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History Shows That Bitcoin’s Sound Money Standard Benefits Society – Bitcoin Magazine

It is well established at this point that bitcoin is the best form of sound money the world has ever seen. To recap, bitcoin excels in each of the qualities of money: durability, portability, divisibility, uniformity, scarcity and acceptability. Most importantly, bitcoin is the scarcest money ever, with a fixed supply of 21 million bitcoin that will ever exist. Regardless of demand, the supply is programmatically defined and will never be changed.

This article focuses on why having a sound money system is important. How do economies, societies and individuals benefit from operating on a sound money system? Throughout history gold has been the most successful form of sound money. It is my belief bitcoin will be the sound money of the future.

Sound Money Imposes Fiscal Discipline On Governments

Sound money imposes fiscal discipline upon governments. Having a monetary system with a sound money base means that the money supply cannot be inflated at will by use of the printing machine. In turn, for governments to spend, they must provide value to their citizenry equal to the amount of tax revenue collected. Under a sound money system forever wars are not feasible, zombie companies (unprofitable companies still in business solely due to bailouts) don’t exist and individuals’ savings cannot be debased at will by bureaucrats.

Contrast the way in which governments must operate under a sound money system to how they operate today on an unsound (fiat currency) system. Forever wars are financed by endless money printing, zombie companies of all shapes and sizes are bailed out time and again, and individuals’ savings are debased at breakneck speeds.

Case in point: over 40% of all U.S. dollars in existence were printed between May 2020 and May 2021. To hammer the point home, this means that anyone holding U.S. dollars in that time period saw the value of their wealth drop by over 40%. Going back in history even further, since the dollar was created, it has lost over 96% of its value.

With sound money, the opposite phenomenon occurs, value is stored into the future without debasement, and purchasing power increases over time.

Sound Money Propels Economies To Flourish

Economies flourish under sound money systems. When the unit of account is stable, and not manipulated at will by governments, economic actors enjoy increased ease of trade, increased levels of savings and generally higher levels of prosperity.

With the benefit of efficient economies, higher savings rates and increased prosperity, individuals and societies have the benefit of planning for the future, as opposed to constantly reacting to the present. This, in turn, leads to advancements in everything from architecture, literature and engineering to arts and sciences.

To demonstrate this point, we turn to two periods of history: the Golden Age of Rome, and the United States pre-1971.

The Golden Age Of Rome

The Golden Age of Rome existed under a sound money system. The aureus was the basic monetary unit of ancient Rome and the Roman world from the 1st century BC to the 4th century AD.

The aureus was made of gold, the soundest money commodity of the time. Under a sound money system, Rome’s Golden Age flourished and led to many groundbreaking achievements that the world has since benefitted from, including breakthroughs in architecture, such as the systemic use of the arch, which changed the way buildings were constructed forever (the Colosseum and the Pantheon were built during this period).

Additionally, there were breakthroughs in engineering, such as using aqueducts to funnel water into cities for drinking and irrigation purposes. The Romans also did things like develop the first legal system and build the most sophisticated system of roads the world had ever seen. Literature and art flourished, and the modern calendar was developed. Eventually, as has always been the case throughout history, the government moved off of a gold-backed sound money system and debased the currency, ultimately leading to the fall of the empire.

The United States Pre-1971

From 1879 to 1933, the U.S. was on a gold standard. All currency in circulation was backed one-to-one with gold held by the Federal Reserve.

Then, in 1933, President Roosevelt ordered all gold to be turned into the Federal Reserve for the set price of $20.67 per ounce. In 1934, the government arbitrarily increased the price of gold to $35 per ounce, effectively increasing the gold on the Federal Reserve’s balance sheets by 69%.

This increase in assets allowed the Federal Reserve to inflate the money supply. The government held the $35 per ounce price until August 15, 1971, when President Richard Nixon announced that the United States would no longer convert dollars to gold at a fixed value, thus completely abandoning the gold standard. How has the U.S. fared since 1971? Let’s look at some charts.

A sound money standard, like that of bitcoin, has numerous benefits for society in comparison to inflationary, fiat-based standards.

Compensation has not kept pace with the increase in productivity. Image source: https://wtfhappenedin1971.com/.

A sound money standard, like that of bitcoin, has numerous benefits for society in comparison to inflationary, fiat-based standards.

Income growth has been skewed ever more towards the top 1%. Image source: https://wtfhappenedin1971.com/.

A sound money standard, like that of bitcoin, has numerous benefits for society in comparison to inflationary, fiat-based standards.

Cost of living has skyrocketed. Image source: https://wtfhappenedin1971.com/.

A sound money standard, like that of bitcoin, has numerous benefits for society in comparison to inflationary, fiat-based standards.

Inflation has accelerated at an increasing rate. Image source: https://wtfhappenedin1971.com/.

