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For Whom the Gold Bell Tolls by Bill Baker
Gold
Tuesday, February 2, 2010

Gold began a secular rally at the beginning of this century coincident with the primary top in the financial markets driven by the mania of internet stock investing. That mania attracted capital from around the globe into the United States, setting the dollar's value at a high that is unlikely to be seen again for some time, if ever. Consequently, the financial media has mostly attributed the overall rally in the yellow metal and its daily ups and downs to dollar weakness vis-à-vis other developed nation currencies. Traders have followed suit, betting on this correlation.

The dollar's demise has been linked to the necessity for the Federal Reserve System to print money in order to restart the credit market from its freeze of late 2008. Armed with generous injections of money from the Federal Reserve System, traders at institutions deemed "too big to fail" and their customers have continued to follow this correlation, favoring the "reflation" and "carry" trades.

But at the start of 2010 the dollar looks oversold. Technical trading indicators, exchange rate parity, and a building crisis within the eurozone have coalesced to cause participants in the gold market to pause, fearful of having the dollar move against them. The large mass of money supposedly protected by risk modeling and ever mindful of correlations has also begun to unwind its bets and even consider going in the opposite direction.

If indeed markets are beginning to fixate on a new set of underlying drivers, gold may still show strength. But the story would need to morph completely and enter a third phase, one which is not dollar-centric and recognizes the failings of all centrally administered currencies, a profane thought that is unmentionable inside the four walls of any institution deemed too big to fail. Ultimately trading will resolve itself in the direction of the underlying fundamentals. However, markets are glutted with large and artificially produced waves of cash produced out of thin air by central planners at the Fed and the Treasury, veiling the organic course of business with a second, now more powerful vector that has made forecasting trickier.

Dollar weakness may be the most oft-cited explanation for gold's price direction, but other more influential underlying factors are at work. These have been resurgent through the first decade of this century, and if they intensify they would emerge as the primary driver of gold's direction from here. Should the dollar stabilize or gain some lost ground against other major currencies, yet gold continued its rally, proof positive would exist for the return of gold as a global vessel of wealth and as a shadow currency. That this would likely happen in a low inflation environment in the United States would doubly validate the case that capital is seeking stability and relief from intervention, manipulation, and reliance upon faulty economic and political theories pursued by central planners. However, in emerging economies, where money supply growth has been clocked at record speeds in comparison with growth rates of other currencies through the last few centuries, a more classical inflationary meltdown might arise, also stimulating demand for physical gold.

Three Phases

The first phase of the gold rally was powerful, fueled by observed inflation acceleration and a recovery from a multi-decade oversold condition when the market had been absorbing supply from forward selling and central bank disgorgement, among other dynamics. The second phase, essentially a consolidation period which began in 2008, was torturous but it resolved to the upside. Amid the collapse of the financial system, gold was mistaken for being a rote commodity. Like copper or oil, when economic activity buckled, it did also. When the pace of business showed green shoots, it rose anemically.

Its breakout to new highs in late 2009 saw a very modest gain compared to the bull run of commercially used commodities. This development happened because investors witnessed a new phenomenon. They saw mega-expansion of the monetary base and concluded, like Milton Friedman did, that inflation is everywhere and everywhere a monetary phenomenon. Some prophesied substantial inflation, even hyperinflation, but the tepid advance was recently shortened amid news that growth was picking up without any palpable inflationary consequences. Most gold bulls maintain that inflation is related to monetary growth, and they warn us that the roughly $1.3 trillion of new bank reserves printed by the Fed since the crisis hit in 2008 could be highly inflationary. Their underlying assumption is that the flooding of high-powered bank reserve money into the system will be multiplied through fractional reserve lending to be ten or more times as great as the original injection.

Surprise is the element that causes swift and forceful moves in financial markets, or wars for that matter. In the third phase of its bull market gold may very well reveal its true colors; it is less a consumer commodity mainly for female adornment and more the world's only impartial vessel for wealth that transcends borders, credit, and government restrictions upon financial behavior. Although regulations remain plentiful and risk modeling is more sophisticated than ever, safeguards backfired. Think of derivatives and the invention of new types of consumer and mortgage loans, changeable and manageable with just a few keystrokes.

