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Your true wealth is your time and freedom. Money is just a tool for trading your time.
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It's a container to store your economic energy until you're ready to deploy it.
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But the whole world has been turned away from real money and has been fooled into using currency, -
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a deceiptful imposter that is silently stealing your two most valuable assets.
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Your time and your freedom. Welcome to the rabbit hole.
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We are entering a period of financial crisis that is the greatest the world has ever known.
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The wealth transfer that will take place during this decade is the greatest wealth transfer in history.
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Wealth is never destroyed. It is merely transferred.
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And that means that on the opposite side of every crisis there is an opportunity.
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The great news is that all you have to do to turn this crisis into your great opportunity is to educate yourself.
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I believe that the best investment that you can make in your lifetime is your own education.
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Education on the history of money.
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Education on finance. Education on how the global economy works.
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Education on how all of these guys, the central bankers, the stock market, how they can cheat you. How they can scam you.
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If you learn what is going on and how the financial world works, you can put yourself on the correct side of this wealth transfer.
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Winston Churchill once said that the further you look into the past, the further that you can see into the future.
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This program is all about creating your own crystal ball.
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Being able to gaze into the future.
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Being able to change this crisis, the greatest crisis in the history of mankind, into your great opportunity.
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The hidden secrets of money. Some of them are hidden in plain sight.
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They're like right in front of you.
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Uh, the way the monetary system works is something that isn't actually hidden away from all of us.
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It's out in the open, but it's complex and people just don't, they can't see how it works.
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It's hard for them to imagine that we're living in such a hoax.
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Others are meant to be secret, but the truth is slowly coming out.
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Like the Federal Reserve being a private corporation and not really part of the U.S. Government.
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But when I started studying this, uh, what I found was that there was no place that I could point people to where they could get it all in one spot.
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And so I basically decided to write my book about it and consolidate monetary history, economics, the markets, uh, the fundamentals of gold and silver.
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There's a lot of smoke and mirrors in economics, and I've sort of made it my job to lift the fog for people.
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Welcome to Egypt. This is where it all began.
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Roughly 5,000 years ago, the Egyptians started using gold and silver as their predominant form of currency,-
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but it was not yet money.
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The pieces of gold and silver that they were using were odd sizes and weights. Odd purities.
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So it still was not interchangable where each unit is the same as the next. This meant that nothing really had a price yet.
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You couldn't put a price of so many coins on something because they didn't have coins yet. Trade was still difficult.
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It was still a guessing game when it came to the exchange of values.
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One of the reasons that we are in the financial mess that we are today globally is that people do not understand the difference between currency and money.
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Currency is a medium of exchange, a unit of account. It is portable, durable, divisible, and something called fungible.
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Fungible means that each unit is the same as the next unit.
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A dollar in my pocket buys the same amount as a dollar in your pocket.
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Money is all of those things plus a store of value over a long period of time.
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Even financial planners, bankers, your accountant, they don't understand the difference between currency and money.
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The currency in your pocket is a medium of exchange. It's a unit of account because it's got numbers on it.
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It's somewhat durable, it's portable, it's divisible in that you can make change, and it's fungible.
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A dollar in my pocket buys the same amount as a dollar in your pocket.
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But because governments can print more and more and more of it and dilute the currency supply,-
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it's continually transferring wealth out of your pocket, out of your bank account to the government and to the banking system.
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The reason that gold and silver are the optimum form of money is because of their properties.
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It's an easy medium of exchange because gold and silver store a large amount of value in a very small area.
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It's a unit of account. Pure gold has the same value all over the planet.
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So an ounce of gold buys the same amount here in Egypt as it would in China or in the United States.
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It's durable. The same gold that Egyptians were using in trade 5,000 years ago is still here with us today.
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It does not corrode. It's divisible.
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You can make change with it. It's very portable.
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You can use something like oil as money. It's just that you can't carry around a barrel of oil on your back.
