The last workweek of the year is complete. Beers were had with friends yesterday, Friday evening. The final shopping trip to the mall was completed today, followed by a good meal with my wife. Now I find myself in a reflective mood, and this is a perfect time to reflect on what an incredible year it was.
Around this time last year, I began writing my dissertation. I knew what I wanted to prove: that a free market is driven by arbitrage to the benefit of all participants, and that the same principle applies in money and credit as it does to the production of food or computer chips. I had no idea that I would not be done until I had typed 32,000 words onto 110 pages!
How many things in life are like that? “If I knew then what I know now!” Every path you take in life has its price. You take what you want and you pay for it. But often, you don’t know the price in advance. After I sold DiamondWare, I spent a few months of reflection and soul-searching about this.
Anyways, in March of this year, I went to the New Austrian School while it was still practically winter in Munich (at least to someone with the “thin” blood of an Arizona resident!) to lecture, and discuss my dissertation. Based on discussions I had while there, I agreed to establish the Gold Standard Institute USA. It was around then that I started to mutter, “so much time, so little to do…” (sorry, sarcasm) to anyone who would listen.
Shortly after that, both the Basel Committee and the domestic regulators in the US announced proposed changes to the rules that would allow banks to gold as a “zero risk weighted” or “Tier 1” asset. Other than a few gold bugs, who got excited about higher gold prices (which have so far not materialized), few paid heed to the broader consequences. John Butler of Amphora Capital was one notable exception. This is a step towards the inevitable gold standard.
Also this year, I had a chance to record some lectures I gave in Phoenix. In the future, I plan to do more in the video format. Aside from being a lot of fun, I think it can reach a different audience and even reach the same audience in a different way as compared with the written word. Partly as a result of these videos, I was invited to give a keynote at the Gold Symposium in Sydney and a one-day economics seminar for Golden Renaissance in October, but I am getting out of chronological order.
In September, it was back to Europe for the next lectures at the New Austrian School and the award ceremony for my doctorate! Back in 1990, when I dropped out of computer science school to get started writing code, I never thought I would be back to school for anything, much less a graduate degree, much less in economics! But the journey that I had begun after selling DiamondWare weeks before the markets began to collapse; starting to read about economics had come full circle.
I want to thank again Professor Antal Fekete for his numerous writings about monetary science. Reading them started me on this path, which led to my travel to Szombathely, Hungary one cold and cloudy winter, to meet him and begin my study under him. Professor Fekete’s ideas form the core of my own thinking about money and credit today.
In many of my earlier papers, I cited his papers and I plan to continue to use his papers as references in my own when they are specifically germane. Thus I want to take this opportunity to acknowledge my intellectual debt to him again. It is impossible for me to imagine what the development of my thinking in economics would have been without my having studied Fekete, as it is similarly impossible for me to imagine my personal, business, and philosophical development without Ayn Rand. Astute readers will see the influence of Rand on everything I say and do, and Fekete on everything I say in economics.
To paraphrase Isaac Newton (who may have been paraphrasing the logician and theologian John of Salisbury): it is by standing on the shoulders of giants that I am able to see farther and undertake my own work. I am dedicating this phase of my life to helping to bring the world forward (not backward!) to the gold standard. The gold standard is, well, it’s the gold standard of monetary systems.
I also want to thank Professor Juan Rallo of King Juan Carlos University, Madrid who was the other examiner of my dissertation.
After Munich, it was on to Neuberg An Der Mürz for the wedding of my colleague Thomas Bachheimer, president of the Gold Standard Institute in Europe. Neuberg is a classic alpine Austrian village, with flowers in front of all the houses—and a church built in the 13th century. Due to its clear, rather than stained, glass windows, it was a light and airy place and very impressive. Congratulations again Thomas. It alone, if not driving on roads without speed limits in a Mercedes, would have made the trip worthwhile!
After returning, I launched Monetary Metals with my business partner Stuart Clapick. This is the other part of my effort to bring the world forward to gold. I will be writing more about Monetary in the near future.
And finally, to complete the year, I received news yesterday. I am an angel investor, who invests money (and sometimes time) in high-tech startups. My first career was in software and I still love it. I have a small portfolio of Arizona-based early stage companies (and one in Dunedin, New Zealand). Two of my portfolio companies, Post.Bid.Ship and Serious Integrated, won the Arizona Innovation Challenge. Arizona awarded each of them a not-inconsiderable amount of money. While I will likely benefit from these grants financially, I find that I have mixed feelings. I wish the world would not grant to government the power to take taxes from everyone and then attempt to pick winners by giving out subsidies! I am not given that choice, though hopefully my work (and the work of many others) will help people discover the simple and yet elusive concept of freedom. In the meantime, I wish everyone a Merry Christmas and happy New Year! 2013 promises to be very exciting, or perhaps “interesting” as in the old Chinese proverb.