertible now into gold, nor is the legal tender they are based upon - except, for both, on whatever exists still or again of a free gold market. - I predict that under full monetary freedom "as good as gold" paper currencies, not redeemable by the issuer in gold but only on the free gold market, in free purchases there, and circulating (normally and at least locally) at par with their nominal gold weight values, will drive most gold coins and gold certificates out of circulation, as well as paper tickets would drive out most tickets and vouchers made out of gold medallions. Gold coins and gold certificates are not the only kind of alternative currencies that ought to be quite free to compete against the monies of monetary despotism and to attempt to drive it out of circulation. - To the extent that gold coins and 100% or fractionally covered gold certificates are a good enough, sufficient and popular alternative currency, they would not need an official status as an exclusive currency and legal tender power to be widely enough accepted by those who like them. To force such currencies upon people who have a more or less rational or irrational and even religious aversion against gold, would be an unjustified cruelty towards them, somewhat like forcing vegetarians to eat meat, because it would be, supposedly, good for them. Monetary freedom is not just for gold bugs - or for money cranks. Under full monetary freedom all kinds of paper currencies could somewhat circulate, at least locally, at least among groups of their believers or contractors, at par or close enough to par with their nominal values. Moreover, all people would then be free to adopt any kind of clearing method that would render them independent altogether from any kind of cash and its supply, although they would still have to agree, among themselves, upon whatever value standard they would use in their clearing transactions. They would consider it as absurd to demand that they must confine their clearing transactions to those, in number and values, which they could fully or fractionally "cover" with a rare metal hoard of gold coins or gold bullion?  They would not believe that such sacrifices are necessary to a god in form of a golden calf or holy cow. Nor do they subscribe to the mercantilist nonsense that is involved: First let us acquire a gold treasure, the larger the better. Then we will be able to trade freely, as long as we keep it. - Mind you, I still consider gold weight units to be very good OPTIONAL VALUE STANDARDS, but I hold that they would be QUITE INSUFFICIENT as EXCLUSIVE EXCHANGE MEDIA. - Just try now, to confine all your trading to those exchanges that you can manage to arrange when paying or being paid exclusively in gold coins or gold certificates, on the open market or in the underground economy. As an anarchist, libertarian or freedom lover you should not insist that the government introduce an exclusive gold coin and gold certificate circulation and value standard system for you. But, by all means, join or imitate Antony Hargis & Co. and trade in this way as much as you can, among like-minded people. That is your right and no one has the right to suppress your transactions or to confiscate or tax your gold. It is also true that most governments are unable or unwilling, most of the time, to turn their kind of paper money into paper money as good as gold, i.e., to give it a par value with gold weight units, when they pay their debts with them, in general circulation and when receiving it back in payment of taxes. As exclusive and forced currencies their currencies are mainly mere fiat currencies - apart from their tax-foundation and their taxes are mainly imposed ones. Proof: They rarely subject their introduction, continuance and height to any referendum. Your consent to them or dissent against them gets somehow lost via your supposed "representatives" and "public servants". The term "fiat money" is as much abused as are the term "cheap money" and "soft money". - To come closer to the realities that are possible and desirable, think in terms of "ticket" money, competing currencies and free choice of value standards, rather than in terms of monetary despotism, which tends to make people overlook, as already Marx pointed out, in one of his few truthful observations, the inherent and natural laws of money. - No freely issued and accepted and stable currency deserves the slur or slander of being merely a "fiat" money without any sound foundation, a fraud or deception, a kind of requisitioning certificates like state paper money usually is. - Each exchange medium issued or offered for exchange and each value standard offered are to be judged by their merits, by those who could readily issue them and those who would readily accept them, not by those who would dogmatically condemn them as mere "fiat" money and would refuse them. The Austrian economists point out the subjective value theory in many respects. Why don't they apply it here, too? - Not even their supposedly ideal currency should ever be allowed to become a forced and exclusive currency - except among themselves. - J. Z., Nov. 88, 15.5.97.
FICHAS OR CANTEEN OR STORE MONEY OF MINES IN CHILE: How does one -establish a bank of issue in the wilderness? What are the minimum- preconditions for it?  - For example, modern mines, established- by foreign companies in remote areas of Chile, where a ready -workforce may not have existed or only some subsistence economy -villagers and while the government of Chile practised only -central banking, with all its flaws, had to consider attracting,- keeping and paying their employees in alternative ways. They did- so by providing very well supplied canteens or general stores,- with much more choice in competitively priced consumer goods, than existed in local stores. They kept these shops well stocked- and, although nominally paying them in government paper money, -allowed wage advance payments or small credits payable in- warrants upon these stores. These private means of payment were -called "fichas". The total of these advances and credits were later, but soon, deducted from their paper money wages. Thus the workers had- a wider choice of consumer goods than they would otherwise have -had, at lower prices, too, and the firms had their suitable wage -payment means. Otherwise, their workers might, e.g., have had to- travel long distances, to reach a town and many might there have -e.g. drunk or gambled their earnings away or would have been robbed and not returned at -all. No one was forced to accept these "fichas", anticipate his -paper money earnings in this way or take out small loans in these -media - but many to most preferred to do so. It gave them a- better lifestyle than they had before and the minimum transaction- costs. This practice went on at least for decades in the 20th century. I do not know to what extent it is suppressed now nor- whether e.g. the government's paper money was also accepted at these canteens or employer's general stores and at what rate, if it was severely- inflated. - Ideally, the workers should have established a- consumer coop and issued these fichas themselves, in loans to the -employer, for wage payment means, taking in exchange the bills of -the recipients of the ores produced at the mines. And with these -they could have restocked their consumer coop stores through wholesalers in Chile, just like their employers did for their canteens. - J. Z.,-6.4.93, 27.5.97.
FINANCE PLAN OF PEACE PLANS 19 c:
FINANCIAL FREEDOM, PRIVATISATION VOUCHERS: According to Radio -Moscow, 13.12.93, privatisation vouchers were then traded on the -capital market. - Ideally, they should have been either evenly -distributed among the population or to taxpayers, in accordance- with the tax burden they have born for, let us say, the last 10 -years. See my proposals in PP 19C: Let Freedom Pay Its Way. I do -not know of any country which has fully used the potential of the -issue and distribution of privatisation vouchers in order to -achieve privatisation fast and for the benefit of all or most- citizens. - Even the communists and socialists could have- favoured such a scheme - because it would have enabled them to- combine their individual shares in the public property to provide -with them whatever public services they would want to provide,- either only for their own and exterritorially autonomous- volunteer communities or on the general free market. - J. Z.,- 13.12.93, 30.4.97.
FINANCIAL FREEDOM: Freedom of issue, free market rating, free -transferability, freedom to refuse to buy certain "investments" -at all, e.g., government "insecurities, and completely free and "-well publicised trade in the financial sphere, would be the- equivalent to monetary freedom in the monetary sphere (exchange -media or currencies). It would permit the free accumulation, -utilisation, transfer and combination or separation of productive -capital in every economic sphere as voluntary owners, traders,- investors and producers would require. - J. Z., 25.4.97. - Both, monetary freedom and financial freedom require not any imposed value standard, not even if this is the best one ever found or proposed, but, rather, freedom of choice for individuals among all the value standards, for all their contracts. Not even an ideal value standard should be forced upon anyone, far less upon the whole world or all people. - J.Z., 8.9.02.
FINANCING LIBERATION EFFORTS:
FINANCING LIBERTARIAN DEFENCE:
FINANCING LIBERTARIAN PROPAGANDA TO VICTORY: See: PEACE PLANS 19: Let Freedom Pay Its Way!
FINANCING LIBERTARIAN REVOLUTIONS:
FORCED CURRENCY: Any currency valid only by legally excluding- others and by giving it a forced value does hardly deserve the -name of currency or money.  However, for decades we have been- forced to experience almost nothing else and the literature is -largely only full of theories of advocates of forced and- exclusive currencies, unaware of the wrong and harm they do and- of the rights and benefits of competing currencies. Thus many -people have even come to condemn money altogether. That is like -condemning all societies because of the existing of some despotic- groups and of a multitude of inherently despotic territorial -States. - J. Z., 12.7.96, 20.3.97. See: LEGAL TENDER, CENTRAL -BANKING, MONEY.
FOREIGN DEBTS, PAYMENT DIFFICULTIES FOR THEM: "The only way to- squeeze cash out of the poor countries, so they can pay the -banks, is for them to somehow run a trade surplus. They must,- accordingly, slash imports and boost exports." - MULTINATIONAL -MONITOR, Washington, July 86. - Every debtor can lastly pay only -with his goods and services. But it makes a great difference to a- debtor whether he is forced to use a means of payment that is- short supplied or one that he can supply himself with, one based- on his readiness to supply goods, services and labour. Allow them -to repay their international debts in private and competing sound- currencies that are redeemable, at their stated standard- values, only in their goods, services and labour. Allow them to -pay wages with such payment means of their own, also taxes, and -imports. Then most of their payment problems, arising from the -enforced use of the money of monetary despotism, would tend to- disappear and this very soon. The former debtor countries could- not only become self-supporting and relatively rich, based on -their labour, services and other resources, but could also, if- they wanted to, turn into creditors, like many of the debtors of -the U.S. once did. - J. Z., in old MFNL notes.
FOREIGN EXCHANGE CONTROL: Through foreign exchange control one can prevent or stop and inflation. - Popular opinion. - This has been tried, in vain, for decades and no one who understands the real cause of inflation will try to fight it, end it or prevent it in this way. This type of price control is as vain and self-defeating as all others are. Rather, control the government's note printing presses, by repealing the legal tender and the exclusive currency status of its paper money in general circulation. Only the government should have to accept its own paper money at par (with any sound value standard, if it has one, or at its nominal value), in all payments of dues and taxes, expressed in its own "value standard) or against a sound value standard, if that has been instituted. The forced INTERNAL EXCHANGE RATE of and the FORCED ACCEPTANCE for its currency, due to its legal tender and monopoly, is the real cause of inflation and without removing it all other measures are at best only palliatives. - Free market rating and free competition and freedom to refuse the government's currency in general circulation and free choice of value standards ought finally to be at least discussed, then understood and introduced - to end inflation, without a fight, without any further despotic "measures". - J. Z., n.d., 2.4.97. - See: EXCHANGE RATE CONTROL, DEVALUATION, REVALUATION, PRICE CONTROL, INFLATION.
FOREIGN EXCHANGE RATE, CURRENCY, INFLATION: The foreign exchange rate, when it falls, MAY be indicating inflation but need not and it certainly does not CAUSE inflation. When a free market rated currency suffers internally a discount against its value standard, then it may but does not necessarily indicate an inflationary over-issue. The discount may be quite small and temporary and would alert debtors to an opportunity for buying up the discounted currency and repaying their debts with it. Thus the depreciated notes and the discount would disappear. Prices marked in sound value standards would remain unchanged anyhow (from the money side). Under legal tender for paper money within a country the foreign exchange rates are the only market rating for a currency that is still permissible and practised. But this foreign exchange rate is not a good enough substitute for internal free market rating of any currency. Pricing of currencies should not be pushed beyond borders or confined to internal markets for foreign exchange. Like any other pricing, it should be as free, direct, public and as fast as possible to optimally fulfil its function. Legal tender is a form of price and wage control and as such not rendered rightful & harmless by foreign exchange rates remaining free. - J. Z., 9.4.86, 9.5.97.
FOREIGN EXCHANGE RATE: As long as the foreign exchange rate remains stable there is no reason to fear inflation. - Wide-spread opinion.  - This is obviously not true as long as there is no quite free exchange rate for foreign exchange. Central banks still manipulate or try to manipulate the foreign exchange rates and for this they use their hoards of rare metals and of foreign exchange which they should not have been allowed to accumulate and keep in the first place. Even when there is a freely floating rate for foreign exchange, then its "stability" might merely indicate the fact that other governments do likewise follow Maynard Keynes' proposal for a slow inflation and this to the same degree. - To me it seems absurd to maintain in all countries manipulated, exclusive and fored currencies and then to try to measure and stabilise their values by observing their exchange rates against each other. Our misrulers may even have "gentlemen's" agreements to inflate their currencies to the same degree and thereby hide their inflations from those who have their eyes and minds only on the foreign exchange rate. The foreign exchange rates and their fluctuations are poor substitutes for free market rating for every governmental national currency and for free competition against it from other, private or cooperative national or local currencies. - The kernel of truth in this notion consists in this that at least towards other national currencies the own national currency has, as a rule, no legal tender value at all nor does it have a monopoly in the world's currency market. - J. Z., 2.4.97.
FOREIGN OWNERSHIP, PURCHASE OF ENTERPRISES, SELL-OUT OF THE COUNTRY TO FOREIGNERS? Rather than complaining about internal "capitalists" as exploiters or against foreign investors and owners, as "buying up our country", the employees of our enterprises should consider whether, how easily & over what period they could themselves purchase, or take over the enterprises they do work it. Seeing the savings and improvements that could result from such a change in ownership, if only property rights, profit and earnings interests (generally: self-interest), are not ideologically denied and opposed in practice, these purchases of enterprises, by their employees could be relatively easy and fast, on free-market terms. Employees, organized as partnerships or coops, could purchase them on terms, using bearer bonds as means of payment. Preferably, these bonds should have value preserving clauses and be redeemable in instalments, using clearing certificates of these enterprises as means of paying the instalments and interest rates, whenever possible and acceptable. Then and thus the productive capital acquired by the former mere employees, could then mostly be acquired with part of the additional earnings they could thus attain. Consequently, they could, if they wanted to, attain full or controlling ownership of the enterprises, as partners or cooperators, over a relatively short period, without having to acquire first corresponding savings for a cash purchase price. Even whilst they paid of their debt, gradually redeeming the bonds, largely with some of their own clearing certificates, acceptable in all payments for their goods and services, they would not have to make, in most instances, any economic sacrifices, i.e., having to reduce their earnings for a few years. No revolution would be required, no general strike, no occupation of factories or land, no any official expropriation and statisation measure. They would just use the capital market optimally for their own purposes. In practice few enterprises are today ever acquired, by capitalists or financiers, with cash payments. Mostly only securities change hands. Workers could do the same. And they could mutually guaranty their securities better than most capitalists could guaranty theirs. If afterwards some foreigner offered to buy the enterprise from them, then it would be up to them to either sell it or not. Such decisions should always be made by the owners. If they found that each of them could retire on the sales proceeds and if they did not want to keep ownership of the enterprise, e.g., to provide jobs for their children and grandchildren, who could blame them? Alas, for most people, even the long-term victims of the hierarchical employer-employee relationship, with its numerous anti-industrial warfare actions,  such financial and monetary transactions towards the achievement of freedom at the workplace or self-management would be too radical. A gradualist approach would be to permit employers to open savings banks for investments of employees in the own firm. Mostly they could offer them higher interest rates than the banks would. Then it would merely be a case of the workers observing the total of their savings at this bank with the total share value  of the enterprise. That would soon tend to steer them in the right direction, towards ownership and ownership responsibilities. Enterprises change hands all the time. The workers would be foolish to exclude themselves from these market options, especially seeing the size of their combined purchasing power and the fact that in most enterprises the employees get directly or indirectly 85 - 95 of the annual returns, including the insurance and welfare spending and the taxes, supposedly levied and spent for their benefit, and the capitalist owners only ca. 5-15%. They might also come to insist that they be permitted to utilise their old age security insurance funds for such acquisitions, instead of handing their administration over to bureaucrats or unionist functionaries, never likely to use them in this way but, rather, to their own advantage. - Indeed, there are some enterprises whose capital investments are so large and the number of their employees is so small that the employees between them and even over a number of years, would have little chance to become owners of all the capital assets. They could then either take up the required take-over capital as a loan, like many of the take-over merchants do, or acquire only a fraction of the capital assets, enough to give them sufficient of a capital and business interest. This means that, in the average, their earnings from investments in the own firm would have to come to at least about 20 to 30% of their wage and salary earnings. Lesser amounts are simply considered as mere bonus payments and give not yet a sufficient incentive in running the business efficiently. Alternatively, they could forego the capital acquisition option altogether and improve their personal independence and earnings capacity by forming work cooperatives, autonomous work groups or productive gangs, self-managed, as proposed and described e.g., by Hyacinthe Dubreuil and could also assure their employment and a higher income by declaring their readiness to be at least partly paid in the monies of monetary freedom. Beyond that, they could exert a considerable influence on the development of their firm by insisting that it adopt one of the best suggestion box schemes. Some of these have already come very close to fully exploiting all the innovative and productive talents now still largely wasted in most enterprises. Sony had reached, years ago, already an average of 350 employee suggestions p.a. per employee  and they were aiming at a still higher rate. People do not have to be treated as dumb servants of machines. They can also greatly contribute to improve them, step by step, given the chance and sufficient rewards. - When there is no fear of becoming unemployed, due largely to monetary and financial freedom, they will no longer be adverse to promoting labour saving innovations, and aware that thereby their average earnings capacity will be increased, quite apart from the rewards they would earn for their innovations. I have a 1987 Mitsubishi Magna Sedan. The guy who services it for me, from a mobile van, once was a supervisor in that firm and also made a small improvement on the motor there, by which a lid and a washer were automatically produced united, instead of having to be put on separately. That little suggestion earned him a $ 500 bonus and many of his work mates earned similar rewards. With such recognition and rewards it is surprising that numerous improvement suggestions are coming forward in a steady stream. Their products become their babies. They become in a way creators, designers, engineers and gain self-respect and recognition - while also increasing their income, improving the position of their firm and providing greater consumer satisfaction. - Monetary and financial freedom are just very important aspects of the whole process of "releasing all creative energies" to make this world a better and more prosperous one. Not just money is involved - but money involves almost everything. - J. Z., 16.5.97. - Experience with the better suggestion-box schemes showed that the vast majority of such suggestions were accepted because they were useful to some degree or the other and they were thus rewarded with bonus payments. Alas, in the vast majority of firm this creative potential remains mostly unused. - Likewise, in the monetary and financial freedom sphere most possible and desirable improvements do not take place because all too many aspects are politically, legally, juridically and administratively regulated by hierarchies with little knowledge of, interest in and appreciation of alternative solution.  Numerous creative energies could and should be released here, too. Not just more theoretical studies are needed and should be sufficiently published but numerous free experiments should be undertaken by volunteers. So far there exists not even a comprehensive suggestion box or archive and information service for all such proposals. Much better monetary and financial systems are not impossible, they are merely outlawed. - J. Z., 14.9.02.
FORGERY OF THE NOTES OF OTHERS OR ISSUE OF THE OWN? The answer to an artificial reduction of the circulation of Australian Notes (issued by the Reserve Bank) would not be an attempt to forge them. Such fraudulent acts should be left to governments, as long as they can get away with them, e.g., when they forge the notes of enemy regimes in wartime. Rather, a private issue of one's own notes should be tried. The own notes ought to be suitable at least for local circulation. That means that they would have to have a sound acceptance foundation with local suppliers of essential goods and services. These main acceptors must be under a contractual obligation to accept them at par. This acceptance obligation would be in their interest as associated issuers, as debtors of the issuing centre of their association and as traders who want to turn over their goods and services using their private means of exchange. But for other people, in general circulation, these notes need not and should not have the legal tender "quality". The possibility of a discount of the notes in general circulation, as well as an occasional small discount of the notes, at least in large denominations and among merchants, would be necessary to keep them generally and for a long time and mostly at par with their expressed value standards. (One can discover a fever only by a working fever thermometer and high air pressure only by a working barometer and high blood presser only by the relevant kinds of meters. For exchange media their free internal exchange rate is their suitable measuring method. - J. Z., 14.9.02.)  - These private notes would possess what Prof. Rittershausen called "shop foundation". Even gold and silver coins would be widely refused or depreciate if they did not have this foundation. - If private people and their associations were allowed to issue sound, i.e. non-coercive paper money types that are suitable to pay wages with and acceptable in the stores and that maintain themselves in free competition with other alternative currencies, then unemployment would soon disappear and inflation would become impossible. - The task consists in sufficiently increasing the money circulation without depreciating the additionally issued exchange media or driving the general price level up. The circulation should be increased just sufficiently to so increase the goods and service exchanges that all involuntary unemployment is done away with, all productive potential is used and all sales difficulties for wanted goods are abolished. The sale of labour and goods should then take place neither at emergency sales prices nor at inflated prices but at free market prices. - J. Z., 85 & 21.5.97.
FOUNDATION OR CAPITAL REQUIRMENTS FOR BANKS OF ISSUE TO- FACILITATE THE TURNOVER OF DAILY REQUIRED CONSUMER GOODS, SERVICES- & LABOUR, AS OPPOSED TO THE FOUNDATION & RUNNING CAPITAL REQUIREMENTS -FOR SAVINGS & LOAN BANKS THAT DO GATHER & LEND PRODUCTIVE- CAPITAL, USING VARIOUS CURRENCIES & CAPITAL SECURITIES IN THE PROCESS: -Most of the errors in this sphere came in with the notion of- banknotes as mere gold deposit certificates. Then, obviously,- only those with a sufficient gold stock, their own, or that- deposited with them by others, i.e., possessing real capital or its gold medal equivalent, could issue banknotes. These notes, being instantly redeemable in gold coins, were wrongly considered- as having no other foundation to achieve their acceptance as exchange media in the their circulation sphere, regardless of- what short-term and self-liquidating real securities the bank had -demanded for the loans granted in its notes. The accumulated- gold stock was also considered as the  ultimate reserve of the- bank. If it had a 100% cover for the gold certificate banknotes- then bankruptcy as a result of failure to redeem its notes in gold, could never occur. The introduction of fractional reserve currencies then -led to the introduction of other securities as an ultimate -backing, in case a bank of issue would go bankrupt. These assets were either to be used to purchase enough gold in the open -market, to redeem all notes in gold or, in case of bankruptcy, to- satisfy the creditors at least with capital assets. Based upon -this model, legislators, public opinion and supposed experts -insisted that for each bank of issue the founders must have- either a sufficiently capital of their own or must be able to- raise a sufficiently large capital through  subscription by- shareholders in the bank. Other options for securing the par--value of banknotes issued were not considered in this model. Such- gold certificates were considered merely as convenient- substitutes for payments in gold coins and bullion. No further -thought on the subject seemed required and no further thought is- still invested in it by the adherents to this systems. They are all too ready to condemn all other currency issues as fraudulent- or coercive issues of paper money, whether done by businessmen or -governments or the governments' central banks. - However, even -gold coins and 100% covered gold certificates, would have little -value to most holders, most of the time and in most situations,- if they were not also redeemable into daily wanted consumer -goods, services and labours by those who provide these. This -latter real  redemption fund or demand for notes, by all those who- depend upon monetary exchanges, due to the division of labour, is -usually ignored by the metallists. They wrongly assumed that -these providers always want to be paid in gold coins or gold- certificates only and that they could not monetise their -readiness to sell their assets into monies of their own and that -they could not keep any of their goods-, service- and -labour-vouchers at par with their nominal gold weight value, even when they would not possess a single gold coin between them. - -Here the true banking principle as opposed to the currency -principle is involved, or the "real bills doctrine": the- discounting of sound commercial bills that represent goods- already produced and sold and on their road to the retailers. In -the issues these bills are then merely discounted (for the time -difference, insurance, cost and service involved) or, rather, -"cut up", temporarily or replaced by smaller, standardised bills,- in money denominations, with which ultimately the original large and uneven bill -is paid or cleared: The manufacturer receives a short-term IOU from the wholesaler or draws a commercial bill upon him. Then the -manufacturer gets this IOU, or real bill, discounted by the bank.- The bank keeps it, the manufacturer gets banknotes. Then the- manufacturer pays his labourers and suppliers with the banknotes. -They carry them into the shops of the retailers, getting goods -for them. The retailers use them, in cash payments or via- deposits at the bank, to pay their debts to the wholesaler and he -pays his debt to the manufacturer or the bank. (The bank might- merely have taken the real bill as security or may have purchased -it.) This kind of turn-over clearing and payment scheme is- self-liquidating and does not need any gold stock or other- capital securities behind it to make it possible. It merely -requires some office facilities, some staff and the ability to -pay the printer immediately or soon. The ready for sale goods, -services and labour provide a very large redemption fund for -these goods, the only redemption fund required and establish a -strong demand for such notes, which assures their reflux to the -issuer, whereby the notes disappear from the circulation, as well- as all the debts involved and the goods, services and labour -efforts that were used up in the process. Although the -participants may consider gold weight pricing of their goods,- services and labour as convenient and would have to be ready to -accept such notes at par with their nominal gold weight values, -none of them would have to possess a single gold coin or bullion -bar and none of them would have to be traded between them, far -less would there have to be a gold hoard, in the vaults of the -issuer, corresponding to their total exchanges. How unnecessary -such a gold hoard is can also be seen if one envisions all these -transactions having taken place only via much more obvious clearing, in account -books or electronically, without any money tokens (or gold coins or- bullion), being owned, produced or moved from one to the other. As -long as this current or reflux or demand or debt foundation for a- currency is sound, i.e., remains equivalent to the notes issued, no other ultimate redemption fund or security is -required - apart from the standard shop foundation among the members of the bank of issue, which might be a shop association. When sufficient immediate or near future reflux is missing then only a capital security or insurance fund or claim upon it is all that the note holders can ultimately claim - if such funds, guaranties or insurance is provided. But for the note-issue and acceptance business itself it is not required. If notes are only issued upon capital assets then no one is obliged to honour these notes with them- any or sufficient immediately available consumer goods, services or labour. An "asset currency" has no such assets. Its security is only realisable upon the liquidation of the business - or to the extent that any cash can be raised by the sale of such assets on the open market. Unless, of course, people are acting under delusions,- once again, and, although they are the real providers of the real -redemption fund, they oblige themselves to accept notes issued- upon mere capital securities, because they think that the existence of- these securities would make the currency safe or give it a sound- and sufficient current value. But even then it is their own readiness to accept- which would give that currency a real, full and immediate value, not the ultimate -redemption, security or reserve fund which they and they issuers -imagine to be necessary. People who issued ticket or token monies- were often clearer about the foundation of their kinds of private -money. Alas, often they, too, were mixed up and promised -redemption in "real" money, although their own money was more -real than the money they considered to be the only "real" money.- Alas, even those who were aware of the mere clearing involved in- the pure "banking principle" and of its self-limiting and- self-liquidating nature, as well as its inherent safety features, assuring sufficient "reflux" or clearing, were all too often children of their -time and thus still subscribed to gold convertibility notions so that -they not only demanded real bills as security but also gold -convertibility, although objectively it was unnecessary and the -gold-par-value of the notes and gold pricing could have been -continued merely by using gold weight units as a reckoning or -value standard unit, NOT AT ALL as a means of exchange unit - or- only rarely, when holders of such rare metal coins wanted to pay -with them and their creditors were willing to accept them. - What -any currency really needs is a CURRENT DEMAND for it by the -providers of daily wanted consumer goods, services and labour. Currency holders usually -want to buy and use goods, services and labour, not purchase- capital securities, at least not with most of their regular -earnings or all of their savings.  (The cases where their earnings are so high that they- could immediately or soon consume only a small fraction of them and have to invest most of the rest, are still rather rare.) - -Currencies should not be issued upon capital that is only required in case of the ultimate failure of a currency issue. -Instead, currency should be issued upon whatever gives it an -immediate value in the hands of note holders for the things they- do want most of all and most regularly, daily or weekly, in their -normal shopping and spending, without which they could not- survive in an exchange economy for many days. - The issue -principle for capital assets involves capital securities, not- currencies. Capital is made easier transferable by capital- securities. Consumer goods and services and labour are easier- exchanged by currencies. Capital asset securities are useless -without real capital assets or capital expectations (returns of- capital with profit) behind them. Currencies are useless without- currently wanted goods and services behind them. The two should- never be mixed up. Currency should never be ISSUED to finance -capital requirements. It should only be USED by those who can- spare some of their income or earnings for investment purposes, -to SUBSCRIBE to capital securities. And capital securities should- not be used and need not be used to ISSUE currencies but can at most provide a guaranty fund in case sound issue principles- and practices for currency issues have not been followed and that- is exactly the case when currencies have been issued merely upon "-securities". What good is a banknote claim to some bricks in a -house, some railway sleeper or part of a bulldozer, or to some- capital securities, due in a few years, to the consumer who holds -the currency note? No matter how often and how strongly such a bank note issuer assures him that all his capitals is secured by- capital assets, to the full amount of the note issue, what can -the note issuer then buy with the notes - unless he finds some- deluded acceptors who are ready to deliver for such asset- currency the kinds of goods, services and labour which the note--holder really wants? But then others provide the real cover for -these notes, not those who issued the assets upon which such note- issues were supposedly based. - At most the bank issuing "asset -currency" could supply a redemption demand for some of its notes- with a corresponding quantity of the securities it holds. Then- the securities so received in redemption by the former note- holder, would have to be sold by him on the capital market, to -get the currency he wants. That market may be in decline just- then or even in a desperate situation. - Indeed, capital- securities may be really secure and profitable - in the long run, in the average, and when insured -- but that means merely that they are good capital securities in -the long run and not that they do have any other value presently -than their market-rated sales value - if and when they can be- sold. Some might even have an almost instant cash value on the -capital market. But, obviously, they do not have it in the local shopping centre. -Consequently, potential acceptors avoid them, even if they come -in denominations that are like those of money denominations, even- if they stand at par with their money denominations. Try to do- your shopping with shares or bonds nominally and in the market -presently worth $ 1. Will you find many acceptors who do accept -them like ready cash? Why should they, if they do not want to -invest or speculate in the capital market, or not in these of its assets? Can you blame them if -they reject your share or bond issue offer and rather insist on -being paid in their own notes or in the currency notes of others -which they do know and have reasons to trust? - In this sphere -people are too ready to accept the mere glowing promises of the politicians of business instead of insisting upon realized -promises only, goods and services and wanted reforms supplied. -Many businesses fail. Business promises or promising businesses- are not always kept or successful. They are not ready cash - of a- public or private kind - which represents already produced goods,- services and labour ready for sale for this cash. - Would you- accept the promises of a politician of a large wealth, that he -supposedly could provide, in form of cash notes issued by him?- Would any of your suppliers accept such notes? Then why accept -notes that are merely based upon promises or speculations of- businessmen, financiers, managers and organizers, who have no -immediate cover or redemption fund to offer in the form of the- goods, services and labour that you want or need? When one gets -one's asset currency notes redeemed in a capital asset, one is -then confronted always with the problem or task to convert that -capital asset into cash or a clearing discount by conversion at a stock exchange via a broker. Time and costs are involved. The transaction costs may be large. The delays involved considerable. One -might have to collect the security and present it to a broker,- who may live a 100 km from where one lives and whose office hours- one cannot keep for a while because one has to keep one's own- office hours. Nowadays there are also permits and taxes involved- upon the transfer of capital securities and special record-keeping. Even the best capital securities are as good as cash -only among certain people and in limited situations. They do not -encounter an almost universal local acceptance wherever one -happens to live and work. - Those who insisted upon a capital- guaranty fund even for mere turnover promoting banknotes, acted -under one or the other of many delusions, e.g. the one that the -issue of banknotes would enable a banker to take up a loan from -the public. Then they wanted to balance that loan by securities -to be provided by the banker. They did not see the note-issuing banker as merely providing a clearing house service with his- notes, i.e., helping his customers to exchange their goods,- services and labour for those of other customers, paying the -banker a fee for this important service. Neither the banker nor -his customers need any capital for this purpose. (Apart from the costs of note-printing and offices and their furniture.) - Alas, the very -wording of the traditional commercial bills kept up the illusion- of a metal payment being ultimately required, although most- bills, in practice, were settled by clearing or payment in banknotes. That "payment in gold" was a fixed idea or spook in- the heads and still does much damage now, in form of the -authority of creditors to suddenly demand cash in form of legal -tender currency instead of merely non-cash payment or clearing.- Even most banknotes, in their texts, persisted to uphold the -illusion of gold payment - when this was long legally abolished- and one legal tender paper note was merely exchanged upon demand- for another legal tender paper note. - People are not mastering -the words but are largely mastered in their thinking and actions - by the words and ideas in their heads, no matter how false and misleading -these words and ideas are. Indeed, cash and securities are both "valuables" -but that does not give them an equal and ready cash value towards- all people in all localities and situations. Both are also all -too often merely called money. But that does not make them the -same and easily interchangeable everywhere by everyone and- equally acceptable to all people at their face value or at their- market value. Indeed, capital securities are sold and bought for- cash but the very fact that they are bought and sold for cash- does already indicate that they are not identical to cash. Cash -has to be kept at par with its nominal value, or close to it and -must be acceptable widely, at least locally. Nor is interest paid- to cash holders or is any capital appreciation to be expected- from holding it (except in times of deflation). - Indeed, -there exists even a special "scrip" or currency which facilitates -the transfer of capital securities and dividend stamps attached- to securities have sometimes been used as cash, in some circles,- shortly before they were due. But that still does not make the- securities identical or sufficiently interchangeable with cash to- allow them to serve as a foundation. Securities bridge time and promise - not always deliver - a greater value in the future.- Currencies offer instant or near future satisfaction -opportunities and without them they become mere capital securities of which most people want, if any then only a limited -number. Moreover, capital securities rarely stay in their market -rating near their nominal or issue values but fluctuate greatly- above or below these. That makes them still useful in the capital market but not in the currency market, expect for limited and- wanted conversions there. - J. Z., 23.4.97. - Since there exists so much confusion on this subject I did not mind repeating myself on thus subject but I do invite shorter and more effective refutations of this ancient error.
FREE BANKING & "GOLD BUGS", GOLD CLEARING STANDARD VS. GOLD COVER AND GOLD REDEMPTION STANDARD: Some see it only as an obligatory tie of all exchange media to metallic gold, as the only option for supposedly free and honest money. Others see the possibility that issues need merely be confined to the ready and available cover of ready for sale consumer goods and services. Others want to over-extend the issue option to include the monetization of all capital assets, including all capital securities, perhaps out of the vague notions that they, too, represent "values" or "money" in a free market or are, relatively easily, most of the time, convertible into one or the other form of cash. Tickets or claims to metallic gold are certainly not the only option but they are, certainly, more liquid than are most shares and bonds, unless the possession of gold and trade in it has become legally criminalized or "regulated". Adherents of "the" gold standard also manage, in most cases, the overlook the various forms which it had taken in practices. Some classified 7 variations. Offhand I can think only of the following: 1.) 100 % redemption obligation in metallic gold. 2) Fractional redemption obligation in metallic gold, made usually practicable because sufficient other reflux arrangements were made, but exposed to the risk of "runs" in case of distrust. 3.) Option notes, which postponed gold redemption for a period. 4.) Redemption only at a fluctuating "gold price". (The Henry Meulen system, in which the paper pound is the "real" value standard rather than a certain gold weight unit.) 5.) Mere gold cover, complete, but without redemption for the note holder. The hoarded gold becomes available only upon liquidation of the bank of issue. 6.) A "gold standard" at which the issuer merely accepts gold at a fixed rate for its currency, but is not prepared to supply gold at this fixed rate. 7.) A "gold standard" in which the cover consists merely in various securities which do have a gold clause. 8.) A "gold standard" in which the cover consists in "foreign exchange" which are fully or somewhat redeemable in gold. 9.) It appears that some of the e-gold electronic currencies not offered on the Internet are merely declaratory: They do not represent an accumulated metallic gold cover but merely the promises of the issuers and the hopes and expectations of the acceptors. 10.) Gold for clearing or gold-for account gold standard. It does not promise redemption upon demand by the issuer but merely convertibility, at the market rate of a currency, in the free gold market, into gold, with the exchange media concerned, in the interest of the issuers and acceptors, being kept at par or as close as possible to par, via a sufficient other kind of "reflux" or "acceptance"  or "debt" foundation. There may be quite a number of other versions of "the"gold standard, which might have to be added gradually by those who think of them and want to add them. Any gold standard, whatever its honesty and advantages or disadvantages, will work best only under free choice of value standards. This kind of reduction of its power, from an exclusive to an optional currency, will limit the abuses that otherwise would tend to follow from its realization as an exclusive and forced currency. Even gold is not good and sufficient to be turned into an exclusive and forced currency. It insufficiency becomes clear when one considers the sheer volume and number of all the other goods and services that are to be traded exclusively through the bottleneck channel of the availability, for the exchangers, of corresponding quantities of gold, even when neither side has any interest in acquiring any metallic gold. While as a redemption obligation for every transaction, an exchange medium for all exchanges,  the available gold is quite insufficient, as a mere value standard, as determined by the rating of a gold weight unit on a free market, it can, without any redemption obligation by the issuer, and without being depreciated, serve for an unlimited number of possible and wanted exchanges, without leading to any "gold shortages" or "runs". This gold-clearing or gold-for-accounting-only-standard" makes, in practices, all the marketed gold in the world available for those desiring to exchange their exchange media into gold. And it can lead to the sound and continuous market rating of all currencies against a weight unit of gold. - J.Z., 26.8.02.
FREE BANKING & FREE MONEY & GOODS, SERVICE & LABOUR EXCHANGES-: Goods and services can freely "buy money" only once money -issues, value reckoning, value accounting and clearing are free -and competitive. Labour will also be free only when it is free to -"sell itself" as a commodity, not only for a forced and exclusive -currency but for all kinds of alternative and optional -currencies, value standards and clearing options that it does -find acceptable. The more options of this kind it has, the more -free it will be. - Full employment can be achieved and- perpetuated only under monetary freedom. - J. Z., 2.4.91, 14.4.97.
FREE BANKING & INFLATION: Free Banking would lead to inflation. Everybody could then cause a general inflation by over-issues of his notes. - Popular opinion. - Nobody's notes would then be legal tender in general circulation. Only the issuer would have to accept them at any time at par. The issuers would obliged themselves - not others. People who know that some issues may be over-issued or who merely suspect them or do not know them, would simply refuse them - as they do now unknown or unwanted or suspected tickets to performances they do not even want to attend, or shares they do not want to invest in. - Inflation of private money tokens would be as impossible as inflation through cinema, theatre, bus or railway tickets or postage stamps - or through the over-issue of uncovered cheques, or unsound shares, bonds and mortgage certificates. Why? Everyone is free to refuse to accept them. They are directly tied to their cover. And no one is forced to use any of them as his value standard. People can go on reckoning and accounting and pricing and contracting in value standards of their own choice, which they do trust. Thus their prices are not blown up when somebody else over-issues his tickets. - J. Z., n.d. & 2.4.97.
FREE BANKING & MONETARY COMPETITION OR COMPETITIVE MONIES: One -can either competitively fight for more or less scarce monopoly -means of exchange (scarce, for some, as some times and occasions, even during inflations and- stagflations) or issue one's own sound and competitive means of- exchange, based on the own goods and service supply ability or clearing -capacity, thus appearing, first of all, as a most welcome buyer -with them and then merely having to redeem one's own standardised -IOU's with one's own goods and services or clearing capacity. -- J. Z., 13.3.97, 20.3.97.
FREE BANKING FOR EVERYBODY: With anyone being free, alone or in -association with others, to issue his own money notes, vouchers,- clearing certificates, in money denominations and based on his- own goods and services and labour capacity, which he is able,- willing and ready to sell - for his own or other currencies),- such alternative competing monies could become optional, i.e. -refusable and discountable but also acceptable local currencies.- They would be free market rated by their acceptors - in- combination with those who refuse or discount them. To the extent- that they could be issued, their issuers could be assured of- corresponding sales within a short period, especially if they -gave their issues only a short term of validity. (Usually only 1-3 months but 1 year at most.) By this means -all ready for sale goods, services and labour could be exchanged -for each other in a monetary way, to the extent that people are- able and willing to supply them and to use them. The full -productive and exchange potential (limited only by willingness -and readiness) of a community could become mobilised, issued and- accepted in payment. The goods and service and labour providers -would become independent of the monopolised and forced currency- and its supply. They could supply their own purchasing power for- their own purchases and see it streaming back to them to pay for- their sales. They would be financial, to their capacity, even before they had sold whatever they had to offer. Under monetary -freedom they have first to struggle for whatever quantities of -forced and exclusive currency they can manage to acquire and then- would be limited in their spending to these amounts. That- restriction and timing would no longer apply. Thus could be -"released all creative energies" in a way that Leonard E. Read, who coined that phrase, never fully envisioned, although he -did also advocate monetary freedom in very general terms.  -- J. Z., 19.12.93, 30.4.97.
FREE BANKING MAKES FOR EASY SALES & EASY PURCHASES, INCREASED PRODUCTIVITY, GREATER TURNOVER & GREATER PROSPERITY - FOR ALL ABLE & WILLING TO WORK, PRODUCE & TRADE: Free banking might make sales of wanted goods so easy that, under the assumption that still more of them would be wanted, more goods and services would be offered. Would over-production and over-servicing result? Free pricing, combined with futures markets and good publicity will tend to avoid that. Over-supplied goods and services would lead to diminished returns while under-supplied goods and services offer higher returns and would thus attract more producers and traders. Exchange and clearing should, as far as possible, be frictionless. Then the self-interest driven machinery of production and exchange will not grind to a halt, for lack of lubricant. Then the only remaining wasteful efforts might be those based on miscalculations or on satisfying merely a hobby interest. The latter would be self-satisfying labours, not dependent upon market approvals and orders and financial profits.- J. Z., 30.5.85, 9.5.97.
FREE BANKING TO EASE THE STRUGGLE TO SELL ONE'S LABOUR, SERVICES -& GOODS FOR GOVERNMENT "MONEY": The current battle, that has already -continued for thousands of years, to sell one's labour, services -or products for a scarce money, to be provided by others, especially the government or its privileged monetary institution, could- and should be replaced, as far as possible, by the much easier- effort to get one's own money accepted by those who supply the -labour, services and goods that one's wants and who would either use -this money themselves or would pass it on to those who would.- This own money could and should be based on the labour, services- and goods that one has ready for sale, alone or in association- with others. That is the only cover or redemption fund one would -have to possess - for it and the only one which one would have to -keep in balance with one's issues. One's own exchange media- would, naturally, not be legal tender for others - but only for oneself - for one must fully recognize one's own IOUs against -oneself. But one could and should keep them at par with their- nominal value against a self-chosen and sound value standard,- also acceptable to those who would accept one's money. Moreover,- one would have to price out one's labour, services and goods in -that standard. Then one would have to accept the own notes back- at any time at par, from anyone, in any payment due to one. That- would be all that is necessary to give them their -par value and to maintain it for the short period during which they would locally -circulate, before they are returned in payments to oneself, at -par. Thus, instead of first appearing on a restricted market, as -a SELLER, asking for the supply of a forced and exclusive- currency, which one needs under monetary despotism for one's- spending, one would, under monetary freedom, as an issuer, appear first as a- BUYER, with a paper money of one's own, that could and should be- as good as gold, if gold weight units indicate the prices of- whatever labour, services and goods one offers and are also used- on the own money, to indicate the value at which one would accept -them back from anyone. The more local potential issuers associate -themselves for this purpose - and then take out short term loans- from their common issuing centre - the easier they would find it -to get their notes accepted in payment at least by all their -local suppliers of labour, goods and services. Under this freedom -the items one has ready for sale can thus provide the exchange -media or monetary demand to sell them. Thus one would sell them -indirectly but certainly, by spending one's self-issued private -or cooperative currency for the items one wants and needs oneself. The -whole process is almost as simple and straightforward as the -issues of tickets. The difference is that not only one particular- consumer goods, service or labour value is offered as a backing- for the own notes, but a whole wide range of them, especially- when several potential issuers combine their issue and readiness -to accept potential. Furthermore, this ticket money is freely -transferable and likely to mediate some further exchanges within- a short circulation period, beyond being once used for purchases- or loans, when issued and then, at last, being used upon reflux, -in the payment of any debts to the issuer, especially in- purchases of goods, service and labour from him. Being issued- against this natural cover for money and limited by that cover- and its optional and market rated and refusable nature,- over-issues become close to impossible or would remain within a -quite acceptable margin and even in these cases the over-issues- and the small discount  they would cause, in some quarters, would- exist only for a very short time. The notes with a discount would- stream back even faster than if they were still at par. The money -and the goods side would be kept in balance and both sides could -be increased and reduced in balance with each other. - J. Z.,- 19.12.93, 1/5/97.
FREE BANKING VS. MONETARY DESPOTISM, MONETARY TOLERANCE VS. -MONETARY INTOLERANCE: If you let your money become monopolised- and coercive (centrally issued, planned, directed and -mismanaged, often to the benefit of the issuer only), then the -results are even worse than letting your religion become -monopolistic and compulsory. - J. Z., 26.7.91. - Indeed, in the- exchange media sphere and that of value standards, we are likewise- confronted by dominant faiths as well as minority groups of non-conformists, non-believers, dissident and- Protestant groups and sects, all of them representing, usually, only small -fractions of truths and moral values among their dogmas, if any. The atheists, -rationalists, humanists or agnostics in this sphere are still- only a very tiny and uninfluential minority and that one, too, is- split into numerous factions or sects engaged in a verbal civil war or- verbal intolerance. Some have already made attempts to define the -basic principles of monetary tolerance but so far few have- subscribed to them. See especially the writings and drafts of -Ulrich von Beckerath. - J. Z., 26.7.91, 28.4.97.
FREE BANKING,  PRICES & INFLATION: "Private money issues would inevitably increase the circulation, being added to the state paper money, and would thus increase prices." - Monetary freedom would permit prices and wages to be expressed in relatively stable and freely agreed upon value standards, rather than in the paper value "standards" of the State's forced and exclusive currency. Thereby they would become relatively stable or at least independent of the government's inflationary or deflationary policies. It would also lead to a refusal or discounting of the government's paper currency, now reckoned in competitive and more stable value units, in which prices and wages are marked out. Thereby the value of the circulation of state paper money would be reduced, reckoned in these relatively stable and optional value units. The better and competitively issued money would take its place. But it could increase the total circulation only to its optimum - not to the potential of the printing presses, precisely because it would be optional, i.e. refusable, and market-rated, too. Upon depreciation the depreciated issues would be discounted or refused and thus could not increase the circulation and they could not increase the prices and wages that are still marked in relatively stable value units. Only reckoned in the depreciated, discounted and widely refused paper currency would they be increased. But no one would be forced to reckon in it - except the issuer, who should still have to take it at par from anyone, any time. - J. Z., 24.3.97. - This means that seeming over-issues, that are still covered by his credits and goods and service supply capacity, and expressed in discounts of the exchange media issued by him, would rapidly disappear, by these issues being cheaply bought by those who owe him money and those who can and want to purchase the goods and services that he has to offer. In all these cases he could and would have to accept his notes at par. Thus the discounted notes and with them their discount would tend to rapidly disappear. - J.Z., 30.8.02.
FREE BANKING, DEFINITION: Consumer sovereignty, free enterprise -competition, freedom of contract, free pricing, free trade, -property rights, self-responsibility, in the most important- sphere of money, currency, clearing, credit and value standards. -- J. Z., 24.4.97.
FREE BANKING, FREE EXCHANGE, FREE MARKETS, LAWS, CONSTITUTIONS, REGULATIONS, CUSTOMS, TRADITIONS: The issue and reflux, acceptance and refusal, discounting and discount rate (against sound alternative and optional value standards), value-standard, foundation, cover and redemption of any competing private or cooperative currency should neither be regulated by constitutions, laws, regulations, government jurisdictions, pressure groups like unions or employer associations, groups of debtors or creditors, customs or traditions but, rather, by free and voluntary contracts, i.e., free-market relationships. - J.Z., 10.7.02, 24.8.02.
FREE BANKING, INTEREST IN AND ENTHUSIASM FOR IT, COMPARED WITH- THOSE FOR SPORTS: If one could interest and enthuse the man in -the street to cheer for the free banking options versus the -monetary despotism restrictions as much as he does for e.g. his -favourite football, soccer, cricket, basket ball or baseball team, -then unemployment, deflations, depressions, inflations,- stagflations, even wars, civil wars, violent revolutions and -terrorism threats would soon be over. - J. Z., 20.3.93, 27.5.97.
FREE BANKING, LIQUIDITY, ABILITY TO PAY, INDIVIDUAL ISSUERS, -PERFECT CLEARING: Freedom to turn illiquid goods, services and- labour, that are ready for sale, into liquid assets or -currencies, spent or lent out on short terms, for turn-over- credits, e.g. for wage and salary payments, would soon be spent- by their recipients to buy the goods, services and labour of the -issuers, especially if they were given only a short circulation- period, let us say, of 3 months. To the extent that the owners of -these goods, services and labour capacity and willingness would make themselves liquid for their expenses, they would make their- potential customers liquid, too, if not directly then indirectly. They would similarly benefit, if- their customers had taken this initiative first and offered them -their alternative currencies and clearing certificates in -payment. Liquidity should not be a government monopoly. No one- should depend upon the liquidity of any government or of any -government institution like the central bank, supposedly able and -willing to supply a whole country, evenly, sufficiently, at all -times and under all conditions, with a sound exchange medium and- value standard - although only very few central banks have ever been able to do that either to a large degree or for long. -Liquidity ought to be self-made in order to be as reliable in its- supply as one can be in the supply of one's goods, services and- labour. In quantity it should correspond exactly to one's readiness to accept it in payment for one's goods, services and- labour as well as other due payments. For that purpose it has to be self-issued and- self-managed, at least via voluntary associations for the issue -of alternative local currencies. Individual issues would be -sufficiently practicably only within a perfected clearing- system. Even decades ago, in English colonies, colonial officials- often paid for many of their expenses with personal chits and the -clearing system was then and there well enough developed (even without computers!) to present them again, with their chits, whenever any payments became due to them. Some- exchange traders specialised on tracing these IOUs back to their -issuers via their debtors. - However, at least for the initial -stages of a monetary freedom revolution I would not recommend- going as far. Step by step developments might occur and become- customary that would make even this degree of monetary freedom -acceptable and, perhaps, customary. Perhaps only the degree of- deflation that always accompanies monetary despotism, made such- private issues practicable before, likewise many other forms of- emergency monies. One cannot exactly predict the results of any- free development - precisely because freedom of choice and the -innovations due to it, are involved. - Assume, for instance, that -we would all be interlinked via phone and computers and our -spending totals and income totals could be known through them and- the associate credit bureaus. Then private issues, within one's- earnings capacities, in form of private cheques, or credit-card--proven private clearing accounts, would become quite practicable. -The credit card itself could serve to identify a person and his -remaining credit and even his soon to be expected income, judging from his continuing occupation and past performance. Then he- could even have a personal value standard, which would be -exchangeable, at electronic speeds, into the value standards of- his trading partners and into their kinds of accounts, for an- automatically calculated and subtracted fee. Personal notes, IOUs and cheques could be electronically scanned and verified- in seconds, as credit cards are now. There is no sound reason why- any private transactions should be tied to any forced and- exclusive currency and clearing avenue provided or withheld or limited and -managed or mismanaged by any government. - See: ABILITY TO PAY;-MONETARY FREEDOM. - J. Z., 19.12.93, 1.5.97, 12.9.02.
