The name of Lieutenant-General of the Tsarist Army Alexander Dmitrievich Nechvolodov today is known to very few. There is a reason to recall the undeservedly forgotten military, writer, historian and economist: these days 150 marks the anniversary of his birth (March 25, 1864, old style; December 5 passed away, 1938, in Paris).
Even those who know the name of the general usually remember him in connection with the four-volume historical the work "Tales of the Russian land." At an official reception in 1912, A.D. Nechvolodova with Emperor Nicholas II. The tsar complained that the history of Russia, written by N. Karamzin, was hopelessly outdated, and suggested that Alexander Dmitrievich prepare a history book available for study. In 1916, the book was ready, printed in the royal printing house. However, in the context of the impending revolution, it, unfortunately, turned out to be unclaimed, and after the Bolsheviks came to power, it was also banned.
But now it is not about the fundamental historical work of the general, but about a small book, almost a brochure, which is called “From Ruin to Prosperity”. This work came out in 1906, and then caused a great resonance in St. Petersburg (and throughout Russia).
What is this book about? First, about Russia and Russian capitalism. Secondly, about the global financial world in which there was then Russia. Thirdly, about gold, which formed the core of this financial world.
From the very title of the work it can be understood that at the beginning of the twentieth century Russia was in a state of ruin. However, this ruin began much earlier - from the end of 50-s - the beginning of 60-s of the XIX century, that is, from the moment when Alexander II ascended the throne and started the reforms that initiated the development of the country along the capitalist path.
Usually everyone remembers the reform that put an end to the so-called serfdom. But at the same time financial reforms began. Russia's access to the path of capitalist development meant the end of the natural economy. The “voluntary-compulsory” involvement of both landowners and peasants into commodity-money relations began. According to estimates, for a normal life in the new conditions, it was required two to three times more money supply compared with the one that Russia had at the time of Nicholas I. And financial reforms, on the contrary, compressed the money supply. This, as A.D. Nevvolodov, contributed to the reformers who captured Western financial theory.
Theories that scared that an excess of money in circulation could supposedly cause inflation. How is this, by the way, similar to the policy of our present monetary authorities - the Central Bank and the Ministry of Finance, which brought the monetization index of the Russian economy (the ratio of the money supply to gross domestic product) to the level of African countries! There is a strangulation of the national economy on a "scientific basis." HELL. Nechvolodov describes in detail the state of Russia's monetary economy of the last decades of the nineteenth century and shows that, in comparison with the countries of Western Europe, the provision of population with money is several times less (and even dozens of times). This inevitably gave rise to the ruin of Russia, especially the village. However, many contemporaries of Nechvolodov paid attention to this — for example, the outstanding Russian economist S.F. Sharapov (also undeservedly forgotten).
Alexander Dmitrievich, being an officer of the General Staff and engaged in intelligence, very well versed in issues such as international finance and Freemasonry. In his opinion, the destructive nature of the financial and monetary-credit policy of the government of the Russian Empire was caused not only by the mistakes of officials of the Ministry of Finance and the State Bank, but by the deliberate subversive activities of a number of influence agents associated with Masonic circles and bankers in Europe and America. The purpose of this subversive activity is to turn Russia into a colony of the West.
According to Colonel Nechvolodov (at the time when the work “From Ruin to Prosperity” was published, he had the rank of colonel), the main blow to Russia was inflicted by Finance Minister S.Yu. Witte, who was associated with the financial and Masonic circles of the West. Witte led his subversive activities in many areas, but still the most important was monetary reform. In any textbook on history and economics, one can read that thanks to the efforts of Sergey Yul'evich in 1897, a golden ruble was born, and this is exposed as his merit. But today many people nostalgically remember Witte’s gold ruble, regarding it as a symbol of the economic power of Russia of that time. But A.D. Nechvolodov, S.F. Sharapov and other thinking people of Russia at that time thought exactly the opposite. They called the new ruble the “golden noose” of Russia and warned that it would lead the country to a catastrophe. They were right: exactly in twenty years there was a Bolshevik revolution. However, this catastrophe at the same time turned out to be a salvation for the country, since Russia managed to jump out of the “golden loop”. Such is the paradoxical dialectic of Russian history ...
So, Nechvolodov sharply criticized the gold ruble Witte. Perhaps two thirds of the entire book “From Ruin to Prosperity” is devoted to this criticism (the remaining pages are devoted to proposals for the country's exit from the golden monetary system). Even today, it can be recommended as an excellent guide explaining what money is in general and gold money in particular. By the way, in the 1907 year of Nechvolodov, this topic was continued and deepened in its brochure called Russian Money.
Nechvolodov gives an overview of the economic situation of a number of European countries and finds out that those countries that used paper money developed quickly. On the contrary, countries that have adopted the so-called gold standard, began to experience economic crises and depression. The gold standard should not be understood as the circulation of gold coins in a country's economy. No, there are almost exclusively paper banknotes (banknotes) in circulation, but the volume of issue (emission) of such signs is determined by the amount of gold held by the bank (central bank). That is, the volume of money issue is determined not by the needs of the economy, but by the volume of gold reserves. Obviously, the gold standard sooner or later turns into a “golden brake” of the economy.