At the start of 2010, most financial market actors who have sold gold fear a dollar rally, or they are not buying because inflation is weak. That gold would be a refuge when leverage unwinds would surprise the public and most financial market participants, because it is an abstraction and a long shot presently. Or they simply don't think leverage will unwind, because markets are healing. Trained to think in terms of permanent Fed-stimulated monetary expansion, a world wherein demand for money rises and desire for investments and speculations falls is absurd. Thus, a surprise is possible, even though the arrival of such a condition was telegraphed in 2008.

All Loaned Up

With debt approaching 400% of national income, our banks are all loaned up, with neither borrowers nor lenders interested in taking on additional commitments whose servicing requirement is a stretch relative to income. Moreover, this is the case at historically low interest charges, especially as attested to by the Japanese experience. There the pernicious effect of low interest rates has created a grotesque force-feeding of debt to that country's people, which is only possible when there is barely any interest cost at all to going deeper into debt. The United States is falling into the same pattern. Here, thanks to Fed manipulation, our government is charged a near zero rate, which sends the signal that borrowing is free. Through its sale of notes, the government is confiscating capital and sending it through the shredder of the public trough, never to be reassembled as principal repayment.

Although the Fed is somewhat accommodative through buying government debt and mortgages, it has by no means offset most of the monetary destruction through the above consumption of savings. The $1.3 trillion added to the monetary base since the beginning of the crisis has caused M3 to grow by only about $260 billion over the last twelve months to some $14.4 trillion (through October 2009, according to Shadow Government Statistics). The monetary destruction that accounts for the difference of roughly $1 trillion represents fractional reserve contraction caused by loans failing, or debt repayment funded by asset sales entered into by a populace interested in selling assets in order to reduce the debt that is financing them.

The Fed's artificial bidding up of credit has spilled over into the equity market. And in the real world, the housing market has been stimulated by the homebuyer credit and subsidized agency mortgages. Nearly all conforming mortgages issued in 2009 were bought by the Fed or the agencies. In its typical sunny southern California way, on December 9, 2009 the UCLA Anderson Forecast published a projection of a 48 percent increase in housing starts in 2010, owing to low rates and increased demand. Just what we need in an overbuilt market!

The Contrafactual Case

From the peak of the internet bubble in 2000 to the advent of the financial meltdown in 2008, the broad money supply (M3) roughly doubled, from $7 trillion to $14 trillion. The odd thing about the doubling of the broad money supply in the seven years leading up to the crisis is that it caused inflation of less than three percent annually.

Some assert cleverly that the consumer price index (CPI) understates inflation by several percentage points at least. But a close look at the methodology suggests that simply applying a delta between actual and reported inflation measurable many years ago to today's statistic may not be valid. Synthetically imputed homeownership costs may have been repressed when the market was booming and extrapolated rental cost was linearly extrapolated. But with real estate markets teetering on a collapse, anyone could find a cheaper place to live or do business if they could get out of their mortgage or lease. When bureaucrats trend line these expenses for today's CPI, they might even overstate inflation.

Moreover, no one can really know what the inflation rate actually is for you or for me. For WalMart shoppers, the purchasing power of the dollar increased. For buyers of new homes, it collapsed until about 2007. For those who dine at McDonalds, prices remained under control. Now there is a $1 value meal - mimicking the deals available decades ago when fast food was a category killer.

One has to wonder about the contrafactual case. What would have happened if the Fed had held broad money growth to the low single digits? Consumer prices would have fallen considerably, maybe by as much as five percent annually. Why? Because the six billion of the world's population who live meagerly desire to exchange their labor for maybe $2 per hour, and they dwarf the roughly 700 million who earn a median income in the mid-five figures in Europe and North America by a factor of nine-to-one.

This won't change, and it is profoundly deflationary for wages and consumer prices, but not necessarily for a host of commodities and the profits of businesses, which nonetheless are still hostage to the credit cycle. Capital is betting on it in a big way. From 2000 to 2007, the market capitalization of the world's equities doubled, yet the U.S. stock market did not increase in value. Now it comprises less than half the total. Prior to this decade, capital was scarce for the BRIC nations, because it was not allowed to flow freely in undemocratic regimes, and knowledge necessary to encourage entrepreneurism and promote technical competence was not disseminated effortlessly through the internet.

