The Podcast of the Lotus Eaters - August 18, 2024


PREVIEW： Epochs #172 ｜ The History of Money


Episode Stats

Length

26 minutes

Words per Minute

169.18228

Word Count

4,420

Sentence Count

301

Misogynist Sentences

1

Hate Speech Sentences

4


Summary

Join me for a very special episode of Epochs, where I am joined by Godfrey Bloom to talk all about money, the history of money and the financial markets, gold and much more. Godfrey is an expert on it all, and has been in the financial services industry for a good 20 years, so I thought it would be fun to have a chat about it.


Transcript

00:00:00.000 Hello and welcome to this very special episode of Epochs. I just want to let you
00:00:04.620 all know that I am taking a one-episode hiatus from my narrative of the decline
00:00:08.920 and fall of the Roman Republic, if anyone tuned in to hear about Caesar and
00:00:12.480 Pompey, because I recorded a conversation, a very interesting conversation I thought,
00:00:15.960 with Mr Godfrey Bloom all about the history of money. And I recorded it a
00:00:19.980 couple of weeks ago now and I didn't want to keep the man waiting another
00:00:22.620 month or two before I put it out. So a one-episode hiatus from the Roman
00:00:27.760 Republic, where I talk to Mr Godfrey Bloom all about money. Hello and welcome to
00:00:32.440 this very special interview where I am joined once again by Mr Godfrey Bloom.
00:00:35.560 How are you sir? I'm good, thank you very much indeed. It's a great pleasure to be here again.
00:00:39.280 No, it's our pleasure as always, an absolute pleasure. So today we thought we'd
00:00:43.720 talk a little bit about money, the history of money, financial markets, gold. That's
00:00:49.420 sort of your forte isn't it, gold? One of your many fortes. And there's some great
00:00:53.200 clips out there, some absolutely superb clips of you spitting fire
00:00:57.520 in the European Parliament at these people for their sort of dogmatic,
00:01:01.360 wrong-headed, economic views. And anyway, you're something of an expert on it, which
00:01:06.280 I, despite working in the financial services for the best part of 20 years,
00:01:09.940 still am not. So it's just, it would just be great to sort of pick your brain
00:01:14.380 about these sorts of things, if that's right with you. Yeah, that would be fun.
00:01:18.700 The thing with financial services is such a broad spectrum. There are bits I don't
00:01:22.840 think about, you know, as well, you know, capital ventures and stuff. So
00:01:27.760 everybody's got this sort of little bit. But the, the thing in my speech in the
00:01:32.380 European Parliament, which incidentally, this might astonish you, my producer told
00:01:36.100 me this, if you add up this and add up that and look at that channel and this
00:01:39.020 channel and all the rest of it, has got over 50 million views, 50 million. I think
00:01:44.080 it's still a record in the chamber. It's only two minutes as well, because you're not
00:01:47.380 allowed to speak for more than two minutes, broadly speaking, and that was
00:01:51.340 on fractional reserve banking. So I called this out maybe 15 years ago, 14
00:01:57.640 years ago, and everything I said then is coming true, not because I'm a very
00:02:01.660 clever fellow, I'm not, it's just because it was so blindingly bloody
00:02:04.660 obvious what was going to happen. So I thought what we do, what we could do is
00:02:09.880 kick it around. You know, what is money, money isn't taught in schools, nobody,
00:02:15.700 you know, you know, don't teach money in schools. So people have a really odd
00:02:21.400 idea what money actually is. And I can start off, I think, with a quote from JP
00:02:28.120 Morgan, which is 1912. His quote was, only gold is money, everything else is
00:02:37.940 credit. And he was right then, he's right now. And that's what people don't always
00:02:46.820 fully understand. And of course, the people who understand it least are
00:02:50.360 consecutive chancellors of the Exchequer. Politicians don't understand money and
00:02:55.060 economics. They just don't get it. And they haven't the last chance that we had
00:02:59.280 who really was any good was Lawson, who understood it. But nobody else really has.
00:03:04.940 So you ever see Janet Yellen talking about the nature of inflation and
00:03:09.140 things? It's mind boggling. I know, it's absolutely fascinating, because we've got
00:03:12.140 a chance of the Exchequer now, Rachel Reeves, I've shared a platform before now
00:03:15.740 on any questions I think it was, is a hero. She's a hero. Janet Yellen is a hero to
00:03:21.460 Rachel Reeves. And Janet Yellen is so screamingly wrong about everything, it
