Golden ruble: crafty idea
The “golden currency” has a good reputation in society. Noble metal hypnotically affects the minds. Meanwhile story teaches us not to trust the "yellow devil", including the history of Russia.
Today, many nostalgically remember the golden ruble of Sergei Witte, who was born in 1897, others were captivated by the gold chervonets of the people's commissar Grigory Sokolnikov of the middle of 1920's ... It sounds loud - the golden ruble. Although just the experience of using the “golden currency” in our country shows that the games with the golden calf end very badly and even tragically.
Unfortunately, in our historical literature it is extremely rare to find a serious analysis of the consequences of the introduction of the gold ruble by the then Minister of Finance S. Yu. Witte. Let me remind you that in the second half of the XIX century, the Russian ruble with might and main walked around the European stock exchanges and was a favorite "toy" for currency speculators in Berlin, Paris and other European financial capitals. Even the predecessors of Witte, finance ministers Nikolay Bunge and Ivan Vyshnegradsky proposed to strengthen the ruble, making it gold. But this required a solid gold reserve, which Russia did not have. Although Russia was a gold-mining country, however, to create the necessary reserves, it was necessary to dig and wash the precious metal for several decades. Another source of replenishment of gold reserves could be the export of grain. Vyshnegradsky threw a cry: "We will not finish, but we will take out." The slogan of the influential minister began to practically implement. Russia for the sake of a “bright golden future” began to malnourish, and sometimes even starve. However, this was clearly not enough to make the ruble a stable currency. The third and most important source of replenishment of the gold treasury of the Russian Empire became gold loans. And who could provide gold on a returnable and paid basis? All the same Rothschilds who, after the Napoleonic Wars, concentrated in their hands large stocks of "yellow metal". And in order for this metal to "work", that is, to bring interest, it was necessary to implant gold standards in the world. The first gold standard was adopted by the United Kingdom (1821 year). After Bismarck introduced the gold mark in the Second Reich in 1873, the process of introducing gold standards began an avalanche. By the way, it was from 1873 that the Great Depression began in Europe, which lasted 23. The link between the introduction of gold currencies and the economic downturn was evident.
Russia was forced into the “golden club” at the end of the 19th century. For our country, the gold standard was a particularly heavy burden, since the gold ruble was approaching 100% (higher than in other European countries). Russia was constantly suffocating from the lack of money; there was a “golden noose” on its neck. In order to weaken it at least a little, there was a policy of attracting foreign capital (in fact, attracting gold currencies to the country). Industry and the banking sector were under the control of foreigners. In terms of the production of many types of industrial and agricultural products, Russia before the First World War occupied 4 – 5 ranks. But the largest foreign debt came to the undisputed first place in the world. The gold ruble was considered a very “hard” currency, although the paradox was that it was secured by debts, but not gold. Because even gold in the vaults of the State Bank was borrowed. The country rapidly lost its sovereignty, turned into a colony of the West. That was the price of Sergei Witte’s gold ruble! The minister acted imprudently, at least not in a state way.
And all over the world, the gold standard was short-lived. At the beginning of World War I, European countries were forced to suspend the gold standard (the exchange of paper money for metal was stopped). After the war, it was restored only in some countries (Great Britain and France), and in a truncated form (the so-called gold bullion standard). Currencies of different countries retained their connection with gold indirectly - through exchange for the US dollar, the British pound, the French franc. By the middle of the 1930-ies in the conditions of the economic crisis, the gold standard was completely dismantled.
The latest version of the gold standard is the gold dollar standard, which was set seventy years ago at the Bretton Woods conference. The connection of the world of money with gold was ensured through the exchange of the US dollar for the "yellow metal", whose reserves in America after the war reached 70% of world reserves (without the USSR). But in less than three decades, the gold-dollar standard ceased to exist, the connection between the world of money and gold was interrupted. It has become an ordinary commodity.