FREE BANKING, LOCAL CURRENCY, INFLATION & FIAT MONEY: A local bank could conceivably flood a local region with unbacked fiat currency....  But these do not last very long. People discount the value of these fiat bills, or else make a run on the bank vaults." - Gary North, THE INDIAN LIBERTARIAN, Aug. 15, 1971. -One cannot "flood" a local circulation with one's own currency when one depends upon voluntary acceptance, acceptance at par and on the actions of one's competitors, too. Fiat money that can be refused or discounted is, obviously, not fiat money. What he meant was probably money not redeemable in rare metals. But if it is not redeemable in rare metals then nobody will bother to make a run on the bank's vaults, either. If it is redeemable in local goods, services and labour then any run upon these would be very welcome. - Any competitively issued local note issue would, right from the beginning, have to find voluntary acceptors. And to find many of these when people are used to other means of exchange and are sufficiently supplied with them, would be difficult to impossible. He should also have clearly stated that people can only discount a local currency if it is not legal tender. And if it is not legal tender, then it is not really a "fiat" currency. He wrongly assumes that the issuer must redeem or ought to be able to redeem his notes with rare metals and that every other note issue, even when every note would be tenfold covered by ready for sale goods, services and labour, as well as by short-term debt certificates of borrowers, would be mere "fiat money". - J. Z., 2.4.97. See: RUNS, REDEMPTION IN RARE METALS, GOLD STANDARDS, GOLD CERTIFICATES, BANKRUPTCIES, REFLUX, COVER.
FREE BANKING, MONETARY FREEDOM & FINANCIAL FREEDOM: Unrestricted competition & publicity is to be applied to exchange media and value standards, clearing and credit and their institutions. - J.Z., 20.6.01. No territorial government is to be granted any constitutional, legal, juridical and administrative powers and privileges in this sphere any longer, because all they amount to is monetary and financial despotism, with inevitable, large and persistent catastrophical consequences. If you need any proof for this demand just consider the history of governmental monetary and financial policies. - J.Z., 27.8.02.
FREE BANKING, SELF-HELP IN A MONETARY REVOLUTION, OR MONETARY -INDEPENDENCE: Let all willing and able sellers of labour,- services and goods act as BUYERS FIRST, paying with their OWN- issues of standardised and typified certificates, in money- denominations, which assign all the readiness to labour, service -and to provide goods, which they do have between them, in their- local labour exchanges and service and shopping centres, down to small market stalls. The existing -monopolised and forced currencies do not mobilise all these assets- sufficiently, monetarily, but leave potential sales of goods and services -undone and labour unemployed or underemployed. The monopoly issuers have- no natural or human right to prevent such self-help steps. On the contrary, they- rather owe indemnification to their former victims. But their- victims will usually be satisfied just with having liberated -themselves from monetary despotism and provided themselves with- sufficient sales and jobs. - J. Z., 19.11.92, 14.4.97.
FREE BANKING, THE GREATEST GOLD RUSH OF THEM ALL, WHILE AVOIDING- GOLD AS AN EXCLUSIVE & FORCED MEDIUM OF EXCHANGE & AS AN EXCLUSIVE & FORCE VALUE- STANDARD: The greatest new "gold rush" and most permanent boom -will occur when the owners of wanted goods and services realize, -finally, that they can directly "coin" or "monetise" or -"liquidify" them into their own kinds of competing currencies, buy- with them the goods and services they want, grant short-term productive loans with them, especially for wage payments, and assure, through- such spending, corresponding sales of their goods, services and- labours. In this way all producers and traders could "open their -own and successful gold mine". - J. Z., 4.7.93, 24.4.97. - Via the gold clearing or gold for account standard they would open up the treasure chest of all the gold accumulated in the world, for thousands of years, for the purpose of gold-weight reckoning, as well as exchanging clearing certificates and notes that have been kept at par with their nominal gold weight value, into part of this combined gold treasure, if they want to and to the extent that they want to. To that extent gold-redemptionism would be very much extended, but it would no longer by compulsory for the issuers. - J. Z., 8.9.02.
FREE BANKING: "Blessed will be the day when it will no longer -from the benevolence of the government that we expect good money -but from the regards of the banks for their own interest. It is- in this manner that we obtain from one another the far greater -part of those good offices we stand in need of." - Hayek,- Denationalisation of Money, 100. - What benevolence of- governments, since they are always benevolent only with other -people's money? - Not just the banks would enjoy monetary- freedom. The right to issue, to clear, to discount, to refuse- competitive currency issues and value standards, will belong to- everyone. Many other businesses with many payments to make and -many payments to receive will also be suitable issuers, at least for- some forms of local currency. Without legal tender and a monopoly -for bad money, good money would drive it out. - J. Z., 7.4.94,- 24.4.97.
FREE BANKING: All the producers and traders, service providers- and unemployed and underemployed workers have all the necessary- ingredients for sufficient exchange media and clearing certificate -issues at their disposal and could also agree upon better than -paper money value standards for their issues and acceptances of- their own monies and yet they fail to see the parts and- interaction of this possible money making machine of their own,- how they could organise and assemble and maintain it, using it to -provide themselves with sales for all their ready for sale goods, -services and labour - by printing, offering and accepting their- own money and clearing certificates. They could be their own- note-issuing bankers - but rely rather on the all too flawed and- wrongful services of the central banks, which keeps them -unemployed or makes them unemployed or makes their business hard- or drives them out of business. Nevertheless, they show, as a -rule, no interest in monetary despotism, its nature and evils and- how it could be overcome and replaced by monetary freedom. In- this case they are almost like slaves, who for centuries at most -aspired to becoming slave masters themselves, rather than trying to -abolish slavery. People greedy to win by gambling, lotteries, -betting etc. should show some greed towards the possibilities of -coining and printing their own money and thereby helping -themselves. But in this respect they act even worse than -primitive and illiterate private people often did, who at least- agreed upon and utilised their forms or primitive money for -themselves. See: PRIMITIVE MONEY. - J. Z., 20.3.93, 27.5.97.
FREE BANKING: By all means, coin & print your own money and try -to find willing acceptors for it, who can use it immediately in- payments due to you. But do not try to force it at par or at all -upon anyone, except, by contract, your debtors, who could, with- it, extinguish their debts to you. Naturally, you yourself must -be prepared to accept it, your own IOUs, at any time and at par -from anyone. Everything else would, obviously, be fraudulent. - J. Z.,-5.11.92, 15.4.97.
FREE BANKING: Free Banking means liberation from communistic,- centralistic, monopolistic and coercive paper money. It allows -everyone to engage in the business of issuing bank notes or- clearing house certificates who is able to do so and as long as -he can, i.e., as he finds voluntary acceptors who accept his -notes, certificates, accounts or electronic credits at par with -their nominal value - or at least close enough to it to not -induce him to refuse to accept such exchange and clearing media altogether. -It offers a choice between cooperative, competitive paper -currencies that are subject to voluntary acceptance and free--market rating - and to full publicity as well on every detail of -their issues. It embraces freedom to issue, freedom to clear, -free choice of exchange media, freedom to refuse exchange media- not contracted for, freedom to rate them and freedom of choice -for value standards, too. - Exclusive and coercive central banking is one of the remaining strongholds of totalitarianism - and one- of the strangleholds upon a free market, a free economy and free- individuals and minorities. Free Banking or Monetary Freedom- means: You could "coin" or monetise your service capacity and -readiness and your ready for sale goods into your own token-money, alone or in association with other suppliers, businessmen,- tradesmen and professionals. You could pay many to most of your- expenses with these privately or cooperatively issued tokens or -certificates or IOUs and then and to that extent would merely -have to sit back and let them bring you orders, sales or jobs -upon their almost inevitable reflux for "redemption" by you in -what you have to offer your usual customers and additional -customers. (If some collectors would rather include them in their -collections than present them to you for redemption, they do indirectly make a corresponding gift to you. You could easily -issue more to "move" your goods and services.)  In essence, you -would merely clear your services and goods against those of -others, in a technically convenient form. But you would already- anticipate your sales proceeds, to the extent that you could- successfully pay with your issues. - J. Z., in MFNL 3/4, 1/89 &-8.4.97.
FREE BANKING: Free choice in banking (including note issuing banks) is even more important than free choice of schools, free choice of newspapers and religious freedom are. - J. Z., 6.10.85, 9.5.97. - However, that is still only the point of view of a small minority. - J. Z., 13.9.02.
FREE BANKING: Free clearing and free note issue can bring about -the exchange of all labour, services and goods that their owners -or providers are otherwise free to exchange at free market- prices. - J. Z., 23.7.93. - That option is as important to our -survival and prosperity as are e.g. freedom of expression and- information, freedom of conscience and freedom to measure and calculate. And yet, this freedom is severely suppressed by the- laws of monetary despotism and neglected by public opinion more -than most other liberties are. I still wonder why, after pondering this question since 1952. - J. Z., 26.4.97.
FREE BANKING: Free competition, free enterprise, freedom of -contract, the free market, free trade, free exchange, capital and -capitalism &  money, are not free without free banking and without- whatever other institutions full monetary freedom would require, -e.g., a free gold market, a free market in foreign exchange, a -free circulation, to the extent that they find voluntary -acceptors, of every foreign national currency in every other country. - J. Z., 23.6.91, 12.4.97.
FREE BANKING: Freedom to sell one's OWN goods, products, labour- and services for the self-issued and self-managed means of -exchange, and to freely clear their values, exchange media and- securities against those of others, using self-chosen standards- of value - as opposed to the compulsion to use only a monopolised- medium of exchange, imposed by a territorial government, together -with its exclusive and forced paper value standard. It means also -freedom from the juridical obligation to redeem all one's own- payment promises upon demand by a creditor not by clearing or -monetized assignments to one's own goods or services but, -instead, by delivering cash, either in form of gold or silver- coins or in from of a possibly as scarce exclusive and forced -legal tender currency.
FREE BANKING: Full employment, a booming economy & stable- currencies through free banking or monetary freedom. - J. Z.,-28.10.91, 16.4.97.
FREE BANKING: I regard free banking as one of the most important -peace plans and panarchistic steps, steps towards self-liberation and introduction of a free market economy, one of the most- important steps to realize economic human rights and safeguard- all others, as the aim for a rightful monetary revolution and of -monetary resistance actions, as a tool to assist in the realisation of rightful tax strikes, as a means to abolish -mass-unemployment overnight, as one of the most important -segments of a complete archive of social reform ideas and of an -electronic free market for all freedom ideas. See PP 20 & 183 &  the GLOBAL- IDEAS BANK established by Nicholas Albery (deceased) on the Internet.
FREE BANKING: I should be able to OFFER you MY money, issued by- myself (or with my associates) but I should not be able to- FORCE it upon you at par or at any discount, unless you agreed, -beforehand, to accept it on terms that are agreeable to both of -us. There are some exceptions to this: In case my money has -become a local currency, locally accepted at par, and you have -not insisted on another payment in our contract, then you should have to accept this local currency - as tacitly agreed upon. - -Moreover, rather than driving me into bankruptcy, by demanding- from me payment in any exclusive currency, which I have not- contracted to supply you with, you should only have the right to- demand clearing from me, possibly settled by the offer of my own- means of exchange, even if only at a discount, but up to the full- amount that I owe you, determined in some sound value standard.- If we cannot agree on the size of the discount then we should- come to agree on an arbitrator who would settle this rate for us.- Only if I were also unwilling or unable to thus satisfy you thus, by -clearing, should you be able to drive me into bankruptcy. - J. Z., -2.2.90, 22.4.97.
FREE BANKING: The term is applicable to all monetary freedom- options, not only to the issues and acceptances and clearings of- formal banks. Primitive money issue and acceptance is also a -banking and clearing function, although a primitive one. Monetary -development towards to advanced banknotes, commercial bills, bill-discounting, clearing facilities, money exchange services, etc., falls -also under banking, even while formal banks are not established.- The name indicates, probably, the origin. It refers to the bench or table of- a money exchanger. He needed no other capital than it, small amounts in different currencies and his- exchange rate knowledge and reckoning skill, to let him profitably- deal with the various currencies and currency substitutes offered- to him and wanted from him by his customers. A modern bank of- issue does also not need a capital of its own, just an office and -a printing facility or a printer's credit. How far the- circulation area of any advanced private currency will expand,- beyond a local payment community, over a state, a federation, a -continent or the world, would have to be left to the market and- its free participants, acceptors and refusers. Computers will -facilitate checking up on the validity and value and genuineness- of private competing exchange media, as they can, upon various- credit cards. Automatic forgery detection machines do already- exist. But I for one am less worried about international acceptance for any private currency than I am interested in seeing locally provided as much local currency as is required for -local service, goods and labour providers. In areas that have -much international tourist influx there are already many -competing exchange offices, in addition to such services being -provided by local commercial banks. Even if no world-wide or- continent-wide competing currencies should develop and be -maintained, under full monetary freedom - apart from the- circulation of some privately minted gold and silver coins, most likely in-standardised weight units - and credit cards - these exchange -facilities would suffice to enable tourists to pay their way- everywhere and to see to it that local exchange media are -returned to their issuers. Whatever is convenient and profitable -in this sphere - will be provided under monetary freedom. Whatever- is too inconvenient and too unprofitable will not be - and that- is as it should be. We should not sacrifice our economic options, prosperity and our liberties to the uniformity spleen.- Informally, and without having legal tender in other countries,- and often under-ground, some currencies, like the U.S. dollar,- have already turned into world currencies. DM were, likewise, widely accepted in other European countries, at least on the -black market, when the own national currencies were more wildly- inflated than the DM was. Let people do their own things for and- to themselves, in this sphere, too. Only coercion, theft, forgery- and fraud need to be suppressed and that can be done more -effectively by private or cooperative and competing agencies,- too than by territorial State governments. - J. Z., 7.12.92.
FREE BANKING: To force all people in a country to be paid only- with one exclusive and forced currency is as wrong and- uneconomical as forcing all of them to be employed only by the- State or by a single private but monopolistic corporation. Free- choice for the issue & acceptance of all kinds of wage payment -means and for all kinds of value standards for them. - J. Z.,- 29.12.92, 29.4.97. - What is unlawful here should be legalised -and what is legalised here should be outlawed. - "Embrace what- you have burned and burn what you have embraced" - A remark- supposedly uttered by a priest upon the conversion of the first- French king to Christianity.
FREE BANKING: While I do favour free banking, I do not want to- run a free bank myself. I favour competitive postal services and- taxi services as well, competitive courts and jury systems, even- competitive governments and free societies and defence forces and- free and ideal militia protection services for individual rights- - but would not want to run any of these services myself. - -Others would be much better able to run or organise such services - and would get much more fun out of them than I would. -- J. Z., 12.3.93, 27.5.97.
FREE COMPETITION WITH & WITHOUT MONETARY FREEDOM :
FREE ENTERPRISE WITH & WITHOUT MONETARY FREEDOM :
FREE EXCHANGE & MONETARY FREEDOM & TAXES: Only an unlicensed- unregulated, untaxed exchange on a truly free market, that is- also monetarily and financially free, is a FREE EXCHANGE. - J. Z.,- 21.10.89. - It requires absence of all wage- and price-, interest--rate- and rent-controls, quotas, subsidies, compulsory licensing, reserve requirements, imposed rare metal convertibility and a -free transport system, too. - The Soviets are not longer ruling- in the Soviet empire but all too many of the Soviet's -interventionist economic measures persist there - and in the- supposedly free Western countries, without being recognised and- fought as such. - J. Z., 29.4.97.
FREE EXCHANGE AND MONETARY DESPOTISM: Our very survival depends -upon division of labour and free exchange of our goods and -services. So how can we favour or consent to any restriction upon- exchange media, value standards and clearing options, in a -manifold monetary despotism, rather than insist upon full- monetary and clearing freedom? The very term "value standard"- suggests already that it should be more reliable than is the frequently mismanaged and often very much depreciated and further deteriorating paper- standard provided by the government. The very term "exchange -medium" indicates how dependent we are on this medium of an- advanced civilisation and economy and that we should never -tolerate its monopolisation and manipulation. The very term "monetary policy" should get our hackles up - after all the- experiences we have had with it. Nevertheless, we remain calm or- apathetic, when our "leaders" proclaim inflation and unemployment- "targets"! - J. Z., 19.3.97.
FREE EXCHANGE, MONETARY FREEDOM, FREE BANKING & FREE ENTERPRISE,- FREE COMPETITION, FREE COOPERATION, FREE CONTRACTS, FULL PROPERTY -RIGHTS: No obstacles to any creative energies (L. E. Read, mostly as: Release all creative energies!) and -their exchanges. Under this condition persistent mass -unemployment and sales difficulties, not caused by wars,- revolutions, political interventionism or natural catastrophes, -do become almost impossible. - J. Z., 14.12.92.
FREE MARKET & MONETARY FREEDOM & MONETARY DESPOTISM: The free market cannot sufficiently liberate, e.g. supply full employment - (for all able and willing to work) and easy sales (for all- offering consumer satisfactions at market prices) if it is not a -fully freed market, i.e., one that would especially include- monetary and financial freedom, too. - It is hard to understand- how such an important liberty could have been overlooked or distrusted or slandered for so long and by so many, even when -freedom of expression and information existed. The extensive existing freedom of expression and information and powerful and very affordable alternative media should be bully -utilised, in their strength, against monetary despotism, a.s.a.p. - J. Z., 29.12.92, 29.4.97.
FREE MARKET & MONETARY FREEDOM:  A free market needs freedom in- the supply of money. - Henry Meulen, THE INDIVIDUALIST, 4/75.
FREE MARKET & MONETARY FREEDOM: Without monetary freedom the "free market" isn't a FREE market. - J.Z., 4.8.01.
FREE MARKET RATING FOR COMPETING CURRENCIES & ACCOUNTS & THE- EFFECTS OF LEGAL TENDER ESPECIALLY UPON INFLATION & STAGFLATION: -The monopolies or oligopolies for the issue of banknotes or for running cheque accounts and- clearing centres, are not discussed sufficiently in most writings- on economics. Instead, legal tender is uncritically accepted as a -supposed ideal or as a necessity and the fact that they are the necessary and sufficient ingredients to make inflations, deflations and stagflations possible, is usually ignored. Thus most "thinkers" and "experts" on this subject remain unaware that free-market rating for currencies, voluntary acceptance or refusals, the self-interest of competing issuers and their internal clearing would rapidly stop or altogether prevent any over-issues. Is there one book in a thousand on economics, that clearly indicates the relationship between inflation, deflation, stagflation and the issue monopoly and legal tender? -
FREE MARKET RATING OF CURRENCIES & THE QUANTITY THEORY: Unless -the government money is freely priced, the government will never -know whether it is putting into circulation too much of its money- or not enough. - J. Z., 24.2.75. - The same applies to any private- currency issues. Free market rating does also require sufficient -publicity for it - in order to be effective. - J. Z., 21.3.97.
FREE MARKET RATING OF CURRENCIES: When under a free market rate - i.e. in the absence of legal tender) an over-issue of a paper--money should occur, then it would suffer a discount in -circulation so that e.g. a gold coin of 20 marks would come to- cost 21 paper marks. But the goods prices would remain unchanged,- provided only they are fixed in gold units, e.g. gold marks.  - -Ulrich von Beckerath, 25.1.52.
FREE MARKET WITH & WITHOUT MONETARY FREEDOM :
FREE MONEY ISN'T FREE, INTEREST RATES: It cannot be provided quite interest free -or free of all fees, like insurance and administrative and- printing costs. But it can be cheaply provided, obliges only the -issuer and the acceptor must merely show some understanding and- self-responsibility and pay attention to publicity, in order to enable him to discriminate between some good and some bad monies.- But, as a rule, he could very easily test the goodness of any private notes- offered to him - by taking them to a cashier at the nearest shopping- centre, asking him whether he would accept them at par. - So far -most people have not yet paid the minimum price for monetary freedom : They have not yet read up on it, pondered and discussed -it sufficiently and taken the necessary steps to introduce it. -- J. Z., 23.12.90, 16.4.97.
FREE TRADE & MONETARY & CLEARING FREEDOM: The stocks of goods -and the number of services and labour hours that could be made -accessible on the international market are immense. They could be- mobilised, world-wide, via a) gold weight value accounting (or -their freely agreed upon equivalents), used in- free international clearing transactions that never promise -payment in gold weight units but acceptance of these clearing- media as if they were their equivalents in metallic gold. b) By the free- circulation of clearing certificates of this kind, world-wide, -and their use to pay all imports and exports with them, if that- is agreeable to the traders involved. c) By the free transfer of -non-cash accounts, whether these are kept on paper records or are -merely electronically recorded and whether they use for their -clearing purposes a gold weight unit or whatever other value standard unit the -trading partners find mutually acceptable. d) By the use of sound -commercial bills of exchange (real bills) or their equivalents, -in international trading, as has been the tradition for hundreds- of years, when not interfered with. But these should be bills- "for clearing only", unless something to the contrary has been- contractually agreed upon. They should not longer be legally and- juridically treated as promises to deliver rare metal quantities or legal- tender paper money. For that is a kind of speculative dealings in futures in which -fulfilment of the contract is not always possible, unless hedging -has been undertaken or withdrawal premiums have been agreed upon.- If the Special Drawing Rights or SDRs, granted by the IMF, were of that nature and if the IMF were not a monopolist for such issues and if they were not usually granted to more or less- bankrupt and mismanaged governments, then they would be O.K.,- too. But it seems advisable to replace them by private issues and- accounting and value reckoning, without any exclusive and forced- values and between traders rather than between governments -- which should have nothing whatsoever to do with international -trade and finance. - J. Z., n.d., 29.4.97. See INTERNATIONAL TRADE, INTERNATIONAL CLEARING.
FREE TRADE & MONETARY FREEDOM, CENTRAL BANKING & PROTECTIONISM: -If Free Traders had been Free Traders regarding Free Banking (-internal, self-managed free trade agreements, as well as the free- use of international clearing certificates and alternative value- standards), as well as financial freedom, then they would have -won their struggle, completely, long ago. But under monetary -despotism the protectionist statists had to get the upper hand- again. One might even say that central banking is the worst- protectionist institution of all. - J. Z., 2.5.93 & 15.4.97.
FREE TRADE & MONETARY FREEDOM:
FREEDOM & MONEY: Freedom - the power over money. - From a St.George (building society) advertisement, on TV, 30.3.87,11.55ppm
FREEDOM OF ACTION IN THE MONETARY SPHERE:
FREEDOM OF EXCHANGE & FREE SOCIETY: If Bastiat was right when he said that "society is exchange" then we will have a free society only once full freedom of exchange is established. -  J. Z. 21.8.74, revised 12.3.85 & 21.5.97.
FREEDOM OF ISSUE, FREEDOM TO ACCEPT, DISCOUNT AND REFUSE, using- any suitable medium and standard: What does it mean with regard -to the issue, acceptance, valuation and refusal of monetary- freedom writings in alternative media, like microfiche, floppy disks and the enormously cheap and efficient text-only CD-ROMs -and ZIP disks and still more powerful options coming up? - No law- prohibits them. No regulations or special taxation burdens make -their practice difficult. No compulsory licensing is required for -them. They may be freely produced and traded and valued and- collected - but, who cares, even among the monetary freedom -advocates, even when the largest collection ever, of this kind, -is only available from LMP on microfiche - and very cheaply and- permanently, too? - J. Z., 9.4.97.
FREEDOM OF NOTE ISSUE, FREE BANKING: "They may even find out that -freedom of note issue is the simple key to the abolition of bank -monopoly." - HENRY MEULEN, THE INDIVIDUALIST, 6/78 p 27.
FREEDOM OF NOTE ISSUE: We must return to a floating gold price- and to freedom of note issue. How and when we do this is a matter- for the politicians; but the sooner it is done, the better. - Henry Meulen, THE INDIVIDUALIST, Feb. 76, p. 5.  - We are not -bound to accept Meulen's hobby horse of a supposedly more stable value standard, consisting of a fluctuating gold weight value of- a thus supposedly more stable paper pound. But people should be -free to adopt his preferred "standard" for themselves. As for -expecting politicians to take up this matter and realize freedom of note issue soon: We might have a very long wait ahead. The -matter has been left in the hands of politicians almost since the- beginnings of monetary economics. It should finally be taken out -of their hands. Enough is enough. - J. Z., 21.3.97.
