Towards a Trias Pecuniae

This article presents the idea of a trias pecuniae as a synthesis of the commodity and credit theories of money. The margins of error provided by the rigidities of a classical gold standard and the flexibilities of a purely fiat standard as grounded in the commodity and credit theories of money have historically proven insufficiently robust to prevent episodes of inflation, financial excess and wealth inequalities. In conclusion, it is argued how through checks and balances, societies are able to grant citizens an unalienable right to the freedom of wealth with an effective and simple check. This article puts forward an analytical framework derived from approaches in philosophy (i.e. two theories of causality), law (through a so-called monetary matrix) and political theory (i.e. Montesquieu’s trias politica) to consistently untangle the elements that characterize the two money theories and the three theories of banking attached to them. In conclusion, the trias politica is applied to all wealth, allowing the discernment of three wealth powers: the fiscal power, the monetary power, and the credit power. The checks necessary to serve societies to remain in balance can be implemented by making the relations between the people and each of these institutional powers reciprocal. Essentially, when future income is removed from the equation of eligible collateral on the basis of which each of the wealth powers is able to enter into arrangements of credit, a society tackles all sources of inflation and financial excess. Through these checks, societies are able to eliminate the tendency of income and wealth disparities to become ever greater, not by top-down measures and interventions, but by means of laws that apply equally to all persons, natural and legal, thus leveling the playing field for the management of all wealth in a bottom-up fashion.

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Dr. Zijlstra’s Legacy and the 21st Century Renaissance of Gold

If you read the series of analyses by Dr. Jelle Zijlstra, one of the world’s most informed central bankers of his era (1967-1981), you have read a little over half a “modern book” on the historical backgrounds of the international monetary framework and the reasons for the Bretton Woods framework to collapse. My selection of translations portrays a great similarity to the extent that the essential point is repeated again and again and which is most eloquently described in Zijlstra’s autobiography of 1992: “Gold as the monetary cosmos’ sun”.

Here are my thoughts on why his analysis is highly relevant to today’s financial crisis.

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Dr. Zijlstra’s Final Settlement: Gold as the Monetary Cosmos’ Sun

Originally posted on April 29, 2012 on and

Whenever I am in Amsterdam, I go to a bookstore and browse the second-hand shelves in the economics section. Recently I found two books by Dr. Jelle Zijlstra: “Dr. Jelle Zijlstra, Conversations and Writings” (1979, second edition) and “Per Slot Van Rekening” (1992, fifth edition). The latter title is a Dutch figure of speech that may be translated as “The Final Settlement.”

Jelle Zijlstra was a renowned Dutch economist and one of Holland’s finer statesmen. Early in his career in 1948, shortly after World War II, he became a professor, specializing in the velocity of money. By 1952 he was appointed minister of economic affairs, then Dutch treasurer from 1958 to 1963 and again from 1966 to 1967. During his last term as treasurer he led the Dutch Cabinet as prime minister as well until 1967, after which he became president of De Nederlandsche Bank (DNB). While president of the Dutch central bank he was appointed as the president of the Bank for International Settlements (BIS) as well, positions he held until his resignation in 1981.

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