Gertrude Coogan, Money Creators
FOREWORD To the American People :It gives me special pleasure to have the opportunity to explain the principles and purposes of this book,written by Miss Gertrude M. Coogan of Chicago.The facts that Miss Coogan was awarded a Master’s Degree in Economics and Finance by NorthwesternUniversity; was for eight years a Security Analyst for The Northern Trust Company of Chicago; thatfrom the beginning she had a deep desire to understand the fancied enigma of money, have given her agreat insight into monetary science.The basic principles of monetary science are simple. It is a sound axiom of monetary science that thevalue of money depends upon the available supply of money in relation to the goods to be exchangedwith it. Knowledge of the science has been made difficult by those who have converted these simpleprinciples into an enigma. They have done so with ponderous volumes written on prices and on theprocesses of production, transportation, distribution and allied topics; weaving into the subject matterdeceptive terms so that the public has been grossly misled by the use of words which contain acceptedfalse premises.The intentional use of deceptive terms has made monetary science obscure. For example; the so-calledmonetary experts and financial writers use the word Inflation to stigmatize justified expansion in thevolume of money, when Inflation actually means
expansion. They use Deflation, whichmeans justified contraction of a previous unjust expansion; that is, contraction of previous inflation, assynonymous with
contraction, in order to commend that unjust contraction.They use the word Money as meaning gold and currency alone, when the word Money really means, asWebster’s dictionary truly says : “anything having a conventional use as a medium of exchange and ameasurement of value.” That is, Money means bank checks and bank demand deposits principally. It isthrough this deceptive use of the word Money that they say there is no relation between the volume of money and our domestic price levels. It is with this false use of the word Money that they deny thequantitative facts of money.They use the term Gold Standard deceptively because the weight of the gold exchangeable for acurrency dollar has no standard measure of value, and cannot have. The value of a fixed number of grains of gold exchangeable for a dollar, fluctuates directly with the expansion or contraction of bank credit money. It was easy to fix the currency price of gold, but the creators and controllers of bank credit money fixed the goods price of gold.The number of grains of gold exchangeable for a currency dollar is of very minor importance from adomestic standpoint. It is only in the purchase of foreign exchange, the currencies of other countries,that the number of grains of gold exchangeable for a dollar is of vital importance. When other countrieschange the grains of gold exchangeable for their currency units, it is necessary that the United States dolikewise, if we wish to enter export markets.In a really scientific money system, gold should not have a fixed price. The number of grains of goldexchangeable for a unit of currency, in reality, should fluctuate as the purchasing power of the dollarsthemselves change. Fixing the weight of gold exchangeable for a unit of currency has been the meansby which the price levels of each country have been altered at the pleasure of foreign Bankers.
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