Bad Money Drives Out Good Money

Bad Money Drives Out Good Money

 

Gold and silver have been real, solid money for nearly 5000 years. Since the mid-1970s, the dollar, which is the reserve currency in circulation, has been torn from gold. The fiat currencies we use today are unlimitedly printed. The fact that the main mechanism of the economic system based on money is being printed unlimitedly is the most important factor that erodes the system itself. The money creation process is essentially a credit creation process. Credits created through banks enter the system together with interest debt and tax. More credits, more fiat money, more interest debt, more taxes, and increasingly bubble markets. In addition to this, in crisis periods, the money donated without return for production also appears as high inflation. These can be seen easily in economic cycles in the historical process. Similar causes lead to similar results in every cycle, without exception.

So what is bad money? Bad money is exactly the money that is not backed by any precious metal like gold and silver. Bad money has always been a major cause of crises in historical cycles. Gold and silver have been good money throughout history. Bad money, which can be printed without limits, excludes good money from circulation. But eventually good money returns to the stage and takes the lead role. Because good money is safe heaven. When the bad money starts to ruin everything, those who can keep the good money survive. In the inevitable end, this is the clearest way to deal with high inflation and rising taxes.

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