Both domestic and international experience shows that gold is an extremely unimportant means of maintaining the stability of money circulation. With the light hand of D. Ricardo, K. Marx, and other engaged nineteenth-century economists, the myth emerged that the “yellow metal” is the most ideal equivalent of value. In addition, the growth of gold reserves is always lagging behind the growth of the economy (or at least the growth opportunities). Therefore, gold as money quickly begins to act as a brake on economic development. The gold standard is needed only for those who have a lot of "yellow metal" and who are willing to lend it. The owners of gold get richer, the rest of the world is in decline.
I recall that in the middle of the 1920-ies in the USSR also hovered ideas to make our gold coin. As a result, he became gold only nominally. That is, it was provided with gold (as well as other valuables), but the metal sign of the chervonets was not exchanged for metal. The then people's Commissar of Finance, Grigory Sokolnikov, said that the Soviet gold chervonets would circulate on all the currency exchanges of the world. Some people even flatteringly called this Commissar “the second Witte”. In those days, in the Party and the government, there was a sharp struggle around the problem of the convertibility of paper chervonets into gold. The exchange of gold pieces did not come. Began to form a monetary system of a fundamentally different type. Inside the country, paper banknotes — banknotes and treasury notes — were circulated. Paper money was supplemented with non-cash money, which served the production sphere. The state currency monopoly acted in the sphere of external settlements, and the ruble was not used for external operations. Thanks to the monetary system that developed in the USSR at the beginning of the 1930s, we were able to industrialize. Before the start of World War II, almost 10 thousands of enterprises were built. By the way, in the 1930, the West has not canceled economic sanctions against the USSR. Under the conditions of such sanctions, the USSR used for the purchase of machinery and equipment the sale of gold on the world market. At the same time, the country increased its gold reserves as a strategic resource in the light of the looming threat of war. According to some sources, this stock on the eve of the war exceeded 2 by thousands of tons.
One thing is the accumulation and use of the precious metal as a strategic resource, another thing is the introduction of the “golden currency”, linking the national monetary unit to the “yellow metal” reserve. If the first is justified and necessary to ensure the economic independence of the country, then the second may lead the country to financial enslavement and disaster. Becoming addicted to gold is dangerous. This is evidenced by both global and domestic experience.
It is dangerous when gold becomes not a means, but an end, a kind of universal, a deity, to whose pedestal we have to make sacrifices.
Today, many nostalgically remember the golden ruble of Sergei Witte, who was born in 1897, others were captivated by the gold chervonets of the people's commissar Grigory Sokolnikov of the middle of 1920's ... It sounds loud - the golden ruble. Although just the experience of using the “golden currency” in our country shows that the games with the golden calf end very badly and even tragically.
Grigory Sokolnikov
Unfortunately, in our historical literature it is extremely rare to find a serious analysis of the consequences of the introduction of the gold ruble by the then Minister of Finance S. Yu. Witte. Let me remind you that in the second half of the XIX century, the Russian ruble with might and main walked around the European stock exchanges and was a favorite "toy" for currency speculators in Berlin, Paris and other European financial capitals. Even the predecessors of Witte, finance ministers Nikolay Bunge and Ivan Vyshnegradsky proposed to strengthen the ruble, making it gold. But this required a solid gold reserve, which Russia did not have. Although Russia was a gold-mining country, however, to create the necessary reserves, it was necessary to dig and wash the precious metal for several decades. Another source of replenishment of gold reserves could be the export of grain. Vyshnegradsky threw a cry: "We will not finish, but we will take out." The slogan of the influential minister began to practically implement. Russia for the sake of a “bright golden future” began to malnourish, and sometimes even starve. However, this was clearly not enough to make the ruble a stable currency. The third and most important source of replenishment of the gold treasury of the Russian Empire became gold loans. And who could provide gold on a returnable and paid basis? All the same Rothschilds who, after the Napoleonic Wars, concentrated in their hands large stocks of "yellow metal". And in order for this metal to "work", that is, to bring interest, it was necessary to implant gold standards in the world. The first gold standard was adopted by the United Kingdom (1821 year). After Bismarck introduced the gold mark in the Second Reich in 1873, the process of introducing gold standards began an avalanche. By the way, it was from 1873 that the Great Depression began in Europe, which lasted 23. The link between the introduction of gold currencies and the economic downturn was evident.
