The Other Gold Standard

The Other Gold Standard

One of life’s little ironies is that there have been many instances in recent history when even the most rabid non-smokers have been desperate for tobacco.

The Other Gold Standard usually comes to the fore during times of economic hardship, high inflation, financial collapse, stifling taxation and extreme government controls.

The Other Gold Standard usually comes in two denominations:
Packs of 20 and Cartons of 10 packs.

Before the fall of Communism in Eastern Europe, for example, the benchmark brand used for The Other Gold Standard was State Express 555.

State Express 555, simply known as 555, is a brand of cigarette originally manufactured in the United Kingdom by the Ardath Tobacco Company.

The overseas rights to the brand, excluding the United Kingdom, were acquired by British American Tobacco (B.A.T.) in 1925.

It was sold widely throughout the worldcluding Belgium, Brazil, China, Hong Kong, India, Indonesia, Kenya, Mauritius, the Philippines, Russia, Saudi Arabia, Sierra Leone, Singapore, Taiwan, Thailand, Uganda, the United Kingdom, and the United States.

Today, the brand is still very popular in Asia, especially in the Greater China area (including mainland China, Hong Kong, Macau and Taiwan), The Philippines, Vietnam, and Cambodia.

Some resources suggest it is the most well-known and popular foreign brand in China.

My personal experience [back in the day] was that I needed State Express 555 to get me through the security controlling access to a particular embassy.

In those days, travellers could live “like kings” in Romania provided they had a plentiful supply of State Express 555 cigarettes

Keep tabs on what else may serve as hard currency.

Before the fall of communism in Romania, the extensive black market was based upon an unusual currency: State Express 555 cigarettes.

They were dreadful to smoke, but nobody ever did because – when sealed in cellophane – they were recognised as the best store of wealth.

Travellers like me took them in and lived like kings thanks to the king-sized cigarettes.

Money Talks: What to do when lumped with a €500 note
The Independent – Simon Calder – 7 December 2012

The cigarette was a serious unit of currency.

Currency, in many places, was not.

China was bad: an economist quoted by Sebestyen had it that, ‘In 1940, 100 yuan bought a pig; in 1943 a chicken; in 1945 a fish; in 1946 an egg and in 1947 one third of a box of matches.’

Hungary was worse.

Inflation ran at 158,000 per cent a day: one author ran to the nearest market to spend his advance on a chicken, a few veggies and a litre of olive oil because he knew it would have become worthless by the time he’d walked across the city.

How Hitler’s dreams came true in 1946
The Spectator – Sam Leith

Obviously, governments try to suppress all forms of The Other Gold Standard
1) They fear the freedom an individual enjoys when they use The Other Gold Standard.

2) They can’t tax income and wealth when individuals use The Other Gold Standard.

However, for everyone else, The Other Gold Standard [based upon State Express 555 cigarettes] was a wonderful invention because the currency had a dual purpose: it could be smoked for pleasure [and status] or spent like money without any government tax or interference.

Therefore, its unsurprising that Tobacco Control only “gained traction” four years after Germany acquired its merry band of apparatchiks from East Germany who thought that by banning smoking they could [eventually] eliminate The Other Gold Standard.

The German reunification was the process in 1990 in which the German Democratic Republic (GDR/East Germany) joined the Federal Republic of Germany (FRG/West Germany) to form the reunited nation of Germany, and when Berlin reunited into a single city, as provided by its then Grundgesetz constitution Article 23.

Apparatchik is a Russian colloquial term for a full-time, professional functionary of the Communist Party or government “apparat” (apparatus) that held any position of bureaucratic or political responsibility, with the exception of the higher ranks of management called “Nomenklatura”.

The World Health Organization Framework Convention on Tobacco Control (WHO FCTC) is a treaty adopted by the 56th World Health Assembly on 21 May 2003.

It became the first World Health Organization treaty adopted under article 19 of the WHO constitution.

The treaty came into force on 27 February 2005.

The idea for a multilateral treaty regarding tobacco control gained traction in 1994 at the Ninth World Conference on Tobacco or Health in Paris, France, when Roemer and Taylor presented their strategy for international legal action. Roemer and Allyn, along with Judith Mackay, were successful, and their proposal was adopted as one of the conference’s first resolutions.