FREEDOM TO EXCHANGE : Kids have the right to swap their -possession, and to do some extra household chores to earn  some- extra pocket money. Adults also and obviously have the right to- swap surplus goods and services and labour in family, friendship -and neighbourhood circles. All members of all free communities -have the right to swap whatever labour, goods or services they- can offer for whatever labour goods or services they wish to obtain, directly or via some agreed-upon money token or clearing process. They do have the right to pay off their debts in whichever way they -please and with whichever means of exchange and value standard -that suits them AND their creditors, or to simply -settle them by clearing or to have them cleared via special clearing -agencies set up by them or used by them. No one has a right to -interfere with any of their peaceful and creative transactions- and with the ways, means and methods they do want to use. Especially no government has the right to administratively, -juridically, legally or constitutionally interfere with any -voluntaristic, tolerant, honest and well publicised monetary, -clearing and financial exchanges, exchange and clearing- arrangements and institutions, and any experiments of this kind, -designed by their participants to abolish unemployment, -underemployment, inflation and stagflation, sales difficulties- and bankruptcies between them. The only condition is that all- these exchanges and experiments are only undertaken at the risk -and expense of their voluntary members, customers and investors. Governments are obviously unable to prevent or end economic- crises but rather cause them, again and again and worsen them -further, by their interventionist, command, regulation, licensing- and monopolistic or other despotic monetary and financial policies. - J. Z., 30.10.93, 30.10.95, 18.3.97, 28.8.02.
FREEDOM TO EXCHANGE ONE'S LABOUR, SERVICES & GOODS THROUGH -MONETARY SELF-HELP MEASURES: See: UNEMPLOYMENT & THE RIGHT TO -SUPPLY ONESELF WITH WORK. A DECLARATION, by Ulrich von Beckerath,- 10.8.1951.
FREEDOM TO EXCHANGE: People should certainly be encouraged to -produce and exchange and clear their debts beyond their current -means to do so, these means being their incomes as defined in and -limited in size by the government's (or its central bank's) -exclusive and forced currency. At presently they cannot produce -and exchange whatever production and exchange is not financed by- the government's paper money and permitted clearing and credit- avenues. That is the major factor that keeps most people much -poorer than they would be under full economic freedom, especially -under full monetary and financial freedom. Nevertheless, so far- only a few dozen to a few hundred people strive consciously -towards that freedom. What is your excuse for not doing so? -- J. Z., 14.5.85, 3.5.97.
FREEZE: A freeze of all wages and prices would stop inflation. - Popular opinion. - It would not stop the note printing presses. Only the abolition of the issue monopoly and the legal tender for monopoly money could stop the note printing presses for such money. Freeze the government note printing presses, and end rather than apply legal tender legislation and the note issue monopoly. Then prices can no longer be inflated by the forced issue, acceptance and value of depreciating money and prices will no longer have to be expressed in it or paid for in it. Allow the market to reject bad money and accept good monies instead. Otherwise the bad money would force not only the good monies from the market but would, finally, finally goods, services and labour from the open market and force them into the underground or black market. Price control has been tried, in vain, for over 4,000 years. What makes you believe that it could work now? Do you believe in miracles? Do you believe that legislators and policemen can perform miracles? Do you believe also in whipping waves to make them subside, like King Canute did? (If he did not merely want to demonstrate the futility of all such attempts.) - J. Z., 2.4.97. See: PRICE CONTROL.
FREMERY, ROBERT DE, "Money and Freedom" and "Rights vs. Privilege":- These 2 titles are the best and the most misleading among his -monetary writings. For he does not write about full monetary -freedom. Instead, he offers his version of a supposedly ideal, -exclusive and forced currency, based upon population figures -rather than products and services offered. He does, instead, -share many of the prejudices of Social Credit advocates and of Single Taxers. A few freedom insights are almost buried among -them. But he is right in the common sense rule that short-term- funds should not be invested on medium and long terms. He does -not realize the wrongs and harms of the State's money monopoly and- legal tender power and advocates as a reform a population--determined circulation, monopolistic and forced currency, issued -by the government. That might turn out even worse than the- present central banking system. He opposes inflation but proposes -what makes inflation possible and likely: a forced and exclusive- currency. "Oh liberty! What crimes are committed in your name!" He wants to outlaw all credit currencies and seems -nowhere to have comprehended the banking principle or real bills -doctrine. He considers even a freely contracted fractional -reserve currency as fraudulent, even when safeguard clauses are -added, like option clauses etc. His constitutional stabilization -and circulation rule is not likely to work any better than the -others that were proposed. But those satisfied with Fremeries -should be free to try them - among themselves. - By all means, -add your own abstract or review! No one can read, abstract and -review all the literature. - J. Z., 16.3.97.
FULCRAUD-MAZEL, M., Labour Exchange Bank, 1818. In Paris, in 1829-a bank was established on his principles. - Hint by A. Menger.- More information on this would be welcomed by me. - J. Z., 19.3.97.
FULL DISCLOSURE FOR THE FINANCIAL CONDITIONS OF BANKS OF ISSUE, OR FULL PUBLICITY OR OPEN BOOKS & ACCOUNTS: That is a condition for free note issuing banks that have nothing to hide and want this condition to be fully known. In the far future, when free banking becomes a routine business, in which all the flaws of old banks of issue are habitually avoided, like astronomers would avoid the assumptions and prediction of astrologers and chemists the opinions and aims of alchemists, that insistence upon full publicity might no longer be required to assure the correct functioning of banks of issue, especially those that issue exchange media to promote turnovers of goods, services and labour. But until then such publicity would be part of a sound issue policy. However, we are not as yet living in an honest and secure world for property rights and free exchanges. Under coercively levied tributes and numerous other anti-economic interventions by political authorities, one should make their jobs harder rather than easier. Thus, as long as "politics as usual" continues, internal auditing and mutual auditing of banks of issue will often have to take the place of full publicity, from which the robbers, oppressors and penalisers of productive people would benefit, too. Anyhow, the normal note exchange and account clearing between banks of issue and clearing banks would rapidly reveal those banks which had issued more banknotes and clearing certificates than they received from other issuers. We are still far from a condition where people would guard their bank relationships like the eyes from any damages or like their children from child molesters, a time in which people would realize that monetary freedom is part of their right to support themselves by their own efforts,  thus part of their right to live - through their own efforts and free exchange in societies based upon the division of labour and free exchange. Such people would not tolerate Big Brother looking over their shoulders and snatching away much of their property and earnings, like a sneak thief or open robber baron. Thus, before monetary freedom becomes general or the norm, we might also have merely some private and free payment communities, within the framework of exterritorially autonomous communities of volunteers. They would have no bank note issue secrets for their members, side by side with other free banking undertakings, not yet so liberated, but prepared to uphold their banking secrets against government snoopers and looters. We might in the transition stage also get some who, as a concession to widespread disbelief in the honesty of any bankers and to the general anti-capitalist mentality and in spite of the tax risk that would thus result, would lay all their cards on the table, by opening their books to any enquirers. We live after all in a time where even some free banking advocates like Rothbard was, are so fanatic in their belief that only their own favourite system would be sound, here a system of 100% gold covered gold certificates, that they do class all alternatives to it as fraudulent or mere fiat money. So not only the critics of capitalism but also its defenders would have to be shown that sound banks of issue, operating on the "banking principle" or "real bills doctrine, or more directly", utilising their shop foundation or "readiness to accept" foundation or clearing options, with their own "ticket monies", etc., have got nothing to hide and can be quite honest institutions that facilitate wanted exchanges. Another safeguard would be unlimited liability at least for all executive officers of a free bank of issue, if not of all members of it. That would not worsen its position on the capital market, since a bank of issue for banknotes, as well as one for capital securities, does not require any capital of its own or any capital subscription by others, but would merely act as a mediator or broker or clearinghouse for the ready for sale and daily wanted consumer goods, services and labours, via its banknotes, or of the capital assets of others whose marketing is to be facilitated by the issue of transferable capital securities. -  J. Z., 15.5.97.
FULL EMPLOYMENT & EASY SALES: The money you spend upon your requirements is sure to come back to you in payment for your goods, services or labour - but only if it was issued by you and upon that basis. Otherwise it will tend to stay at least temporarily with others, sometimes long enough to make you unemployed or bankrupt. The medium and long-term equilibrium achieved by the law of fluctuating gold or silver quantities is not satisfactorily operating in the short term. Thus one should not become or remain dependent upon gold and silver cash or rare metal certificates or upon exclusive and forced legal tender paper currencies issued by a national central bank, under their current policies, whatever they may be and however untimely and insufficient or misleading they might be. - J. Z., 20.4.93, 16.9.02.
FULL EMPLOYMENT & MONETARY FREEDOM : Jobs for all willing and- able to work, at market rates, will become available only with- freely competing private currencies, that would make possible for -all of them to have the means of exchange and the sound value -standards required to exchange all their ready for sale labours, -services and goods for those of others. The monies of monetary- despotism are, apparently, not sufficient or suitable to mediate -all these wanted and possible exchanges. - J. Z., 3.3.95, 27.5.97.
FULL EMPLOYMENT & MONETARY FREEDOM: Full employment by realising the principles and institutions of monetary freedom, in combination with free pricing (for goods and wages and services) and unrestricted savings, investments and capital transfers. - J. Z., 1985.
FULL EMPLOYMENT & MUCH EASIER SALE FOR ALL GOODS & SERVICES: -Goods, services and labour could almost sell themselves if they -could be freely offered in form of money tokens. Moreover, the -owners of goods, providers of services and labourers offering -their labour services, could then even anticipate their sales by using their money tokens first, buying with them - as far as they -could - their requirements and then later accepting them -in payment, i.e., redeeming them with their goods, services and- labour. Only monetary despotism could have left such a free,- easy, natural and self-liquidating issue and reflux option for -sound exchange media - largely unused over the centuries and still- overwhelmingly repressed today. The tradition of this repression -is so strong and widespread that it is largely accepted as widely -as death and taxes are. But this evil is much easier to avoid and defeat permanently. As many goods, services and labour hours- could thus be monetarised as people want and are willing to give -their goods, services and labours in return. Any shortage of- exchange media between them could then be rapidly supplied. Moreover, under voluntary acceptance and free competition and sound value- standard reckoning, no one could, even if he wanted to, force so -many of his tokens into circulation that they would become vastly- depreciated or that they could affect any prices marked out in- sound exchange value standards. - Yet, this natural and problem solving monetary -liberty is everywhere legally suppressed and largely unknown and -studied only in some more or less obscure writings, that few- scholars are fully aware of. Probably no one knows all of them as -yet - for no full bibliography of such writings has been published and only few of them are in print at any time or accessible in- public libraries. Almost all people talk or write about money -- but usually only about the money of monetary despotism, not the- money of their monetary emancipation. As a result they are all- unjustly and unnecessarily impoverished, driven into- dictatorships, civil wars and wars against their will, dedicate- their lives to class-, race-, national-, religious- and- ideological hatreds - instead of being fully employed and freely -exchanging with whoever they like on earth. It is a tragi-comedy.- According to one recent report, it may be exaggerated, if one can- really exaggerate the wrongs and evil of artificially brought- about unemployment, there are ca. 1 billion unemployed and -underemployed now. Add to them their dependants! And, apparently, -no leader or parliamentarian or bureaucrat or government expert -or central banker knows the cure or admits to it. Neither do- their victims. Nor do they show any significant interest in it. - -It is almost as it was before the Reformation in Europe with -regard to religious freedom. - J. Z., 18.9.91, 28.4.97.
FULL EMPLOYMENT & SACRIFICES: Full employment requires sacrifices. It can only be achieved by slow inflation. This is the sacrifice or lesser evil that has to be chosen. - Popular opinion. - The only sacrifice that is required to achieve full employment is that of the prejudices, errors and myths of monetary despotism.  - This reminds me of the bachelor who set fire to his house in order to get warm, when his heater did not function. - It also reminds me of the ancient Egyptian, Soviet and Nazi approach to full employment: They achieved it by forced labour or slavery, conscription, oppressive and exploitative taxation, confiscation etc. Some people are still foolish enough to praise them for the "successes" of their methods. - J. Z., n.d. & 2.4.97.
FULL EMPLOYMENT AS A VOLUNTARISTIC & SELF-HELP OPTION: I would like to see a complete register of all such proposals, as opposed to the vast majority of statist proposals that have been advanced, all based upon compulsory taxes and transfer payments or further issues of "greenbacks". I would also exclude all voluntary charity proposals for job provisions and concentrate on those only which are productive, self-supporting, profitable, i.e., credit - and self-help ones, using monetary and financial freedom options and organisational alternatives and free contracts, all free market options, in a business-like way. - J. Z., n.d., 24.5.97. See: IDEAS ARCHIVE.
FULL EMPLOYMENT FOR THOSE SUDDENLY RENDERED UNEMPLOYED THROUGH LIBERATION, LIBERATION COSTS, FINANCING A REVOLUTION, TAX STRIKES, REFUSALS TO ACCEPT GOVERNMENT MONEY OR BUY GOVERNMENT BONDS: Productive and harmless jobs from one day to the other for all those formerly employed by governments, e.g. in armed and uniformed services, in arms factories, in nuclear power plants, in customs disservices, etc. Only free banking could achieve that. Moreover, it should already have proven this ability e.g., by employing, almost instantly, millions of refugees, asylum-seekers and deserters. In Australia  every third to fourth employee is employed by the government or one of the Quangos (quasi-autonomous non-government organization), based upon legal privileges. All these people would tend to vehemently oppose liberation efforts that would threaten their jobs, unless they can be confident to find other jobs rapidly. To the extent that they are armed, they could defeat a liberation effort. Thus a tax strike should be combined with some voluntary taxation system run by the liberationists, to enable them to temporarily become the paymasters of the government's military forces, while the government, through a tax strike, a refusal to buy government bonds and a general refusal to accept government paper money, would be unable to pay its soldiers. Depending upon the situation, the state of enlightenment or the predominant prejudices, the government soldiers could be bought off with temporary grants, including the purchase of their weapons, or with personal credits or with immediate job openings or with a combination of such offers. Even if a statist soldier would have to be bought off, this would cause less than the damages to lives and property that he could cause if he kept fighting for a despotic government and thus helped to keep such a regime in power for a while. - J. Z., 16.3.85.
FULL EMPLOYMENT JUST NOT FEASIBLE & LOW UNEMPLOYMENT NO HARDSHIP?- "... full employment was 'just not feasible in a democratic -economy', the Institute of Public Affairs (Melbourne) said- today. ... These figures showed that unemployment at the levels -of the past 12 months imposed no desperate hardship on most of- those unemployed. - The December figures showed that 137,000 -people were unemployed in Australia. - 'Of these, 54,000 were -teenagers - more than one-third of the total - and practically -all of them would presumably be supported by their families. - -Nearly one-third of the unemployed are female, and probably half- of these were married women. Half were under 21.' the institute -said. - 'Another third of the total unemployed - the HARD CORE -were difficult to place in jobs, because of physical or mental- handicaps, age disability or personal defects of character. - -Surveys by the Department of Labour show that more than half of -the unemployed find jobs within one month. - It is generally- overlooked that the unemployed are composed of a moving, not a- static, population, and that prolonged hardship is rare. - The -prevalent notion that unemployment around 2 % is responsible for -widespread hardship clearly does not stand up," the institute -said. - THE SYDNEY MORNING HERALD, 3.2.73. - Now that -unemployment is somewhere above 8% it is more difficult to be as- complacent about it - when one does not suffer under it oneself. -- The somewhat disabled, and the young people, at market rates of- pay, according to their actual productivity, would have no- different rates of unemployment from others. One can always have -those numbers of unemployed one is willing to pay for -sufficiently to make some prefer being so paid for doing nothing, rather than working for a living. The figures on unemployed when- compiled by bureaucrats are unreliable. They will e.g. include -many, who are working, some who register as unemployed several- times and get several unemployment benefits. (One con-artist -in West Berlin managed to get such benefits from 12 of the 20 -districts of this city.) Some will work in the underground- economy, regularly or occasionally. All this depends on the dole being granted as a handout rather than as a credit, whose -repayment is strictly assured. It was absurd to include all school -leavers as unemployed, from the moment they left school and all- job changers, from the last day of their last job. The- bureaucrats and politicians, for their own motives, will either -over-state or understate the existing unemployment. But to deny- its existence or to assert that any degree of involuntary- unemployment of capable and willing workers is necessary or unavoidable is -quite another thing. - J. Z., 29.5.97.
FULL EMPLOYMENT REQUIRES THE RIGHT TO WORK, PROPERLY DEFINED: The right to work, properly defined, means the right to supply oneself with paid productive work, paid at free market rates and without depriving anyone else of a job to achieve that. It includes the right to undertake all organisational, monetary and financial steps required for this purpose, regardless of contrary legislation, jurisdiction, administrative practices, trade union dogmas, public opinions and the views of presumed experts. - J. Z.,10.12.92, 23.5.97.
FULL EMPLOYMENT THROUGH INDIVIDUAL RIGHTS: Full employment through full knowledge and realisation of all individual rights, especially all economic individual rights and, among these, especially of all monetary and financial freedom rights and liberties. - J. Z., 25.9.93, 16.9.02.
FULL EMPLOYMENT THROUGH SLOW & FIXED INFLATION:  No more than 3 - 5% annual inflation are required to achieve full employment - and this is an acceptable sacrifice. - Popular opinion. - This has been tried, over and over again, for decades, and unemployment of at least some per cent still continued - while the currencies were more and more depreciated and reduced to a small fraction of their former value, with value standard reckoning and long-term private investments destroyed rather than protected. - Will such false employment policies also be pursued, in spite of all evidence against it, like religious dogmas, like price control for over 4,000 years? - Full employment does not require any sacrifices. It need not cost anything. It can provide surpluses, extra wages, sales and profits right away - if only the market is set free in every sphere, especially in the monetary and financial sphere. Exchanges of services labour and goods for services, labour and goods - do not have to be promoted and stimulated. If only set quite free then they have enough internal and natural stimulants and incentives, also safeguards and warnings and alternative options. No inflation of forced and exclusive currencies does prevent all unemployment nor can it prevent (from establishing by itself) some degrees of unemployment, especially obvious in the later stages, that of a galloping inflation, or a large degree of unemployment in a stagflation. In Russia today, in spite of an inflation of hundreds of per cent p.a., the government is still in arrears of wage and salary payments for months. Sooner or later, as a result of that, it will either be deserted by most of its servants or even these servants will rebel against it. Sacrificing others, en mass, without their explicit consent, for what you perceive to be the public good, is never a rightful or efficient solution to any problem. Governments have destroyed the lives and properties of hundreds of millions in this century, through their monetary despotism and its consequences: wars, revolutions, civil wars and terrorism. It's high time to end their kind of "full employment" policies and to finally begin on the monetary and financial freedom path to full employment. At least those willing to risk entering it, with their lives, property, services and labour, should not longer be obstructed by governmental monetary and financial "policies". - J. Z., 2.4.97.
FULL EMPLOYMENT, FREE MARKETS & MONETARY FREEDOM: Full employment through a really free market - including a free market for exchange media and standards of value. - J. Z., 1985.
FULL EMPLOYMENT, MONETARY DESPOTISM & MONETARY FREEDOM: You are not free to sell or offer your labour power or exchange it for other services and goods you want. This is why you or others are unemployed or underemployed and why almost all are under-paid. - You are not free in this respect because you are forced to sell your labour for one thing only - exclusive & force currency of the government or its central bank. This currency is in short supply because its supply is monopolised and controlled by the Central Bank. (Remember the past and current credit restrictions with their artificial unemployment and depression.) - Thus only freely competitive note-issue banking can do away with unemployment and sales difficulties, with depressions and underdevelopment. - J. Z., 1985.
FULL EMPLOYMENT, MONOPOLIES & THE STANDARD OF LIVING: Break ALL legally introduced and maintained monopolies and you could have full employment in a day and a much better standard of living very soon. - J. Z., 23.8.95, 25.5.97.
FULL EMPLOYMENT: Full employment exists naturally when services, labour and goods can be freely exchanged for other services, labour and goods, in a monetary and clearing way, using sound value standards. -  Unemployment results only when someone puts one or the other hindrances in their way, thus preventing some or many of these voluntary exchanges. - The worst such hindrance is the legalise monopolisation of the exchange medium and of coercive standard for all transactions and their coercive manipulation. (From PP 16-18, with slight changes. J.Z., 15.9.02. See: UNEMPLOYMENT.
FULL EMPLOYMENT: Full employment expresses the freedom to -exchange, to mutual satisfaction, whatever one has to offer in -labour services and skills (via some currency, employer, retailer, banking or clearing services) for whatever goods, services -and labours one wants. To be fully free and effective in -promoting full employment for all involved in free exchanges, all factors involved, -the exchange media, value standards, clearing and banking -services, prices, wages, employers, bankers, wholesalers, -retailers, etc., must be quite free to do their things in this process, -quite unlimited in their productive and exchange contracts and in -their terms and conditions. Especially they must know,- appreciate and apply full monetary, clearing and financial- freedom. No law or regulation or board, authority, judge, inspector, controller, -policeman - or central bank must be given any powers to prevent,- reduce, regulate or postpone or tax their exchanges. Only then- will the market be free and can all the debts and credits become freely exchanged for each other and thus settled. Not only some -forms of money must be permitted, namely the money of monetary despotism: an exclusive and forced or legal tender currency, but all kinds- of money that free people are able and willing to issue and able -and willing to accept, to their own advantage and to that of their trading partners and that of the whole economy. With regard -to full employment that requires e.g. the repeal of all- anti-truck legislation, so that alternative exchange media for- wage payments can be freely offered and freely accepted,- discounted or refused, particularly in times when a central bank- severely over-issues its paper money or has severely deflated it. -In other words, full employment requires free and voluntary- conditions, in which good monies are free to drive out bad monies-, that is: in which bad monies are not legally given despotic powers to- drive out good monies - which leads to stop-and-go policies, -alternating booms and busts, and almost all the time introduces -at least degrees of inflations AND deflations AND stagflations,- which would not occur under monetary freedom. No truths may be -better established in fact and in theories in economics and -public policies and legislative efforts and yet, this insight is -still one of the rarest and least popular, most ignored or most- argued against. - J. Z., n.d. & 29.4.97.
FULL EMPLOYMENT: Full employment for all able and willing to- work at market rates and payment for work done in competitive and- optional currencies, that are privately or cooperatively issued- but presently outlawed, unknown or wrongly maligned or suspected.- That would be a free economy or free market measure, one of free-enterprise, free exchange, free contracts and free trade, one of -self-help, more useful than all the Welfare State measures- combined. Finally an end to monetary despotism, to the -totalitarian communistic or state socialistic and centralistic -money system, with its coercion, monopoly, fraud and wrongful -taxation powers, without any representation by the victims of it.- Nor have the masses of unemployed, now ca. 800,000 in Australia- and about a billion in the world, been given a vote for or against -monetary despotism and for or against monetary freedom, at least -as far as their own voluntary associations are concerned, their- own potential payment communities. Enterpreneurs do not really- deserve this name or the name of employers until they prove that -they can turn the huge stock of ready for sale consumer goods and- services and of under-employed or unemployed labour into at least locally useful cash to pay newly employed labourers with and to -become thus employers of all able and willing to work for- competitive monies. Their addiction in their thinking to forced currencies, only, and- its practices, does probably do much more wrong and harm than do the combined addictions to alcohol, tobacco and other drugs. - Without monetary freedom the required -monetary, credit and clearing self-help steps cannot be taken.- Monetary despotism is the problem, not the solution. - The- despotic monetary clauses in the constitutions, laws, -regulations, juridical decisions and despotic powers in the -government's monetary and financial institutions have to be- either repealed, ignored or overthrown in a monetary revolution, one -that is rightful, non-violent, economic, non-destructive of- property rights and very rapid in abolishing unemployment through -alternative and sound exchange media and value standard- reckoning. To the extent that this monetary revolution is not- obstructed, the old institutions and practices could be tolerated -and continued by those who still like them - at their own expense -and risk. But under fully free competition in this sphere they- are unlikely to last long. - Monetary freedom would realize the -right to supply oneself with work without depriving anyone of- their rightful jobs and without extorting tributes or privileges -from others. (Some bureaucratic jobs would, indeed, become -superfluous. But if the current jobholders are intelligent, -industrious and willing, they would soon find productive and -perhaps even better paying but certainly more satisfying jobs.) -In essence, a new kind of merely monetary and financial -revolution is required that would not infringe any basic individual rights  but rather would realize many important and so -far largely unknown, ignored or suppressed individual rights. - J. Z., 29.8.02.
FULL EMPLOYMENT: Full employment requires, first of all, full- monetary freedom. - J. Z., 6.11.91. - Alas, so far not one in a- million unemployed and perhaps only one in ten-thousand economists -has recognised this truth or, in other words, the connection -between legal tender monopoly money and inflation, deflation and- stagflation. - Once this truth is recognised, involuntary mass -unemployment could, in most cases, be abolished within a day. But -the mentality of unemployed induces them rather to seek further -government meddling, or to appeal to charity or to gamble, prospect for -gold, diamonds etc., retreat to a potato and carrot patch and- blame, "capitalism", "financiers", "the market", "conspirators", -"competition", "immigrants", "profiteering", "greed", "speculation" etc. - Even these -imagined causes have not yet been fully registered and refuted- yet. - Their floods swamp or push out of consciousness the few real solutions that have been -proposed. GIGO. - J. Z., 26.4.97.
