Why I believe in a return to the gold standard

　　Since November 2004, the author has believed that with the rise of the euro to challenge the US dollar, the world economy and finance will undergo a series of major changes, the core of which is the decline of the dominance of the US dollar. The outbreak of the financial crisis is a sign of the accelerated decline of the dollar.

　　As the United States accelerates money printing to rescue the market, national debt soars. If its ratio to GDP exceeds the high warning line of 100%, the dollar crisis will move from the superficial stage - financial crisis, to the core collapse - currency crisis stage, that is, the dollar versus gold And commodity prices plummeted, stock prices fell, and the dollar's real purchasing power shrank sharply.

　　In the past, the author's judgment on the U.S. financial crisis was mainly derived from the perspective of the game between the four vested interests of the U.S. dollar, the euro, gold and oil. Recently, through a more thorough study of the history of currency evolution and the nature of currency, the author discovered the fundamental difference between the gold standard and the US dollar standard.

　　The essence of the gold standard is that natural rights and civil rights are better than national (or oligarchic) privileges. Gold is a currency issued by God. It is the last choice of mankind after the various natural currencies have been eliminated by natural selection for thousands of years. Its essence is a natural resource currency, and it is also the most fair and equitable value and rule for all users, because it embodies the same fair and equal values, and has the same constraints on everyone, especially the powerful privileges. , so they are often disliked by the powerful and privileged.

　　In the history of human currency, banknotes that have escaped the constraints of natural currencies such as gold and silver - such as the Ming Dynasty's Ming Dynasty communication banknotes that were used for more than 80 years - have never escaped the fate of collapse. The reason is not complicated, because the privileges are not Due to the "law of heaven" of gold, the excessive printing of banknotes is inevitable, which will inevitably lead to its own disintegration and disappearance of legitimacy.

　　Paper currency, free from the constraints of gold, has ruled the entire human race only once, and this is now the U.S. dollar. Why can the US dollar achieve this miracle? It is because all the established powers were completely defeated through two world wars, and the United States became the only super winner. This allowed the privilege of the United States as a country to override the sovereignty of all other countries and became a super privilege.

　　In 1913, the international financial oligarchy controlled the country's super privileges through the Federal Reserve. When this kind of super power is formed, it not only has enough power to suppress the national monetary sovereignty of various countries, but also has enough power to imprison gold. In 1945, 75% of the world's gold stock was "imprisoned" in the United States.

　　In other words, since 1945, the world economy has actually entered a unipolar world in which the United States dominates the world, and the challenges from the former Soviet Union have never constituted competition in the economic field.

　　Then, like all superpowers and superpowers in history, they were defeated by their own greed and indulgence. For currency, it means adding water to the currency. In the era of gold, silver, and copper, it was adulteration to reduce the gold content. In the era of paper money, it was more convenient to overprint.

　　The excessive printing of banknotes and the subsequent inflation will inevitably encourage people to speculate and discourage people from creating real wealth, that is, they are keen on wealth redistribution - the proliferation of speculation that puts money from other people's pockets into their own pockets, which will inevitably lead to The extreme expansion of the virtual financial industry has eroded and disintegrated the country's real competitiveness.

　　Those who support the US dollar order often live in the memories of the past and will repeatedly emphasize that the United States is powerful in the past, present and future. In fact, the United States today is far from the United States in 1945. It has now transformed into a relatively strong pole in a new multi-polar world.

　　In 1945, the GDP of the United States accounted for 66% of the world's capitalist countries, its steel production accounted for 61%, its automobile production accounted for 84%, its food production accounted for 33% of the world's, and its gold reserves accounted for 75% of the world's. No other country can come close. However, today, the GDP of the United States has dropped to 23.44%, and the European Union has surpassed it; steel production has dropped to 7.2%; the automobile industry cannot even protect the last three major automakers; the proportion of official gold reserves has dropped significantly to 4.9%.

　　America's financial industry was particularly strong at the beginning of this century, but today it is in tatters and Wall Street is losing its luster. Among all the countries in the world, the only one where the United States still has a big lead is the military, but this advantage is no longer an absolute unilateral advantage.

　　Therefore, behind the decline of the US dollar is the decline of the United States, that is, the arrival of a multi-polar world regardless of human will, the rise of multiple currencies, and the collapse of the single currency rule of the US dollar, which is logical.

　　When multiple banknotes compete with each other, if there is no referee, vicious competition will form. Everyone will compete to print banknotes indiscriminately and beggar their neighbors. This will trigger inflation and social unrest in various countries, and then evolve into a political crisis. In the end, it may even trigger a world war. , the history of the years before World War II has proven this logic once.

　　In this case, each strong banknote will eventually be forced to call for a common referee and value symbol, which is most likely to be gold.

　　Why not a basket of banknotes called the Special Drawing Rights (SDR)? Why not a basket of goods? Why not a combination of diamonds, gold, silver and copper? Because they are all too complex, each country has to compete for a share of banknotes or commodities that are beneficial to itself, and reach a compromise with a multi-weighted combination, and the probability of success is infinitely close to zero. In this super-complex Great Game, the simplest solution that is most likely to succeed is the gold standard.

　　However, the future gold standard will not be the gold standard of 1945. It will be a new form that is highly integrated with modern Internet tools and modern financial markets. The author will elaborate on this in the next column. (This article only represents my personal views and is for reference only. Investors make decisions at their own risk)