Philip Barton: A Return To The GOLD Standard is Inevitable!
- The GOLD standard is inevitable!
by Lars Schall, http://goldswitzerland.com/
The gold standard is absolutely inevitable
In this interview for Matterhorn Asset Management, the founder / president of The Gold Standard Institute, Philip Barton, talked with financial journalist Lars Schall about gold primarily as money, not as an investment. He thinks that in this current crisis we will see the separation of the state from money – and gold will be the measure of value.
By Lars Schall
Philip Barton was born in Watford, England in 1946. Since 1965 he has lived in Australia, Colombia, Malaysia, the United States, and Austria. A long-time retailer and restaurateur he has also lectured, panned for gold, worked as a spray painter, hat maker, farmer, company director and investor. He has had an interest in gold going back to the 1970s. He is the founder of The Gold Standard Institute (goldstandardinstitute.com) and the editor of The Gold Standard Journal.
Lars Schall: Mr. Barton, why is it appealing to advocate a return of the gold standard?
Philip Barton: Well, to be precise, Lars, we are not advocating a return of the gold standard, we are advocating the initiation of the gold standard, because the world has actually not for over a thousand years known a true gold standard. A gold standard means by definition that gold is the measure of value. The 19th century, which is commonly regarded as the gold standard, was not a true gold standard, it had a large fiduciary content – about 60 percent of the paper was not backed by gold. It varied from time to time, but let’s say on an average 50 percent of the circulating paper was unbacked by gold. That’s not a gold standard, that’s a paper standard. That was a far better system than we have today, but nevertheless it’s not a gold standard. So we are not advocating going back to anything, we are advocating going forward to an unadulterated gold standard.
L.S.: Do you think this is possible?
P.B.: I not only believe it is possible, Lars, I believe it’s absolutely inevitable. Firstly, the world will return to gold, I knew that twelve years ago. And four years ago, when I founded the institute, I made it very clear to the people who came on board then that the idea wasn’t to push for a return of gold in the monetary system, that was obviously coming irrespective of what everybody did, that was going to come anyway because when paper money collapses worldwide, what else can happen, there is no other alternative; our job was to advocate an unadulterated gold standard – a specific, pure form of gold standard, if you like. So yes, I believe it is not only possible, but also absolutely inevitable.
L.S.: How do you envision such a pure gold standard?
P.B.: It’s very interesting, until about two months or so ago, I couldn’t have answered that question without a lot of waffle, and I had that blinding realization recently, which was: before when government issued pseudo-currencies have collapsed – and a great example is the Weimar Republic, of course, as one that everybody knows – people blamed the government or von Havenstein, the German finance minister, they blamed specific governments, which is fair enough because around Germany and Austria where the inflation happened, the currencies were reasonable fine. So it wasn’t seen as a problem of governments per se, but as a problem of the German government and of von Havenstein in particular.
This is different. In the globalized, synchronized, meshed world of paper money today, every single paper money in the world is interlinked, and I am absolutely convinced, mathematically certain, that when one goes, they’ll all go. Absolutely. And this brings us to the situation where when every single paper currencies collapses at the same time, not only has the money collapsed but surely the validity of the issuing authority has collapsed, too. And I believe for the first time in recorded history, this collapse will see the credibility of governments as organizers of the money supply brought very much into question.
I first wrote about this in October of 2008, about what I saw as an ideal situation for the separation of the state from money. First there was the step to separate the state from church, a very good thing, and the next step will be the separation of the state from money. I actually think that we are upon that point. In this current crisis it looks very real to me that this will be the outcome.
L.S.: Would there also be the need for a separation of private and state banking?
P.B.: If governments don’t control money in any way whatsoever, if money returns to the free market and thus to the people, governments would have no business in banking. In a free market of money, who on earth would choose to bank with a government? There would be no central bank, that kind of banking would be completely divorced automatically by the market.
L.S.: So you’re not much of a fan of central banking?
P.B.: It would be true to say that, Lars. I don’t believe there is any space for a central bank under a system of free money.
Sorry, the comment form is closed at this time.