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A.C.Bhaktivedanta Swami Prabhupada
Events: Kirtan Festival
World Sankirtan Party
© 2004 - Hansadutta das
Where is the Real Money?
by His Divine Grace A.C.
Bhaktivedanta Swami Prabhupada
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There was one question I had, Srila Prabhupada. You have written in the
Third Volume of the First Canto [Srimad Bhagavatam 1.17.39
and 1.17.40] different instructions for the
age of Kali, how there'll be
compulsory marriage and so on and so on. And you mentioned about the
gold standard, that this is very bad, this artificial standard of
Prabhupada: Oh, yes. It is very bad.
Ramesvara: In the future this is something that we should try to correct.
Prabhupada: You should introduce coin, real money.
Hari-sauri: Real gold coins. No paper.
Prabhupada: Anyone has got money... It is fact. And what is this nonsense, keeping some paper and thinking he has got money? How cheating it is going on, from government's side. And therefore artificial inflation. You can print, so the price is increased. Because you haven't got to pay him real money, you print and pay him, and he will ask, "Give me this money. Then I'll supply." "All right, take." You print and pay.
Ramesvara: It's definitely a means that the government has for controlling. Because they can withdraw money, pull it back out of circulation by increasing the interest the banks give, or they can get more money in...
Prabhupada: Anything done artificially.
Ramesvara: They control the amount of interest on loans. It's all standardized from what they call the Federal Reserve system. This was introduced during the Depression by the bankers.
Prabhupada: Whatever they do, when you receive money in the paper it has no value. Bad money. It is bad money. It is not good money.
Ramesvara: Actually most purchasing in America is done on credit now. Even a step beyond paper money is credit, no money, buying on no money, loans.
Prabhupada: That is in India also.
Ramesvara: We don't find these things in Vedic culture too much.
Prabhupada: There was never paper money.
Hari-sauri: No. They used to...
Prabhupada: That barter system. You have got rice; I have got something else. So I give you something; you give me something.
Hari-sauri: But isn't inflation possible even with coins? Even if you have gold coins, isn't inflation still possible?
Prabhupada: No, gold is acceptable by everyone.
Ramesvara: The main point is the barter system.
Hari-sauri: Yes, well its value is recognized by its purchasing power.
Hari-sauri: So you can alter... Say, you have one gold coin. You can alter what it...
Prabhupada: No. If you introduce real metal coin, then there will be no inflation.
Hari-sauri: There's only a certain amount of metal.
Prabhupada: That's all right. The exchange... The more demand, more price. So suppose here is a spectacle. I am demanding ten rupees. So both of you are customer, and you are asking for this spectacle. Then I am increasing my price. So if you can pay me by printing paper, you'll accept any price. That means artificially price is increased. Is it not?
Hari-sauri: So the idea is that with coins the man who has the goods, he can't...
Prabhupada: Therefore... Suppose he has got ten coins; you have got ten coins. I am wanting fifteen coins. So there will be no competition. I have to accept either from you or you, ten coins.
Hari-sauri: Right. Because there's only that much money.
Prabhupada: But if I increase price and if you print... If you have got power to print, "All right. Take fifteen coins, er, fifteen rupees." But you [can] print and pay me. But if the gold, the coin, is there, you cannot increase on that.
Hari-sauri: He can't increase the price of the product, and the man who got..., 'cause there's only a certain amount of money there.
Prabhupada: But I can increase the price provided you pay me. But by printing, it is easier. But if you have to collect coins, that will be difficult, so there will be no artificial increase of...
Hari-sauri: Yes. Coins is a check...
Hari-sauri: ...on charging too much.
Prabhupada: That is wanted. And these rascals, they are artificially printing paper as money. And I am a rascal; I'm demanding more because I have got customer.
Ramesvara: The difference between Vedic culture and..., the Krishna conscious culture and the modern culture is very, very dramatic, very big difference. So the transforming of society...
Prabhupada: And besides that, if we concentrate in farm project there will be no need of exchange, because I'll be satisfied with my products. That's all. There is no need of exchange. Whatever I need, I get in my farm.
Ramesvara: Weaving, cloth.
Prabhupada: Everything I get. So I haven't got to go outside for exchange. If you are satisfied in your farm—I am satisfied—then where is question of exchange? There is no need of artificial... So this banking, "fanking," everything will collapse automatically. There is no money, who is going to keep money in the bank?
Hari-sauri: Who needs it?
Prabhupada: [laughs] So this artificial way of banking, that will be also collapsed.
purport, Srimad Bhagavatam 1.17.39: According to Srimad-Bhagavatam, gold encourages falsity, intoxication, prostitution, envy and enmity. Even a gold-standard exchange and currency is bad. Gold-standard currency is based on falsehood because the currency is not on a par with the reserved gold. The basic principle is falsity because currency notes are issued in value beyond that of the actual reserved gold. This artificial inflation of currency by the authorities encourages prostitution of the state economy. The price of commodities becomes artificially inflated because of bad money, or artificial currency notes. Bad money drives away good money. Instead of paper currency, actual gold coins should be used for exchange, and this will stop prostitution of gold. Gold ornaments for women may be allowed by control, not by quality, but by quantity. This will discourage lust, envy and enmity. When there is actual gold currency in the form of coins, the influence of gold in producing falsity, prostitution, etc., will automatically cease. There will be no need of an anticorruption ministry for another term of prostitution and falsity of purpose.
purport, Srimad-Bhagavatam 1.17.40: Thus the age of Kali began with gold standardization, and therefore falsity, intoxication, animal slaughter and prostitution are rampant all over the world, and the saner section is eager to drive out corruption. The counteracting process is suggested above, and everyone can take advantage of this suggestion.