FULL EMPLOYMENT: Inflation is the result of full employment policies. - Popular opinion. - That may be the "good" intention of "full employment policies" by governments - but, alas, never the result. Perhaps we should be grateful that government fails in this as in everything else. Otherwise it would have at least this leg to stand on or could, to that extent, be intellectually defended. - The tiny kernel of truth in the assertion is the "theory" of Keynes that demands a slow inflation to promote full employment. When this is realized then this means that inflation is the result of inflation. A very good "explanation" that! - J. Z., n.d. & 2.4.97.
FULL EMPLOYMENT: People, if only they are free to produce and exchange, make their own jobs for each other, as they always have and always will. They can do so in any numbers, even by the millions, as they have done, for instance, for the ca. 50 million immigrants to the U.S. - A hero of French detective stories said: "Cherchez la femme!" - Look for the woman who is involved. With regard to employment and sales difficulties we should always look for the exchange media and value standards that are involved or, rather, for those which are missing because they are outlawed. - J. Z., 23.8.95,24.5.97.
FULL EMPLOYMENT: The task consists in transforming the personal needs and wants for consumer goods and services of the unemployed, within the limits of their personal ability and willingness, education and training to give labour and services in exchange, into wants supplied with purchasing power or effective monetary demand for these consumer goods and services. This task must be solvable for there are many others who have needs and wants for the labours services which these unemployed would be able and willing to supply, if only these others, likewise, could transform their needs and wants into effective demand or purchasing power. - Obviously, central banking is not up to this task. The utmost decentralisation, free enterprise and free competition is required in the sphere of supplying alternative and sound exchange media and value standards. Also the utmost individual sovereignty or consumer sovereignty towards the alternative currencies offered, to assure that they do really serve the needs and wants of all producers and consumers, at least in a local area of issue for any competing currencies. Like the present central bank paper currencies, none of the competing monies has to be UNIVERSALLY acceptable to be LOCALLY useful. - Let free people find out which kinds of currencies they could offer and free potential acceptors decide which kinds of currencies they are ready to accept. To over-supply or under-supply them, under these conditions, with the wrong kind and more or less useless currencies, would be as impossible as supplying them with e.g., the wrong kind of houses or vacuum cleaners or tickets for wanted performances. Let the good monies drive out the bad ones, by sovereign consumers refusing to accept them, while they readily accept and pass on the good ones. - J. Z.,20.8.91, 24.5.97, 16.9.02.
FUNDING ISSUES OF CURRENCY, ASSET CURRENCY, GUARANTY & SAFETY -FUNDS, BANK CAPITAL, BACKING, COVER & RESERVES FOR BANKS OF -ISSUE:  Attempts to "fund" currency issues with medium- or long--term private or public securities do not provide a corresponding -full or sufficient and immediate or short term demand for the issued notes. Only upon ultimate liquidation of a bank's business- would the creditors of a bank be somewhat or fully satisfied- through such securities. But the purpose of a currency is not to- achieve creditor satisfaction in case of a bankruptcy but almost -instant exchange satisfaction. And instantly such asset currency- cannot be turned into the cover-securities nor is such a cover -even wanted by most note holders. At most the debtors of such -securities could pay interest and dividends with the currency -notes issued. But that relatively small periodical demand for the- asset currency cannot keep it at par with its nominal value for many months or -years. And the notes themselves do not pay interest or dividends -to their holders. Capital securities not paying interest will -drop in their market rating. There must be another motivation for- potential acceptors and holders of currency notes. They must be- able to pay all their current debts and expenses with them. That- is not the case when they are merely issued upon medium or- long-term private, cooperative or public securities. Why should private suppliers of daily wanted consumer goods and services -have to or want to accept such asset currencies - beyond their- desires to invest on medium or long terms? They should and could- rather issue currencies of their own and refuse those of others or- discount them in the few cases where they would still be prepared- to accept them. Security upon liquidation should be distinguished -from security and guaranty, instant usability or reflux of a currency.- Without it it is not "current" or currency. If the market were- flooded with "asset currency", it would not be flooded with- additional and wanted consumer goods and services. In other words, in relation to the offer of consumer goods and services, -the asset currencies would go down in their market rating,- against sound value standards, even though the assets involved -may be quite rightful, honest and productive. They are simply not -due yet - and not as much and as widely wanted as consumer goods- and services in daily demand are and the holders of these goods- and services are under no obligation to exchange them for any- asset currency - unless the government forces them to do so via the issue monopoly and legal tender legislation. Then they have- no other defence against being so wronged and harmed by this -flood of ill founded "currency" than by increasing their prices,- fees, salaries and wages, although in purchasing power, reckoned -in sound value standards, they might remain largely the same. -- Unless people want to invest they do not want scrip promises- ultimately covered by securities for investments. And if they- were to accept scrip then it would only be to the extent that -they want to so utilise their savings rather than spend them- right away or soon upon consumer goods and services and paying due debts. -- In other words, an future liquidity does not provide a- sufficient liquidity or readiness to accept it right now, for the- goods and services one wants right now. - The terms "security"- and "guaranty" are very misleading in this connection unless one -observes the time factor and the term obligations involved. - In- Australia, if you had a share in a privatised Sydney Harbour -Bridge, or Harbour Tunnel, what could you do with it? At most you could pay your- toll with it, if it were in the right denomination and if the- security were already due. You could not dismantle a stone or- beam etc. of the bridge or tunnel for it and take it home. Nor would you want to. When interest or- dividend are due, you could also pay tolls with your coupons or -ask for a share in the toll takings, to the extent of your -interest or dividend claims. But no retailer in Sydney would be- under any obligation to accept your share or bond in payment for- what he has to offer. Why should he be? YOU considered the bond- or share certificate to be valuable enough to want to buy it. Why should he? In other words, we should distinguish the capital -market from the currency market. J.Z., - 16.8.94, 17.4.97.
FUTURES DEALINGS WITH CASH. EACH MONEY DEBT IS TODAY SUCH A- SPECULATION: A speculation in futures is involved in any promise -to supply a form of cash which at present one does not yet have -on hand. I know of only of one author, namely Ulrich von Beckerath, 1882-1969, -who has extensively discussed this problem and its solution. He- did not want to abolish the non-cash and clearing transactions -but, rather, free them and make them customary and standard -behaviour, a basic monetary and property right. Any debtor should become free to offer clearing, instead of cash to his creditor,- under conditions that are mutually acceptable, in the settlement- of all his debts. For this purpose, he should also become free to -offer his own clearing certificates in settlement, in some cases- at a discount that would be required to satisfy a creditor. When necessary, the- settlement should be arbitrated through an agreed-upon- arbitration avenue. The liquidity and bankruptcy rules, like the reserve, redemption and convertibility rules of governments, are -entirely unsatisfactory and have caused, promoted prolonged -and sharpened many monetary crises. In most cases, when the -system is fully developed, such a discount would not even be- required. Even when clearing was merely carried on via book--entries, it was already so developed e.g. in colonial India, that- a colonial official could "pay" for  his coffee, meal or -purchases on the market with a privately written and informal "chit", then and there,- accepted at par, without hesitation, which ultimately was- deducted from his income account, via some chit traders, who- specialised on mediating such clearing. And more or less -primitive French subsistence villages, far from Paris, had their -own clearing payment communities, for their internal exchanges,- in which private IOUs were freely issued and accepted and-, periodically, mutually offset, without any official "Franc" being -involved at all, physically. The government's cash currency-" standard" was merely used as an accounting and pricing standard- but not used physically in most of the local payments. - No one should be driven into liquidation or bankruptcy without every- clearing options having been fully exhausted first of all.
GAME DESIGN & PLAYING OF MONETARY FREEDOM OPTIONS: I have -pondered, years ago, a kind of monetary game, among a group of- friends, in which banking, note, currency, value standard, issue -and similar "suspicious" names would be expressly avoided, but -the essence of all monetary and freedom terms and techniques -could be practised, using inconspicuous code terms, and in which -some limited goods and services could be exchanged between- friends, to familiarise them with monetary freedom terms and -practices. It would not be very difficult to design. It could- even appeal to the self-design and handicraft interest to the -participants. It could rapidly teach what does not work in this -sphere and thus lead them to proceed, quite naturally, to what does work. It could progress from everyone being an issuer of his own "currency"- tokens, or, rather, everyone attempting, in vain, to interest -everyone in his own token exchange medium and also his own token -value standard, to each participant rather trying to discount his- "markers", scrip, etc., in a common token, one which one or the other member would begin to provide, or in a common clearing centre and, most -likely and soon, in the acceptance of a common standard of value- (under some cover name: like points). After people have played -such a game for a few months, on and off, trading, in practice, only very few goods and services in this way,  trying to feel their way and trying to understand it, they might then be mentally prepared for -reading some theoretical studies or comprehending some handbooks- on free banking. I made some notes on such a game while visiting- Tom Greco but he had then a "bee in his bonnet" about some -"conservation" or "ecology" "currency" and was thus, temporarily, deaf to any -deviating notions. Special interests are often like that, for everybody. People are like that, including myself. (For years I ignored, even theoretically, the CD-ROM and even the floppy disk options for libertarian literature, in favor of microfiche and, in practice, I still do. - J.Z., 5.9.02.) Among many others there is the notion that- anything of some subjectively high value could be readily be turned -into an acceptable currency for others, especially if the others share -that subjective value estimate, or even if they do not. So,- sooner or later someone will try to "monetize" the beauty of -nature or of art works, of architecture, of human faces, of- flowers, etc. - Until his listeners or readers finally wake up -and ask themselves: Can I buy my newspaper or loaf of bread or- litre of milk with THIS? Is it "current" or "acceptable" enough- for this? Does it have sufficient value in the local market, for- daily consumer transactions, to be able to compete with other- local currencies? - J. Z., 11.4.97. - Would I want my wage or salary or other earnings to be paid in this "currency"? How many of my bills could I readily pay with it? Would my landlord or tax lord accept it? - J. Z., 5.9.02.
GENERAL PRICE LEVEL: "The general price level should be stabilised. When there are goods shortages one must reduce the circulation, when there are surpluses, one must increase it." - Widespread opinion. - The general price level is not of importance to the individual consumer and producer. His particular price level is. And he will not be happy when his transactions with his customers are forcefully interfered with because the transactions between others have changed. Under monetary freedom this kind of monetary despotism would also be "outlawed" (no longer practised) - for all but its voluntary victims. - J. Z., 24.3.97.
GEORGIA, IN EURASIA, IN 1993, COMPETING CURRENCIES: An all too -short and general radio news report of 19.12.93 mentioned that in -this formerly Soviet province 2 currencies coexist. Probably the -rapidly inflated Rubel paper money of the former Kremlin regime- and that of a new central banks of a secessionist group only.- However, like the two currencies that coexisted for years in West -Berlin, all such parallel currencies have some lessons to teach.- The Eastmark and Westmark in Berlin had a relatively free and- daily determined market rate against each other. However, in wage -payments, for people crossing the frontier, for their work, -bureaucratic quotas and rules existed for full or part payment in- either currency, according to the residence of the employed, on -either side of the Iron Curtain. After a while, already -before the Berlin Wall went up, employment beyond the frontier -was no longer permitted. Spending of East Mark by West -Berliners in the Eastern sector was not only frowned upon and considered to be "unpatriotic" but was sometimes penalised by -confiscations of the goods so purchased. I guess that the same- applied to East Berliners, who tried to make purchases in West -Berlin. Judging by my flawed memory, the exchange rate between -the Eastern German Mark (Ostmark) and Westmark fluctuated -between 4 to 1 and 6 to 1. Both sides acted confrontationally- and had tried to make their currency an exclusive one for West- Berlin. Due to the favourable exchange rate for my Westmark, I- could make some cheap literature purchases in East Berlin, many- of historical or classical texts, which the regime had no- interest in censoring. In this way I could also buy my first new -typewriter very cheaply. (Its quality left much to be desired, though.)  The choice of goods in East Berlin was -limited but one could find some relative bargains there - through -the difference in the exchange rate. Wages for East Berliners in- Ostmark were for a long time about the same as Wages in Westmark- for West-Berliners. - Hayek pointed out that in border regions- the use of both currencies was and is rather frequent - unless the governments involved manage to suppress this limited monetary- freedom or choice in currencies. -  J. Z., 2.5.97.
GERMAN MANUSCRIPT, English translation, EXTRACT FROM PP 61-63, explaining basic terms- of monetary freedom and free banking. The German original is now available digitised, from PP 399-401.
GERMAN SCHOOL OF MONETARY FREEDOM: See: APHORISMS ON THE MONEY- PROBLEM.
GERMAN SCHOOL ON MONETARY FREEDOM: Include much of Discussion -Paper 7.
GERMAN SCHOOL ON MONEY, A SUMMARY OF ITS TEACHINGS or: SOME -PRINCIPLES OF MONETARY THEORY REPRESENTED BY RITTERSHAUSEN, -MILHAUD, ZANDER & OTHERS, by Ulrich von Beckerath, 1952, with -some notes by John Zube, 1977, slightly revised in April 97, 6pp. -- Published in  PEACE PLANS series, originally as DISCUSSION PAPER No. 7- of the RESEARCH CENTRE FOR MONETARY & FINANCIAL FREEDOM, c/o John- Zube. -------- (1) INFLATION & DEARNESS: Inflation and dearness -(dearth or high prices) are completely different concepts. -Inflation is caused exclusively from the monetary side, dearness- exclusively from the goods side. -  (2) DEFLATION & CHEAPNESS: -Deflation and cheapness are completely different concepts.- Deflation is caused exclusively from the money side, cheapness exclusively from the goods side. -  (3) PRICE INCREASES: Price -increases must not be mixed up with dearness. Price increases may-be due to inflation or they can be caused by a reduction of- supply in relation to demand. In the latter case it would be -dearness. Price increases may also be due partly to inflation and -partly to dearness.  - (4)  PRICE REDUCTIONS: Reduced prices -should not be mixed up with cheapness. They might be due to- deflation or due to an increase of the goods offered in relation -to demand. In the latter case only would it represent a genuine cheapness. The reduced prices can also be due partly to deflation -and partly to a genuine cheapness.  - (5) LEGAL TENDER: Without- legal tender one cannot inflate a currency.  - (6) NOTE ISSUE -MONOPOLY: Without the note issue monopoly one cannot cause a -deflation.  - (7) FREE MARKET RATING OF CURRENCIES: When under a free market rate (i.e. in the absence of legal tender) an- over-issue of a paper money should occur, then it would suffer a- discount in circulation so that e.g. a gold coin of 20 marks -would come to cost 21 paper marks. But the goods prices would- remain unchanged, provided only they are fixed in gold units, -e.g. gold marks. - (8) SHORTAGES OF MEANS OF PAYMENT: If- typified and standardised exchange media are short in circulation- (when e.g. during monetary crises factories are short of means- of payment for wages), then those concerned can help themselves -by issuing emergency money without legal tender - until nowhere -in their payment circles does any shortage of the necessary- exchange media remains and the public thus begins to refuse to- accept the emergency money at the same face value as gold or- silver coins. The goods prices would remain unchanged whenever -they were determined in gold units (gold marks or grams of fine -gold, etc.). -  (9) ACCEPTANCE VS. REDEMPTION FOUNDATION: When- paper money is not redeemable (by the issuer in gold) then it- will suffice in order to preserve the parity of the paper money- with gold to arrange for the acceptance of the paper money like- gold money by institutions which sell goods in daily and general -demand. (Such institutions are e.g. the taxation department -when it "sells" tax receipts, the railway, the P.O., and shops- which owe something to the bank issuing that paper. Their -indebtedness may arise out of the discounting of sound commercial- bills and the corresponding contractual obligation to accept the- notes of the bank like gold money. Naturally, in all such cases,- the bank must concede its debtors the right to pay back all their -bank debts with that paper money as soon as they receive it, at -par, regardless of the exchange rate of the paper money.) - (10) -PAPER MONEY CIRCULATION & FOUNDATION: When paper money is funded -as under 9, then it can circulate more widely than merely among- those who directly claim the cover involved. When the paper money -has tax foundation, then it will circulate not only among those -who just then have to pay taxes. If it has shop foundation (a -concept coined by Rittershausen), then it circulates not only among those who have to buy something from the shops which are -under acceptance obligation. When the railway issues money (as -in Germany in 1923/24 for several 100 million marks), then it- circulates not only among those who just then want to use the -railway's services. The tax foundation imparts to paper money (-as apparently Lorenz von Stein found out first) a par value (to -gold or silver coin) for an amount equivalent at least to the -tax revenue for 3 months, even without legal tender. - -(11) RIGHT TO REFUSE ACCEPTANCE OF ANY PAPER MONEY: The- unrestricted right of people to refuse to accept any paper money -offered (Compare par. 2 of Bismarck's Bank Act of 1875 and the -numerous laws of the confederated German States during the 100 -years before this law was passed.), makes impossible every abuse -of the right to issue, either by the bureaucracy or private -persons. - (12) INFLATION: Inflation, according to the above, is- a condition in monetary transactions where paper money is accepted without limits and at a prescribed value only because -legal tender prevails: a coercion which makes it legally -impossible to account for depreciation by discount or refusal. - -(13) DEFLATION: Deflation, according to the above, is a- condition in monetary transactions in which there is a shortage -in typified and standardised exchange media (so that workers- have to be dismissed because banks cannot or will not advance the -means of payment for their wages) and at the same time,- nevertheless, typified and standardised exchange media (e. g. -typified clearing cheques and goods warrants etc.) cannot be -issued because a certain authority, e.g. a central bank, has the -monopoly for note issues. - (14) LEGAL TENDER: Legal tender is- the legal prescription for every recipient of monetary payments -to accept paper money or inferior coins at a fixed value. This- forced exchange rate for general means of circulation, prescribed- for every citizen, must not be mixed up, as happened in Berlin in -the discussion of West & East marks, with a fixed or controlled- exchange rate for foreign exchange. The word "Zwangskurs" (legal -tender) is far older than 100 years and was always used in the- way here described, in royal Prussian edicts, in imperial- Austrian regulations and even by Marx. Another use of it proves- only ignorance of the terminology of economics. - Ulrich von -Beckerath., 25.1.52. --------------- SOME NOTES BY JOHN ZUBE, -ADDING OR COMMENTING TO THE ABOVE SUMMARY: (15) FALLEN & FALLING- PRICES: Fallen prices must not be mixed up with falling prices.- The former tend to encourage buying and reduce hoarding. They do usually originate at the goods side and lead to corresponding -additional turnover, to new orders and employment. The later tend- to deter buying and lead to deflationary hoarding, sales- difficulties, bankruptcies & unemployment. Moreover, the former- tend to fall step by step according to developments on the goods- side (technological improvements). The latter tend to occur more- generally and evenly because they are due to a deflationary money- shortage. This difference may be statistically indistinguishable -but it is of great economic importance. Because of this -distinction price levels cannot rapidly enough adapt to a -deflationary reduction in the money supply - contrary to the -expectations and predictions of most economists of the Austrian -School of Economics. - (16) MARKET & MONETARY DESPOTISM: A- market subject to monetary despotism isn't free. To prevent and -end both, inflation and deflation (capital destruction and -unemployment ), monetary freedom has to be introduced. - (17)- GOLD STANDARDS, DIFFERENCES THAT ARE IMPORTANT: A gold standard -as an exclusive currency is very different from a gold standard- as a permitted and preferred but competing currency. It is as- different in its effects as a creditor's legal claim to payment -in gold coins, even when a debtor has none and cannot obtain any,- is from the right of debtors to pay their creditors in gold only- whenever they possess it (or contractually obliged themselves to- supply it) and otherwise and normally to pay only in gold- values, in any acceptable currency, by gold accounting or gold- clearing. For the latter there need not be a single coin of gold- in a country, although a small gold coin circulation would be -preferable. The former amounts often to torturing a deaf and dumb -person in order to extract a confession from him. The latter- payment method is, under monetary freedom, available to every -productive person. - (18) COVER FOR MONEY ISSUES: As money cover- can serve anything that is found acceptable by well informed- acceptors of a paper money in a free market. - (19) ISSUE-PRINCIPLE IN THE MONETARY SPHERE & IN THE CAPITAL MARKET: The -right to issue and its principles can be applied not only in the- monetary sphere but also in the capital market. There it can- finance e.g. a libertarian take-over of a bureaucratic democracy,- a libertarian revolution in a dictatorship, education, innovation and research, desert irrigation, even space exploration. Its -monetary application is essential for the financing of a rightful- defensive war and of a rightful revolution. - (20) REDEMPTION IN- RARE METALS: Redemption in rare metals BY THE ISSUER OR A- RESERVE BANK is not required to preserve the value of a paper--money. It can be replaced by acceptability (for all kinds of- consumer goods and services and for other due or soon due debts) under the control of a free market -rate (against rare metal weight units). This would leave the- discount possibility as a necessary feature but would, generally, -lead to a par rate of the paper money on a free gold market. It- would not be a gold redemption by the issuer but a gold clearing -standard. It would transfer redemption from the issuer to the- free gold market - for whosoever would need it or would be -doubtful or suspicious. This possibility was not sufficiently -discussed by the advocates of a 100% gold dollar. - (21)- GOVERNMENT SPENDING & INFLATION: Inflationary government- spending is not "spending", no more so than private forgery is or -official and forceful requisitioning. - (22) MONEY & CREDIT -CREATION?  Nobody can create money or credit out of nothing, no -more so than creating energy and matter out of nothing. What- appears or is considered as "creation" is either a forced or fiat -"value" or a replacement system temporarily substituting suitable -bills or notes for unsuitable ones (for general circulation), -clearing or fraud. - (23) DISCOUNT POSSIBILITY IS ESSENTIAL: The -possibility of suffering a discount is a necessary feature of a- free monetary system. It would draw depreciated notes quickly out- of circulation. They would be rapidly paid back to the issuer, who -has still to accept them at par. This discount would thus be- welcomed by his debtors. The more the notes are discounted the -more rapidly they would return. With the returned notes the -circulation and the discount would be reduced. It is obvious that -while the discount continues new issues will be hard to impossible -to achieve. People will simply refuse to accept them - unless- they owe the issuer something. - (24) LEGAL TENDER & GRESHAM'S- LAW: Without legal tender and under free monetary competition,- each exchange medium, being subject to free market rating and the- right to refuse it altogether, the good types of exchange media- and value standards would soon drive out the bad ones. The economists of the German monetary freedom school recognized this- truth before most of those of the Austrian School of Economics -and other economists, did. Inflation-proof money is not- impossible - it is merely outlawed. Let good money drive out the -bad : Repeal Legal Tender! - J. Z., 77 & 97.
