The newest invention in monetary affairs are the so-called Bitcoins. Their creators and promoters explain them as follows: 'Bitcoins are digital money. They are transferred person to person through Internet without going a bank or a clearing house, so they are independent of the current monetary system. Several currency exchanges exists where you can trade your Bitcoins for dollars or euros, and some small business and freelancers are starting to accept them in payment'.
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The Bitcoin is a game. We live in a highly confused and perplexed world regarding what real money has to be. Let's get this straight: real money has to be the commodity that is generally accepted by society as payment in full for goods or services received.
Throughout history, the commodity most generally accepted in payment has been gold. Silver has taken the second place after gold. Gold and silver were chosen by humanity thousands of years ago, as the commodities with which to make payments.
In the exchange of any given merchandise for gold (or silver), neither of the parties to the interchange ends up owing the other party. There has been “settlement”.
The Bitcoin may serve as a medium of exchange, as do the world’s currencies, but neither the Bitcoin nor any of the currencies of the world can achieve settlement, because the Bitcoin is not a commodity, and neither are the dollar, the euro, the yen, the yuan, etc.
Since there can be no settlement with Bitcoins, at some point many people are going to be more or less seriously burnt when this Bitcoin game goes out of fashion, depending on how much they are holding when the game ends.
So you won playing that great game, “Monopoly”? It’s a great satisfaction to win playing “Monopoly” – you have all those bills, and your game partners are busted! In truth, all the high and mighty fellows running the world’s Central Banks are keeping us amused and busy as we attempt to gather as much as we can of the “Monopoly” money they print up for us. But when you have a lot of their “Monopoly” money, or of Bitcoins, what do you really have when the game ends? You have papers or worthless digits, period.
The only thing that the holder of Bitcoins can do – like any holder of currencies – is to get rid of them by buying things, while there is someone willing to receive them in “payment”. I use quotes around the word “payment”, because since August 1971 there is in this world no real payment at all. Real payment involves settlement, and neither Bitcoins nor currencies can achieve settlement. The proof lies in the $11 Trillion of International Reserves that have built up around the world, because there has been no settlement of international trade imbalances since August 1971. If the Bitcoin mania continues to grow, expect digital quantities of Bitcoins to show up in Chinese Central Bank reserves. Then the creators of the Bitcoins will have to proceed to issuing Bitbonds, so that the Chinese can trade there Bitcoins for Bitbonds which pay interest . It’s all a huge game, dollars, euros, pounds, yen, yuan and now Bitcoins – all the same garbage.
Bitcoins cannot be accumulated safely as savings, because they are not a commodity, nor redeemable into any commodity. We are seeing how unsuspecting depositors of sums of currency in banks are in danger of seeing their deposits cancelled by government decree. Tangible commodities such as gold and silver cannot evaporate because they are not created artificially.
The world of artificial currencies – which now includes the famous Bitcoin – will end in disaster. A truly maddened world knows not where to turn for safety. The vicious drug of artificial money has got the world on a “high”. More drug will kill our civilization, but less drug will send it into a violent withdrawal. Humanity seems to be trapped in a death-cult.
The popularity of the Bitcoin is based on the existing mentality, which considers that something designed “scientifically” must have some value.
The Bitcoin is an example of the tremendous hold that the idea of the omnipotence of technology to solve human problems has upon humanity. However, technology cannot create matter; it cannot create commodity-money, as it cannot create petroleum. Technology may give various forms to matter, but it cannot create matter or substance, and money must be the substance that is most accepted in commerce. All the Ph.D.s and Nobels in Economics are playing games to keep the world entertained. The less their pronouncements make sense, the wiser they think we will consider them.
You tell me: What is the future that awaits a humanity so confused that it can no longer distinguish between an abstract concept and what is real and material? Very confused people are participating in speculations in imitation currencies – dollars, pounds, euros, yen, yuans, Bitcoins - in the hopes of obtaining some profit or benefit, because unable to think for themselves, they can do nothing but speculate – and ruin themselves.
What worries me is not how the speculators will fare; what worries me is: how are the masses going to behave toward me and my family when the fraudulent currencies of the world, Bitcoins included, have turned those masses into hungry beggars?