By the way, the classic capitalist country of Great Britain carried out an industrial revolution using paper money. The de facto gold standard in this country began to operate from the 1821 year. Until the middle of the XIX century, Great Britain continued to develop by inertia as an industrial power, but then the inhibitory influence of the gold standard began to be felt. In 1857, a banking crisis erupted. The flight of gold from Great Britain began, which it was possible to stop, only by raising interest rates on bank deposits. From that moment, the industrial degradation of the country began.
The second largest country to adopt the gold standard was Germany, which was established on the basis of Prussia and many small principalities after the Franco-Prussian 1870-1871 war. This was under the "Iron Chancellor" Bismarck, who is more correctly called the "golden" Chancellor. " Germany, as the winner of the war, received a contribution from France in the amount of 5 billion gold francs, and this metal became the basis of the gold standard. After this, the example of Germany was followed by other countries. Nechvolodov draws attention to the fact that from the 1873 year in Europe began an economic depression that lasted until the 1896 year, that is, the 23 year. It was the Great Depression, about which modern textbooks usually do not speak very clearly, without linking it with the introduction of gold standards.
The introduction of the gold standard in Russia was conceived by reformers as far back as the 1860s, but the country's gold reserves were so small that the question did not go over to the practical plane. Only with the arrival in the Ministry of Finance S.Yu. Witte gold reserves were already substantial. How did the country accumulate gold? First, due to the active balance of foreign trade. Witte's predecessor in the Ministry of Finance Vyshnegradsky threw the slogan: "We will not finish, but we will take out." Russia began to chronically undernourish and even starve, forcing the export of grain. Secondly, by gold mining. Russia was rich in precious metal deposits, but its extraction was at an extremely low level. And part of the gold mined in the Far East left the country illegally. Thirdly, at the expense of the gold loans that the Rothschilds provided.
Actually, the dog is buried here. After the Napoleonic Wars, the Rothschilds became fabulously rich, and in their hands they concentrated most of the European gold. They needed the gold standard, which would guarantee a steady demand for their gold. No, they were not going to sell it: they planned to give it to the states in the form of loans. As the economy grows and the volume of money needed to service it, countries will need more and more yellow metal. The Rothschilds will hold all the gold in their hands, giving gold loans for a while and getting gold back with interest. So, behind the sign of the gold standards there was a golden “perpetuum mobile”, the beneficiaries of which were the Rothschilds. Nechvolodov in his work reveals, in numbers and examples, the principle of operation of this “golden pump”, which pumped the wealth of the whole world into safes and Rothschild accounts. No country voluntarily was ready to put on the neck "golden noose". Everywhere the Rothschilds acted through their agents, using strength and cunning. In Russia, the sly and energetic Rothschild agent was S.Yu. Witte.
Why did Russia manage to impose a gold standard, moreover in 1897, when its devastating consequences were already evident in Europe? Nechvolodov believes that this is partly because, apart from Witte, there were many other agents of influence in the ruling elite of Russia, mostly associated with the Freemasons and Western bankers. In addition, most of the population was generally illiterate and, therefore, knew little about finance and money. As for the “educated public,” she was poisoned by various Western theories and firmly believed that the best money was gold. This was greatly contributed by the great enthusiasm of the Russian intelligentsia for Marxism, and, as you know, in the “Capital” of Karl Marx, money and gold are practically the same thing. For dozens of pages, the classic proves that gold and only gold can act as a universal equivalent of value and most effectively perform all other functions of money. A. Nechvolodov qualifies these arguments of Marx as slyness and frank service of the interests of the Rothschilds.
An alternative to the gold standard Nechvolodov considers paper money, unchangeable on the metal. The paper contains a comparative analysis of such monetary systems as the silver standard and bimetallism (money based on silver and gold). The gold standard is the most stifling monetary system. After reading the work of A. Nechvolodov, you better understand the events that took place in Russia at the beginning of the twentieth century. By the way, on the eve of the First World War, Russia occupied many places in the world of 4-6 in many types of industrial and agricultural products, but in terms of foreign public debt - the first place.
The work of A. Nechvolodov "From ruin to prosperity" is extremely relevant for today. For four decades the world has been living in the conditions of the so-called paper dollar. In 1970, the demonetization of gold began, the yellow metal was expelled from the world of money. The “golden brake” was removed from the “printing press” of the Federal Reserve System (FRS), it started working at full capacity, the world was filled with trillions and trillions of cash and non-cash dollars. The climax of such monetary liberalization was the financial crisis, the first phase of which took place in 2007-2009. It is obvious that the world can cover the second, much more powerful wave of financial crisis. The paper dollar system has completely discredited itself. A search is underway for alternative models of the financial system. Increasingly, economists, politicians, statesmen are recalling the gold standard. The book Nechvolodova "From Ruin to Prosperity" warns us about what can happen to Russia and humanity if they once again step on the "golden rake."