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The Four Different Types of Money

From a scriptural point of view there are four basic types of money, in descending order of desirability.

  1. Commodity money (lawful)
  2. Commodity-backed money (lawful),
  3. Fiat money (unlawful), and
  4. Debt money (unlawful).

A ‘commodity’ is anything that has intrinsic desirability and worth on the open market. Historically, commodity money is silver, gold, and also copper. In Tanach (Old Testament) times, payment was made by measuring out specific weights of the desired ‘specie metals.’

B’reisheet (Genesis) 23:14-16
14 And Ephron answered Avraham, saying to him,
15 “Adoni, listen to me; the land is worth four hundred shekels of silver. What is that between you and me? So bury your dead.”
16 And Avraham listened to Ephron; and Avraham weighed out the silver for Ephron which he had named in the hearing of the sons of Heth, four hundred shekels of silver, currency of the merchants.

The use of specie metals as money honors Elohim’s judgments. Because our forefathers disobeyed Elohim, He ordained we would have to toil in order to obtain our food and our livelihood, ‘by the sweat of our face.’

B’reisheet (Genesis) 3:17-19
17 Then to Adam He said, “Because you have heeded the voice of your wife, and have eaten from the tree of which I commanded you, saying, ‘You shall not eat of it,’ cursed is the ground for your sake. In toil you shall eat of it all the days of your life.
18 Both thorns and thistles it shall bring forth for you, and you shall eat the herb of the field.
19 In the sweat of your face you shall eat bread till you return to the ground, for out of it you were taken; for dust you are, and to dust you shall return.”

Because Elohim judged that man should work, work is both noble, and good. Further, because we have to toil ‘by the sweat of our face’ in order to obtain precious metals, they honor the labor that Elohim gave man to do; and therefore they honor Elohim as well.

Because gold and silver are limited in supply, and because they are useful and universally desirable, they have what is known as ‘inherent value.’ So long as the gold and sliver is of a known purity and the weights and scales used to measure them are accurate, specie metals form what is called ‘lawful money.’ That is, Yahweh considers specie metals to be ‘honest.’

The American Founding Fathers were aware of the inherent desirablilty of gold and silver, and that Yahweh honored it as lawful money, and this is one reason why the U.S. Constitution grants the federal government the right (and by implication, the responsibility) to coin money, and to regulate the value thereof. The word “coin” here refers specifically to specie metals.

Section 8. The Congress shall have power…To coin money, regulate the value thereof…and fix the standard of weights and measures….

Considered from another angle, perhaps the reason specie metals are lawful is that they constitute a pure form of barter. In essence, one exchanges a known quantity of metal for whatever other goods or services one wants to purchase, just as Avraham did. The only difference is that scales are not needed, as the purity and quantity is established and regulated by the mint.

So long as the metal is of known purity and weight, the only real issue with using specie metals in commerce is the inconvenience. Gold and silver are heavy, and bulky, and it is impractical to use them in electronic transactions. For these reasons, most governments issue both paper and electronic ‘currencies’ in place of gold and silver coins. Such currencies can be lawful, but only when they are backed one-to-one by gold and silver, and only when they can be exchanged for gold or silver at any time. When backed one-to-one, and when one can redeem them freely at any time, then such commodity-based currencies are literally “as good as gold”; and this is why they are lawful. However, when all of these things are not true, then the money is not lawful money, but what is called ‘fiat’ money.

Genesis 1:3
3 Then Elohim said, “Let there be light”; and there was light.
VUL Genesis 1:3
dixitque Deus fiat lux et facta est lux

In Latin, the word ‘fiat’ means ‘let there be.’ In the Latin Vulgate, in the account of the creation, when Elohim said ‘Let there be light,’ the Latin is ‘fiat lux.’

The reason that money which is not backed by gold or silver is called ‘fiat’ money is that just as Yahweh called the world into being when nothing existed before it, governments also sometimes command money into being, even when it is not backed by anything, and represents no hard physical commodity for which men are willing to labor. Because ‘fiat’ money is not honest, Yahweh does not honor it; and therefore it is unlawful.

Throughout history, various governments have tried to establish fiat money systems, but they always fail. Not just theory, but also hard experience prove that when money is not backed one-to-one by a hard commodity such as silver or gold, problems invariably arise, for which there are no solutions. This is why the French statesman Voltaire said that ‘paper’ money always returns to its intrinsic (inherent) value, which is zero.

“Paper money eventually returns to its intrinsic value —- zero.” —Voltaire

It is quite a thing for a nation’s currency system to lose all of its value. Democracies seem to be especially prone to this kind of thing; but how does it happen?

At least in theory, voters in a democracy are supposed to be noble-minded citizens who educate themselves, so as to elect the best qualified candidates. In turn, the candidates are supposed to win elections by proposing a sensible platform that benefits all parties concerned. However, all theory aside, Scripture tells us that man’s nature is not truly admirable, but evil.

Yirmeyahu (Jeremiah) 17:9
9 “The heart is deceitful above all things, and desperately wicked; who can know it?”

In reality, secular electorates typically vote not for the best interests of all, but for their own selfish interests. This same principle of secular self-seeking also holds true for the candidates, who usually win their elections (or re-elections) by promising to give the people more than they take from them in taxes. However, Yahweh does not honor schemes to ‘get something for nothing,’ even if the candidates pretend to believe in Him. To whom more is given, more is required; and as with King Ahab, when leaders and their citizens dishonor Yahweh’s instructions, there is always a price to pay.

There is nothing hidden that shall not come to the light. All governments face budgetary pressures, but how they resolve these budgetary pressures reveals their true character. When government must back its currency one-to-one by silver or gold, then it must bring in at least as much money as it spends each year; and therefore it must balance its budget. However, when the people place no limits on how much money government can print, it becomes easier just to print more money, than it is to raise new taxes.

However, when government prints more money than it has silver or gold to back it, it sets a devastating train of events into motion. Instantly, each dollar represents a smaller slice of all federal assets, and so the number of dollars it takes to purchase any given commodity goes up. The result is inflation; and while inflation is almost accepted as ‘unavoidable’ in modern-day America, it does not exist outside of fiat money cultures. What inflation is, then, is just simply a curse for disobeying Yahweh’s instructions with regards to honest money.

Another one of Yahweh’s judgments is that when one steals something from an innocent neighbor, one must then give back many times more than one initially took.

Shemote (Exodus) 22:1
1 “If a man steals an ox or a sheep, and slaughters it or sells it, he shall restore five oxen for an ox, and four sheep for a sheep.”

Now if a man is punished fourfold for stealing from an innocent neighbor, how much more shall Yahweh punish us for stealing from our children? And how much will our children have to suffer, due to generational sin?

When a nation tries to avoid paying for its government at the time services are rendered, it always pays more in the end. Inflation brings hidden taxes on savings, because whatever money one places in savings does not hold its value (but it deteriorates). This gives the people a real disincentive to save; and this disincentive causes even more problems, because all commercial economies require savings in order to function.

For example, new businesses often need capital in order to start up. However, if no one has any money saved, then new businesses cannot borrow the startup capital they need; and so they cannot start. The result is a much weaker economy that is unable to take advantage of the best new technologies and ideas.

However, the real time-bomb effect is set when the people start to accept the idea that they do not need to pay for their government as they go. When the voters begin subconsciously to expect their representatives ‘just to print more money,’ then the people involuntarily begin to accept the idea of funding government on credit now, and leaving the debt for their children to pay later. However, this is the exact opposite of the scriptural principle, which is not to leave a debt for our children to pay, but an inheritance for them to keep.

Mishle (Proverbs) 13:22
22 A good man leaves an inheritance to his children’s children….

If we spend more than we bring in, we develop what is called a ‘budget deficit.’ Somehow we must borrow the difference, and that difference is now our ‘debt,’ which we have to pay interest on. If next month we don’t have enough revenue to cover our spending then we have yet another deficit, and so we must borrow even more money; and yet we still have to pay the interest on our loan from before. If each month we have a new deficit, we keep on borrowing, and our debt continues to grow. Soon the interest on our loan becomes so great that it takes all the money we have just to pay the interest, and we don’t have any money for anything else. This situation is called ‘bankruptcy,’ and it is the logical consequence of using fiat money.

“When the people find they can vote themselves money, that will herald the end of the republic.”
—Benjamin Franklin

If fiat money is bad enough to bring down the republic, the United States has adopted something far worse. The United States has adopted what is called ‘debt money.’ The Devil hides in these details twice.

With fiat money, the government creates money that is backed by no real assets. In effect, the government says, “Let there be cash”; and then the government prints cash; and the government says, “It is good.”

However, with debt money, the government does a thing that makes no sense. Instead of printing its own fiat money, the government approaches a private group of bankers and says, “Please loan us cash at interest.” Then these bankers create fiat money. They say “Let there be cash”; and there is cash. Then these private bankers loan this cash to the Federal Government at a rate of interest called the ‘Prime Rate.’

“If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them (around the banks), will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered.”
—Thomas Jefferson

As delusional as the idea of embracing debt money sounds, early in the 1900’s, U.S. representatives met in private with the major banking families of Europe and America in order to found a private banking cartel that was to establish a debt-money system for the United States, and then loan this newly created debt money to the United States Government, at the ‘Prime Rate’ of interest. The United States Federal Reserve was born.

