This government printed so much money the mint workers went on strike!


Paris, France
August 18, 2015

I’m the world’s worst tourist.

To give you an example, I’ve been to Paris at least 50 times yet I’ve never been to the Eiffel tower.

The prospect of standing in line to look at stuff doesn’t thrill me in the slightest– least of all when that stuff happens to be the monuments of destructive monarchs.

Here in Versailles (which I’m visiting at the request of my parents) is an epically grand palace that remains one of the top tourist attractions in the world.

It’s one of the finest reminders of the largesse and stupidity of empires.

This colossally expensive, and self-centered palace was all for the benefit of one guy (Louis XIV) at the expense of everyone else.

And it’s this kind of largesse that ultimately bankrupted France.

It took time, but by the late 1700s France was completely broke and was borrowing money just to pay interest on the money they’d already borrowed.

In 1789, starving French peasants famously revolted and ousted the king. But as they soon discovered, revolution didn’t make their fiscal problems go away.

It doesn’t matter who’s in power. Debt will follow citizens around like a bad rash.

And so, the newly empowered National Assembly came up with a bold solution. They decided to print money.

The first batch was in April 1790 at 400 million units– a sum that was considered astronomical at the time.

And they promised that was all the money they would ever print.

Of course, they kept printing. And printing. And printing. They printed so much that the workers running the printing press actually went on strike from being overworked.

By 1795 they had printed some 35 billion units; almost a hundred times as much as they had originally promised.

(That number was so large at the time that they didn’t even have a word for ‘billion’; they just called it 35 thousand million.)

As you can imagine, this ultimately resulted in hyperinflation and the complete loss of confidence in the currency.

One of the greatest books ever written on the topic is Andrew Dickson White’s “Fiat Money Inflation in France”, originally written in 1876.

White wrote the book in hopes of convincing policy makers in the United States to avoid making the same mistakes.

Needless to say, they didn’t listen. And here we are more than a century later in the midst of one of the greatest financial bubbles in history.

I really recommend picking up White’s book. It’s a great read and it’s short.

I’ve read it several times, from which I’ve come away with three key lessons that I’d like to explore with you today.

1) It is the people themselves who ask for the instrument of their own demise. They cheer when their policymakers conjure something from nothing and make phony promises.

2) Yet even with all the central planning in the world, and the tightest capital controls, price controls, and information controls, you still can’t prevent the collapse of an unsustainable financial system.

Delay, perhaps. But never prevent.

3) Lastly, even when paper currencies are doomed to fail, they always go through periods of strength.

French paper currency in the late 1700s went through periods where it actually increased in value.

In 1792, for example, the currency surged 20% after the French army scored a major victory.

It was exactly the sort of thing to make politicians say, “See! Paper currency is a great idea.”

And yet it still failed, just as every experiment with paper currency always has.

The French episode highlights each of these lessons, and we’re seeing each of the same things unfolding today.

Listen in to today’s podcast as we explore each of these three lessons, as well as the solutions.

If you think the dollar is ‘strong’, you really need to understand this.

More importantly, we’ll talk solutions. Because the solutions today are the same as they were three centuries ago: get your money out of a bankrupt system.

The good news is that it’s easier than ever to do this.

Listen in here.

2 thoughts on “This government printed so much money the mint workers went on strike!

  1. “by the late 1700s France was completely broke and was borrowing money just to pay interest on the money they’d already borrowed.”

    I think the problem here, wasn’t fiat money per se but debt based private money issued by money lenders. Also it’s my understanding Louis XIV borrowed far more to pay for foreign wars than for Versailles. Instead of using taxation to raise the money, he borrowed it at interest from money lenders. He then tried to get out of debt by issuing his own money – so much that it led to inflation.

    Lincoln also issued interest-free fiat money (called Greenbacks) during the Civil War when the American people were being squeezed by the refusal of the banking aristocracy to issue enough money to keep the American economy going. Rather than creating inflation, it reduced deflation and helped a lot of Americans out of abject poverty.

    The only way to end current banking bubbles is to end the privilege of private banks to create money by issuing loans (every time you borrow money from a bank, the money is created out of thin air). There is absolute no check on the amount of money they create, which means bubbles is inevitable. You need to ban banks from creating money and restore that function to the public through their government representatives.

    In case you haven’t seen it, the film Money as Debt explains this pretty clearly.


    • Hello Dr. B, you are historically correct. No form of governance has ever been immune to debt. Money lenders, now banks have and always will manipulate the money supply due to greed and corruption. Ultimately society pays the price, we are in uncharted territory. What if the global monetary system is collapsing as gov’ts are printing money at an unprecedented rate, a race to the bottom. The “Fed” can give the illusion of control by manipulating interest rates, money supply, GDP, economic indicators, housing, unemployment numbers… but ultimately all countries collapse due to poor fiscal management, rising debt and irresponsible spending.

      Quick and dirty way of getting out of debt is to impose capital controls, devalue national currency, or worse case declare a bank holiday and seize private bank deposits to pay off creditors like in Cyprus. When a Cyprus bank went bust in 2013, the Government SEIZED 40% of ALL SAVINGS DEPOSITS OVER €100,000.

      Yet another scam which has never been done before is to impose a Global Monetary Reset. Read my latest post:


♥Thanks for sharing♥

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