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It's fungible. Pure gold is the same wherever it is on earth.
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Pure silver is the same wherever it is on earth. It's limited in quantity.
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That's the reason that it maintains its purchasing power. Governments cannot print it.
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Over the last 5,000 years, only gold and silver have maintained their purchasing power.
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There have been thousands upon thousands of fiat currencies.
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Currencies that are unbacked by gold or silver, and they have all gone to zero. It's a 100 percent failure rate.
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Well, fiat currency, of course, is um, a currency that is, exists at the dictate or by fiat from, from a government.
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They have their printing presses, and the paper money rolls off the printing presses.
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And then they give it the fiat designation which then makes the currency official.
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It's just worthless paper, but when Ben Bernake gives it the special sign, and they have the cult meeting -
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at the Federal Open Market Committee meetings, it suddenly becomes currency.
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If you look at what's really going on it's, it's a con game. And so there's confidence.
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Well, the Federal Reserve is very forthright about what they're doing.
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If you read their website they'll tell you it's a confidence game.
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They tell that there's no intrinsic value in their money.
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They'll tell you that they print it backed by absolutely nothing.
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They actually display all these facts.
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But if you tell somebody in the public that this stuff is created out of thin air, there's no backing whatsover -
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, it's absolutely worthless, it's about as valuable as Monopoly money, they'll look at you like you're nuts.
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Is there an example throughout history of a fiat currency, a piece of paper that's unbacked by anything, surviving?
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Short answer, no.
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Long answer, no. And here's why.
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When Addison Wiggin took over at The Daily Reckoning, they got cranked up.
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Uh, Bill Bonner asked him to catalogue all of the fiat currencies throughout history and what happened to each of them.
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Addison dutifully went to work. Within a short period of time he had gone through the alphabet. All the fiat currencies that started with the letter A were done.
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They all went to zero. He was halfway through the letter B and all the fiat currencies that started with the letter B,-
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and there were 600 of them in just the first letter and a half of the alphabet.
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And every single one of them went to zero. Every one.
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600 fiat currencies that start with the letter A, and half of the ones that start with the letter B, there are 600 of these things.
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Not one ever came close.
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And you think this one, the United States dollar is gonna be the first one after all that? I don't think so.
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No. No currency, fiat currency has ever survived.
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None.
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The thing about money is there actually is a fairly well accepted definition of what money is.
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The question is as you apply that definition to particular things that are, people claim to be money, do they fit the definition?
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Well just take the paper dollar for example. How well does it perform those functions?
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Will it store a value? Uh, the dollar has lost 95 percent of its purchasing power, uh, since the creation of the Federal Reserve in 1913.
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So not very good as a store of value.
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One of the things I do is, uh, just a way to get the audience's attention is I have a slide and there are three pictures on the slide.
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One is a pile of Monopoly money. The other one is a pile of Federal Reserve notes.
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Uh, what Americans would call paper money.
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Uh, the other one is a solid gold, uh, American Eagle, uh, one ounce coin.
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And the title of this slide is which of these is not like the other.
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And if you know the show Sesame Street or if you have children who watch it, it's one of the favorite vignettes in Sesame Street.
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And what it really is is a kind of IQ test for five year olds.
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They're supposed to look at the three things and look at characteristics and find the one that's not like the other.
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Well, I've shown this slide to, um, groups of, you know, Ivy League university professors, and I've also shown it to, uh, you know, uh, children.
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You know, kind of find results in my nieces and newphews and so forth.
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Uh, and when the, uh, professors look at it they say well, um, clearly the, uh, the dollars are not like the others -
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'cause gold has no role as money and Monopoly money is junk and the American dollar is a store of value.
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So that's not like the other. But the children look at it and they say well, the gold coin is not like the other -
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because the other two are just piles of paper, and the gold coin is clearly something different.
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So my question to the audience is who's smarter? A five year old or an Ivy League professor?
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Before World War I, each note that a treasury issued would say that there has been deposited with the United States Treasury -
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20 dollars in gold coin payable to the bearer upon demand.
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The money was in the vault. The currency was a note they gave you that was a claim check.
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Only a claim check on the money. The same as if you go to the dry cleaners and you give them your shirt and they give you a claim check for your shirt.
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The value is, is that shirt at the dry cleaners. Not the piece of paper that says that you own that shirt.
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So our currency that's circulated was the paper U.S. dollars and they were claim checks on money.
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The next hidden secret is the difference between currency and money.
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Money must be a store of value and maintain its purchasing power over long periods of time.
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As we progress through this series, you'll learn that national currencies are really a tool used by the government -
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and the financial sector to leach away your time and your freedom by stealing your purchasing power.
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So rather than storing your economic energy, currencies leak.
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Now compare that to the gold and silver the Egyptians were using. Like I started with, it still wasn't money because it wasn't interchangable yet.
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Like I started with, it still wasn't money because it wasn't interchangable yet.
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But they were on the right track as gold and silver have proven over thousands of years to be the ultimate store of value.
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Gold is only formed when a star explodes, a supernova. And it stays around forever.
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This is one of the properties that make it the ultimate money.
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You know, people are amazed that after 5,000 years the pyramids are still here.
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But what I'm more amazed at is that the currency that the people that built this were using,-
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that currency, that gold and silver that they were using in trade on a daily basis, is still around today.
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It may have been melted down and re-refined and it's in a coin or a bar or in some piece of jewelry.
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But it's still with us today and it still purchases something.
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Yes, it is the ultimate money because there is nothing else even in the same league. It's divisible.
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It's permanent. It's a store of value.
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It's, uh, a unit of account. It's got everything you want out of money, but it doesn't go away and it can't be increased.
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That is what makes gold the most beautiful money of all. What more can you ask out of a money?
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It keeps governments under control. You can maintain a solvent system.
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Governments don't like gold at present because they're getting away with the fiat currencies, and they'll do everything they can to discredit it as an asset class.
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I mean, my goodness. Gold has, uh, outperformed the Dow Jones Industrial Average in each of the last seven years.
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Uh, yet it's not considered a legitimate asset class. Why?
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Again, it's the fear that maybe gold will be imposed on the system.
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That it will constrain government ability to spend beyond its means.
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They can't print it.
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They can't print it, no.
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The proper definition of inflation, I use Milton Friedman's definition. Inflation is an expansion of the currency supply.
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Deflation is a contraction of the currency supply. If you expand the currency supply, eventually prices will rise.
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And if you contract the currency supply, eventually prices will fall.
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This is a pool. But it's not a pool of water.
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This is a, the currency pool. And these are prices.
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And if you expand the currency supply, prices like a sponge in water have to rise to suck up the excess currency.
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Governments never stop printing more currency and adding currency to circulation.
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Therefore, prices keep on going up. Not because they stuff that you're trying to buy is changing.
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The real estate doesn't change. What has changed is the currency purchases less and less.
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It's the currency going down. Not prices going up.
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The truth is, what we have that makes our world work right now is a big story. None of it's real.
00:15:01
It's all just promises. And if you think about it, that's how currency began to work in the beginning.
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You know, before we had currency we had barter.
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I'll give you three coconuts and you give me four fish 'cause that's kind of a fair exchange on coconuts and fish.
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But that got complicated so we had to invent this thing called money to be a divisible, portable medium of exchange.
00:15:20
And the challenge is that we've lost that a long time ago. We lost having things of value be our currency.
00:15:27
And now we have this thing called numbers and accounts. But trust me.
00:15:29
It is not real. It's a big made up story.
00:15:33
One of the biggest make believe stories ever is called quantitative easing which sounds complex, -
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but it's really just a smoke and mirrors term for currency creation.
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QE started with the banking bailouts back in 2009.