00:03:27.320 makes it gives me sort of the shivers. But if you look at if you look at money, what is
00:03:34.100 money? How would you define money? You might say, well, first of all, it's got to be an
00:03:39.300 accepted medium of exchange.
00:03:41.100 Right. So that could be anything, that could be a stick with notches on it, a tally stick, couldn't it?
00:03:46.100 It could. And funny as you say that, you might know why you're leading me onto the
00:03:51.340 guns here, but the Sumerians used tally sticks for 200 years. So tally sticks were
00:03:58.540 actually used. And it's the only thing that I know of historical money, which
00:04:05.340 hasn't had an intrinsic value. And that is really weird. So there's no intrinsic
00:04:11.780 value. So it was a sort of forerunner, perhaps, of Bitcoin, I don't know. But so
00:04:15.940 the tally sticks and the Sumerians, but it's not... I was reading something the other day, they were still using tally sticks in the age of
00:04:20.540 Henry the second and King John. Ah, yes, they were. But of course, there was money as well.
00:04:25.540 Yes, it was fact that was an accounting system rather than money. It was an accounting system.
00:04:32.540 But yeah, these things are all fascinating. But if you've got, if you go back to moving on from the Sumerians, you go on to the Greek drachma, for example, which was real money, silver, and then you go on to the Roman Empire, and you have the denarius and stuff like this is your field, of course.
00:04:53.540 I've been doing a thing on Crassus recently, they often talk about talents in that.
00:04:57.540 Yes. Talents of silver, talents of gold.
00:04:59.540 Yes. And of course, that then brings you, that's hard money, that's real money, silver coin or gold coin, and silver coin is fine too, because it's a precious metal, and that makes it right.
00:05:12.540 And then of course, now I'm drifting into your subject again here, what actually brought down the Roman Empire, they did two things, of course, they degraded their currency.
00:05:22.540 By putting alloy in it, so the denarius was degraded by alloy, and of course, they couldn't defend their borders.
00:05:28.540 Now, here's a wonderful historical feature of this is if you degrade your currency and can't protect your borders, your empire collapses, and we are seeing that now, big style, we're seeing that in America in particular, and we're seeing on a smaller scale in Europe.
00:05:43.540 So this is the sort of problem we have. Then if you fast forward your coins to Henry VIII, and Henry VIII clip coins as well, to fight wars, and he clip coins and debased the currency.
00:06:01.540 And of course, he was followed by the formation of the Bank under Queen Elizabeth I, Thomas Gresham, on the famous economic thing, good money forces out bad.
00:06:17.540 And of course, we've had Gresham actually put that right by making the money right. So we saw the degradation of money, if you counterfeited money in the Middle Ages, the punishment was that you had your hands chopped off.
00:06:34.540 They actually chopped off. This is in England, by the way. They chopped off your hands for counterfeiting money.
00:06:39.540 And of course, I'll come on to that in a minute.
00:06:41.540 There's a story from Edward I or Edward III, I can't quite remember, but they found out that the Royal Mint was sort of debasing the money.
00:06:51.540 And yeah, a lot of people lost their hands and or lives.
00:06:54.540 Yes. And of course, the first man, the Royal Mint, and it was Isaac Newton that took over the first Royal Mint and started to get, you know, the original
00:07:04.540 old ducks in a row, as it were.
00:07:05.540 Can I ask you a quick thing, just before we get to sort of the Bank of England, the Elizabethan age, there was, of course, and that's the Bank of England.
00:07:11.540 There was banking, if not central banking for that, for example, the Medici family, and there were banks even before them.
00:07:19.540 I mean, banks, not necessarily as we know, not like a high street bank.
00:07:22.540 Yes.
00:07:23.540 Nonetheless, there was sort of double entry bookkeeping and all sorts of things already in the early Renaissance.
00:07:29.540 That's quite right. The Italian Renaissance really saw the first of what we might call modern banking.
00:07:36.540 And it got so sort of corrupt, as these things do, that they had to insist that if you were a banker, you couldn't be a merchant as well.
00:07:46.540 You were either a merchant or a banker, and you couldn't be both.
00:07:49.540 So that's an interesting, that was an interesting development in the concept of banking.
00:07:54.540 And British banking came along later, at that 1690, I think, when the Bank of England was founded, or round about 1690.
00:08:04.540 It was in the fallout of the South Sea bubble, wasn't it, really?
00:08:09.540 That came, well, yeah, that was round about the same time, but rather, very slightly late.
00:08:17.540 But yes, you're right. We had, we had sort of these bubbles that happened.
00:08:22.540 We had the, we had the Louisiana Purchase, that was, which collapsed the French, Assignat, French currency.
00:08:30.540 Terrible shape.
00:08:31.540 That collapsed.
00:08:32.540 We had the South Sea bubble, which didn't collapse, perhaps the currency, but collapsed, you know, and black tulips and Amsterdam and all these things.
00:08:41.540 Bubbles.
00:08:42.540 Bubbles have always been with us.
00:08:44.540 And it's an interesting question of why are bubbles always with us?
00:08:48.540 Well, if you degrade money, and by degrading money, it means that you move away from the fact that it's asset backed in some way.
00:08:59.540 Now, as a medium of exchange, you know, you can go back, you can go back quite a long time.
00:09:05.540 Let's take 1945 Berlin, for example, where currency would be bottles of whiskey or American cigarettes or nylons.
00:09:13.540 Bartering, essentially.
00:09:15.540 Well, it was a sort of barter. Yes, it was a sort of barter, but it was as close to an acceptable currency as you could get.
00:09:22.540 Like cigarettes in jail or something?
00:09:24.540 Well, nobody smoked them, or they weren't using for smoke, they were using for exchanges.
00:09:30.540 Right, right.
00:09:31.540 So that was interesting.
00:09:34.540 And so you will always revert to barter if you have a broken society.
00:09:39.540 In Berlin in 1945 was a broken society.
00:09:42.540 It recovered very quickly.
00:09:44.540 But so you have these, you have these interesting phenomena.
00:09:48.540 And whether it's a gold coin or silver coin, it doesn't matter a great deal because it is, if you don't degrade it, it's unforgeable.
00:10:00.540 The government can't print it.
00:10:02.540 They can't, they can't degrade it at all.
00:10:05.540 So, which is why, and certainly if I'm ever speaking to undergrad, where I'm not, universities where I'm not banned, for intimidating undergraduates by talking about things like Lord Salisbury.
00:10:19.540 So, you have these, you have these situations where, you know, your money, what is money, how does it work?
00:10:28.540 Now, if, let's say we accept the argument and it's not an unreasonable argument, that gold is a heavy metal and it makes, it doesn't make sense to lug it about too much in the old days when it's dangerous and transport and so much better.
00:10:46.540 Much better if you can get a note from, in those days, it was goldsmiths.
00:10:55.540 In point of fact, you had a note and then banking sort of morphed into that.
00:10:59.540 So you've given it rather than lugging your, your brick of gold around with you, you had a note.
00:11:06.540 So you only had a note and you could claim the note, either the gold, the gold bullion dealers or the bank.
00:11:15.540 They morphed into banks, they became banks.
00:11:18.540 And so they would have the gold in their vault.
00:11:23.540 And you would then be able to go and call and get your gold in specie from that bank.
00:11:30.540 By physically getting it.
00:11:31.540 You physically get it.
00:11:32.540 And that is hard currency.
00:11:35.540 That's what they mean by hard currency.
00:11:37.540 And I will remember, I'm old enough to remember the big white five pound notes.
00:11:43.540 I never had one, of course, as a sprog of that age, but I don't think my father had money either.
00:11:48.540 Really?
00:11:49.540 I promised to pay the bearer on demand the sum of, you know, and that would be in gold.
00:11:55.540 And in theory, could you go to the Bank of England and exchange that for a bit of bullion?
00:12:02.540 In theory, you could.
00:12:03.540 And up until, up until 1914, you still could.
00:12:10.540 And then we went off the gold standard in 1926.
00:12:13.540 We went back onto it in 1931 and it all got very close.
00:12:16.540 And then we had another war in 1939 where we came off it again and so on and so forth.
00:12:20.540 But yes, you could.
00:12:21.540 You could go and do it.
00:12:22.540 And the Bank of England, right up until 1914, on your note, you could demand in specie.
00:12:29.540 And they would have the gold in the vault and they would change it.
00:12:34.540 They would change it for you to give you that gold to walk away.
00:12:37.540 Now, here's the funny thing.
00:12:38.540 A lot of people, when they hear about, oh, we need to go back onto the gold standard or gold money.
00:12:44.540 It isn't quite as simple as that, because very rarely did the Bank have more than about 50% of gold in specie.
00:12:52.540 They didn't often have.
00:12:54.540 They didn't really need more from a practical point of view.
00:12:57.540 50%.
00:12:58.540 But it did mean if there was, if people felt that the pound notes or the five pound notes or the promissory notes were dodgy or they didn't like it,
00:13:07.540 and they'd come and get their money out, it would very soon, if you had a run on the bank, they'd soon finish with the gold.
00:13:12.540 So you had a problem then because it wasn't 100% backed.
00:13:16.540 Never been 100% back, really.
00:13:18.540 But it did give, if you know the gold's in the bank, nobody runs on the bank at the same time.
00:13:24.540 So broadly speaking, it quite worked.
00:13:26.540 It worked quite well.
00:13:27.540 So if, for example, we came off, we went back onto the gold standard in 1819 after the Napoleonic Wars, which we had to come off, because you can't fight wars.
00:13:41.540 Money is all about wars.
00:13:43.540 But if you come off the gold standard, the reasons that you come off the gold standard, any country comes off the gold standard, Britain in particular, is to fight a war.
00:13:50.540 And that's the time, you know, that's the same from Henry VIII onwards.
00:13:54.540 You need money.
00:13:55.540 You need gold.
00:13:56.540 And the Napoleonic Wars, we had to actually ship gold to the Prussians to keep that side fighting.
00:14:01.540 We need to pay our troops in the peninsula and the Spanish guerrillas and the Spanish army in gold coin.
00:14:08.540 So it's hemorrhaging gold all the time.
00:14:10.540 An element of Nixon coming off, I understand, in 71 was because Vietnam was becoming so ruinously expensive.
00:14:15.540 Classic.
00:14:16.540 Classic war.
00:14:17.540 I mean, you can run through the whole gamut.
00:14:19.540 You can go to the Nine Year War, you can go to the War of the Spanish Succession.
00:14:22.540 All these things where we had to come off the gold standard, you know, for temporary or manipulate the gold situation.
00:14:32.540 But when you have a gold, when you have a hard currency, let me call it a hard currency.
00:14:38.540 Let's take the sovereign because from 1819, that's what we had to 1914.
00:14:42.540 So the sovereign, I used to hold one of these up to if I'm speaking to undergraduates and just show this is this is a sovereign,
00:14:50.540 which is sort of the equivalent of a pound coin really in those days.
00:14:53.540 That was a coin.
00:14:54.540 And this was dated 1905.
00:14:57.540 Now that sovereign would buy you bed and breakfast in a good hotel in Berlin, London, Paris or New York.
00:15:06.540 Buy a good hotel, bed and breakfast.
00:15:09.540 No problem at all.
00:15:10.540 And the interesting thing is to understand the preservation of wealth that you get with gold is that it will buy you that today.
00:15:17.540 A gold sovereign is worth about 450 quid today.
00:15:20.540 Right.
00:15:21.540 And you'll get a decent hotel, bed and breakfast in any of those cities today for 450 quid.
00:15:25.540 Not necessarily the very, very best, but, you know, probably OK.
00:15:30.540 Let's look at one would imagine, would one not.
00:15:34.540 In the 19th century, what's a staple?
00:15:37.540 What's a staple commodity?
00:15:39.540 One might argue bread.
00:15:40.540 So when we went on to the sovereign and the sovereign started appearing in 1820 and all the way through to 1914, and that's that was the basic coin of the realm in gold.
00:15:57.540 That was that made a loaf of bread in 1820 was the same price as it was in 1914.
00:16:08.540 Right.
00:16:09.540 So that is astonishing.
00:16:12.540 It kills inflation.
00:16:14.540 You can't inflate the currency.
00:16:16.540 If it's gold, you can't do it.
00:16:18.540 It's physically impossible for you to do that.
00:16:20.540 So and if you look, I would argue now, I would argue that perhaps from the 20th century, the staple commodity, the core global commodity would be oil.
00:16:34.540 And if you look at a graphics showing you oil per barrel in gold, it's a flat line.
00:16:47.540 It's a flat line.
00:16:48.540 There is no inflation of oil over gold.
00:16:51.540 It's a flat line from the turn of the from 1900 for the last 120 odd years.
00:16:56.540 It's flat because gold holds its value and it held its value when bread was the core commodity.
00:17:03.540 And it's hold its value with now for the same reason.
00:17:08.540 Could I make it maybe a broader point?
00:17:10.540 Because I know you're an expert in gold.
