The Goldeuphoric Standard

[machinehead]

Philosophers have debated for centuries whether there is an alternative monetary standard to Keynes's 'barbarous relic,' gold. Contemplating the polished curve of a golden hookah, it occurred to me that there is: opium.

 

Like gold, opium has been revered throughout human history as nature's best medicine: a pick-me-up for enduring tedious work (how do you think the western half of the transcontinental railroad was built?); a soporific for sleep; and, on ceremonial occasions, an entree to a Coleridgian dreamland:

 

In Xanadu did Kubla Khan

A stately pleasure dome decree

 

Just as an ounce of gold historically bought 15 ounces of silver -- or a suit of clothes -- an equivalent several ounces of opium also has maintained its purchasing power through time. A warehouse full of it could provide the monetary base, backing the issuance of warehouse receipts. Like the 19th century bimetallic standard, one can imagine gold and opium-backed currencies circulating together in a so-called goldeuphoric standard.

 

Gold is indestructable and of finite supply, coming from veins in the earth, whose exploitation is governed by territorial control and extraction technology. Opium is grown from poppies, whose production involves not only territorial control but also the culturally older and gnarlier vagaries of agriculture. But set against this apparent demerit, opium also engages the deep universal vein of forbidden shamanistic knowledge, which could serve as the next great breakthrough for humankind ... inner technology, as it were.

 

By contrast, the highest and best use of fiat paper money is to finance wars. Ultimately the paper currencies of the English-speaking abacus axis (Australia, Britain, Canada, U.S.) are backed by their superior ability to deal out mass death to rivals. But because military technology and economic power are forever shifting, superior force cannot serve as a long-term stable base for enduring acceptance of a fiat currency.

 

The opium standard has both a dark side and a bright side, just as the gold standard did in the days when the world's largest producer was apartheid South Africa. Universally suppressed, the still-lucrative opium-based monetary standard is in organized crime hands at present. And just as U.S. prohibition shifted the alcoholic drink market from beer and wine to more-concentrated distilled spirits, drug prohibition has led natural opium to be processed into synthetic heroin.

 

To visualize the bright side, imagine if the Netherlands went beyond growing marijuana to growing opium. From the dikes to the polders, the low country would be an endless field of red poppies. As in the tulip boom of 1634-36, Holland would once again be a center of world trade, banking and wealth.

 

But the realities of Europe are such that other members would demand their fair share: Germany, with its formidable abilities in organic chemistry; France, with its centuries of mushroom lore; Spain, with its close ties to Morocco's 'kif from the Rif.' Nightmarish visions of the 'wine lakes' and 'butter mountains' of yesteryear recur. With agricultural assets, boom can turn to bust in many ways.

 

An interesting dynamic is underway now. Nick Guarino claims that Saddam Hussein looted Kuwait of billions worth of gold in 1990, which presumably is stashed in underground bunkers. Sounds too far-fetched. But suspend disbelief for a moment and consider the implications. Across the board, the abacus paper death money axis is going for "control of the physical": the poppy production in Afghanistan (like any colonial plantation, it will be badly managed); a large gold stash in unfriendly hands in Iraq (how do you think Saddam pays his bills?); and the oil reserves (again, Iraq) which currently fuel all the fiat-money economies.

 

The Afghanistan leg of the strategy could be viewed as a modus vivendi between the paper death money axis and organized crime. Organized crime gets a limited sales franchise in the rich countries, limited exemption of their cash flows from money laundering confiscation; and protection of their producing areas. The paper money economies, having sucked dry their credit creation abilities, get to sink their teeth vampire-like into the opium economy, which still functions as it always did.

 

This is the ugly way, of course. On the bright side, one can imagine the euro as a strong and prosperous opium-backed currency. China and the Islamic world have long histories with both gold and opium economies. One wonders how they were induced to sell their birthright for a mess of paper-money pottage?

 

And then there's abacus, the paper money death axis. Britain and Canada are on the verge of legalising marijuana, which is at least a toe in the water toward the opium economy. Australia and the U.S. aren't. What will happen to these hard cases, if they insist on cutting off their way forward toward sound money, prosperity, and access to the collective unconscious, the undying source of universal knowledge? I guess they'll be left behind. Or perhaps blow up the whole lot in a fit of poor sportsmanship.

[Charmin]

Either way the writing is on the wall for the Belshazzar Buck

 

if you can interpret the writing you will rule with a chain of gold round you neck

 

while the ones drunk with wine and opium will be defeated

[SevenOfEleven]

One problem with the opium standard - allow me to demonstrate:

 

Allright, it's payday! Got a light?

 

On a more serious note I have to say I'm impressed with your thought process and ability to express that process MH. Anything that flares up the old neurons in this creaky head of mine is a good thing

[Guest]

I hope investing in gold isn't as addictive as smoking dope. :grin:

 

Perhaphs Afganistan should consider an opium-backed currency.

 

Regards,

Vesselin

[Goldmember]

Oddly enough, during the tyranny of the Taliban poppy growing was banned. While the western media were showing video clips of sacks of raw opium stacked in warehouses they were old production, and perhaps confiscated by the Taliban. Not that I liked the Taliban, far from it!

 

Now with a "free democratic government" poppy and cannabis growing is once again the bumper crop de jour in Hashghanistan, no profit in growing food! The monetary proceeds of these crops will, sadly, be a repeat of the eighties where the generated cash goes to arms buying from the western world, aka U.S. defense contractors.

 

I am even hearing talk of international grants to further Hashghanistan's "agricultural" production by developing water diversion canals to the fields.

 

Will the CIA be the delivery courier once again? Ah, the hash that flowed from Hashghanistan during the eighties was a tasty treat, derived from the famed Afghany Kush, especially so when my source was not stepping on it with organic fillers to increase weight. :grin: