Gold - did you know?

Inflation Has Always Been With Us And Probably Always Will Be! ?



The money supply of the world's reserve currency has been almost doubled in recent times. Considering today's massive inflationary environment, I would like to point out that this phenomena has always been with us throughout most of currency's history.

In today's world the majority of all international trade goes through the monetary mechanism of the US Dollar. Briefly explained, this means if China wishes to purchase goods from Brazil, it has to exchange its Yuan for US Dollars first. Then it can purchase goods from Brazil. The same applies for Brazil since it must exchange its Reals for US Dollars before being able to purchase goods from China.

This mechanism has been in existence since the end of the Second World War stemming from the Bretton Woods meetings. Mind you, China and Brazil are now taking measures to side step this process so they may exchange their respective currencies directly by taking the US Dollar out of the equation. This is much the same as what the United States did with Brazil back when the British Pound was the reserve currency prior to WWII, again because of massive inflation.

However, let's consider an ancient time approximately 2,000 years ago away from the modern era when the world was dominated primarily by Rome. You could say the Roman Empire was the then-known world or the equivalent to the encompassing modern era of today. Rome traded with their own issued currency known as the Denarius, and it was exchangeable via many mediums, one of them being money changers with all other currencies in its surrounding provinces. For example, Greek Drachmas or Shekels. You might be able to say it was the reserve currency of the day.

In approximately 100 BC the Denarius was similar in size to a US 10cent piece and was 80% silver and 20% base metal. Each year the Romans would collect taxes from its citizens within the empire and its provinces. The Denarius was then sent to Rome's treasuries where the coinage was melted down, and a small fraction of the silver was removed year in and year out. Hence, each year the Denarius 80% silver content was reduced and its base metal content increased. Slowly but surely debasing its currency and also inflating its production with less valuable coinage minted with copper and zinc contents in-creased.

Through all history the biggest exchange for money has always been mankind's labor, not goods as most would think, because all goods involve mankind's labor to produce them. Inflation is a deceptive theft of peoples' labor taking more currency to purchase the same measure of goods or labor in the form of salaries.

Around 100 years later in Jerusalem, one of Rome's provinces, a learned and highly esteemed man in his early 30s named Jesus understood the theft by deception of inflation. In a simplified explanation, money changers would sit in the temple exchanging different currencies of the region for Shekels, which at this time period held an 80% silver content and were not being debased. However, the Denarius was being debased thereby taking more Denarius to be exchanged for the Shekel. The Shekel was the only currency acceptable to purchase the temple sacrifices needed for religious offerings for a multitude of different reasons in this time period's culture and region.

In the historical accounts of the four gospels in the books Matthew, Mark, Luke and John, Jesus is eye-witnessed as entering the temple and driving out the money changers. The books Matthew, Mark and Luke speak of one particular account, yet the book of John speaks about a completely separate incidence where John indicates Jesus is angry enough to premeditatedly make a whip before He enters the temple. When researching other historians, it is soon very easy to see that Jesus not only entered the temple on this issue two times accounted for by the four gospels, but he entered on multiple occasions dealing with this issue regarding the money changers.

As I stated in the heading of this article, inflation has always been with us and probably always will be. The objective is to see beyond the illusionary trick of it and not have the fruits of your labor stolen from you over a lifetime. I trust you can see in the days ahead why Gold and Silver are so important in the times we live in today.


Until next time,

Simon Heaps






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