GERMAN UNIFICATION AND ITS "CURRENCY REFORM": The same "problem" -might soon confront us in Korea and, hopefully, in Mainland- China, too! - Among the mistakes of this German "currency reform"- was the further centralization of two state socialistic central- banks into one, all in the name of non-communism or even -anti-communism and a supposedly free market or capitalistic- economy. Furthermore, the East Mark, worth on the free market as- little as 5% of the West Mark, was, nevertheless, exchanged at -the rate of 1 for 1. That provided the recipients with unearned- purchasing power to that extent. Fed up with inferior consumer -goods, provided before in East Germany by themselves, under the -"principle" of "production for use, not profit", and at last- enjoying freedom to travel across the frontier and to buy West- German goods already imported into East Germany, they boycotted their own shoddy and short-supplied goods and bought almost- exclusively West German - or even European and World goods, with the West marks thus obtained as a gift - at the expense of the West German taxpayers or inflation victims. What- did this mean for their own enterprises? They had to shut down or- only very few could still work in them. The rest were then put on- unemployment relief, also paid in DM, at the expense of the West- German taxpayers and sometimes they remained nominally on the pay-roll, but received their full wage, while being told to go home, since -there was no work for them. All this was falsely called free market and capitalist economics! Who granted such wage credits? Again -the German taxpayers, I suppose and all inflation victims. Since- mostly husband and wives did work and their combined unemployment -benefits amounted to about a full salary in DM for one, and this at -the often high wages, due to the high productivity in West Germany, many- couples took their cheap little East German cars and went on a grand tour -through Europe, paid for by the West German taxpayers or current and future inflation victims. Did these -owe them, collectively, this kind of indemnification, even to- those who did not flee - when they did have the chance to do so,- even to those who for all too long upheld the East German regime -and its anti-economic "policies"? What all this amounted to was -more state socialist and welfare state redistributionism under -the communist slogan: From the able to the needy! All this in- the name of anti-communism! - The purchasing power of wages and- salaries must ultimately be EARNED by productive efforts -providing wanted goods and services at market prices. One can't- get away permanently from that general rule. Thus the East German workers -should have been paid in monetised assignments upon their own -goods and services, i.e. in alternative, optional and -non-coercive currencies, as the only rightful and honest -solution. The East German paper money could have been gradually- withdrawn via taxation. To force most of the old bureaucrats -out of their offices and into productive jobs, most of it should have- been "paid" with it. It should no longer have been legal tender- or have been exchanged 1:1 for the legal tender of West Germany -but left to whatever value it still could derive from tax--foundation and voluntary acceptance on the East German market.- That acceptance and purchasing power would be more and more limited, the more alternative- and sound exchange media would be freely provided. Wage and salary -level equality cannot be provided by decree - except at the -expense of other producers and consumers. Wages and salaries in -East Germany, paid in whatever optional currencies would be -issued there or accepted there from other national currencies, at- their market values, and using whatever value standard would -be found acceptable, should have found their own market levels.- The lower productivity of  a relatively underdeveloped country -like Eastern Germany - or any other undeveloped or underdeveloped- country, cannot be made up for, effectively, by burdening the -more developed countries. That foreign aid notion has largely led- only to further abuses, especially in government to government -aid. Subsidies do only encourage waste and inefficiency and low- productivity and idleness. One can always have as much -unemployment and poverty as one is willing to pay for. To add- East Germans to the Welfare rolls of West Germans was no solution. Nobody should be his brother's keeper when his brother -is able to work for his own support. - The replacement of the -forced and exclusive currency of  East Germany should have been -rightful and rational, by depriving it of all exclusivity and- coercion and leaving it only legal tender power towards the tax -authorities. The new
East German State governments, under these conditions, need -not even be under any prohibition to issue the returned East- German Marks again or issue new ones. The right to refuse their- acceptance or to discount them, combined with the obligation to -accept them at par in taxes, would have been enough. In the -absence of the issue monopoly and legal tender, newly and freely- issued sound alternative currencies, all optional, with juridical and legal tender power only towards their issuers, using any value- standard acceptable to issuers and acceptors, would soon have- driven out the governmental paper money. Taxes should also have -been payable with the new alternative currencies, but at their -market value compared with the East German paper money. This old State paper -money should have lost its monopoly for tax-payments, too. But -note holders should remain "privileged" to get this money- accepted THERE at par. - The West German DM and the East German -mark should have been freely market rated against each other,- while the East German mark still existed. - The West German DM- should likewise have been deprived of its exclusive and forced- currency status, in East Germany and West Germany. Liberation-from the communist system in every respect! No monopoly, not even- any exchange medium and value standard monopoly any longer. No -more coercive central banking powers in East and West. -- Moreover, under state socialism there was excess- bureaucratisation and manpower waste in most East German -enterprises. E.g., bookshops of a size that were run in West- Germany by 1-3 employees were often run by 12-20 in East Germany. -I suppose that in most other State "enterprises" similar manpower- wastes occurred and that the average productivity per employee was low- and their earned wages correspondingly low, too. Under these -conditions Western award wages could naturally not be paid to all- and not even to few, if the few continued with their previous low-productivity. Keeping up with Western productivity standards must -have felt like capitalistic exploitation at its worst to them. -The notion that they have to earn their wages by their own -productivity is never very strong in East and West among any- employees. But realistic steps towards self-management within enterprises, in any of their numerous forms, could soon come to help do away with this lack of insight- and understanding. - Not only could East German output hardly be- sold to previous East German customers but the productive capital- was run down and frequently breaking down and no longer worth- maintaining and repairing, especially when orders had largely disappeared. While in N.Y., in 1990, I met with an anarchist machinist & foreman, who was consulted regarding the value of an East German factory and its equipment. His respected judgement was: Both are worth only scrapping. They could not be made to pay their way under free market and free trade conditions. In some instances the infrastructure was even worse: For instance: some road surfacing consisted of- tailings of uranium mining that were still radioactive but, the East -German authorities had asserted that the radioactivity would be low- enough to be safe. Even the West German authorities were not -convinced of this and so they had to remove and replace these road- surfaces. Sometimes I wonder whether there are any limits to what- government planners are capable of and their victims are prepared -to put up with. Assume that cryonics would have succeeded in freezing and reviving human beings successfully, without damaging their tissues and able to cure any diseases that might have killed them. Would we then have to expect at least some governments,- after their wrongful and  foolish policies had once again, lead to mass- unemployment, to freeze these unemployed and unfreeze them only -when the government would see that there were jobs waiting for -them? Would it be beyond any government to assert in such cases- that it would act only in the public interest or even rational -interest of its individual victims? - Enough of this: What should have been done monetarily upon re-unification? The East -German workers should have remained dependent upon incomes from -their own production. Thus they should have been paid in- assignments upon their own goods and services, to the extent that -these were still produced and sold. Towards goods and services- provided by West Germany, Western Europe and the World, such- token money would have had a low exchange rate and low purchasing- power. Its power could have increased only gradually and -naturally with increased quantity of and quality of products and- services. Payments in DM would only have become possible to the- extent that DM could have been earned. Payments in other foreign- currencies, likewise. And earnings and accounting in them should- have been free. But compared with some of the more underdeveloped- countries East Germany would have been relatively developed. And -now it could have freely traded with them, using first of all- assignments upon its own products and services to pay for imports -from these countries. And in these countries East German inferior -products might still have been acceptable at lower market prices,- in preference to higher priced quality products from e.g. West -Germany. Thus while less East Germans might have bought their own -products and rather, to the extent that they could afford to pay -for them, with their own means of exchange, the better products -of the somewhat free world, more trade with the Western World- would have opened up or could have been opened up fast - by- importers using East German and competitively issued clearing- certificates that had only value in clearing against East German -goods and services. But this kind of monetary and clearing and- free trade freedom did not and does not exist in West Germany,- either. But it could have been the fastest, most rightful and -efficient way to induce East Germans workers to "pull their socks up" and -become more productive. - Beyond that they should have offered -tax exemptions for all new investments that would provide more -jobs and, moreover, they should have offered the refuge capital- of the world the option of value preserving clauses of whatever kind they wanted, for their foreign investments in East Germany,- quite exempt from East German and West German existing -legislation on this subject. - What was done was, at least -temporarily, more destructive to the productivity in East Germany than the East German regime had been. It put more people out of- work and subsidised their unemployment at the expense of the- remaining employed, especially those in West Germany. Moreover, I- suppose that the limitations to progressive income taxation, that -existed in East Germany already in the late 50-s (maximum rate -20%, i.e., what many libertarians in the West hope to achieve as the flat rate tax!), were probably abolished in East Germany, upon unification,- which meant that the progressive taxation demanded by the- communist manifesto of 1848 was increased for East Germans. In -another rationalisation of East German production, under- communism, at least the seniority system was largely done away- with,  so that quite junior but very capable people could quickly -rise into "senior" management positions. Indeed, often they might -have been quite "capable" only within this system of a centrally -planned and misdirected economy but this was certainly not always -the case. To the extent that they were party people, its kind of- seniority system would also have existed. But the traditional and- probably still widely  continued seniority systems of West Germany, often -supported by unionists, with special lower rates and less positions open for younger people, might, through the unification- have been introduced in Eastern Germany as a backward step.- Furthermore, before the reunification it had a managed trade with -the Eastern Block countries, run largely for the benefit of the- Soviet Regime. The disadvantages of this trading would have -disappeared. But they would have been at least partly replaced by- whatever protectionist trade restrictions West Germany has put -itself under. Foremost among these might be the prohibition of- freely and competitively issued international clearing-certificates, as proposed by Prof. E. Milhaud and Ulrich von- Beckerath. - In other words, some market or capitalist or contract -forces were allowed to operate in East Germany - but in West -Germany and the newly united Germany - only to a limited extent. Economic interventionism and -bureaucratic mismanagement went on and to some extent was even -increased. The situation was somewhat similar to that of the -"liberation" of the former Soviet Union and its satellites. This -"liberation" went never far enough, especially with regard to- monetary liberation. - If a full economic liberation had been- achieved, for East and West - Germany, then we would soon have- seen a new and much larger "economic miracle" developing in East- and West Germany, much faster and more successful than the previous "economic miracle" of West Germany, based on -relatively stable currency and the ending of most price controls,- all rationing, forced deliveries and many war-time -regulations, also upon many long term foreign loans or even- subsidies, like those of the Marshall Plan. The latter could be -more than made up for - by free private foreign investments on a- stable currency and tax exemption basis, spreading from free- trade industrial areas, zones and ports to the whole country, but- based only on voluntary free trade communities, with voluntary- protectionist communities left free to compete as well as they- can or believe that they could.
GESELL, SILVIO, HIS ERRORS IN THE MONETARY SPHERE, WITH REFUTATIONS:
GESELLIANS: How many of them, apart from Paul Nagel, Karl Walker -and Heinz Peter Neumann, advocated at least a degree of monetary- freedom? Help me to compile an honours roll for them, preferably -with a reference to those of their writings in which they uttered- monetary freedom ideas. Since their prophet advocated only -another form of monetary despotism, their independent minds -towards him should be especially celebrated, in spite of the fact -that most of them would still have expected Gesellian money to -win in free competition. - J. Z., 20.3.97.
GIFT EXCHANGES, COERCIVE ONES & GOVERNMENTS: Governments are- coercive "gift" exchanges that coercively transfer part of your -property and income to others. - J. Z., 22.4.93. - See: TRANSFER- PAYMENTS, WELFARE STATE, TAXATION, EXPLOITATION, PROPERTY RIGHTS,- FINANCIAL FREEDOM.
GIFT VOUCHERS, ON THE ROAD TO MONETARY FREEDOM? Only yesterday, -in Franklins supermarket store in Bowral, I saw a sign that- indicated that Franklins issues gift vouchers in $ 10, 25 & 50 -denominations, which are usable in all of 240 Franklins stores in -Victoria, NSW & Queensland. These, too, could suddenly be transformed into loans for wage payments to employers. It might- be worth a try for them. One of the other shop association or- chain store ought to take the lead in this. - Gift vouchers,- properly issued, as loans, for wage payments, could become a very -important gift to a whole depressed economy, with close to 1 -million unemployed in Australia alone. - Do look this gift-horse -into the mouth. Do check out its teeth. You will find them to be sound. These gift vouchers, in the hands of consumers, have their -full monetary value, even when they were not first paid for with -the government's forced monopoly currency. - It is also obvious- that no store could or would over-issue gift vouchers or could- afford not to accept them like ready cash. - And from one day to- another the local stores could declare that they would mutually- accept their gift vouchers. Within a few days they might agree- upon issuing a local shop currency which all of them would -accept, and issue it largely in loans for wage and salary -payments, i.e., for goods already produced and sold at least to -the wholesalers, in most cases. - The shopping centres could become the centres for new banks of issue. That would lead to a -boom economy comparable to the limited booms for computer-, -video- and mobile phone shops. - Allow good monies to supplement- and finally drive out the government money - and with it all- imposed taxes, too. - J. Z., 25.4.97.
GIFT VOUCHERS: Gift voucher schemes by individual firms could -and should be locally combined into a local optional currency -with which local and short term loans for  wage and salary- payment could be offered. To the extent that such loans would be -provided, these uniform local gift vouchers, in money- denominations, would soon be spent in the local shops, then used- for restocking them towards the wholesalers. These could with- them pay their manufacturers, the main employers, who received -the loan and can then repay it to the common issue centre of the local shops for their loan of their gift voucher or shop -foundation money. Such self-liquidating issues could be ever -renewed, as required. Being refusable, i.e., not legal tender and- if they are also using a sound alternative value standard, then -they could not be inflated and be issued only to the extent that -they are kept at par or close enough to par not to be refused.- Gift vouchers are already customary and wide-spread. Issuers and- acceptors are familiar with them. Their combined issue would not -be too large a step to be comprehended and would make them even- more acceptable to most people. They seem to be legal. Westfield- shopping centres in Australia had by x-mas 1992/93 ca. 3400 -shops, all of which accepted Westfield shopping centre gift- vouchers. Franklins supermarkets, in 3 States of Australia, have- ca. 240 branches, all accepting its gift vouchers. The way of -least resistance might be to issue the gift vouchers to the own- staff whenever any bonus payment is intended, e.g. for x-mas. The- next step might be to grant any wage and salary increases in this- form. The next one might be to make the new jobs available e.g, to young people, or older people, who otherwise might remain- unemployed, but only when they are prepared to accept their wages -or salaries totally or largely in these local gift vouchers.- Those prepared to accept all of their wages in these exchange- media might also be offered a wage increase. Thus, step by step monetary freedom could be introduced - if the laws of monetary despotism are not enforced or can be as gradually repealed or ignored. -Sudden and locally widespread such issues should only be tried, -contrary to the existing legislation of monetary despotism, in- times when the suppression of such issues would be politically- inopportune, i.e. in times of high unemployment and shortly -before an election. There should also be pressure exerted towards a free jury system to adjudicate any accusation by the- authorities that there laws of monetary despotism would be- infringed and that the public interest would have been harmed by -these self-help steps, which would obviously be in the public interest by taking people off public relief -roles and putting them into self-supporting jobs without the aid of- any government programme or measure. - J. Z., 4.12.92,  30.4.97.
GIFT VOUCHERS: See: RAILWAY MONEY & GIFT VOUCHERS; SHOP- CURRENCIES & GIFT VOUCHERS.
GLASNER, DAVID, Free Banking & Monetary Reform, Cambridge, CUP, 1989, reviewed in CATO JOURNAL, Washington, Dec. 89, & abstracted in GREAVES, BETTINA BIEN, Mises Bibliography, II, p. 103. Apparently, he merely discussed some of the main crisis theories & comes out against the Austrian one. - J. Z., 11.5.97.
GOLD AS A MEASURE FOR PAST & CURRENT PRICES: An ounce of gold in- 1935 bought a good suit. An ounce of gold today still buys a good- suit. 200 ounces of gold bought an average house in 1935. 200- ounces of gold still buys and average house. - Pointed out by -Prof. James L. Green, in MM, 1986.
GOLD AS MONEY, A MATTER OF CHOICE: The man concerned with -justice does not aim to force others to use gold as money.- Rather, he insists that government has not right to prevent him- and other men from using gold as money if they choose. - Paul- Stevens, THE FREEMAN, 1/75, 3/4.
GOLD BONDHOLDERS PROTECTIVE COUNCIL, P.O. Box 2283, Seattle, -Washington 98 111, Tel. (206) 622 4960. - I found this address in 1990 and have not contacted them as yet. - As long as governments -are authorised to wipe out any monetary and financial rights -merely by an act of legislation, no mere council can offer much protection. Monetary and financial rights as well as particular- other economic rights have first to be compiled, then fully- discussed, then become widely enough recognised to become part of- effective and protective constitutions. Ultimately, they would- not only have to be upheld by courts, which are independent of politicians -and their ambitions, frauds and false pretences but also by -volunteer militias, well trained, armed and organized to uphold- all individual rights. - We are still very far from such an -awareness. Just another lobby group for gold clauses is definitely not enough, although it might do some good by- educational efforts and lobby pressures. -  J. Z., 26.4.97.
GOLD BUGS & THE ERRORS THAT ARE BUGGING THEM:
GOLD BUGS OR ADVOCATES OF A 100% GOLD REDEMPTION BY THE ISSUER OR- CLASSICAL GOLD STANDARD, TALLIES & OPTIONAL GOLD CLEARING -STANDARD: GOLD BUGS as well as their opponents have still not- taken a sufficient stand towards the technical, voluntaristic -and competitive alternative of an optional gold standard that is -merely used as a weight unit, for accounting, clearing and -value reckoning purposes, for debts, prices, wages and salaries, -taxes, rents, interest payments, dividends, fees, subscriptions -etc. This could but need not be combined with the right of -debtors, who do have sufficient gold metal weight units, to pay -with them, as means of exchange. But creditors should never be- granted the general authority to demand payment of debts owed to -them in gold metal unless this payment has been explicitly -contracted. Even then, since a dealing in futures is involved, -withdrawal premiums should be agreed upon in case a debtor cannot- fulfil such a contract. To impose gold weight units as the only -permitted value standard and as the only permitted means of payment is not only wrong but harmful, too.  Under these -conditions the economy does not fast or in the long run sufficiently adapt itself to the shortage of a rare metal. In -proof I want to point out that the tax foundation money in form- of wooden split sticks of tallies was used in a country like -England even to 1826 - for centuries. Surely, there had been- enough time for all prices and wages to adapt sufficiently to the -existing low quantity of gold, by corresponding low prices and -wages, as the Austrian School writers believe the could and- have? If so, then the tallies would not have been invented and -used as supplementary means of payment and clearing - issued in anticipation of taxes to be paid and then circulated and finally -used in tax payments.
GOLD BUGS, EXCLUSIVE GOLD STANDARD, GOLD COINS & CERTIFICATES- AS EXCLUSIVE MEANS OF EXCHANGE;  FORCED GOLD REDEMPTIONISM BY THE -ISSUER, UPON DEMAND BY THEIR BANKNOTE HOLDERS: The monetary -despotism advocated by gold bugs is morally and in principle no better than that of advocates of an exclusive and compulsory State -paper money with its forced value. Indeed, the latter, if well- administered (which is rarely the case but sometimes happened)- can be superior in avoiding depressions than an exclusive gold- currency could be (Austrians would deny that, believing in- instant and sufficient price and wage adaptations under freedom to -avoid any currency shortages.) If well administered, they have, sometimes, even avoided large scale inflation for a year or more (-e.g., in post WW II Germany), keeping the price level stable or- inflating it only as much as was needed to prevent otherwise naturally occurring fallen prices. Contrary to their expectations and as a result of- Gresham's Law, their favourite currency, under free market -rating, would be driven out by currencies without gold cover and- gold redemption by the issuer but, nevertheless, as good as gold, being -kept at par with their nominal gold weight value via a vast -readiness to accept them for daily needed goods and services (including labour), by other debt and clearing foundation, while reckoning e.g., -in gold weight units, without any obligation by issuers or reckoners to supply these gold weight units in physical metals.- The suppliers of gold clearing currencies could refer gold- convertibility to the free gold market, which has all the gold in- the world for those able and willing to pay for it with their competitively issued or accepted notes. They could pay for it with alternative exchange media standing at par as -well as with gold certificates that are 100% covered by gold- coins, through the issuer of the certificates. Thus the gold- reserve of those who are not gold bugs would be much larger than- the combined gold reserves of the gold bugs, whose banks issued- gold certificates upon their gold stocks.  - J. Z., 4.12.92,-30.4.97.
GOLD BUGS: Should people not possessing gold or silver or not- having credit with those who do, give up trying to exchange their -goods and services and labours among themselves, in a monetary- way or via clearing, just because they lack sufficient rare -metals to cover with them all the transactions they desire? Their -own labour, services and products can be all the cover they do -need for themselves, for their exchange media and for their clearing transactions. Without possessing a single gold or -silver coin they could price out all their goods, labours and- services in rare metal weight units and clear their exchanges with a mere rare metal accounting standard.-Why should e.g. every petrol money token, gas or electricity- money, railway, bus or tramway money have to be "covered" by gold- or silver - when there is sufficient service potential to cover- its value? Those who can't think of any better monetary and -clearing arrangement than via rare metal pieces and accounts of -them, should never be put into a position where they can outlaw- all other transactions as the otherwise admirable Murray N. Rothbard would have been inclined to do. - J. Z., 16.3.97.
GOLD COINS AS MEANS OF PAYMENT, GOLD MARKET, GOLD PRICING, GOLD WAGES, LAW OF FLUCTUATING GOLD QUANTITIES, INSISTENCE UPON BEING PAID IN GOLD: If you insist on being paid in gold coins, for your internal and external transactions, then, in the medium and long run you would be paid in gold - but only by those able and willing to do so. Which means that the monetary demand for your services would decline and you would be paid less than others, who only insisted upon being paid E.G. in gold weight values (or other value standards acceptable to them and their trading partners) with whatever exchange media are suitable locally and only at their exchange rate against the gold weight unit chosen, either at par or close to par. But you should not expect to able to be paid in gold immediately or in the very short term future by most of the potential customers for your goods or services, within your country or in other countries. They simply aren't sufficiently supplied with gold coins. You would also be burdened by the extra charges involved in building up, storing, transporting and insuring gold coin payments. Moreover, you should become aware that the value of every gold coin spent by you, in all cases that you find ready acceptors for it, will not with certainty or soon enough return to you, in form of other gold coins paid for your goods and services. Only your own goods and service warrants or clearinghouse certificates, when made out in gold weight clearing or accounting units, are bound to return to you, in payment of debts owed to you or for your goods and services, and this rather fast and with great certainty. And they would not limit you to the amount of gold coins you can manage to accumulate as means of payment or that you currently receive in your sales. Then only your own productive capacity would limit your spending. You would be independent of your own gold hoard and that of others. If you made yourself dependent upon what has been called, for the trade between countries, "the law of fluctuating gold quantities", which, over periods, sometimes extended periods, tends to balance out the spending of gold coins with the receipt of gold coins, then you might have to wait for a considerable time - and in the meantime you might get broke or unemployed. - However, you should be free to choose the exchange medium and value standard that you do prefer for yourself. But beware, you might get them, with all their inherent limitations! - J.Z., 28.7.91, 27.8.02.
GOLD COINS AS TICKET MONEY: Counters representing commodities- and services. - Charles Moran, Money, 21. - This they would have -in common with length, weight & volume measures. Neither an- over-supply nor an under-supply of these measures should be feared -when they can be freely produced - and rejected. But, obviously, -these measures need not be made out of gold. Nor need purchasing- claims for commodities and services be made out of gold, if only- they can be issued and maintained at par with their nominal- gold weight value, i.e., for their purposes, made as good as gold. - J. Z., -22.4.97.
GOLD CONVERTIBILITY OR REDEMPTIONISM AT THE ISSUERS, THE CLASSICAL GOLD STANDARD REQUIREMENT FOR GOLD COVER OR RESERVES, 100% OR FRACTIONAL GOLD COVERS & THE LEGAL, JURIDICAL, CUSTOMARY OR THEORETICAL OBLIGATION OF THE ISSUERS OF BANKNOTES TO TREAT THEM AS IF THEY WERE GOLD CERTIFICATES THAT IMPLY AN OBLIGATION OF THE ISSUER TO CONVERT THEM INTO GOLD UPON DEMAND BY THE NOTE-HOLDERS: If this obligation were a natural law of economics then no sound other banknotes could have ever existed. Instead, there were a multitude of alternative currency issues, emergency monies, primitive monies, truck monies, canteen monies, local currencies, street monies, monies of single enterprises, token monies, that satisfied their users and did not defraud them. Indeed, official and private issuers have ignorantly and wilfully also made numerous mistakes in the issue and reflux arrangements for alternative currencies. Even in our times not all questions on monetary freedom were quite clear among famous scholars like Mises, Rothbard and Hayek. Even they did not know all of the literature of monetary freedom and all of its historical precedents but were often mislead by their own wrong assumptions and theoretical concepts. But all these do not refute historical experiences with sound and honest competing  currency issues that were not convertible into gold by the issuer but, e.g., merely accepted by the issuers and their associates as if they were gold (or silver or platinum). Their real foundation was, instead, the readiness to accept them, like gold, for goods and services that are in daily demand by average consumers. If one does not accept the blinkered historical model, limited to a few countries, of gold value notes as gold smith and later gold bank certificates of deposit, if one does not ignore all other historical and contemporary experiences, without this redemptionism by the issuer in rare metals, then one will concentrate on other forms of stable value reckoning, including gold weight accounting and clearing, and redemptionism in all kinds of daily wanted consumer goods, services and debt payments or clearing settlements, i.e., the debt or readiness to accept foundations and their great variety. One would then welcome instead of condemn all voluntarily agreed upon value preserving clauses, using one or the other freely chosen value standard and one or the other means or payment or clearing to carry or use that value standard for all ones free economic and monetary exchanges. - J. Z., 24.2.89. - As for those, who really wanted or needed to get metallic gold for their exchange media, there would be or should be no difficulty in exchanging them on a free gold market, especially when at least locally they are circulating at par with their nominal gold value. Precisely the possibility that on a free gold market they might not be accepted at par, if there were flaws in their issue or reflux, will tend to keep most of them at par or close to par with their nominal gold weight value (or other value standard chosen by their issuers).
GOLD CONVERTIBILITY, REDEMPTION, COVER OR RESERVE FUND: Gold--convertibility could and should be realized via the greatest -redemption fund at all, namely the free gold market. Anything -that passes there at par with gold is, by definition and in -practice, as good as gold in value, has the value of gold - but- is much more portable and less risky than the equivalent gold--weight units would be, if physically present. - J. Z., 3/97.
GOLD COVER & REDEMPTION OR CONVERTIBILITY: There is no inherent -reason why each exchange of labour, goods and services or any- exchange medium or exchange process, in a free exchange economy,- should be "covered" by an equivalent amount in form of rare -metals. This compulsory gold or silver "licence fee" for every exchange should be abolished - at least as a wrongful and -unnecessary imposition. Likewise abolished should be the -equivalent "licence" requiring a "cover" of each transaction by- or conversion option upon demand by the creditor into, legal -tender cash - any forced and exclusive currency. Free trade in- any form for any free exchange, using any medium or process, at- least among all consenting adults. Gold and Silver as exclusive -means of exchange and standards of value should be no more than -options for the believers in them, not obligatory for those who- do not believe that they are the only or best options available.-- The cover, redemption or reserve spleen demanding rare metals,- fractionally or 100% behind every monetary certificate, is so -popular, even within "scientific" writings, that the few- exceptions to this few and counter arguments and references- should be combined and published together and so should be all- the alternative cover, reserve, convertibility proposals, -experiences and practices for all kinds of alternative transport -tickets or ticket money, purchasing vouchers etc. - J. Z., 3/97.