The $1.3 trillion injected by the Fed occurred over a little more than a year. Were it to continue for seven more years without further stretching debt-to-GDP beyond its stratospheric near-400% ratio today, the money supply would only grow half as fast as it did before the crisis. The lynchpin of the case for inflation advanced by John Paulson, the hedge fund manager famous for betting on the sub-prime meltdown, is the historical correlation between the monetary base and consumer prices. However, his data is historical, and it only contains a period beginning when far less leverage was in the system, progressing through decades when borrowing was substantially increasing relative to income. It was most certainly not derived from history when debt-to-GDP was flat or falling.

Inopia Nommorun or Nommorun Caritas?

As explained in my recent book, "Endless Money" (John Wiley & Sons, 2010), in U.S. history there is a pattern of long waves where demand for money balances - or in the opposite, credit - rise and then fall. It is likely we have begun a stage when we prefer accumulating money over credit, but it is being forestalled by big government spending and borrowing. The pattern of the Fed injecting money into the banking industry's reserve base getting consumed by the money multiplier working in reverse will continue, where heavily leveraged asset holders hit propped up bids and use the proceeds to reduce debt. Actually, the phenomenon is common to empires whose treasury or central bank manufactured new money abundantly. The Romans, with their prolific silver mines and conquests, had phrases for each: Inopia nommorum described times when credit expansion pushed up the value of assets relative to coins; nommorun caritas was when those holding money could buy cheaply.

No one can be completely sure, and that is what makes markets so fascinating. Respondents to the inflation-deflation poll running on the ConservativeEconomist.com web site show 55% think more inflation is in store, but 35% believe deflation will surface by year-end. Never in the memory of current participants has the investment community entertained such sharply divergent macroeconomic opinions.

The prediction of hyperinflation runs counter to observations of past panics described in "Endless Money" and in my articles published on www.ConservativeEconomist.com and on the www.mises.org web sites. After an up-cycle of using credit to chase asset prices, which can last for a generation or two, heavy indebtedness eventually overwhelms deliberate attempts by policymakers to maintain high prices achieved through debt fueled speculation. Only preposterous money production (such as in eighteenth century France or the Weimar Republic) could counteract this tendency.

The most compelling narrative of that eventuality is well described by John Williams of Shadow Government Statistics, especially in his Hyperinflation Special Report dated December 2, 2009. Closely monitoring the GAAP-based financial statements of the federal government, he makes the astonishing observation that when the figures for 2009 are released (they have been uncharacteristically delayed for two months), the GAAP "loss" incurred by the government will approach $9 trillion.

While the cash loss is only about $1.4 trillion, he implies the GAAP figure telegraphs a government budget spiraling out of control such that the annual liabilities are now nearly equal to the entire GDP produced by its people. The refunding crisis that could result, with Treasury notes being issued in shorter and shorter durations, would pressure the Fed to expand its quantitative easing considerably. Implicit in this argument also is that dollars provided by the central bank to buy government notes would be passed on to the hands of government contractors, so these recipients would circulate them into the economy rather than seeing them lie fallow in bank reserves.

But while this scenario is possible, it rests on the flimsy assumption that stimulus beneficiaries would behave differently than players enjoying the Fed's monetary injections in the capital markets today. In 2009 the pet banks of the Fed used freshly minted reserve notes to arbitrage what was once a yawning gap between a risk-free rate applied to the cost of funds and yields provided in credit securities, or to earn the "carry trade" available between that same nearly free cost of funds and long-term or foreign securities of comparatively higher yield.

However, when the party switched into high gear on Wall Street, Main Street sobered up and drove home early, repaying debt with asset sales attested to by the excess of $1 trillion of broad money supply destruction that has occurred since the crisis began, as detailed earlier. Moreover, the prodigious production of GAAP liabilities is not cash flow. Rather, these are promises to remit money at a later date, which does not require refunding.

John Williams may be on to something when he warns of a day approaching when the Treasury could no longer sell notes at a risk-free rate, if at all. If printing by the Fed were forced up several notches in response, the question will be whether the public would remain sober, repaying its debt, which was accumulated in past decades under the auspices of having a federally guaranteed one-way betting parlor. A trillion here or a trillion there still pales in comparison to some $40 trillion amassed over that time by the private sector and the over $10 trillion issued by government. Whether or not it reaches the pockets of an increasingly unemployed public through the capital markets or via the fiscal stimulus of Obamanomics, what difference does it make? If water gets into the tub from the showerhead or the bath spigot, does the drain care one way or the other?