Ivan Alekseevich Vyshnegradsky
Russia was forced into the “golden club” at the end of the 19th century. For our country, the gold standard was a particularly heavy burden, since the gold ruble was approaching 100% (higher than in other European countries). Russia was constantly suffocating from the lack of money; there was a “golden noose” on its neck. In order to weaken it at least a little, there was a policy of attracting foreign capital (in fact, attracting gold currencies to the country). Industry and the banking sector were under the control of foreigners. In terms of the production of many types of industrial and agricultural products, Russia before the First World War occupied 4 – 5 ranks. But the largest foreign debt came to the undisputed first place in the world. The gold ruble was considered a very “hard” currency, although the paradox was that it was secured by debts, but not gold. Because even gold in the vaults of the State Bank was borrowed. The country rapidly lost its sovereignty, turned into a colony of the West. That was the price of Sergei Witte’s gold ruble! The minister acted imprudently, at least not in a state way.
And all over the world, the gold standard was short-lived. At the beginning of World War I, European countries were forced to suspend the gold standard (the exchange of paper money for metal was stopped). After the war, it was restored only in some countries (Great Britain and France), and in a truncated form (the so-called gold bullion standard). Currencies of different countries retained their connection with gold indirectly - through exchange for the US dollar, the British pound, the French franc. By the middle of the 1930-ies in the conditions of the economic crisis, the gold standard was completely dismantled.
The latest version of the gold standard is the gold dollar standard, which was set seventy years ago at the Bretton Woods conference. The connection of the world of money with gold was ensured through the exchange of the US dollar for the "yellow metal", whose reserves in America after the war reached 70% of world reserves (without the USSR). But in less than three decades, the gold-dollar standard ceased to exist, the connection between the world of money and gold was interrupted. It has become an ordinary commodity.
Both domestic and international experience shows that gold is an extremely unimportant means of maintaining the stability of money circulation. With the light hand of D. Ricardo, K. Marx, and other engaged nineteenth-century economists, the myth emerged that the “yellow metal” is the most ideal equivalent of value. In addition, the growth of gold reserves is always lagging behind the growth of the economy (or at least the growth opportunities). Therefore, gold as money quickly begins to act as a brake on economic development. The gold standard is needed only for those who have a lot of "yellow metal" and who are willing to lend it. The owners of gold get richer, the rest of the world is in decline.
I recall that in the middle of the 1920-ies in the USSR also hovered ideas to make our gold coin. As a result, he became gold only nominally. That is, it was provided with gold (as well as other valuables), but the metal sign of the chervonets was not exchanged for metal. The then people's Commissar of Finance, Grigory Sokolnikov, said that the Soviet gold chervonets would circulate on all the currency exchanges of the world. Some people even flatteringly called this Commissar “the second Witte”. In those days, in the Party and the government, there was a sharp struggle around the problem of the convertibility of paper chervonets into gold. The exchange of gold pieces did not come. Began to form a monetary system of a fundamentally different type. Inside the country, paper banknotes — banknotes and treasury notes — were circulated. Paper money was supplemented with non-cash money, which served the production sphere. The state currency monopoly acted in the sphere of external settlements, and the ruble was not used for external operations. Thanks to the monetary system that developed in the USSR at the beginning of the 1930s, we were able to industrialize. Before the start of World War II, almost 10 thousands of enterprises were built. By the way, in the 1930, the West has not canceled economic sanctions against the USSR. Under the conditions of such sanctions, the USSR used for the purchase of machinery and equipment the sale of gold on the world market. At the same time, the country increased its gold reserves as a strategic resource in the light of the looming threat of war. According to some sources, this stock on the eve of the war exceeded 2 by thousands of tons.
One thing is the accumulation and use of the precious metal as a strategic resource, another thing is the introduction of the “golden currency”, linking the national monetary unit to the “yellow metal” reserve. If the first is justified and necessary to ensure the economic independence of the country, then the second may lead the country to financial enslavement and disaster. Becoming addicted to gold is dangerous. This is evidenced by both global and domestic experience.
It is dangerous when gold becomes not a means, but an end, a kind of universal, a deity, to whose pedestal we have to make sacrifices.
Information