“In centuries past, kings would debase gold and silver coins by reducing metal content, making smaller coins and actually replacing the original metals with cheaper alloys, while holding the legal-tender value the same. This gave rise to Gresham’s Law, a principle in economics that bad money drives out good money. Consumers will use the devalued currency in transactions and take the more valuable money out of circulation. Since the establishment of the Federal Reserve, American coins have been debased numerous times, replacing more valuable metals with less valuable ones. The dollar, which was backed by gold decades ago, is now backed by nothing but legal-tender laws.
Devaluation of the currency gives rise to a general increase in prices, inflation in the popular sense. General price inflation is, everywhere and always, a monetary phenomenon, as stated by various economists, including central bankers. That means that a general increase in prices cannot arise from an increase in the prices of gasoline, food or any other commodity, the mythical “cost-push inflation.” The monetary phenomenon that the money specialists talk about is the increase in the money supply by the bankers.”
“The inflation tax is just as much a burden on the population as a direct tax. It is more insidious, however, because it is not seen as a tax. It has become such a normal occurrence that people just factor it into their daily business. People are told that rising prices cause inflation to divert the heat from our elected officials. In reality, it is just the opposite. The rising prices are the effect. The increasing money supply is the cause.“
And from Llewellyn H. Rockwell, Jr.’s The Government Wrecks the Economy:
“…we are in for tougher times ahead.
So what does Washington do? In an act of incredible stupidity, Congress has passed an extension of unemployment benefits. The old rule remains true: if you subsidize something, you get more of it. So this will give us more unemployment.”
Please do read the articles in their entirety: