MY THOUGHTS TODAY
by Hugo Salinas Price
President, Mexican Civic Association Pro Silver
September 21, 2007

Turmoil prevails. Lots of writing on financial and economic themes by worried people. All about “money”.

What no one mentions is that what the world is using as money in these times, is not really money at all. What is called money today is only a means of exchange, and the transfer of this so-called “money” does not constitute payment. “Money” today, is NOT a means of payment, which is one of the essential functions of money.

Money has been defined as having three functions:

1. A means of exchange.

2. A means of payment.

3. A store of value.

Of these three functions, only ONE remains: a means of exchange.

Today’s money is not a means of payment; ever since mankind used barter – before money existed – there did exist payment: each trader handed over something in exchange for something. That was PAYMENT. Payment is the delivery of some thing, in exchange for some thing.

Today, handing over a dollar, or a yen, or a euro – whatever – is not handing over something, nor even a claim on some thing. Therefore, handing over a dollar – or any so-called money today – is not really payment. It is not the delivery of any thing, nor of a claim on any thing. We are not “paying” in truth, because we do not deliver any thing. We do not use money, only a means of exchange.

World central bank reserves are neither a thing nor a claim on anything at all. Therefore, they are not a store of value; the falling exchange value of the dollar is a verification of this: that no money today can be a store of value. A non-thing cannot store value.

The Central Bankers of the world do not know what to do about their ever-increasing reserves; if any of them thought five minutes about money, they would understand that they are being very silly and playing games. If the CB reserves were gold – as they used to be – there would be no worry at all. Because gold is a tangible thing, but a dollar or a pound or a euro or a yen, or any other “monetary unit” is not a thing, it is only an abstract unit, a number.

Christian Noyer, on the ECB economic council and head of the Banque de France, does well to advise against “excessive accumulation of reserves”! Of course, it is always adviseable not to accumulate too much of nothing. “You got plenty o’nuthin’ “, Christi ole boy! (And nuthin’s plenty for you?)

Big shots and prestigious writers are talking and talking, and worrying and writing about “money”, when what we are using all over the world, is not money! The best and brightest brains WILL NOT see that the world is not using money at all.

This blindness that prevails in the world is of vast philosophical importance. We are living in a deluded world and the outcome of this delusion is going to be nothing less than apocalyptic in its overwhelming, destructive consequences for mankind.