A sound money standard, like that of bitcoin, has numerous benefits for society in comparison to inflationary, fiat-based standards.

Federal debt as a percentage of GDP has skyrocketed. Image source: https://wtfhappenedin1971.com/.

A sound money standard, like that of bitcoin, has numerous benefits for society in comparison to inflationary, fiat-based standards.

Federal debt has soared from well under $1 trillion to near $30 trillion today. Image source: https://wtfhappenedin1971.com/.

Contrast this with how economies function under a sound money system to how they operate today. The unit of account constantly fluctuates which makes trade unnecessarily complex and inefficient.

Take, for instance, the $6 trillion-dollar-plus foreign exchange market. Governments and companies employ millions of people who focus solely on currency conversions, international payment settlements, foreign currency reserve management, and on and on. None of that wasteful complexity exists on a sound money system.

Additionally, savings are near non-existent. Most U.S. savers have less than $5,000 in their bank accounts. Are people free to think long term and plan for the future when any type of financial setback will wipe out their savings completely? No, and analyzing the state of affairs across the world makes this painfully apparent.

Sound Money Benefits Individuals

Individuals living under a sound money system have many benefits, some of which we discussed above. Free from having to run ever faster and work ever longer in order to keep pace with the devaluation of their savings, individuals have the chance to focus on activities that benefit society. Under sound money systems, families have tighter bonds, communities grow stronger and individuals have the capacity to explore the arts, sciences, engineering and literature in a way that leads to breakthroughs that will benefit their societies as a whole.

Contrast the quality of life for individuals under a sound money system to the quality of life today. Social unrest is palpable. Political division is extreme. Physical and mental health problems across the globe are alarmingly commonplace. Why? Fifty-plus years of operating on an unsound money system have taken a toll on the world. Thankfully, we now have the opportunity to return to a sound money system via the soundest money on earth, bitcoin.

The Bitcoin Sound Money Standard

A world under a bitcoin standard would look vastly different from today. Most importantly, the system will benefit all participants. A key aspect of bitcoin from this standpoint is that there is close to no inflation. Removing the ability for governments to print money will greatly reduce the wealth gap, which is the cause of many societal issues we see today.

Bitcoin also incentivizes saving and proper money management. There are no bailouts under a bitcoin standard. Personal and corporate responsibility will be paramount to success. Savers will no longer be punished for saving diligently only to have their savings debased on a whim by central bankers. People will be free to plan for the future knowing that the unit of account is stable and unchangeable.

Under a bitcoin standard, one is not penalized for patience and has no urgency to deploy capital. This incentivizes companies seeking capital to create real value before raising money in capital markets. This in turn will eradicate zombie companies subsisting only because they are beneficiaries of the easy monetary policies of today.

Bitcoin will also restore sanity to equity markets. Currently, equities are measured in dollars, which are an ever-growing unit of measurement, making it impossible to do any kind of rational valuation analysis of a business. Under a bitcoin standard, the unit of measurement that companies cash flows and valuations are measured in becomes a constant. The gravity of this cannot be emphasized enough.

Bitcoin encourages limited governmental control and spending and will initiate a shift toward an age of self sovereignty. This age of sovereignty, along with the necessity for governments to provide value to their citizenry, will cure many of the ills we see today due to the vast amount of wasted and misappropriated government spending.

Lastly, having bitcoin as a global reserve currency will empower more than just the United States. It will especially benefit citizens in countries with hyperinflated currencies (Venezuela, Zimbabwe, Argentina, etc.), as well as countries oppressed by dictatorships and other non-democratic forms of government. Fortunately, bitcoin gives the global citizenry another choice for storing their wealth.

I know what I’m choosing. Do you?

This is a guest post by Don. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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Court Orders Ex-CZI Boss Zizhou To Pay US$180 000 For Sexual Harassment – New Zimbabwe.com

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By Mary Taruvinga


FORMER Confederation of Zimbabwe Industries (CZI) chief executive Farai Zizhou has been ordered by the High Court to pay his ex-personal assistant Rita Marque Mbatha US$180 000 damages for sexual harassment.

This follows a spirited fight by Mbatha over the past two decades after she was sexually harassed by Zizhou during her time of employment with the CZI.

Mbatha had claimed US$500 000 from both Zizhou and CZI. However the law suit against the CZI is yet to be finalised.

She worked at the CZI between 2002 and 2003 and Zizhou made sexual advances to her.

In delivering his judgment, High Court judge, Justice Martin Mafusire said he was impressed by how Mbatha pressed on against all odds.

She said  Mbatha, now an International Alliance representative, and human rights advocate was a strong woman who had fought for justice.

“The matter has had a long and turbulent history. Mbatha says the wheels of justice have turned ever so slowly for her. There can be no denying that. She has been to this court. She has been to arbitration,” the judge said.