GOLD DISCOVERIES & INFLATION: Back in the time of the autonomous gold standard no one would have blamed John Sutter for starting the 1849 California gold rush.  Still economists agree that the mid-century inflation of world prices had to be attributed to the burst of gold mining in California and Australia. The price rise after the turn of the century had to be attributed to Klondike and South African gold discoveries. - Dr.Paul A. Samuelson, THE NATIONAL TIMES, 26.4.71. - A very popular error this! -  This easy "explanation" has been parroted for over a century by people who never closely watched the development of prices, expressed in gold weight units, over the decades. The gold discoveries were not only followed by great price increases but also by long periods of great price decreases, without gold suddenly disappearing from the Earth. Other explanations of the prices rises that did occur, e.g. bad harvests, natural catastrophes, wars and inflationary policies by governments, are simply ignored by such people. See e.g. OTTO SCHMITZ, Die Bewegung der Warenpreise in Deutschland von 1851 bis 1902, Berlin, 1903, Franz Siemenroth, 443pp plus a large table. This book was very much recommended by Ulrich von Beckerath. Once I learned one of its gold price statistics by heart. (I have not yet got around to microfiche it as well. - J.Z., 4.9.02.) There was no gold weight unit price inflation corresponding to the additional gold production. Nearly 150 years later and after enormous further gold production, prices expressed in gold weight units have, probably, in most cases, not risen at all and in some cases fallen. E.g., an alarm clock costs probably less in grams of gold now than it did 150 years ago. A pencil, likewise, and a can of beans. But the governments' paper money prices have risen, almost always, sooner or later, in proportion to its "production" of additional paper money. - J. Z.,2.4.97.
GOLD DISCOVERIES: They have often wrongly been blamed for -scarcity and emergency prices, after bad harvests, revolutions, natural -catastrophes etc., leading to shortages in the supply of goods -and services. If one compares the price levels for subsequent- periods, then one will soon find out, that the added gold,- remaining accessible or in circulation, has not correspondingly- and permanently driven up prices and, upon further researches, one- will usually find the real causes of the temporary price -increases, reckoned in gold units, that did occur. Even in my -youth and in a relatively developed country like Germany, the -monetary economy had not yet completely penetrated and some -exchanges were still made by payments in goods or produce. Gold -and silver coins were never available in sufficient quantities to -mediate all possible and desired exchanges. To that extent even- large new gold and silver finds did not and could not affect the -price levels much. Moreover, they constituted only a small- fraction, as a rule, of the accumulating total of these metals. - J. Z., 3/97.
GOLD IN "THE" GOLD STANDARD: Gold has a unique usefulness as a- value standard. Even as an exclusive and forced value standard it- could not do much harm, except to the sensibilities of those who -hate gold with an almost religious favour. But as an exclusive- and forced means of exchange it would be costly, cumbersome and -all too limited. It would limit trade to the transactions that it- could mediate and outlaw or reduce to barter all others. To that- extent and although its purchasing power would then be much -increased, it would rather be harmful than helpful. We would all -have to wear "chains of gold" and be correspondingly restricted- in our productive and exchange efforts. For many centuries, when -gold and silver were almost the only permitted and customary -means of payment, prices expressed in gold and silver were, -indeed, very low. But not yet low enough to mediate all desired- transactions in a monetary way. Even into the 20th century and in- spite of the availability of many other means of payment and- clearing options, degrees of barter still persisted in developed -countries and in previous centuries they were quite extensive.- Moreover, people depending on trade, desperately tried to provide -money substitutes or clearing avenues and non-cash payment- methods, do get away from their all too large dependency upon- gold. To grant a debtor who possesses gold the right to pay a- creditor with it is one thing. But to grant a creditor the right- to demand gold from a debtor, who does not possess it and could- only offer his goods and services at their gold values, in- corresponding certificates, is destructive and bankrupting- monetary despotism. Even if gold coins were not only the best or- among the best value standards, to force them upon all as -exclusive means of exchange would be no more rightful than- insisting that all who want to drive automobiles  must not be allowed to drive in the cheap cars they could afford but only in- a Mercedes or Rolls Royce, even though they could not afford -them. A free market for monetary and clearing media and standards -would not insist upon a monopoly and forced acceptance at par, not even for the best kind of exchange medium and value standard. It- would respect subjective value choices and consumer sovereignty, -freedom of contract, free enterprise, free choice of jobs and professions, free trade and property rights in the monetary -sphere as well. - J. Z., 16.4.97.
GOLD MARKET, FREE, RARE METAL MARKETS TO BE UNRESTRAINED: Rare -metal markets should be completely freed from all government- restraints, subsidies, prohibitions, taxes, confiscations, -jurisdictions, regulations and controls. They all interfere with- the free choice of value standards, which is an important part of monetary freedom and of the right to issue money tokens, to make -contracts, to take steps to employ oneself or provide oneself- with sales of one's goods and services. After thousands of years- of governmental abuses no kind of monetary and value standard- despotism and monopolism must be permitted any longer. The price -to be paid for it, in mass unemployment, bankruptcies,- impoverishment, in inflations, deflations, stagflations and in- political despotism, wars, civil wars, revolutions and terrorism, -in suicides and sickness and despair - is just to high for the single benefit of having a "uniform" currency, "guarded" and- guarantied" by one's government. We have put up with lies and- ignorance and powerlessness to undertake self-help actions this- sphere - for all too long in. At last we must become monetarily emancipated, too. Our- very survival may be at stake. For our misrulers are now -armed with mass murder devices or anti-people and anti-city, even- anti-country "weapons". - J. Z., n.d., 29.4.97.
GOLD PRICE, DISTINCTION BETWEEN PURCHASE AND SALES PRICES OF A- CENTRAL BANK: Ulrich von Beckerath frequently pointed out that- one ought to distinguish, in the managed "gold standard" between -the central bank's purchase price and its sales price for gold. For many years there was no sales price for gold at central- banks, because they did not sell any. All they did was PURCHASE- gold at a price, expressed in national legal tender, that tended to be considerably below its market- price, at least that on the black market. They pretended that their- PURCHASE price established a par value for their paper money. But that par value can only be achieved when there is not only a -purchase price but also a sales price for gold and this not only -at the central bank but on a free gold market, that is world--wide.  - Likewise, for some years there was a sales price for- gold from the central banks - but it applied only to other -foreign banks and thus was not a proper sales price, either, -because all others were excluded as bidders. - When any paper -money, one that is not legal tender and is an optional or competing- currency, stands at par, in a free money and gold market, then -this means that its price consists of a free purchase and a free- sales price - different only by the "gold points". This profit- margin for gold traders is rather small but has to cover -transport costs and risks. Sales and purchase prices for other- commodities vary, usually, much more. - J. Z., 22.4.97.
GOLD PRODUCTION & INFLATION: Gold production leads to inflation. -  Popular opinion. - One might as well assert that steel production or kwh production leads to inflation. - To assert that, especially decades after the classical gold standard was abolished and when during most inflations there were severe penalties upon the possession and smuggling of gold, is absurd. - The current gold production is always only a small fraction of the total accumulated gold. Moreover, the total gold treasure tends to increase slower than general productivity and population. In other words, the per head and per unit of other goods equivalent in gold weight units tends to decrease rather than to decrease. If there were no paper money inflation we would see decreases rather than increases in the gold weight unit prices of goods, while services and labour, due to higher capital investments per head and technical, managerial and scientific advances, would be increased in gold weight units and purchasing power towards other goods. The gold "inflation" effect is entirely imaginary. It is an unjustified put-down or slander by upholders of monetary despotism. They can't produce anything better, so the malign gold. The ever increasing use of gold in industry and arts would alone see to it that the value of gold would not decline. We do also bury more and more of the gold production with the teeth of our dead. - J. Z., 2.4.97.
GOLD REDEMPTIONISM & ITS AUTOMATISM: When monetary "experts"- focus only on the automatism of gold redemptionism or gold- convertibility, then they do tend to overlook the automatism- resulting from free monetary issues, free market rating of such- issues, the right to refuse to accept them or to discount them, -the separation of means of payment freedom from the freedom -consisting in free choice of value standards, the right to clear -one's goods, services and labour freely for those of others, -regardless whether oneself or they do possess any gold, the -possibility of shop or tax-foundation or debt and clearing- foundation for any kinds of notes and clearing certificates,- without any of the participants possessing any gold. With all their attention focused on gold coins or gold covers and gold redemption of gold certificates, they tend to overlook the other securities involved in banknotes and short-term turnover credits of note-issuing banks, or they tend to put them down as insufficient, although they have sufficed and would still suffice to preserve the par value of competitive bank notes - in combination with "shop foundation" which is part of the whole clearing process that is involved. It hasn't helped to achieve full comprehension of the "real bill doctrine" and of the "banking principle" that was based on "sound commercial bills" (real bills as opposed to financial bills), and the cover and reflux that they provided in discounting them and in their repayment with banknotes (or credits established by banknotes) that commercial bills are no longer extensively used (largely due to the severe penalties upon infringing their rules) and replaced by other and easier to use short-term securities. That "commercial bills of exchange" were largely discontinued may also have been due to the fact that the central bank got a monopoly to discount them or had to supply its notes for such dicounting by other banks, without being involved in examining the business of the bill debtors. The "art" of note-issuing bankers consisted for a long period largely in his ability to distinguish a sound commercial bill from a mere financial bill, or sound turn-over credit bills from prolonged loan instruments. By involving a centralised bureaucracy this art became largely lost - and is by now largely unknown to most of the remaining bankers and their employees, no longer being involved with sound and self-liquidating note issues and their security, reflux and clearing arrangements. Governments had pre-empted and thereby largely destroyed that sphere, even though, in their monetary legislation, they still paid considerable lip service to this sound banking tradition, more in e.g. Germany than in the US, where the "asset-currency" spleen largely prevailed, apart from notions of metal redemptionism. - They also- overlook the disadvantages involved in any exclusive currency and- seeing that they believe their exclusive currency so good and- quite sufficient, they have often no hesitation to demand not -only an exclusive status for it but also legal tender power -- which they do rightly condemn for all other media of exchange and- value standards. They ignore the vast possibilities of all kinds- of ticket monies with some or the other readiness to accept -foundation. They believe with such religious fervour in gold--weight units as ideal standards and that that standard can be -maintained only by convertibility through the issuer, upon- demand, that they quite ignore gold clearing and gold accounting -and gold pricing options, in which means of exchange as good as -gold (at par with their nominal gold weigh value) are accepted- at par in all payments. Their preferred metallic redemptionism makes them overlook- the greatest redemption fund of all, that consisting of the- ready for sale goods and services, and also the greatest gold- redemption reserves that exist, namely those on the free gold -market, far in excess of those of any particular issuer of gold -certificates. That vast gold market convertibility reserve or- cover is available to all those who hold ticket money, goods and- service vouchers and clearing certificates that stand at par with- their nominal gold values and, fractionally, even to depreciated- notes, that no one but the issuer would still have to accept at -par with gold. A free gold market trader might still accept them- at their discounted value for gold, provided only its issuer is- not already bankrupt and out of business. The Misean kind of- "free banking" is very different from that e.g. of Henry Meulen- or that of the "free banking" period in U.S. monetary history,- which granted a blanket permit for currency issues upon the "security" of more or less fictitious capital assets or- securities. Even government debt certificates were considered- acceptable. And today sometimes even the securities of already or -nearly bankrupt foreign governments are considered as -"securities" for the issue of "asset" currency that has exclusive -status and legal tender power in the own country. The Austrian- School of Economics has gone far in exploring property, trade and -market relationships, free pricing, free enterprise etc. - but it- has not sufficiently applied its insights and principles and- recommended institutions to the sphere of money, credit and -finance. Gold bugs, or gold redemptionist notions still spook- around in their heads, misguided by ancient mistakes and -traditions and beliefs, that do not even fully liberate all gold- contract options. Non-gold bugs have much more to offer in -redemption funds and free market issue and acceptance limits, and -in clearing options and alternative value standards than have the advocates -of gold redemption by the issuer. However, as  fellow -fighters against despotic, exclusive and legal tender paper money- of governments, the Austrians are welcome allies on the road to- general monetary freedom. One simply does not have to accept all -their proposals for alternatives or has to see to it that they- can be freely practised only in voluntary payment communities or -exterritorially autonomous communities of volunteers that try to -practise the principles, theories, institutions and methods of -limited constitutional governments among themselves. Monetary -freedom advocates and panarchists would not want to outlaw but -rather welcome them, as free experiments, useful to teach lessons- not yet learned by their participants.
GOLD RUSHES, CURRENCY FAMINES, GREED, GET RICH SCHEMES, ABILITY TO PAY, MONEY SHORTAGES, CRISES, UNEMPLOYMENT, MONETARY DESPOTISM & MONETARY FREEDOM, AURI SACRA FAMES, THE CURSED HUNGER FOR GOLD, POVERTY, SUPPLY OF MEANS OF EXCHANGE: The proverbial "cursed hunger for gold" or "greed for money" or riches has been expressed not only by numerous beggars in the street or long lines of unemployed, queuing up for jobs, by slum areas around cities, by involvement of many poor people in smuggling, drugs, gambling, betting, lotteries, prostitution, pyramid schemes and crimes with involuntary victims, but also in land and gold rushes. The latter two have led to suddenly exploding population figures in areas opened up for settlement or open to gold mining claims. These rushes do not only indicate a quest for adventure and for easy and large riches but also an insufficient supply under then and still persisting production and exchange conditions, that confined people to sell their labour only for an exclusive and insufficiently supplied currency, which made it hard to impossible for many people to earn a living. It also meant underpaid jobs, sales at emergency sales prices and many business and enterprise failures and much less choice in jobs for job seekers. Gold and silver coins were never quite evenly distributed all over the world, nor were 100% or fractionally covered gold and silver certificates. An uneven supply of exchange media and jobs can even now be found between country areas and city areas. The centralisation of much of the world's population in cities has as one significant and mostly ignored contributing factor central banking, which manages to supply city enterprises better than country enterprises with currency. Further: Any currency once acquired in country centres of trade and production does not necessarily stay there but tends to flow off, into the cities. It would be different for their local currencies. If the system of monetary despotism or of an exclusive currency as good as a gold coin or gold certificate currency, had managed to supply everybody willing and able to produce, trade, serve and work, to the limits of their capacity, with ready cash, i. e. rendered them to that extent able to pay, then e. g., State socialism & welfare statism and totalitarianism would have lost most of their supporters and unproductive get-rich schemes, zero sum games and crimes would be much rarer. But in spite of the fact that there are numerous indications of an insufficient supply of exchange media, advocates of central banking and those of an exclusive gold currency as well, do still assert that their systems would be able to supply any legitimate demand for currency and that "currency famines" and "currency shortages" are merely imaginary. - It is so easy to forget even the experiences of one's youth, with insufficient pocket money - or of none at all for many years, as in my case, and quite insufficient earnings opportunities for most young people. It is also easy to ignore all those who have given up registering as unemployed or under-employed and all those who do not bother to register that they would be ready and willing to work part-time. All the unused production capacity, unused labour forces, ready for sale goods, still remaining unsold, even when there is a great need and want for them among hundreds of millions of people, the great urge to get overtime jobs and payments when one is employed, all these indicate, at least to me, a shortage of sound currency. More of an inflated and monopolised and coercive currency does not help. It is offered all the time but does not improve but rather worsen the situation. And to recommend to all people to become merely "gold diggers" or traders in gold and gold users for all their exchanges, is not a great or sufficient help for them, either, in their persistent currency shortage. There are only a few who seriously assert that we live in an age of affluence. It is easy for a well-paid and world famous professor like Galbraith to assert this and to ignore hundreds of millions of unemployed. The very existence of a single unemployed, able and willing to work and yet unable to get a job, at market rates, although seeking it for a long time, would indicate already some sort or barrier that prevents him from exchanging his labour capacity for the labours and goods that others would like to sell him. Obviously, exchange media, value standards and clearing avenues or their lack of them are involved in this. But then we still live in a time that in spite of the cruelty of man to man and of nature to man - asserts that we all are children of a God and that he is a loving and caring creator and father. Similarly, the faith in central banking and in an exclusive gold standard currency does persist, in the face of all contrary evidence. Regarding money, too, religiously upheld dogmas do exist and the supposed experts on money are, as Ulrich von Beckerath used to say, just the priests of the popular religion on money. We are still all too church-, faith- and priest-ridden in this respect. Here, too, the non-conformists and dissenters and reformers have not yet gained their independence, self-government and self-management and self-help options, rights and liberties. We are not yet monetarily emancipated but we need to be. The sooner the better, for the enemies of liberty have now access not only to conventional but to ABC mass murder devices and all the animosities raised by monetary despotism against foreigners, immigrants, minorities, other ideologies and religions, ethnic or racial groups and the collectivist thinking engendered by territorialism, can still lead at any time to a general holocaust, even to the extinction of the human race, via nuclear, biological or chemical "weapons" or anti-people "weapons" or mass murder and mass destruction devices. Perhaps only rabbits and cockroaches might survive. The latter can stand a thousand-fold or even a hundred-thousand-fold as much radiation as can human beings. - And we are forced to pay tributes to our future mass murderers and mad enough to praise them for their "defence efforts" or "deterrence" policies. - J. Z., 20.8.86, 15.5.97.
GOLD STANDARD AND MONETARY FREEDOM: Today's free-market- advocates of the gold standard differ from past advocates. For -example, free-market advocates do not exclude silver or other -commodities from their concept of a gold standard. Indeed, they- do not even insist that gold MUST be money. - Paul Stevens,- referred to as a freelance writer, in THE FREEMAN, 1/75. - Alas,- some have not yet forgotten anything about the old standard -except bad experiences with it - and have not learned anything- about its other options and are not willing to listen, or study,- either. - J. Z., 21.3.97.
GOLD STANDARD CURRENCIES: As proposed by Mises, Greaves,- Rothbard et al, as exclusive and forced or  exclusive currencies -without legal tender power, they should become permissible but -only for their voluntary followers and within their -exterritorially autonomous communities. They, too, should not be- given any constitutional, legal or juridical powers to impose -their own favourite system upon all others territorially, whether they like it or not. To that extent, too, their limited- government should be much more limited than most of them dreamed -of. - J. Z., 4.12.92, 30.4.97.
GOLD STANDARD, "THE", FREE GOLD MARKET, GOLD COVER, GOLD REDEMPTION:  Free exchange and free clearing via the tokens (exchange media)  and value standards of monetary freedom do not require a metallic cover for their debts or accounts but merely soundly administered issues of exchange media that are using a sound value standard, acceptable to issuers and acceptors alike. And sound value standards do not require a gold reserve by the issuer or by a central bank - in case a gold weight unit has been accepted as a value standard, but merely a free gold market. The free gold market can make much more gold available than can the largest gold hoard of a central bank to those who want to convert their exchange media into gold. - J.Z., 8.4.01, 26.8.02.
GOLD STANDARD, GOLD REDEMPTIONISM, GOLD RESERVES, GOLD COVER, GOLD CERTIFICATES: It is neither necessary nor advantageous that banknotes are convertible upon demand by the issuer into either gold coins or gold bullion, although such banks have been set up and could be set up again. - Firstly, such a provision of exchange media is expensive. Secondly, by limiting exchange media thus to the availability of a single product for all exchanges of millions of different products and services, an unnecessary and unjustified bottleneck is established, one that will prevent many exchanges or it might make the sales of goods, labor and services possible only at emergency prices. - It does not sufficiently distinguish between value standard and exchange media and limits the exchange media supply to the supply of the value standard medium. It does not take note of the facts that numerous exchanges took place in the past and take place now without such gold cover, furthermore, that clearing transactions, i.e. the mutual cancellation of debts, does not require any physical exchange media at all, not even paper money cash. Theoretically, the number of exchanges is unlimited - except for the productive and service capacity of people and their willingness to produce and consume. Most of them do not want to produce, sell and buy gold but, instead, goods and services. Their exchange media should represent that reality and allow them to monetize what they have to offer in goods and services, in optional and market rated money, whose issue is thereby self-regulated and will serve to achieve the sale of whatever they have to offer in wanted goods and services. Beyond that, under competitive conditions, with a free and well publicized market for competing exchange media and their value standards, they could not successfully and for long issue any exchange media at par, no more so than a theatre could for long sell many theatre tickets at par beyond its seating capacity. We do not need a central bank to determine or regulate the value of all tickets issued and used. Currency or cash notes are best perceived as tickets to the goods and services offered, issued by the providers of the ready for sale goods and services. Who else would be rightly entitled to issue claims to what they have to offer? That means shop currency, based on shop foundation. Indeed, it is based on debt. The issuer has obliged himself by his notes. Whoever he lends them to, has to repay him, with some interest, covering at least the costs and risk of the process. The issuer also owes the holder of his IOU's  the goods and services he offers - up to the value of the shop currency he holds, to the extent that it was issued by him or associates. Prices and notes are best expressed in sound and agreed upon rather than government determined and mismanaged value units. Historical experience speaks overwhelmingly for this change. Consumers are in the market, generally, to buy consumer goods and services, not gold coins or bullion. Their exchange media should represent that fact and facilitate the turnover of goods and services rather than that of gold coins and bullion only. Indeed, a gold certificate or gold coin would be widely acceptable - but not universally, by all people, in all situations. And we should never be made dependent upon them as exclusive exchange media and value standards. When monetary freedom is introduced, a few such banks will be established - but I doubt that they will last long in free competition with sound other exchange media providers who might e.g., use gold weight units only as their preferred value standards, without promising redemption in them. Likewise, in clearing and in debt contracts gold weight units might be used only as value standards or accounting units. Issues of "shop currency" would merely oblige themselves to accept their notes as if they were gold coins. Thereby they could keep them at par or close enough at par with their nominal gold weight value. For many purposes such notes, not only redeemable gold certificates, would even be preferred to payments in gold coins and in gold bullion.  Independence from gold holders, gold mines, gold coin mints and the gold stocks accumulated by banks! Free choice of exchange media and value standards - for the gold bugs as well. But no one should have to become a gold bug or a victim of the beliefs of gold bugs. - The gold redemption by the issuers can be replaced by the gold redemption on a free gold market. That gold hoard embraces all the gold that is on the market, not merely the gold that the gold standard banks have been able to accumulate. And it can indicate the gold weigh value not only of classical gold standard certificates but of all alternative currencies, even those using other than gold weight values as their value standard. - J.Z., n.d. & 24.8.02.
GOLD STANDARD, MONETARY DESPOTISM & POLITICAL MONEY: The old- standard functions with the force and inevitability of natural -law, for it is the money of freedom and honesty. Society may- temporarily depart from it in the vain hope of replacing it with -political money that is managed and manipulated for political -ends - used and abused as an instrument of public plunder. - -Sennholz, THE FREEMAN, 2/75. - When gold payment, in gold or gold- certificates with gold redemption is legally and juridically -imposed upon all debtors then this gold standard becomes- dishonest, impractical and very harmful, too, for all non-cash -and clearing transactions cannot be so covered, nor, by their- very nature, need they be so covered. A single gold weight, used- as a standard of value, would suffice for all these transactions. -The imposed obligation to deliver gold instead of clearing has -often led to panics and economic depressions. It should be- replaced by an optional and individual obligation and even then withdrawal premiums ought to be included in the contract, as they- are in most other dealings with futures (Trades that promise to- deliver what one does not yet possess but only hopes to attain.-).
GOLD STANDARD, THE: It is wrong to speak and write as if only- one kind of gold standard were possible, did occur historically- or had been proposed. - Ignored are e.g. the various forms of- option clauses and the gold clearing or gold for account value- standard. Both eliminate, in their way, the redemption risk and- this without having to accumulate a 100% gold redemption fund.- Even a fractional reserve redemption currency can be frankly -offered as such and run, without false pretence, as long as it- can be. Its runs and moratoria can be foreseen and anticipated by clauses for gradual settlements that are satisfactory for the -bank and its voluntary customers. - J. Z., 16.3.97.