00:17:13.540 Just a broader point before we go on about how it seems to me, I mean, I can't remember who I heard this from.
00:17:21.540 I haven't made this up myself.
00:17:23.540 Someone much more learned than me said this.
00:17:26.540 Maybe it was Kenneth Clark, the historian, not the politician.
00:17:30.540 Yeah.
00:17:31.540 Said that there's something almost magical about gold that appealed even to ancient people.
00:17:36.540 That it's one of those metals that, you know, you can leave it in a riverbed or in mud for a thousand years and it comes out.
00:17:42.540 Yeah.
00:17:43.540 It's not different by one atom.
00:17:45.540 Yeah.
00:17:46.540 And it's very, very finite.
00:17:47.540 I mean, of course we can have more, find more gold mines and dig up more gold, but essentially it's finite.
00:17:52.540 And that there's, you don't really need to be, you don't really, it's obvious that it's precious.
00:18:01.540 And that people in the Dark Ages, the so-called Dark Ages after the collapse of the Roman Empire in the West, it was obvious that the only thing these people wanted, the barbarians of the sixth and seventh and eighth century, all they coveted really was gold.
00:18:16.540 They liked things like amber and garnets and things, but it was gold.
00:18:21.540 It was gold because it doesn't matter if you're in ancient Sumeria or the 21st century, it's valuable.
00:18:28.540 It has some sort of intrinsic value.
00:18:30.540 Fascinating.
00:18:31.540 Isn't that remarkable?
00:18:32.540 It's remarkable, isn't it?
00:18:33.540 5,000 years.
00:18:34.540 And of course, the Egyptian tombs, it's got, they didn't have gold, to our knowledge, didn't have gold coins, but anything of value, statues and chariots or whatever it happened to be, you know, gold or gold fittings on it.
00:18:46.540 It's always considered all those years.
00:18:48.540 And it's so constant.
00:18:52.540 And so we have this historical dimension that for 5,000 years, it's been a precious metal, only perhaps in coin form for a few thousand years, but that's good enough historically.
00:19:05.540 Because when you hold it in your hand, it's so heavy, it feels different to, it's surprisingly heavy, isn't it?
00:19:10.540 It's a very tactile metal.
00:19:12.540 I particularly like gold watches, gold pocket watches, because they're, and they're funny, they're low quality gold.
00:19:19.540 They're only about eight or nine carat gold in order to be malleable, in order to make a watch out of them.
00:19:24.540 But they're a good thing.
00:19:25.540 They look like a good thing.
00:19:26.540 You know, they feel like a good thing.
00:19:28.540 So yeah, gold is a very tactile thing.
00:19:30.540 There's one last thing I'd like to ask before we go on with the history of it.
00:19:33.540 I've heard it said, and this is one of those facts, quote unquote facts, which I find difficult to believe, although I don't question it, because I'm sure people know better than I do.
00:19:41.540 But I've heard that all the gold ever quarried, ever mined in the whole world, if you put it all together in one place, it would fill one Olympic-sized swimming pool.
00:19:50.540 That's absolutely correct.
00:19:52.540 Which seems, you think, surely there's more gold in the world than that, but apparently that's the fact.
00:19:57.540 Yeah.
00:19:58.540 So it's finite, and it's very finite.
00:20:00.540 There's actually not a huge amount of it.
00:20:03.540 Nearly all the gold ever mined is still in existence, for obvious reasons.
00:20:07.540 That which didn't go to the bottom of the sea in transit, which hasn't ever been found, but that's not a great deal.
00:20:14.540 So you do have this fascinating situation that gold mined a year is about 2% or so of what is the available stock of gold, which means it's varied.
00:20:31.540 People say, oh, yes, I know, they mine it, so it should deflate by 2% a year, but it doesn't.
00:20:38.540 It's never worked like that because people hold it.
00:20:41.540 Yeah.
00:20:42.540 And they stash it, and they're called stackers in the modern world.
00:20:46.540 Wish I was a stacker.
00:20:48.540 Well, this is the fascinating part about it, but it is a store of wealth, and that's what we're looking at at money.
00:20:56.540 It's a medium of exchange, a store of wealth, and gold does that.
00:21:03.540 Silver, of course, we might argue with silver coinage, and that's been very prevalent in European history, the silver coin.
00:21:12.540 And that is also, of course, an industrial metal, and it doesn't behave quite in the same way.
00:21:19.540 It does. If you go back long enough, you find there's a dynamic between the two, but that hasn't been around for several decades.