When the Fed manufactures electronic dollars and donates them to pet banks, it does nothing other than to subsidize employment for an overstuffed industry of providing credit and to make Wall Street speculators whole. It changes nothing among the residents of Main Street, who are still obligated to pay their new landlord, the government bank or agency that snapped up mortgage securities with the purchasing power of newly counterfeited money. The same amount is due each month. Bonuses may rise at a select few firms at the center of finance, but there is no increase in income engineered for anyone else.

Even a big Keynesian government spending program that might pump dollars out of the Fed's well onto the land from sea to shining sea would go to workers desperate to repay mortgages. Is it rational for these workers to go deeper into debt and play the greater fool in a real estate market still soggy with a generational monsoon of credit? As prices fall, doesn't the incentive to walk away from an upside-down mortgage rise? How on earth does transferring ownership of a mortgage to the same gang that owns the IRS have any positive effect upon the value of the underlying asset?

Hoarding

Of course, not everyone in America participated in amassing the $40 trillion of private debt in recent times. Some had foresight, and others had windfalls from careers on Wall Street. These wise souls were mostly seniors who saved for their golden years, often having hit the bid on their homes and having moved into a small retirement space requiring less effort to maintain.

The great classical economist, David Ricardo, observed that if holders of money felt that a substantial quantity of assets was held in weak hands, they would anticipate lower prices and be inclined to stockpile money rather than expend it on assets or consumption. They might also hoard if they were uncertain about their job or prospects for insolvency.

If gold were not present to govern actions, then only paper would be available for hoarding. Since paper is intrinsically worthless, in inflationary times it would be rapidly exchanged for oil, copper, real estate, or other hard assets used in commerce, or the ownership of businesses through stocks, unless gold or silver were available. The reflation of the credit bubble in 2009 is understandable in this context.

Banks recycled deposits into real estate investments. Therefore, the deposits of electronic Federal Reserve notes in banks have a value that is ultimately linked to this collateral, especially since actual money is not at these banks - only a promise to remit it once mortgages are repaid. Because income governs the ability to honor promises made, so too would taxes be difficult to collect to subsidize the banking system. Thus, in an unraveling of a credit bubble, gold would be vastly preferred over electronic deposits. Does the hoarder care if there is no inflation? If the money isn't physically there in the bank, then it's simply academic whether its purchasing power could be inflated away, or if its value disappeared because it was already gone to begin with.

Furthermore, what if unemployment, foreclosure, and a newfound aversion to credit has begun to lurk as the greater force of deflation and intervention? Might not the value of commodities, equities, and bonds have escalated by the bloating of credit under a fiat currency system, which presents a one-way bet on using debt? Should these prices be trusted by those who are holding money balances and who are not encumbered by debt, who must be few in number given that debt is nearly four times greater than national income, or twice the ratio achieved in 1929?

The consensus that developed in the second phase of the bull market in gold first drove the gold price down in late 2008 by the logic that it would be less needed by a nation of paupers; then that same thinking lifted it in 2009 based upon the fear of inflation. Is that market response rational in light of the classical economic theory espoused by Ricardo? It can only be so if gold jewelry demand did behave rationally in 2008, falling amid rising prices, but gold money demand must have been non-existent.

Once the global nature of the currency problem becomes evident, the age-old use for gold could become apparent. It has utility for steering clear of a meltdown in the value of deposits backed by real estate lending, especially if taxation might not be adequate to repay public debt or prop up banks. When one side of the scale is light with "just" $1 trillion or so of quantitative easing and the other is heavy with $50 trillion of private and public debt and another $50 to $100 trillion of entitlement promises, a massive air-drop of paper might be called forth that could be inflationary. But not long ago a $1 trillion intervention was thought to be shocking, and our sensibilities tell us adding another $1 trillion might be doubly so.

Some History

Hoarding and intervention are opposing forces; in conjunction they explain the strange correlation of bonds, equities, and the falling dollar that was a defining feature of the second phase of the gold rally. Milton Friedman won a Nobel Prize for the insight that the Fed might have offset the monetary contraction partly caused by hoarding in the 1930s. But Murray Rothbard documented evidence that the Fed intervened forcefully and was overwhelmed by the public's desire to repay debt and the disruption injected by default from unsuspected quarters such as Creditanstalt. True, by ratio analysis our intervention might look greater than that of the 1930s, but even that is uncertain when we consider the shadow banking system, the roughly half a quadrillion dollars in derivatives outstanding, or the tens of trillions of yuan, yen, rubles, rupees or other currencies pyramided upon the dollar as the world's reserve. Today another Iceland, Dubai, or Greece could set off a chain reaction.

