end to fluctuate between deflation (monopolistic money shortage causing unemployment, sales difficulties and bankruptcies) and inflation (coercive over-issues, forcing all prices up). Without free pricing socialism is as impracticable and chaos producing in this sphere as in all others. Unemployment and inflation do under this system also occur simultaneously as not all spheres of the economy can be equally supplied with currency, not even with inflated currency. Due to the issue restrictions at least local deflations tend to persist while other areas may suffer from an inflation or one proceeding at a faster rate because they are at the same time more thoroughly flooded with money. Think of the current example of starving private industry of funds (e.g. by deflating this sector through extreme taxation) while lavishly "spending" on some areas of the public sector, often with "funds" coming directly from the printing presses. Add to this the fact that once an inflation has become noticeable it will be taken into account by raising prices in expectation of further price increases and as a precaution against losses they are then often raised above the market level (considered as an equivalent between the present money circulation and the present quantity of goods and services). Thus the inflated money is not enough at any time to buy all goods and services thus priced, at least not during a commonly known progressive inflation. 7. WHAT IS MONETARY DESPOTISM? It is a condition where the government "regulates" and manipulates the standard of value, all paper money, banknote issues and issues of clearing house certificates, all coinages and also, as far as it can, all credit and clearing transactions. The system is characterized by central banking, money, credit and banking legislation full of prohibitions, licensing quotas, penalties and privileges like issue monopolies, also by deposit regulations and confiscations. Even a system which imp...