00:21:26.540 And we're expecting that when I say we, the city and Wall Street, we're expecting that to change because it's grossly silver now is really, really undervalued.
00:21:36.540 It's about sort of whatever it's $30 an ounce or something.
00:21:39.540 That's ridiculously low.
00:21:41.540 And so that should see a big bounce, but it is more speculative than gold.
00:21:49.540 And so you have these, you have these two metals, which for thousands of years basically have been coinage.
00:21:58.540 And I'm a bit of a silver bug myself.
00:22:02.540 In so far, I don't hold it because you have to pay VAT on it in this country.
00:22:07.540 So it, you know, 20% kills your investment at day one.
00:22:12.540 You know, you've lost 20% of it in VAT.
00:22:15.540 But leaving that aside, silver coins.
00:22:19.540 Now, I remember silver sixpences.
00:22:21.540 I'm old enough to remember.
00:22:23.540 We used to put them in the Christmas pud.
00:22:25.540 You know, that was one of the traditions of Christmas.
00:22:29.540 But silver is good because it's an everyday currency because people, a lot of people write to me and say,
00:22:35.540 Well, how can I go and buy, go to Sainsbury's and buy even with a half sovereign?
00:22:42.540 You know, that's sort of 200 quid, you know, and so does that work.
00:22:46.540 And of course, silver is a much more easy and historic way of dealing with your, your pints of beer or your shopping or bits and pieces.
00:22:53.540 And that makes sense.
00:22:54.540 In the Roman era, it was, it was the silver coin that was really the most important thing because gold is so scarce.
00:23:01.540 That's right.
00:23:02.540 It was the day-to-day currency.
00:23:04.540 That's right.
00:23:05.540 And we were talking about if our society, just before we started recording, if our society did completely collapse and we went back to a barter system,
00:23:12.540 you would probably want to physically have gold, silver coins.
00:23:16.540 Yes.
00:23:17.540 Because even a small gold coin is far too much if you need to barter with someone for a chicken or a loaf of bread.
00:23:23.540 Which is why, of course, if you think going right back to coppers, I mean, my grandmother used to call them coppers.
00:23:28.540 And coppers, you know, pennies, I've got any coppers or, you know, penny for the guy.
00:23:34.540 But we went well into the 1950s, got any coppers, you know, coppers governor and this kind of thing.
00:23:40.540 Yeah.
00:23:41.540 And that's money because you can't degrade it.
00:23:43.540 But I say you can't degrade it.
00:23:44.540 But of course, we have seen the degradation of it in Roman times, as you very well know, we saw it in medieval times.
00:23:50.540 And the adding of alloy to silver.
00:23:55.540 So it's not the right weights on the so forth.
00:23:58.540 So you can sort of muck about with it to that extent.
00:24:02.540 Now, going back to where you don't want to lug your bag of gold around because it's heavy and it's cumbersome and it's dangerous.
00:24:12.540 So you have your note of exchange, you have your note, which is how paper money started to come about.
00:24:20.540 And there is an argument that says it's it was first in China that they can find paper money in China.
00:24:28.540 But that's an academic point, which is of no interest.
00:24:30.540 But certainly notes now.
00:24:33.540 OK, what happens when your your gold bullion dealer or your in those days, you know, your Huguenots, who were your gold people in the main morphing into banks, turning slowly into banks, modern banks as we understand them now.
00:24:54.540 So they've got this gold in their vault.
00:24:57.540 It's doing nothing until somebody comes along and claims it.
00:25:00.540 So the temptation for the bank is to lend it or sell it otherwise, knowing that not everybody's going to turn up on the doorstep wanting it back.
00:25:10.540 And this is the first time we see, if you will, the counterfeiting, the counterfeiting of currency.
00:25:20.540 And even if it had a 40 percent or 50 percent backing in gold, that's OK, that works.
00:25:27.540 You can make that work.
00:25:28.540 And history shows you can pretty well make that work.
00:25:31.540 But of course, your problem again is when it comes to warfare, when it's war, you have to go off the gold standard because you have to you have to print money.
00:25:39.540 Without paper money, there would be no wars because nobody could afford to fight a war.
00:25:46.540 It's only when you counterfeit and fake the currency.
00:25:49.540 That's where things start to go wrong.
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