Here’s the latest – and somewhat philosophical – piece from our favourite billionaire, Mexico’s Hugo Salinas Price. Being somewhat “old school” he is not a big fan of Bitcoin, but while the title might make it sound like Bitcoin is his main focus, he only really makes passing comment on that topic. Rather he gives an interesting perspective on a number of the unreal constructs that we all take for granted everyday including “the Corporation”, Central Banks, interest rates and of course money. As always a thought provoking piece…
By Hugo Salinas Price – Initially published at Plata.com.mx
Imagination is an exclusively human faculty. Only humans can imagine.
I have on another occasion mentioned Arthur Koestler’s remarkable book, “The Sleepwalkers”. As a child of his time, Koestler accepted the theory of Evolution, but he did have a question (which he did not answer) regarding this theory.
I am not quoting Koestler’s very words, but this is their substance: “If we are evolved creatures, and our bodily constitution reflects the challenges of survival and our ability to evolve to meet those challenges, then – how is it that we are endowed with brains of a capacity for thinking vastly greater than necessary for our survival? All other living creatures have brains only just sufficient for their survival. But we humans have brains whose abilities far exceed the requirements of survival. This is a puzzle.”
At no time in history, surely, has humanity lived in this real, physically tangible world with so enormous a reliance on the human brain’s capacity for imagination.
We humans are living a great part of our lives in an imaginary world; I believe the great problem of our time is that this imaginary world has gradually evolved to a condition where what we imagine is rapidly losing connection with the real physical world in which we live.
Without a doubt, the faculty of imagination is essential to human survival, for all purposive behavior implies a capacity to imagine something not present or even existing as a final cause of human action. If we are going out for dinner, we imagine what we would like to eat before deciding where to dine. However, this faculty, like Reason itself, has its proper limits. Past those limits we enter a dream-land, where imagination can ignore, for a time, the realities within which we live.
Consider the Corporation. Corporations do not exist anywhere outside of our imaginations. Tell an employee that the corporation he works for, or tell an investor in that same corporation that the corporation does not exist and you will at least get a blank look. Neither the employee nor the investor, nor the vast majority of mankind, cares to distinguish between what is imaginary and what is real.
“Walmart” does not exist. There are tens of thousands of buildings which bear a sign that says, “Walmart”. But Walmart is not the buildings. There are over one million employees of Walmart, but – where is Walmart? There are executive offices of Walmart, thousands of executives and a Governing Body of Walmart – but they are not Walmart. What part of Walmart does the investor own? No part that can be identified. We can find close-by, a building that bears a sign “Walmart”. But we can never find Walmart itself anywhere, because it exists only as an idea in our imagination.
There are probably millions of corporations in the world, and such is the enormous power of imagination, that people mistakenly believe in the existence of those corporations when they are only imaginary constructs.
The Supreme Court of the US has declared that “corporations are persons.” It stands to reason that the Supreme Court of the US would state such a thing, since the Supreme Court itself is an imaginary construct: a group of men and women who have been declared to be The Supreme Court, which is only an idea, not a reality, by some other men and women who imagine themselves vested with authority to name people to the imaginary Supreme Court.
One of the great problems with corporations is that, as “imaginary persons” they can do very big bad things; but corporations cannot go to jail, they can only be fined and bankrupted as punishment; and since their executives are not the corporations themselves, executives of corporations form only a very tiny percentage of people in jails, in spite of the fact that they are the real culprits, guilty of all felonies which may be committed by the imaginary corporations under their command.
The whole structure of Government has ever been, since governments were invented in this world, a work of the imagination, in ancient days supported by pagan religion, impressive ceremonies celebrated by priesthoods who overawed the people, and the pomp and circumstance of the Royal Court.
Government power today comes not from the gods but from votes, which in “advanced” countries involves getting people to push voting buttons in private booths. The result of the voting is relatively meaningless; what counts is that the voters are satisfied that their will has been manifested and will be taken into account, and they can thus comfortably forget about politics and continue to pursue their usual amusements.
The imaginary governments of the world, peopled by flesh and blood individuals who collectively style themselves “the government”, are supported in their selected comfortable lifestyles by the imaginary institution of a Central Bank. In Washington, D.C. you may be shown the impressive Eccles building, where dwells the imaginary Federal Reserve. Benjamin Shalom Bernanke, who thinks of himself as chief of that imaginary institution, and his colleagues enter that building and do the jobs they are supposed to do as constituting the imaginary Federal Reserve – which can nowhere be seen, since it exists only in the imagination as an idea.
You can have the same experience in any capital of the world, for there are imaginary Central Banks in every capital city of the world.