In other words:

Tobacco Control is not about the health effects of tobacco.

Tobacco Control is about eradicating The Other Gold Standard [i.e. freedom].

State Express 555 clearly illustrates the point made by Martin Armstrong that anything can be used as money.

Ultimately, the definition of money itself is purely a medium through which an exchange between two parties takes place.

It is almost impossible to define money in terms of its physical form or properties due to the fact that money has evolved from a variety of items in different parts of the globe.

Money is anything that can be widely used for the purpose of making payments and permitting the accounting for debts and credits.

In essence, money is the physical language within a transaction in much the same manner as speech facilitates the emotional and intellectual communications within society.

In Asia and in Africa, cowrie shells became a prized possession thus lending itself to emerge as a medium of exchange due to its valued status within those societies.

In the case of China, the first forms of bronze coinage were cast in the shape of a cowrie shell thus retaining the familiar shape while combining it with a valued commodity – bronze.

Among other forms of money in primitive societies, we find everything from wampum (beads woven into a belt used for ornamentation) in North America, Yap disc-shaped stones with a whole in the center some measuring as much as 12ft (4m) across (used as late as the 1960s), and whale teeth (in Fijian society) and cattle, which were even used during the primitive periods in western culture as well.

We also find manillas (copper half rings) in west Africa which were ornamental metallic objects worn as jewelry that served as money as late as 1949.

From ancient Britain, early civilizations of the Celts used bronze rings as ornamentation as well as money.

In Santa Cruz, primitive money took the form of red feathers glued together on to a vegetable-fiber coil some as long as 30ft.
The value depended upon the brightness of the color.

The Origins of Money By Martin A. Armstrong

It is highly unlikely that pure gold coins will ever be used again as money because there isn’t physically enough gold to meet the needs of a day-to-day currency [and because governments can’t print gold out of thin air whenever they choose].

An estimated total of 174,100 tonnes of gold have been mined in human history, according to GFMS as of 2012.

This is roughly equivalent to 5.6 billion troy ounces or, in terms of volume, about 9,261 cubic metres (327,000 cu ft), or a cube 21 metres (69 ft) on a side.

However, its a possibility that inter-governmental settlements could once again be facilitated by some form of Gold Standard in the future.

A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold.

Most nations abandoned the gold standard as the basis of their monetary systems at some point in the 20th century, although many hold substantial gold reserves.

Perhaps the most important points raised by Martin Armstrong are:

a) Anything can be used as money provided the users have confidence in the currency.

b) Money produced by governments always have a declared value exceeding its production cost.

MONEY is whatever the people say it is for the other person has to accept it.

Peripheral economies imitated gold and silver coins of Rome and even made them heavier than the Romans.

If GOLD was the “money” then why are imitations heavier?

It was the CONFIDENCE in the Roman currency just as there is CONFIDENCE in the US dollar compared to everything else.

It was NOT the gold or silver in the coin or else they would have just traded lumps of metal.

As soon as a government coined gold, it became fiat for they declared its value to be greater than it cost them.

Starting to Get It – Great News by Martin A. Armstrong

Therefore, it unlikely that investing in gold coins will prove to be very successful in the long term because if governments ever do decide to return to some form of Gold Standard then they will simply confiscate your gold coins [as per 1933] before they become too valuable.

Executive Order 6102 is a United States presidential executive order signed on April 5, 1933, by President Franklin D. Roosevelt “forbidding the Hoarding of gold coin, gold bullion, and gold certificates within the continental United States”.

The effect of the order, in conjunction with the statute under which it was issued, was to criminalize the possession of monetary gold by any individual, partnership, association or corporation.


Therefore, the art of survival sometimes depends upon owning [or producing] something that can used as The Other Gold Standard [outside of government control or when there’s no government].

Gallery | This entry was posted in Economics, History. Bookmark the permalink.

2 Responses to The Other Gold Standard

  1. Money is required when things are scarce.
    Artificial scarcity has been created for some time.
    This may be due to a wise King of the World, who has ordered that granaries be filled.
    Communism is expensive. With endless energy, everything is cheap. Sharing confers spiritual enrichment. Greed does not need to be the prime motivator.

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