5months ago, when the currency in Iran sharply depreciated, the country, along with many other developing nations, has been struggling with inflation. During this time, I came across the book "Honest Money" written by Gary North.
The main idea of "Honest Money" by Gary North can be summarized in these sentences:
1. Advocates for a return to a gold standard to ensure stable and honest money.
2. Criticizes fiat currency systems and central banking for their potential to cause economic instability.
3. Discusses the historical significance of money and its role in shaping societies.
4. Emphasizes the importance of sound money in fostering economic growth and individual prosperity.
5. Proposes alternative monetary systems that prioritize transparency and trust.
Overall, North's criticisms focus on the potential negative consequences of government overreach and intervention in economic and societal affairs. He advocates for limited government and free-market principles to foster prosperity and individual autonomy.
During Reagan's presidency, he made the following predictions about the future of monetary structure:
First, the bankers and politicians are still in the business of continuing the status quo, which is the worst of the current situation. Second, the collapse will happen at a different stage. Inflation and hyperinflation, then price control, then dictatorship, then deflationary stagnation in the hole world.
North's first prediction came true. Two of the most important of these events occurred in the first decade of this century. One was when the Federal Reserve lowered interest rates and the US economy grew. And another in 2008, when the administration passed a massive bailout that most Americans wanted. Both created these entities or bubbles: the housing bubble and the debt bubble. These two actions, which only exacerbate the crisis, reinforce North's argument, and the third prediction appears to be coming true. Countries are struggling with inflation and their debts are increasing.
The article highlights the potential dangers of misinformation in the monetary system, leading to hyperinflation, hidden control of prices, and ultimately recession. North believes that a competitive market can counter misinformation by encouraging accurate information on a stable basis.
However, he acknowledges that reviving a past model where governments are not involved in monetary affairs may not be possible. Instead, North suggests that the government's role should be limited to implementing correct weights and measures, preventing the issuance of unsecured treasury receipts. This, according to him, will lead to a society with real money, while any other solution would only be a half-finished measure.
Ultimately, North seeks a political solution to achieve honest money, advocating for the elimination of the deficit reserve banking system and the removal of the government's monopoly on money issuance. He believes that these actions are crucial in establishing a stable and honest monetary system in society.
