The Golden Revolution: How to Prepare for the Coming Global Gold Standard

PRAISE FOR THE GOLDEN REVOLUTION

"John Butler provides much illuminating detail on how theworld′s monetary system got into its present mess. And if you′rewondering what comes next, this is the book to read."
—Bill Bonner, author of the New York Times bestsellers Empire of Debt, Financial Reckoning Day, and Mobs, Messiahs and Markets

"John Butler has written an indispensable reference on the subject of gold asmoney. His book is a combination of history, analysis, and economics that the reader will find useful in understanding the use and misuse of gold standards over the past century. He breaks the book into a long series of essays on particular aspects of gold that the reader can take as a whole or in small bites. It is technical yet accessible at the same time. The Golden Revolution is a useful and timely contribution to the growing literature ongold and gold standards in monetary systems. I highly recommend it."
—James Rickards, author of Currency Wars: The Making of the Next Global Crisis

"In The Golden Revolution, John Butler makes a powerful case for a return to thegold standard and offers a plausible path for our nation to get there. Enlightened investors who blaze the trail will likely reap the greatest reward. For those still wandering in the dark, this book provides necessary light to keep you headed in the right direction."
—Peter Schiff, CEO, Euro Pacific Precious Metals; host of The Peter Schiff Show; and author of The Real Crash: America′s Coming Bankruptcy—How to Save Yourself and Your Country

"John Butler′s historical treasure trove empowers the reader tounderstand, prepare, and act. To have a chance to emerge unscathedfrom financial turmoil, join the Golden Revolution. I have."
—Axel Merk, Merk Funds; author of Sustainable Wealth

"The Golden Revolution is another indispensable step on the road map back to sound money. John Butler′s experience of the modern ′fiat′ banking world, combined with his understanding of the virtues of a disciplined monetary system, allow for genuine insight into the practical steps that could, and surely will, be taken to reestablish gold as money."
—Ned Naylor–Leyland, Investment Director MCSI, Cheviot Asset Management

"Ex scientia pecuniae libertas (out of knowledge of money comes freedom).John has used his exemplary knowledge of money to lay out a cogent framework for the transition of society based on fiat money to a more honest society forged by gold. He has taken complexity and given us simplicity. Monetary economics and its interrelationship with geopolitics, finance, and society is extraordinarily complex, but he has managed to assimilate a vast array of information and distill it in a simple and thoroughly thoughtful framework. That is an art many academic writers never achieve."
—Ben Davies, cofounder and CEO, Hinde Capital

Acknowledgments ix

Introduction: Why a Gold Standard Lies in Our Near Future 1

Part I Why the Days of the Fiat Dollar Are Numbered 7

Chapter 1 The Window Closes 13

Chapter 2 Stagnation, Stagflation, and the Rise of "Darth" Volcker 23

Chapter 3 Of Bubbles and Bailouts 35

Chapter 4 Why Financial Genius Fails, or, a Forensic Study of the 2008–2009 Global Credit Crisis 41

Chapter 5 An Unstable Equilibrium 51

Chapter 6 The Inevitability of Regime Change 73

Part II Running the Golden Gauntlet: Transition Scenarios Back to a Gold Standard 79

Chapter 7 A Golden Bolt out of the Blue 85

Chapter 8 Golden Preparations 95

Chapter 9 Long–Forgotten Suggestions for How the United States Could Return to Gold 115

Chapter 10 The Golden BRICs 125

Chapter 11 When All Else Fails, Enter the Gold Vigilantes 133

Part III The Economic, Financial, and Investment Implications of the Coming Global Gold Standard 137

Chapter 12 The Role of Central Banking under a Gold Standard 143

Chapter 13 Valuation Fundamentals under a Gold Standard 155

Chapter 14 Estimating Risk Premia under a Gold Standard 167

Chapter 15 Golden Winners and Paper Losers 181

Chapter 16 Some Implications of the Gold Standard for Global Labor and Capital Markets 189

Conclusion: The Golden Society 193

Further Reading 199

About the Author 206

Index 207

John Butler worked for over 15 years asan interest rate, foreign exchange, and commodity strategist at major banks around the world before founding Amphora Capital, an independent investment and advisory firm, in London. He has written extensively on financial topics, and his work has been cited in the Financial Times, the Wall Street Journal, and the Frankfurter Allgemeine Zeitung, among other publications. He is also the author and publisher of the popular Amphora Report newsletter and is an occasional speaker at global investment conferences. He resides in the English countryside with his wife and four children.