Intervention is not a new phenomenon. In the nineteenth century a few state governments manufactured "inconvertible paper currency" directly, and most did so indirectly by sanctioning printing by designated banks. Fiscal stimulus was common; very large budgets were expended by states to build roads, canals, and railroads. These worked for moments in time, but legislative and banking experiments ended dreadfully. Although we remember these happenings by their most horrific panics, "of 1819" and "of 1837," both these chapters of history enjoyed more than one peak, thanks to forbearance through "internal improvements" and continued production of "inconvertible currencies."

After the specie suspension of 1814, false prosperity resumed until the panic of 1819. In response to that crisis, many states intervened in money markets with the "loan office" solution, which compelled creditors to accept certain sanctioned state bank notes for payment in lieu of specie, an ironic stance since these creditors had issued paper for gold deposits in the first place for the purchase of lands. These interventions helped kick-start the system for a while. Missouri, after seeing five-sixths of its money supply vanish, directly issued "inconvertible currency" that could be accepted for tax liability.

Anti-bullionists such as Thomas Law, husband to Martha Washington's daughter, proposed socialization of banking by backing national currency with Treasury debt. Treasury Secretary Crawford proposed a similar scheme until he recanted when he realized this arrangement would encourage the government to issue too much money, and Treasury bonds would inevitably fall in value.

Likewise, after a downturn caused by the withdrawal of government deposits from the second US bank in 1834 (following Jackson's veto in 1832), in response to stimulus and expanded state banking, asset and commodity prices rose for several years. Then a devastating collapse in 1837 plunged the nation into a seven-year depression.

The Illinois legislature allocated $12 million in 1838 for boondoggles, widening and deepening every stream, for example connecting the Illinois River with Lake Michigan. Wrote President Lincoln's personal secretaries George Nicolay and John Hay that the result of these "brilliant schemes (was) a load of debt that crippled for many years the energies of the people, a few miles of embankments that the grass hastened to cover, and a few abutments that stood for years by the sides of leafy rivers, waiting for their long delaying bridges and trains."¹

New York City, which in the late 1830s was the leading commercial city in the United States and the second most important in the world, accounted for two-thirds of all import duties.² Its banks were first in the nation to suspend gold convertibility in 1837, starting a cascade among most other cities - many such as Philadelphia were more highly leveraged.

The state of New York moved towards resuming depositors' rights to reclaim their money through a new state banking law the following year that stimulated the opening of new banks capitalized with engraved and printed circulating notes "in the similitude of bank notes in blank" that were issued by the state when the new entities bought a like amount of state debt.³ By January 1842 New York State teetered on the verge of bankruptcy, with fiscal stimulus such as the enlargement of the Erie Canal and monetary policy being contributing factors.

The Global Experience

What has been a dollar problem could now become a truly global experience. Nations less indebted than the U.S. or Japan may have room for more borrowing, as their over 20% money growth statistics belie. But their growth would necessarily be autarkic, and the loss of foreign trade could wipe out equity at the base of their inverted pyramid of banking leverage, much as Smoot-Hawley might have in the 1930s, as argued by Thomas Rustici in his new book, Lessons from the Great Depression. This may be what is unfolding in China. That country has used stimulus to produce, for example, an entire nearly uninhabited city, Ordos. A remarkable Al Jazeera video that tells that story is linked to on the ConservativeEconomist.com web site. Or, at the very least, consider the destruction in value that has been ongoing to holders of Indian rupees, which have been depreciating rapidly against gold for as long as they eye can see, shown in this chart:

While the United States is all loaned up, China, India and other emerging nations are not, and they have been behaving much like America did in the 1970s, when banks printed money lavishly and caused consumer prices to escalate. The developing world has benefitted from the United States having converted its economy from a manufacturing power into a financial services and real estate centric marketplace. Roughly eight percent annual money supply growth since 1971 when Nixon broke America's promise to redeem dollars with gold has facilitated a moral hazard that would entice its citizens with a one-way bet to borrow and buy real estate, diverting capital away from building factories.