GOLD STANDARD, THE: Most of the advocates of "the" gold standard -do not sufficiently distinguish between gold a) as an EXCLUSIVE &- FORCED value standard AND as an EXCLUSIVE & FORCED exchange -medium and b) Gold as either an EXCLUSIVE & FORCED value standard -or merely as an OPTIONAL, COMPETING & MARKET RATED value- standard, in combination with gold as an OPTIONAL, COMPETITIVE  & -MARKET RATED means of exchange, one that is supplemented by numerous- other optional means of exchange and value standards, that are- all competitive and market rated e.g., against gold weight units, but -not covered by or redeemable into them and c) gold as a means of- exchange that a debtor may pay, when he is well enough supplied with it, from gold as a means of exchange that a creditor may- demand from a debtor, although the debtor is not well enough- supplied with it. When gold metal payment is optional for a debtor then no difficulties arise, as a -rule (apart from the transaction costs for large rare metal -payments) for debtor and creditor. When it is compulsory, upon demand by the creditor, for a debtor, then the- difficulties that arise from this for both, debtor and creditor,- are large. - Moreover, advocates of "the" gold standard do -usually assume that the market for goods and services of all kinds can and will rapidly and fully enough adapt to ANY and- RAPID  changes in the quantities of rare metals that are readily -available as exclusive exchange media and value standards in any -developed economy, so that the quantity available would not -matter at all. That expectation or prediction or "rule" is not- sufficiently born out by the facts. Rare metals have been used as- exchange media and value standards for thousands of years but- still have never managed to make all desired monetary exchanges -possible. Barter exchanges and currency famines persisted to some- degree, even in boom times and spread widely during crises. And- this in spite of the fact that numerous clearing exchanges did- supplement those exchanges which were made possible by the -available quantities of rare metals, used for exchanges. As a- result of the prices of goods, labour and services not- immediately falling far enough to restore the equilibrium between- the suddenly reduced (in circulation) exclusive rare metal- exchange media on the one side and of the goods, services and labour on the other side, even primitive emergency monies gained currency for a-while, at least locally and dozens of millions of involuntarily -unemployed found it impossible to exchange their labour even at- emergency sales prices for labour. - In this connection it is- often overlooked that falling prices deter from buying and- encourage more hoarding, while fallen prices encourage buyers and -reduce cash hoardings. Deflations tend to induce falling prices. Technical improvements and better harvests tend to bring about -individually fallen prices. - Generally speaking, monopolies are -never very good at fast adapting to any changes. But gold bugs- assumed that their favourite monopoly could and would. - J. Z.,- 16.4.97 & 22.4.97.
GOLD STANDARD: I do not favour "THE" gold standard imposed upon -all people in a country but only the kind of gold standards that -people would voluntarily apply among themselves, in their own -payment communities. But I do also favour any kind of other value- standard that people agree to adopt between themselves without- making any attempt to politically impose it upon any dissenters -in any territorial State.
GOLD STANDARDS, DIFFERENCES THAT ARE IMPORTANT: A gold standard as an exclusive currency is very different from a gold standard as a permitted and preferred but competing currency. It is as -different in its effects as a creditor's legal claim to payment -in gold coins, even when a debtor has none and cannot obtain any ,-is from the right of debtors to pay their creditors in gold only- whenever they possess it (or contractually obliged themselves to -supply it) and otherwise and normally to pay only in gold- weight values, in any acceptable currency, by gold accounting or gold- clearing. For the latter there need not be a single coin of gold- in a country, although a small gold coin circulation would be- preferable. The former amounts often to torturing a deaf and dumb- person in order to extract a confession from him. The latter -payment method is, under monetary freedom, available to every productive person. - J. Z., 77 & 97.
GOLD, AS EXCLUSIVE COVER FOR EXCHANGE MEDIA & AS AN EXCLUSIVE VALUE STANDARD:  Why should only the owners of particular and rare commodities, like gold and silver, have the right to circulate the value of these in form of standardised & typified certificates for local circulation? Why should only such weight units be permitted as standards of value, singly or several in parallel? Most people want to buy many other things and services, among many millions, rather than gold or silver. Moreover, hundreds to thousands of alternative value standards have been proposed. All other goods and services and all capital goods are also worth very much more than all the gold and silver accumulated in the world, for thousands of years, and still available on the rare metal markets now. Why should all trade have to be mediated only through these 2 commodities, i. e. all of millions of commodities, services and capital assets only through 2 commodities (3 if one includes platinum.)? If this is a voluntary choice of some people, that is one thing. If it is constitutionally or legally imposed upon all, that is another. Instead, all producers and traders, tradesmen and service providers should be at liberty to offer their ready for sale goods and services in their own ticket money, which only they would have to accept at par and free to use them with whatever sound (or unsound) value standard they would like use among themselves, i.e., among volunteers, e.g., a gram of gold. - Used merely as an optional value standard, gold would be plentiful to mediate, as a reckoning unit - for the free exchange of any quantity of goods, services and labour. - J. Z., 26.6.85, 9.45.97.
GOLD, IN THE OPINION OF THE GOLD BUGS: … people ..  are asking that gold come out of the depositories and vaults of the central banks and return to the pockets and purses of private individuals, for gold is the only really sound money with intrinsic value. The desire for a retun to gold is understandable, and we hope to see it realized some day, although the argument in favor of the gold standard is not always stated in a valid way. The distinctive function of gold money does not consist in its intrinsic value or in the constancy of that value, which fluctuates even in the absence of government intervention. The excellence of metallic money in free circulation consists in the fact that it renders impossible the abuse of the power of the government to dispose of the possessions of its citizens by means of its monetary policy and thus serves as the solid foundation of economic liberty within each country and of free trade between one country and another. - Faustino Ballvé, Essentials of Economics, 1963, published by FEE, 1956, in English since 1963 - He seems unaware that the abolition of legal tender and of the central bank's issue monopoly would do this even better. If one can force one of the gold standards upon the government, then one can also force it to give up legal tender and its money monopoly and its abstract paper value standard, leaving it to the competition between currency producers and currency acceptors, discounters or refusers which currencies will continue to exist. - The gold bugs are right only in demanding the dissolution of the gold hoards of the central banks, which are a great expense and do not fulfil any sound economic function there. But they manage to insist on gold hoards for note-issuing banks, which is also an authoritarian imposition. Without a monopoly or oligopoly for such banks they could not persist for long. Their issue costs would be too high and they would reach their inbuilt issue limits all too soon, without being able to supply all the exchange media which free markets need. They would have to transform their redemption gold standard into a gold clearing or gold-accounting standard to become competitive. - J.Z., 27.8.02.
GOLD, THE CURSED HUNGER FOR GOLD: Auri sacra fames, the cursed hunger for gold. This often cited quote is connected to the limited monetary views of those who see in it the only possible or desirable means of payment. But it does also indicate that difficulties arise when gold has the status of an exclusive means of payment. It is then, quite usually, insufficiently supplied. A hunger or a famine exists, that can, supposedly, only be abolished by an increased supply of gold. In recent centuries this limited view of monetary options was expressed by royal mint prerogatives and later by the obligation of paper money issuers to redeem their issues in gold upon demand. Paper monies as good - or even better than gold - and still reckoning with gold weight units as their standards of value and their accounting and clearing standards, were considered only by a few and the practice of such issues was so rare that it has been overlooked by those only considering the most wide-spread practices. - We should not let the primitive or underdeveloped monetary and clearing ideas and practices of the past centuries determine all our monetary and clearing transactions of today and all our theories on money, currencies, value standards and clearing. A single instance of a successful gold accounting or gold clearing contract or acceptance of a paper exchange medium, not convertible by the issuer into gold, but accepted nevertheless at par with such a gold weight value, as if it were gold coin of that weight, should be considered enough to overthrow or at least throw into doubt and controversy all gold redemptionist assumptions and assertions of the currency school. - It is high time to think of currencies and value standards in other terms than merely those of  the gold certificates of the early issuers, the gold smiths. - That was a more or less accidental or inevitable discovery of ONE monetary option. We should not confine our thinking and practice, our business, our production, or exchanges, our whole economic options to that single option as if it were the only possible and desirable one. - Even primitives knew, appreciated and used for long periods other options and some may still do so. What they can imagine and practise, somewhat enlightened and civilized human beings should be able to imagine and practice, too, but without committing themselves to THEIR primitive solutions of the payment and value standard accounting problem. - J. Z., 12.2.86, 15.5.97, 13.9.02.
GOLD-REDEMPTIONISM OR A COMMODITY RESERVE STANDARD? MONETARY FREEDOM: Competition would provide better money than- would government. I believe we can do much better than gold ever -made possible.  Governments cannot do better. Free enterprise,- i.e. the institutions that would emerge from a process of- competition in providing good money, no doubt would. There would -in that event also be no need to encomber the money supply with -the complicated and expensive provision for convertibility which -was necessary to secure the automatic operation of the gold- standard and which made it appear as at least more practicable- than what would ideally seem much more suitable - a commodity -reserve standard.... - Hayek, Denationalisation of Money, 83.
GOODS WARRANTS WITH SHOP FOUNDATION: A MINIMUM READINESS TO -ACCEPT REQUIRED TO TURN THEM INTO CUSTOMARY  LOCAL CURRENCIES? - -It would be largely a matter of local shopping conditions and of the -participation rate in a local shop foundation bank to determine- whether such issues could form one or even several local- currencies. When there is a very large supermarket in a district, -then its participation would be essential. But it should not have -to "carry" all other and much smaller local shops with its vast -readiness to accept. Thus credits to the smaller shops by the -local shop association banks should not exceed the readiness to -accept capacity of these shops and the readiness of local- consumers to spend their earnings with them. At least under -present conditions many new small shops do fail and do fail, -soon. Ill planned and ill managed new local shops should no more -be subsidised under monetary freedom than under any system of -monetary despotism. To the extent that their shop foundation- capacity for the issue of shop foundation money is still in- doubt, they might find themselves left out by the main local shop -association bank and thus induced to combine, with other such local- shops, into an issue centre of their own. Perhaps, initially,- they could issue their notes only at a discount that would make -them acceptable to those  potential buyers only who are always on- the lookout for discounted prices. These issuers would,- naturally, have to accept their notes at par, which amounts to -their buyers, who got these notes at a discount, to the same as- if the shop had granted them a discount price. In this way this -separate issuing centre may get its goods and services more widely -known and accepted, until it could, finally, issue its notes at -par, too, and might merge with the major local centre of issue. -In a situation of mass unemployment already a single local -general store might already find ready acceptance for its store -currency through the willingness of enough of the local- unemployed to accept it in payment for jobs which they could not -get otherwise, if they insisted on payment in exclusive legal -tender currency. If, as a result, this shop multiplied its- turnover, then other local shops would soon come to consider the -potential benefits of monetary freedom for themselves, too. - To -prepare local public opinion for such issues, local papers and -radio stations should explore the size of the ready for sale shop -foundation that exists in the local retail shops and service- centres and should publish this figure, together with an estimate -of what percentage of this total ready-for-sale offer could. in -any particular period, 30 to 90 days, be issued, probably,- according to past experiences with real bill banknotes, at par -with their nominal value. With these figures known, discussed and- appreciated,  many of the local shops and service suppliers might -then come to want to mobilise this potential for alternative money circulation and sales options for- themselves as soon as they can. Enlightened unemployed, asking- for jobs, might also tell their potential employers that they- would find payment in a local shop currency, in full or in part, -acceptable. When traditional unionists would object against such -"truck payments" then they should be invited to make proposals -not to outlaw such voluntary and self-help steps but, rather, how -to improve them, i.e., how to make local private or cooperative- issues of shop foundation money more widely acceptable, locally, -than they are already. Alternatively, they should be asked, how -they would increase the supply of exclusive and- forced currency of the central bank, to the local community, and assure its reflux to -it, once it is spent somewhere else. As major potential acceptors -and users of local shop currencies, representatives of local- employees should also participate in the setting up and- management of local centres of issue. The retailers should apply -their maxim: The customer is always right! - here, too. They do -generally depend on customer satisfaction and feedback and should arrange for it initially and continuously for their issuing -centres, too. - J. Z., 5.12.92, 30.4.97.
GOODS WARRANTS: See: WENNING, EDWARD, Universal Prosperity.- According to Tandy, Voluntary Socialism, p. 205, he proposed a- giant coop company to issue scrip redeemable in its goods. - Text- wanted for fiching. - J. Z., 97.
GOVERNMENT & BANKING: Some believe that "government has been- forced to interfere with the business of banking." - What has -happened, rather, is that much meddling by governments with -banking has led to many abuses, which the government tries to- cure and in reality makes worse by further meddling. See: -REGULATION, DEREGULATION, CENTRAL BANKING, MONETARY DESPOTISM,- MONEY POLICY, CURRENCY POLICY, CONTROLS, LIMITS. - J. Z., 3/97.
GOVERNMENT & JOBS: The government destroys more jobs than it creates - inevitably. - J. Z., 21.10.93.
GOVERNMENT MONEY WITH TAX OR CLEARING FOUNDATION: Even- government money used to be similar to privately issued clearing certificates or turn-over promoting and self-liquidating banknote -issues. They were issued in anticipation of short-term tax claims -and were rapidly streaming back from a limited circulation in payment of taxes. Usually the taxes for up to the next 3 months could thus be -"anticipated" by issuing and spending these kinds of clearing -certificates. Ideally, this kind of tax foundation (if there is -anything ideal about coercive tributes) was practised without- legal tender and using a sound value standard, to avoid- over-issues and the cheating of any creditor. Such clearing--issues of "tax foundation money", for the clearing of government-- spending against its tax claims, and anticipating near future tax--payments, persisted for a considerable time but governments do- not tend to remain honest for very long, if they can get away- with using fraud and coercion instead, to their short-term advantage. Even Adam Smith, in one of his neglected passages, in- Wealth of Nations, realized that tax foundation money does not -require a gold reserve but merely sound accounting. Knapp, too, -in his famous The State Theory of Money, recognized the possibility of tax--foundation money and its clearing nature, as the essence of -government paper money issues. But he realized as well, in a -short passage, the possibility and clearing nature of private payment communities and their certificates. He merely did not -develop the private options in this work, since it was, by its title, dedicated to the other and supposed "ideal" clearing- option for a country-wide and uniform paper money. When -governments extort payments from their victims, then they should- at least provide the victims with sufficient sound exchange media- to facilitate these payments. Otherwise they do act like -inquisitors who torture deaf and dumb persons in order to extract- confessions of them. - J. Z., 3/97.
GOVERNMENT MONEY: Government money has now no redeemable feature -except that you can pay with it the government's tribute- extractions and the charges for its monopolised and usually over-priced public services or -disservices and that you can buy investments in tax slaves with -it, in form of government insecurities. Formerly, its- convertibility in rare metals and the absence of legal tender for- it were its only redeemable features. - Its uniformity counts as -nothing when compared with the deflationary, inflationary and- stagflationary wrongs it commits and damages it does to people's -lives, earnings, properties and liberties. - J. Z., 6.7.91,- 28.4.97.
GOVERNMENT MONEY: There is no such thing as government money. -- Prime Minister, U.K., Margaret Thatcher.  - Did she really -consider the paper money of the Bank of England to be a PRIVATE -and not a governmental institution? But, indeed, it becomes a- somewhat sound money only as a clearing medium for taxes (tax--foundation) and has in general circulation otherwise only a- forced value, as a monopoly money and one with legal tender. - -J. Z., 16.4.97.
GOVERNMENT PAPER MONEY ISSUES: Can they be honest, non-abusive, -non-coercive? Such issues happened but they were the exception- rather than the rule. When all powers of monetary despotism are -granted to a government then they are usually abused, sooner or -later, more often than not. - J. Z., 3/97.
GOVERNMENT PROGRAMMES AGAINST UNEMPLOYMENT: Government programmes can only coercively shift employment opportunities from the unknown and ignored numerous forgotten men and women, to themselves and their favoured few. The jobs previously sponsored privately, with the funds the government steals for its job programme, cease, although they were wanted by consumers and thus productive ones, and are thus replaced by a lesser number of unproductive ones, which do not earn or produce the artificial wage rates paid for them at the expense of tax payers. To the extent that the means are used to expand the bureaucracy, these levies are even counter-productive. Naturally, government statistics, bookkeeping and public pronouncements will not show these negative effects. To some extent the governments will act like the Soviets or the Imperial Japanese Army did. They will point out the length of e.g. railway tracks built by them but not the number of deaths caused by their construction methods and treatment of their forced labourers: prisoners of war. Thus they not only managed to "employ" thousands, correspondingly diminishing unemployment, they even managed to greatly reduce the number of workers, like pestilence did in former centuries.  - J. Z., 10.1.94, 24.4.97.
GOVERNMENT PROMISES, GOVERNMENT PAPER MONEY, REFUSALS & DISCOUNTS-: All government promises ought to be either outright refused or -greatly discounted, if experience is to be any guide. - J.Z., -6.7.91, 26.4.97. - See: TAX STRIKES, PAPER MONEY, LEGAL TENDER,- REFUSALS TO ACCEPT GOVERNMENT PAPER MONEY, DISCOUNTING.
GOVERNMENT PROVISION OF JOBS? Governments can "create" only wasteful, oppressive, make-believe jobs but not any additional real, productive, consumer-wanted and supported ones, at market rates, except, naturally, by the government getting entirely out of the way. But it can, indeed, destroy many jobs and prevent many from coming into existence. - J. Z., 25.11.93, 24.5.97.
GOVERNMENT RESOURCES: A misnomer if ever there was one. All- governments are, essentially, without any "resources" of their -own, unless they adopt the stance of King Louis XIV, who once -impertinently claimed: I AM the State! - Like many kings and- despots he claimed a country and his people as his private -property, to do with them as he pleased. But somewhat enlightened -people should not recognize such claims, not even when transferred to parliaments or elected rulers, in democratic or republican or -constitutionally (more or less) governed countries.  What- governments are physically in control of are the remaining assets- remaining from their former and recent robberies, the extorted- monopoly profits from their self-proclaimed and maintained- monopolies, e.g. the telephone, postal and central banking money -issue monopoly, their legal and juridical and administrative -monopolies, the remaining assets from their conquests and- confiscations. But none of them are, by rights, the property of- any government and all of them should, as far as possible and as- soon as possible be restored to their victims. Including e.g., -their "reserves" in gold, silver and foreign exchange, without -justification or common sense accumulated in their central banks.- - J. Z., 17.8.94, 17.4.97.
GOVERNMENT SPENDING & INFLATION: Inflationary government- spending is not "spending", no more so than private forgery is or -official and forceful requisitioning. - J. Z., 77 & 97.
GOVERNMENT SPENDING: Government "spending" is really indicating- a form of confiscation, via direct or indirect taxation or the -inflation tax, and of distributing this loot to favourites or -interested people as political bribes.  Legal tender and the -monopoly of the central bank for note issues and the popular and -academic belief (among most economists) in monetary despotism,- makes this abuse not only possible but likely. - J. Z., 8.4.97.
GOVERNMENT SPENDING: Government "spending" is still considered -as proper and honest spending, although only stolen funds or -fraudulent and coercive requisitioning certificates are involved.- From the budgets of their "spending" policies some kinds of- miracle cures are expected. To me that merely resembles expecting- economic miracles from the "spending" activities of a community- of thieves, robbers, con men and organized criminals, while -completely ignoring the correspondingly decreased spending of- their victims and also outlawing the free issue options for sound competing currencies and "regulating" or "controlling" issues of and trades with capital certificates. - J. Z.,-11.4.97, 5.9.02.
GOVERNMENT SPENDING: Issuing a monopoly money & forcing it into -circulation through this monopoly and legal tender, thus- enforcing its acceptance by every creditor, at par, when it -has already been much depreciated by the government, does hardly -deserve the term "spending". Spending is a voluntary act and it- involves using only what rightfully belongs to oneself in- voluntary exchanges with others, for mutual benefit. - J. Z.,-12.5.95, 16.4.97.
GOVERNMENTAL INVESTMENTS IN JOBS: Government funds, stolen from the taxpayers or inflation victims, or robbed from future tax victims as government "security" investments in tax slaves, lead usually to less jobs than would be invested in without this amount of taxes being levied and also to the funding of less productive jobs. To call such schemes "employment schemes" is a misnomer, another political lie. - J. Z., 1.11.93. - I heard of a local road building programme, paid for by one of the numerous governmental provision of work schemes, at tax payer expense, running under a confusing number of different names, fast forgotten, at least by me. (REA, Rural Employment Agency?) One local supervisor of unemployed, by the scheme as road-workers, expected to get a fair day's work for an average wage. He got instead a lot of slacking and loafing, which has, almost everywhere, made the "men at work" signs as standing joke. When he cracked down upon a particular lazy fellow, the whole work gang ganged up upon him. They did so physically intimidate him that in future - I do not know for how long - he could not get any productive work out of them at all. But on pay day they all still turned up to collect their pay. Another anecdotal story that I remember was that of a flood indemnification scheme for which an office was established in Paris. The last flood victim was paid off by 1917. But the office had great longevity. It was only closed down some time after World War II! Admittedly, these are only extreme instances of government-paid jobs. But mass media and books are full of other instances. Observe, e.g., how postal rates have gone up while postal services have gone down. Some of my air mail takes 20 days to reach me. The faster the jets, the slower the mail, it seems, under government management. A second-hand book dealer in West Germany told me that bookshops that are run in Germany by 2-3 people were, in state socialist East Germany run by 12-20 people. So much about the productivity of government organized and paid jobs. ("Production for use rather than profit!") There were numerous other reports about East Germans having to relearn proper work habits and self-discipline, after having taken their work obligations very easy for years to decades. Yet, after the unification they wanted to be paid standard wages and salaries in DM and, unfortunately, they often were - or remained unemployed and unemployable under these conditions and the continuing communist totalitarian central bank regime of Germany. - J. Z., 1/11/93, 24.5.97.
GOVERNMENTS & TOKEN MONEY: Governments can't even provide a- decent token money, in the best possible forms, shapes, sizes and -quantities. - J. Z., 6.7.91, 28.4.97.
GOVERNMENTS AS INFLATION FIGHTERS: Governments should fight inflation. -  Popular opinion. - "... the control of inflation and cost of living rises a job for the Federal Government" - said the Queensland Premier Mr. Bjoelke-Petersen. - The buck should, indeed, be passed to the federal government and its responsible federal institution, the central bank, the Federal Reserve System in the U.S., the Bank of England in the U.K., the Bundesbank inGermany, the Reserve Bank in Australia etc. These institutions would not need to fight inflation if they were not causing it in the first place. And once it has happened, it cannot be fought, and defeated and reversed. At most governments can slow it down and end it temporarily. They cannot restore the value of a currency which they have depreciated. - To entrust this task to monetary despots, who caused the problem in the first place, is like asking criminals and gangster leaders to fight and control crime. - J. Z., 2.4.97.
GOVERNMENTS AS MANAGERS AND REGULATORS OF MONEY, CURRENCY &- CREDIT:  Having been mostly and for most periods wrong to -dishonest in the administration of exclusive and forced- currencies and wrong and mistaken, mostly, in their monetary- despotism now, all governments should be deprived of any powers, -monopolies and privileges in this sphere. Without a coercive -government backing even the worst privately or cooperatively -issued currency could not do as much wrong and damage in any -country as even the best government-managed currencies have -usually done so far and are likely to do in the future. The worst -mercenaries do not do as much wrong and damage as the -government's conscript armies do. All the private criminals do -not rob citizens as much as the government does. No one can cause- as much mass unemployment or inflation or as severe crises as- governments have often been culpable of. - Decentralise,- minimise and voluntarise damaging systems - and let the good- systems drive out the bad ones - not only by collectivist and -very restricted political voting rights but by granting full- consumer sovereignty and free enterprise to individual citizens -and exterritorial autonomy to their media, standards, clearing -processes & credit arrangements, in their voluntary payment and -political communities. - J. Z., 10.7.91, 22.4.97.
GRADUALISM OR RADICALISM IN THE ABOLITION OF THE CENTRAL BANKS' -ISSUE MONOPOLY & LEGAL TENDER POWER? - Like with the abolition- of price control, and enforced delivery quotas and rationing, the -radical solution is morally the only correct one, economically the best, the most beneficial, -the least harmful one. However, a central bank that can manage to -continue to exist on its merits, without any privileges and legal -tender powers for general circulation, is welcome to its -remaining voluntary customers. And legal tender of all kinds of -IOUs towards the issuer of each type ought to remain, as an- obvious self-responsibility. No one but the issuer is morally -obliged to accept his notes at par with their nominal value or at- all. The juridical defence of legal tender, namely that there -ought to be one or the other means of exchange by which a debtor- can always discharge his debts, can be replaced either by private -contracts on the kinds of means of exchange to be used in- settlement, or, in case such agreements have been omitted, by the -juridical assumption that a debt can be settled by any local currency that stands locally at par with its nominal value. Since, in these cases, -nothing to the contrary has been agreed upon, this must then be a -judicious assumption. No creditor has any reason to complain when -he has not contracted some other payment and when local currency, -standing at par, is offered to him in settlement. Since the local- currency stands at par, he could change it locally into any other -currency he desires, at is par value - less the -transaction fee. As a rule creditors do not tend to resist- debtors prepared to pay them on time and in a sound currency. When debtors and creditors live in different locations and again, -both were foolish or careless enough not to state the means of -payment required in the settlement, then the presumption would be -that either the local currency of the creditor, as long as it- stands at par, could be used in repayment or that of the debtor's- location, or the kind of currency in which the loan was granted.  So I do not expect any difficulties in this sphere, -never mind the apprehensions or pretences of lawyers. - Whenever debtors have difficulties in meeting their -repayments then, before driving them into liquidation or- bankruptcy and in the interest of both sides (if necessary -adjudicated by previously agreed-upon arbitration avenues), the- debtors should be free to offer settlement in assignments upon their own goods or service delivery capacity, in suitable denominations, freely transferable, at a discount to be- agreed upon or arbitrated, up to the full value of the debt. - -J. Z., 10.4.97.
GREAT DEPRESSION, THE: Nobody had any idea how it would end and- whether it would end. - From an ABC-TV ad for one of its- coming-up broadcasts, 14.4.97. - That is a typical journalistic- statement, quite contrary to many facts. While this might have -applied to ignorant and disinterested and prejudiced men of the- street and journalists - and many others, at least during the Great Depression in Germany numerous proposals fo