“She has been to the Supreme Court. She is back to this court. She strives for closure. Any lesser mortal would probably have given up. Plainly, the Mbatha is no lesser mortal. Her tenacity and fighting spirit have moved mountains. She is still fighting. This judgment only settles her case. The other half still continues.”

Mbatha alleged sexual harassment of female employees at CZI was rampant, and said Zizhou was the sole culprit.

“The sexual harassment was over some nine months. It started when she was still on probation. She got employed by the second defendant in September 2002.

“She got fired in July 2003. It was an unfair dismissal. The first defendant (Zizhou) engineered it all. He schemed it. She had reported him for sexual harassment. He took revenge.

“The charges were inappropriate touching, unwelcome offensive jokes, invitation by innuendo to an inappropriate sexual relationship, receiving offensive telephone messages, receiving pornography on the computer, an attempt to kiss by force, causing an injury on the thigh in the process of resisting,” reads the judgement.

According to electronic messages submitted during the application, Zizhou pestered Mbatha to give in to an affair despite the fact that they were both married.

“Rita, I have used the above caption just in case. Please delete completely immediately after reading. Look at the time I am sending this note-just to show you I could not sleep before writing this note to you Rita.

“I love you very much and wish you could be mine. When I am taking a bath with Clara I always pretend it’s you. The torture is unbearable. It hurts me that when I touch your lovely hand you cringe and ask me to stop. Do I repulse you? I desperately need to kiss you,” Zizhou wrote in an email to Mbatha.

“Shamwari if I do get dismissed, it will be because I would like to do whatever I can for the person I care for most, you. Right now I am under pressure to balance the budget of CZI.

“You have just completed your probation and according to CZI rules, you are not eligible for the general increase for permanent staff, but the small adjustment that is in your appointment letter, I am bending the rule for you.

“Please hold on tight to me – if we crash – we crash together. I am awarding you the same percentage increase as everybody else. I am defending it against the treasurer this morning. Doing so will cost CZI an extra $3 million in employment and other costs for the three people involved.

“The others are lucky to be associated with you. This will wipe out the surplus we were going to make after selling the Land Rover. The treasurer had made his recommendations following the rule and I have asked Venek to make the changes before he comes for the final meeting this morning.”

Zizhou added: “I feel guilty as it is not right to expropriate you from your husband but unfortunately… Please God help me on this one as it has been giving me sleepless nights. You are the love of my love. I will do anything for you.”

The arbitral tribunal in March 2014 found Mbatha was unfairly dismissed and sexually harassed by Zizhou. Psychiatric reports obtained from Mbatha’s doctors noted that she was severely traumatised by the experience.

Justice Mafusire ruled Mbatha suffered severe posttraumatic stress disorder as a result.

“This condition manifested almost immediately after the abuse. She experienced recurrent involuntary and intrusive memories of the traumatic event. Her pain was acute, with chances of recovery rated as being very poor. Treatment would be extensive and indefinite.”

“She suffered physical and emotional pain, which scarcely suppressed anger. During the counselling sessions, she would lose track of her answers midway through and would ask that questions be repeated,” reads the judgment.

“Before the incident, she was engaging, outgoing, and loved reading. She had a good sense of humour. All that is gone. She experiences recurrent nightmares. Her sleep is broken most nights. She has lost all confidence in herself. There was another kind of collateral damage. She says her marriage broke up, largely because of the change in her personality.

“She says the situation was further compounded by the defendants’ conduct after her unfair dismissal. She could not secure alternative employment thanks to the defendants’ negative testimonials to her potential prospective employers. The plaintiff’s case seems such a textbook case. Manifestly, no amount of money seems adequate enough to compensate for her loss,” the judge said.

“The sexual harassment was persistent. There has never been an apology.

“Taking all factors into account, it is considered that the proper level of damages for the sexual harassment perpetrated by the first defendant upon the plaintiff during the period of the plaintiff’s employment with the second defendant from September 2002 to June 2003 is US$180 000, or the equivalent thereof in local currency, convertible at the inter-market bank rate at the time of payment.

“The first defendant shall pay the plaintiff the amount aforesaid together with interest at the prescribed rate from the date of this judgment to the date of payment. The first defendant shall pay the plaintiff’s costs of suit.”

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Civil servants get forex bonuses, decry high bank charges – The Herald

The Herald

Africa Moyo-Deputy News Editor

Civil servants’ representatives are generally excited that their members have started withdrawing their US dollar bonuses, but are upset that some banks are deducting significant bank charges despite the instruction that such accrued charges should not be deducted from bonuses.

These are bank charges of anything between US$100 and US$200 on accounts that were opened last year when Government was paying its workers a cushioning allowance in foreign currency. 

The account holders then retained the accounts although there was no money in them and the banks continued to levy charges, only collecting these when the bonus money arrived.