The hollowing out of productive enterprises and the structural trade imbalance would export dollars to the BRIC nations, constantly signaling to their monetary authorities that they had more reserves upon which to pyramid monetary growth. No matter how much credit they created, like the Roman generals refreshing the imperial treasury with war booty from conquests, their monetary base would grow rapidly underneath. In the United States, however, the monetary base would remain flat, and we would become increasingly indebted.

For Whom Does the Gold Bell Toll?

Karl Marx dreamt of a world in which there was no money, for money was the tool which extracted and stored the added value of labor for the enjoyment of exploitative capitalists. Instead, the state would keep track of production at all levels of the economy, planning investment and exchanges of output among citizens. Lenin thought gold might be better used to adorn public bathrooms.

In the twentieth century capitalist system, gold was demonetized and devoted to the adornment of women, and to a lesser extent, men. In its place was installed a centrally planned supply of money, which by being programmed to lose some of its value each year caused all who would hold it to wish to disgorge it to accumulate assets instead. And in fact, they would not only disgorge it, but yearn to be in a state of owing it. They would strive to have a large negative balance of it channeled into real estate, such that the burden of servicing it even with rock-bottom interest rates would challenge getting by with the necessities of life. This would drive the price of land sky-high, while everyday items might even fall in price thanks to Wal-Mart or the integration of Chinese production into global trade.

To the Marxist or the modern day capitalist, gold has little utility. It is valueless in the eyes of fiat inflationists like Warren Buffett. But it is this quality that makes it ideal as an intermediary substance between us, because its supply and demand is most distant from shortages or sudden shifts in demand such as would affect oil or copper, for its cumulative production since the dawn of time still might circulate. Gold won't disintegrate like deposits backed by real estate would. And it wouldn't grow like a cancer, like the money supply did post 1971, or for that matter since the founding of the Fed in 1913, or the invention of bank money by the Hamiltonians that circumvented the constitutional edict that money was silver and gold.

So for whom does the gold bell toll, and why is not its ringing heard? Why has its rise during the first and second phases of its bull market begun in the twenty-first century defied skeptics, when unlike the 1970s inflation is not apparent, but financial pandemonium emerged unexpectedly instead? Why do so many have faith that the Fed can exit from its strategy of having injected $1.3 trillion of reserve bank credit into a beleaguered financial sector? Why is there another view that leaving in these reserves would cause rampant inflation, rather than merely validate the rise in asset prices already achieved? Or, for that matter why wouldn't leaving in these reserves merely confirm the lack of deflation that otherwise would have occurred when $2 per hour labor was integrated into the global supply chain, as described in the contrafactual case above?

A yawning gap between the broad money supply and the market value of above ground stocks of bullion has developed since the Fed was chartered in 1913. Consequently, the potential reward from a relative change in wealth for holders of gold compared to holders of paper or commodities has never been greater than it has now, should the deflationary force of labor globalization destabilize the banking system and reveal once and for all how untenable and destructive the fiat currency system is. But still those who cling to paper do not hear their bell tolling. If we were to validate with a 20 percent gold backing the $14 trillion printed so far, 95 percent of which has been created since Nixon closed the gold window, the price of bullion would rise to over $10,000 per ounce.

The gold bell tolls. It is calling socialists, Marxists, and capitalists who have commandeered the power of the state to reassure mankind that unbridled monetary production has no unseen effect upon its users, even if they have kept a solemn promise to maintain a low inflation rate. Gold is a commodity that is least like all the others used in trade, but it possesses characteristics that have made it the ideal selection as a vessel for wealth for thousands of years: Scarcity, yet existing in large enough quantities for use in exchange. Cumulative production that far exceeds annual mine output. Durability. Easily identifiable. Homogeneity. Divisibility. These characteristics are lacking in electronic and paper money, and these failings have produced inequity, impoverishment, and waste of public resources on a scale that no amount of regulation could harness, regardless whether one speaks of the twenty first century or the nineteenth.

¹ Paul M. Angle, ed., The Lincoln Reader, New York: Da Capo Press, 1947, p.102.

² Reginald Charles McGrane, The Panic of 1837, University of Chicago Press, 1924, pp.100-101.

³ C.Z. Lincoln, Constitutional History of New York II, Rochester, 1905-8, pp. 42-43.

William Baker is the author of "Endless Money: The Moral Hazards of Socialism" (John Wiley, 2010)

Disclosures: Long and short equities. Long gold, gold derivatives, and gold equities.