“This Act (the Federal Reserve Act, December 23rd 1913) establishes the most gigantic trust on earth. When the President (Woodrow Wilson) signs the Bill, the invisible government of the Monetary Power will be legalised… The worst legislative crime of the ages is perpetrated by this banking and currency bill.” —Charles Lindbergh Sr.

The Federal Reserve Board was established in 1913. At the time of this writing (in 2009 CE), Americans have been charged perhaps four percent (4%) interest per year just for using Federal Reserve dollars instead of issuing their own currency; and this has been going on for the past ninety six (96) years. While there are many more factors to take into account, if we simplify the equation, we should be able to see that if one starts with (V) value of a dollar in 1913, devaluated at 4% interest per year for some 96 years, then the final value (FV) of the dollar in 2009 is just over two percent of its original worth in 1913; or just over two cents left.

FV = V x [(1 – 4%) (96-1)]
= 1 x [(.96) 95] = .02069
= approximately two cents on the original 1913 dollar.

Since inflation does not exist apart from fiat money, the Federal Reserve Board has transferred perhaps 98% of the American people’s wealth to the private banking families over the past 96 years. Could this be the reason why the banking class keeps on getting richer, while everyone else keeps on getting poorer?

“The financial system has been turned over to the Federal Reserve Board. That Board administers the finance system by authority of a purely profiteering group. The system is Private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people’s money”
—Charles A. Lindbergh Sr., 1923

Many commentators point out that although secular social models such as socialism and communism have attractive features, they are inherently hostile to Judeo-Christian beliefs and principles. This is because what secular social models do, in essence, is to offer a counterfeit system by which citizens can depend on the state for all of their needs, without having to depend upon (or obey) Yahweh. In essence, they serve as an attractive deception for Yahweh’s way. These commentators also point out that the statists typically try to achieve their legislative aims by declaring a state of emergency, and then pass the necessary legislation. Scripture refers to this as ‘devising evil by law.’

Tehillim (Psalms) 94:20
20 Shall the throne of iniquity, which devises evil by law, have fellowship with You?

The Federal Reserve Act was passed two days before Christmas as an ‘emergency measure,’ supposedly necessary to avert an impending ‘national emergency.’

“Every collectivist revolution rides in on a Trojan horse of ‘emergency’.”
—Herbert Hoover

Whether these actions stem from conscious evil intent, or whether they stem merely from Ephraim’s spirit of rebellion against Yahweh’s Instructions, this same sort of ‘national emergency’ was declared in 1933, when U.S. President Franklin D. Roosevelt criminalized private ownership of gold coins, and all gold proxies.

I, Franklin D. Roosevelt, President of the United States of America, do declare that said national emergency still continues to exist and pursuant to said section to do hereby prohibit the hoarding gold coin, gold bullion, and gold certificates within the continental United States by individuals….

We might also note that the Economic Stimulus Act of 2009 was similarly touted as an ‘emergency measure,’ supposedly designed to avert a ‘national catastrophe’; yet this ‘social spending’ bill will more than triple the national debt, making the problem worse.

Ironically, one of the most eloquent arguments against illegalization of gold currency in favor of debt money was made by former Federal Reserve Board Chairman Alan Greenspan in the early days of his career, before he turned and joined the Federal Reserve Board.
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. …. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.
— Alan Greenspan

The ‘debt money’ the socialists and the banking elites have devised by law is precisely the “Short Measure that is an Abomination” decried by the prophet Malachi. It is an unjust weight and an unjust measure that steals from the innocent, and gives to those full of violence.

Micah 6:8-13
8 He has shown you, O man, what is good; But what does Yahweh require of you But to do justly, to love mercy, and to walk humbly with your Elohim?
9 Yahweh’s voice cries to the city — “Wisdom shall see Your name: Hear the rod! Who has appointed it?
10 Are there yet the treasures of wickedness in the house of the wicked, and the short measure that is an abomination?
11 Shall I count pure those with the wicked scales, and with the bag of deceitful weights?
12 For her rich men are full of violence, her inhabitants have spoken lies, and their tongue is deceitful in their mouth.
13 “Therefore I will also make you sick by striking you, by making you desolate because of your sins.

Can we hear the rod now? The debt money foisted off on us by the bankers has gutted the once strong dollar, and has given the United States debt obligations of over $65,500,000,000,000.00 dollars, more than the gross domestic product of the world. It has bled the poor, and has made us all stricken and sick; and all to the benefit of a banking class that Yahweh’s Torah says is unlawful to start with.

Devarim (Deuteronomy) 23:19-20
19 “You shall not charge interest to your brother — interest on money or food or anything that is lent out at interest.
20 To a foreigner you may charge interest, but to your brother you shall not charge interest, that Yahweh your Elohim may bless you in all to which you set your hand in the land which you are entering to possess.”