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This currency was created out of thin air and then given to the banks who paid themselves record bonuses in reward for crashing the world economy.
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This is a global phenomenon, but all you have to remember for now is that whether it's QE, bailouts, or stimulus programs, -
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these are all just voodoo, hocus pocus terms for increased currency creation.
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I believe gold and silver will reassert themselves as money and when they do, there just isn't enough.
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And their purchasing power is going to go up many, many, many times.
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Egypt is an amazing place. There's a franticness about it, an utter chaos. Especially like the traffic.
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When it comes to like all of the merchants that are trying to get every last dime out of you, -
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you get fleeced to the point where you come back with an empty wallet. [LAUGH]
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But you know what? They're amateurs compared to Wall Street.
00:16:56
In the past several years, I've, I've spoken in many countries about the crisis that's coming, -
00:17:01
and a lot of people think that they're gonna be okay in their country.
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That it's only gonna happen in the United States or maybe the United States and Europe.
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Uh, but what they don't realize is that this is a global phenomenon.
00:17:13
I got to show you something here. This is, uh, base currency in the United States.
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This is the number of paper dollars that exist basically.
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It took 200 years to go from no dollars in existence to 825 billion.
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And then we had the bailouts, and then we had QE1, Quantitative Easing 1.
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Then QE2. And then we had QE3 and then QE4 and then soon we're gonna have QE57 and QE382. [LAUGH]
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And, uh, it isn't just here. This is what the Canadian currency supply looks like.
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This is Australia. South Africa. Russia.
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Now this starts out in just the year 2001, and this is like 18 times more currency in existence in a little over a decade.
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Uh, here's Singapore. Same story. Look at that. Since the crisis, just bam.
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India. China. Every government on the planet is -
00:18:23
doing this insane deficit spending and expanding their currency supplies, uh, doing bailouts.
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And history shows that there is no example of this turning out well.
00:18:35
It is sometimes amazing that we haven't experienced more inflation than we have.
00:18:42
If they keep expanding the money supply so vastly, why aren't our prices growing faster than they really are?
00:18:49
And the answer is that a good chunk of the money that the Fed created has been shipped overseas.
00:18:55
Uh, I remember early in my research I heard this expression that the Americans have exported their inflation.
00:19:01
I thought what is that? How can you export your inflation? Put it in a box and send it out? What do you do?
00:19:06
Well now I understand. You export your inflation by simply sending all these dollars that you created to these other countries -
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and then they send you their refrigerators and their cars and whatever, their TV sets.
00:19:17
So you get hardware and they get little pieces of paper. It's a great deal for the American people for a while. For a while.
00:19:26
Sooner or later all of those pigeons come home to roost.
00:19:30
When the time comes as it looks like it's now coming, when the rest of the world is saying nuh-uh we don't want to play this game anymore.
00:19:37
Uncle Sam's dollars are just becoming worthless. There are too many of them.
00:19:41
We've got to find something else other than American dollars. Then those dollars start to come back to America.
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People, we don't want them anymore. What do we do with them?
00:19:50
Once this revs up and we've got this, this little trickle of money coming back that we'd previously exported, -
00:19:57
when, once it becomes a flood and it starts to rush back, now we are getting our former exported inflation brought back to us.
00:20:07
And then we'll see the quantity of money inside the United States grow much more rapidly -
00:20:12
even than the Federal Reserve can create it because we're getting our previous money back.
00:20:17
And, uh, that's when we will really see the tanking of the U.S. Dollar in terms of what it will buy.
00:20:24
During the second round of quantitative easing, global food prices went up 60 percent, -
00:20:29
and this created a humanitarian disaster for the two billion people on earth who live on less than two dollars a day.
00:20:37
These people were hungry to start with. They became hungrier and some of them started overthrowing their governments in North Africa and around the Middle East.
00:20:46
So quantitative easing was the spark that ignited the Arab Spring.