The levying of accrued bank charges is despite communication from the Ministry of Finance to the Reserve Bank of Zimbabwe last week that there should be no backdating of bank charges. 

In an interview yesterday, Zimbabwe Teachers’ Association (Zimta) chief executive officer Dr Sifiso Ndlovu said while their members were getting their US dollar bonuses, the charges needed to be removed altogether since the forex bonus is a once-off cushion from President Mnangagwa.

“What I have gathered is that a number of banks have released the US dollars and people are getting it,” he said.

“But I heard that some of the money has been chewed by bank charges, which I think should not be an issue since this was a once-off payment. The bank charges are the downside to the excitement we have over the US dollar bonuses.

“The Finance and Economic Development Minister (Professor Mthuli Ncube) said he would look into the issue of bank charges and we duly call upon him to do so, so that civil servants take home all their money.” 

Permanent Secretary for Finance and Economic Development Mr Mr Guvamatanga last night said the ministry sent communication to the Reserve Bank last week directing that banks should not backdate bank charges.

Mr Guvamatanga

“Some of the foreign currency accounts were opened last year when Government was paying some US dollar incentives to civil servants.

“The accounts remained open and since then, they have been accruing bank charges. Now, some greedy banks want to backdate the charges to last year, but we have directed them not to backdate the charges,” said Mr Guvamatanga.

He added that some banks were lying to their clients that they had not yet received foreign currency from the Reserve Bank, for as yet unknown reasons.

A comprehensive statement on the payment of US dollar bonuses is expected from the Ministry of Finance today. 

Public Service, Labour and Social Welfare Minister Professor Paul Mavima told The Herald last night that the payment of US dollar bonuses was on-going although some employees have challenges with their foreign currency accounts.

Prof Mavima

“By and large, the withdrawal of US dollar bonuses is going on smoothly,” said Prof Mavima.

“But I have to say that the demand for cash is quite high and you see long queues for cash at banks. However, this is a good challenge.

“We urge banks to avail as much cash as possible to civil servants at one go, so that they minimise the number of times that people go to the bank to save transport costs.” 

President Mnangagwa decided on a once-off payment of US dollar bonuses for civil servants and Government pensioners to cushion them from the fluctuating exchange rates, which eroded the value of their earnings.

Government says paying bonuses in US dollars was ideal to ensure that they don’t take their earnings to the parallel market to buy forex, a move that would erode their earnings.

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RTG subsidiary creates revenue streams for social influencers – NewsDay

BY WINSTONE ANTONIO
GATEWAY Stream, a subsidiary of the Rainbow Tourism Group (RTG), yesterday launched a platform that will enable social influencers to monetise their brand equity on the Gateway Stream platform.

The Gateway Stream is Zimbabwe’s one-stop online marketplace with nine sub-applications across a diverse range of products, services and experience.

Through the Gateway Stream Social Influencer, artists will be issued with an account and a promo-code and they will be able to sell all products found on the Gateway Stream platform and earn a commission from the sales.

In his address at the launch, RTG group chief executive Tendai Madziwanyika said they aimed to help social influencers exploit the valuable asset they had, that is, access to markets, in a way that ensures that they monetise their brand equity.

“Social influencers have what corporates want, a defined market and reach, which they access in an effective, cost-effective way,” he said.

“Through the Gateway Stream Social Influencer, artists will be able to sell a diverse product range found on the Gateway Stream platform from groceries, hardware, clothing, hotel accommodation, adventure activities, food and drink, and short-term insurance and earn a commission from the sales.”

Madziwanyika said it was time for social influencers to make money from their brands using music and entertainment as a hook.

“The sky is the limit for opportunities which our local social influencers can explore on Gateway Stream.

“Imagine just converting 1% of their following. They will be well on their way to becoming millionaires.”

Gateway Stream general manager Taremeredzwa Chipepera said so far they had registered over 30 social influencers, ranging from musicians to comedians.

“Instead of being just brand ambassadors for different companies, they can earn passive and perpetual income directly from their networks,” he said.

“This initiative is a mutually beneficial partnership that will drive traffic and sales volumes on the platform.

“We are driven by the desire to help social influencers gain greater value from their social networks.”

He said a follower of the social network would quote the promo-code when processing a booking or making a purchase on Gateway Stream.

“Once a member completes a purchase by way of payment, the agreed commission level for the specific product category will be credited to the social influencer’s account.

“The more sales the social influencer makes, the more money they stand to earn,” he said.

Chipepera said Gateway Stream was working on the development of a portal which would enable social influencers to have backend access where they can load their products, view transactions under their promo-code, track their commission and request pay-outs from their account.

“Besides the products on the platform, social influencers can also have an opportunity to brand and sell their own memorabilia such as clothing lines, perfumes, et cetera on the Gateway Stream platform,” he said.

  • Follow Winstone on Twitter @widzoanto

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