The How and Why of the Gold Standard!

“The streets of Daidu (old Chinese for “Beijing”, meaning “Great Capital”) are so straight and wide,” wrote Marco Polo (~1280 of the geometrically planned capital), “that the guards at one city-gate can see all the way through the city to the guards at the opposite gate.”…

But nothing in China amazed Marco more than the use of paper as a substitute for gold and silver coins…..paper money was something that seemed to defy commonsense….”You might say that the Great Khan has mastered the art of alchemy,” wrote Marco, for he could print paper money that was as good as gold.  -Russell Freedman:  Adventures of Marco Polo, Arthur Levine Books, 2006, pp. 27-9.

The Mongols knew a few things, but these were mostly military in orientation.  Of finance they knew next to nothing; paper money was a scheme that the Mongols supposed might help them dominate the Chinese.  The Chinese–far more numerous, experienced and rich in culture than the Mongols–were placed by the Mongols at the bottom of the social pecking-order, themselves on top, with Moslem middlemen generally.  Population control here meant to suck the money/energy from the Chinese.  On the open steppes nobody was  going to beat the Mongols, but in China proper the context demanded some other approach.  The Mongols, paralleling many Jews, chose not to intermarry with the Chinese and so disappear in the vast gene pool.  Therefore paper money, backed at times not by gold nor silver but by Mongol soldiery**, appeared “to buy” what they needed from Chinese.  What the Chinese did with the paper money hardly concerned the elites in control.  But, as we know, “the peasantry” did figure out how to throw the rats out of their house.

To emphasize the point, centuries later at 1911 A.D. “the peasants”–Chinese–again figured out how to throw a basically militarily organized group–the Manchus–out from the rulership.

The dynasty of central banking and the central bankers and their buddies is not forever.  However, having so much media and political control and experience, the present dynasty running the political/economic systems of the world will not easily cave-in.

Our basis for change, along with raw necessity, is pure reason–the mandate for change.  When people in general cannot even define now the basic value/form of money, then the very existence of gold and silver offers to the unbiased the necessary reference point.  From there the straightforward who are unafraid to use perspective will, like a little child, lead forward.       -rp, mt. shasta, california

** See comprehensive article on Chinese finance:


** See especially–   “Although by the 1260s many Chinese in the north were working for the Mongols, Song officials and the educated class more generally tended to see in the Mongols the greatest threat Chinese civilization had ever faced.”  -p. 97 of P. Ebrey et alia:  East Asia:



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