00:20:50
So that's, that's it. When you create money, you get some sort of inflation.
00:20:54
It just depends on where the inflation goes.
00:21:07
Given the premise that you have a permanent underclass or poor class and how does inflation affect them disproportionately,
00:21:15
um, it affects them basically in the percentage of their income that goes to food.
00:21:23
And we see this as a ratio, and we know that there are some danger points.
00:21:27
For example in Egypt recently, once that ratio got to 40 percent of income going to food -
00:21:34
and the price of food rising due to inflation, when it got to 40 percent that's, uh, historically a point where people actually stage a revolution.
00:21:42
That's exactly what we saw. The French Revolution similarly was all around the price of food getting to a certain critical point where people simply, the risk-reward for revolution was favorable toward revolution.
00:21:59
Well, exactly right because when you have a runaway inflation, it's punishing the very people who are most productive in society.
00:22:07
In other words the people that produce more than they consume and save the difference.
00:22:12
The problem is is that those productive people, the savers, save in their national currency -
00:22:18
and unfortunately the national currency is just a fiat piece of paper at this point.
00:22:24
So when it's destroyed through runaway inflation, that 100,000 dollars that you were hoping to retire on doesn't exist.
00:22:32
And the things that you were gonna buy with it and provide for others don't exist either. Now what are you gonna do?
00:22:40
So that all seems pretty scary. However, uh, you know, this is going to happen and you can only play the hand that you're dealt.
00:22:49
But the great news is that gold and silver always end up doing an accounting of the expansion of the currency supplies.
00:22:55
Basically the will of the public and the free markets.
00:22:59
When governments do this kind of stuff to their currency supply, they debase it, eventually it comes back in inflation.
00:23:05
People sense the loss of their puchasing power. They rush back to gold and silver and they bid the value of -
00:23:11
the gold and silver up in the country until it meets or exceeds the value of all the currency in circulation.
00:23:18
This is a process that's been going on over and over again throughout history except this time it's happening on a global scale.
00:23:26
It has never before happened in all countries at once.
00:23:30
And that means that this is the greatest wealth transfer in history.
00:23:34
Therefore it's the greatest opportunity in history and it's not gonna happen again in your lifetime.
00:23:43
So now we've learned that your true wealth is your time and your freedom.
00:23:47
Money is a trading tool that stores the economic energy that is your time and freedom whereas currencies leak them away.
00:23:56
Gold and silver are the ultimate money simply because of their properties.
00:24:00
Fiat currencies are based solely on confidence and always return to their intrinsic value of zero.
00:24:06
Governments don't like gold because it imposes restraint. Rising prices are a symptom of an expanding currency supply -
00:24:13
and gold and silver always acocunt for an expanding currency supply.
00:24:18
So that's it for this episode. Join me next time as we begin to investigate how monetary history just repeats and repeats -
00:24:25
and how gold and silver always win the battle between currency and money.
00:24:29
Until then, my challenge to you is to stop calling currency money. It's a crucial first step towards setting your mind free of all this economic voodoo and changing your context.
00:24:34
It's a crucial first step towards setting your mind free of all this economic voodoo and changing your context.
00:24:40
You can learn more by watching the bonus features on our website and if you have any questions you can post them there -
00:24:46
and we'll answer some of your questions in future bonus features.
00:24:50
So good luck. Thanks for watching. And we'll see you next time.
00:25:00
Good morning.
00:25:02
Wow.
00:25:06
What does fiat mean?
00:25:08
It comes from the Latin for crappy car.
00:25:22
I'm in the desert in a suit.
00:25:27
My camel died.
00:25:29
You're not too sure about that are you? Huh?
00:25:36
I am ready for a, a good long nap.
00:25:40
Hi, welcome to this bonus feature for the very first episode of hidden secrets of money, -
00:25:46
uh, and this is currency vs money. So that's the, uh, major topic-