Our dollar has lost some 98% of its value over the last century. Debt money is a curse that has come upon us because our fathers have not sought Yahweh’s face, nor been meticulous with money, as He commands.

Devarim (Deuteronomy) 28:9-14
9 “Yahweh will establish you as a people set apart to Himself, just as He has sworn to you, if you keep the commandments of Yahweh your Elohim and walk in His ways.
10 Then all peoples of the earth shall see that you are called by the name of Yahweh, and they shall be afraid of you.
11 And Yahweh will grant you plenty of goods, in the fruit of your body, in the increase of your livestock, and in the produce of your ground, in the land of which Yahweh swore to your fathers to give you.
12 Yahweh will open to you His good treasure, the heavens, to give the rain to your land in its season, and to bless all the work of your hand. You shall lend to many nations, but you shall not borrow.
13 And Yahweh will make you the head and not the tail; you shall be above only, and not be beneath, if you heed the commandments of Yahweh your Elohim, which I command you today, and are careful to observe them.
14 So you shall not turn aside from any of the words which I command you this day, to the right or the left, to go after other elohim to serve them.”

Verse 12 tells us that when we obey Torah, we will lend to many nations, and shall not borrow. Yet because we have disobeyed Torah, now we are borrowing not only from the Bilderbergers and the Federal Reserve, but also from the enemies of the faith, such as secular socialist China. What does it bode for the future of America’s national security that we are now tripling our national debt? The debtor is the servant to the lender.

Mishle (Proverbs) 22:7
7 The rich rules over the poor, and the borrower is servant to the lender.

At the time of this writing, America’s leadership is still working to establish a socialist government in America. They will undoubtedly succeed, for it is not Yahweh’s will that His people continue to live out in the dispersion. Rather, explained in Revelation and the End Times, Yahweh wants life in the dispersion to continue to deteriorate, so that His people will be eager to return back to the land of Israel when He decides to open the door.

Haggai 1:5-7
5 Now therefore, thus says Yahweh of hosts: “Consider your ways!
6 “You have sown much, and bring in little; You eat, but do not have enough;
You drink, but you are not filled with drink; You clothe yourselves, but no one is warm; and he who earns wages,
earns wages to put into a bag with holes.”
7 Thus says Yahweh of hosts: “Consider your ways!”

While a severe ‘tightening up’ process is about to come upon our nation, the politicians and the privateering bankers who brought us debt money will also suffer. In the end, all those who have dealt selfishly with Yahweh’s people will pay, for Yahweh is an Elohim of justice and truth. Yahweh will punish all those who have instituted “the short measure that is an abomination,” as well as those who have built beautiful houses for themselves by using their neighbor’s monetary currencies “without wages, without giving (them) anything.”

Yirmeyahu (Jeremiah) 22:13-17
13 “Woe to him who builds his house by unrighteousness and his chambers by injustice, who uses his neighbor’s service without wages and gives him nothing for his work,
14 Who says, ‘I will build myself a wide house with spacious chambers, and cut out windows for it, paneling it with cedar and painting it with vermilion.’
15 “Shall you reign because you enclose yourself in cedar? Did not your father eat and drink, and do justice and righteousness? Then it was well with him.
16 He judged the cause of the poor and needy; then it was well. Was not this knowing Me?” says Yahweh.
17 “Yet your eyes and your heart are for nothing but your covetousness, for shedding innocent blood, and practicing oppression and violence.”

As those who act selfishly will learn, Yahweh is not slack concerning His promises, as some count slackness.

While most Americans may still be in denial about the coming economic judgment, Elohim will not be mocked. Because we have strayed from the righteous money He told us to keep, this country’s outstanding debts are more than our nation can ever possibly pay. And by tripling our national debt over the next ten years, we are only leaping closer towards total insolvency.

But what happens when the world’s largest economy goes into default? And when it defaults, who now has enough money to step in and help us to pick up the pieces? And what will he want in return?

The only good news is that despite all of our harlotry, and all of our wickedness, Yahweh still loves us with an everlasting love. If we will only turn back to Him, He will turn back to us, and take us back in once again.

Yirmeyahu (Jeremiah) 3:1
1 “They say, ‘If a man divorces his wife, and she goes from him and becomes another man’s, may he return to her again?’ Would not that land be greatly polluted? And you have played the harlot with many lovers; yet return to Me,” says Yahweh.

Yahweh is ever merciful, and forgiving. When He finally brings us back to His land, let us be sure to keep all of His Instructions, and establish His kind of money as our standard. And let us make sure that the evil works of Ahab’s house are no longer done in His land.

In Yeshua’s name, amein.

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