Now to get to the heart of perhaps the most important imaginary construct in which we live: money. Today, the world uses as money something totally imaginary: fiat paper money exists in printed form and can be folded, but its value is quite imaginary; the numbers on this paper money, which give it value in proportion to their magnitude, bear no relation at all to anything tangible. On the other hand and to a much greater extent we have fiat digital money; this form of money is absolutely imaginary, and is produced by the imaginary banking systems of the world.
All imaginary digital money is imagined to exist exclusively in imaginary banks, where it is registered as supposedly the property of corporations and other imaginary institutions of all sorts, and also, as the property of flesh and blood humans. An awkward fundamental question is “How can something imaginary constitute property?”
Such is the mighty hold of imagination upon humans that even the ridiculous imaginary Bitcoin has gained the attention of some otherwise prudent humans. Governments have objected to the use of the Bitcoin because the Bitcoin, as imaginary money, invades the imaginary turf of bankers and governments and these people don’t like that. Curiously, on the Internet we can see pictures of pretty shiny Bitcoins, though none have been minted. A picture is helpful to the promotion of an imaginary coin.
On the part of some normally sound critics of fiat money the main doubts regarding the Bitcoin refer to its security and safety from falsification. Nobody is concerned that the Bitcoins are totally imaginary. Humanity appears to be quite happy in the imaginary world in which it lives.
Today, imaginary governments rule by means of distribution of imaginary money provided by imaginary banking systems controlled by imaginary central banks.
To give the creation of imaginary money a semblance of authenticity, we are told that money is created when a debt is created. The fact is that digital imaginary money, which is most of the money used in the world, appears in the realm of quantity as pure number – not a part of the material world – the effect of key-strokes on computers by individuals authorized to carry out such key-strokes by the managers of imaginary banks. But to preserve the illusion of authenticity of the imaginary money, its creation (though the world “creation” is not logically applicable to the invention of a number which represents nothing physical at all) is tied to the creation of debt. So we are told that all money originates in the need for credit, and the banks, responding to the need for credit, grant loans in imaginary digital money.
Here we meet another figment of the human intellect: debt. All debt is imaginary. It is imaginary because it is a promise, and promises have no material existence. One measure of the quality of a human being is revealed by his feeling that his honor is involved in fulfilling a pledge. But what if the credit money received is something imaginary? And what if the debtor is a Corporation? As imaginary constructs, corporations have no sense of honor, a human quality. And the officers of a corporation are not held personally responsible for the debts of the corporation.
What can we say of the so-called “interest rate” determined by the Federal Reserve? It is an entirely arbitrary number determined by the imaginations of the functionaries at the imaginary Federal Reserve, and has no relation whatsoever, to any reality of the market-place.
When Mr. Cheney was imaginary vice-president of the imaginary US government, he is reported to have said: “Deficits do not matter”. He was correct, for the National Debt of the US is entirely imaginary. It cannot and will not ever be repaid, and will grow numerically up to the point at which reality finally dissolves the bewitched imagination which holds the population in thrall.
The bucket of water thrown upon the Wicked Witch of the West by Dorothy, in “The Wizard of Oz”, symbolizes the release from an imaginary threat which has become oppressive. Instead of a bucket of water, we might consider a bagful of $1 Trillion dollar platinum coins, issued by the imaginary Treasury and paid to the imaginary Federal Reserve to extinguish the imaginary threat of imaginary money owed. Why not? We are taught in kindergarten to be creative in the use of the imagination.
What lies ahead?
Humanity has abused the faculty of imagination. We live in a dream-land which has drifted away from any attachment to the reality of the physical world.
A relatively small group of men behind the facade of established imaginary governments of the world long ago decided that the only way to obtain and retain “that perfect bliss and sole felicity, the sweet fruition of an earthly crown” was to resort to imaginary money and distribute it liberally to the ever-hungry masses, drugging them into holding their peace.
What lies ahead is a series of financial disasters in various parts of the world – at first these will be isolated events – which will increase in frequency until finally the whole world is caught up in a financial storm. The cause of the storm will be the failure of the real economic world to satisfy the expectations of the public.
The storm will force the men and women of the world, who have lived so unquestioningly in their highly imaginary world, to wake up and find, to their astonishment dismay and anger, that they have lost their jobs, that they have no savings and that their pension funds are gone or have been confiscated. Their indignation will be forgotten as sheer terror sets in. The Department of Homeland Security has been given a supply of more than one billion hollow-point bullets for good reason.
George Orwell, in his book “1984” painted a pessimistic picture of the future for humanity: “A boot crushing a human face into the mud, forever.” I prefer to be hopeful. Evil is not self-sustaining. We are living in a transitory period of history, always in flux. This world of dreams of ours will give place, but for a time only, to a more reality-based world. For mankind are dreamers of dreams, for better or for worse.
You can now buy gold and silver with bitcoin. Check out this post to learn more about the pros and cons: How to Buy Gold and Silver with Bitcoin