Welcome back to the Worldwide Fiat Currency Race to Debase!

At the close of third quarter 2010, it is clear for the world to see that all fiat currencies around the globe have been getting their paper back-sides kicked in by the true hard monies, silver and gold.

To all investors who have their human labor tied up in paper fiat currencies, we have this to say to you. Scoreboard.

RACE TO DEBASE                                        Year 2010  -   Quarter 3
GOLD vs. Fiat Currency + 19.9%			SILVER vs. Fiat Currency + 29.8%

Fiat money has no place to go but gold. If all currencies are moving up or down together, the question is: relative to what? Gold is the canary in the coal mine. It signals problems with respect to currency markets. Central banks should pay attention to it.

- Alan Greenspan

Many people, like the aforementioned bubble maestro Alan Greenspan, mistakenly refer to fiat currency as fiat money. In order for a currency to also be money it must by definition be a store of value over a long period of time.  Only two currencies are money, gold and silver.

Lets delve further into the numbers.

Here is a look at how real monies, gold and silver, have performed against 74 various fiat paper currencies thus far in 2010.

 

Fiat Currency vs. One Gold Ounce	1-Jan-10	30-Sep-10	% Gold Gain
Afghanistan Afghanis	53,343	57,162	7.2%
Albania Leke	104,997	132,216	25.9%
Algeria Dinars	78,965	95,891	21.4%
Argentina Pesos	4,171	5,161	23.7%
Australia Dollars	1,223	1,352	10.5%
Bahamas Dollars	1,097	1,303	18.8%
Bahrain Dinars	414	491	18.7%
Bangladesh Taka	75,662	90,340	19.4%
Barbados Dollars	2,195	2,606	18.7%
Bermuda Dollars	1,097	1,303	18.8%
Brazil Reais	1,914	2,212	15.6%
Bulgaria Leva	1,497	1,874	25.2%
CFA BCEAO Francs	502,190	628,614	25.2%
CFA BEAC Francs	502,190	628,614	25.2%
Canada Dollars	1,154	1,342	16.3%
Chile Pesos	556,850	631,042	13.3%
China Yuan Renminbi	7,493	8,722	16.4%
Colombia Pesos	2,244,898	2,347,464	4.6%
Comptoirs Français Francs	91,358	114,358	25.2%
Fiat Currency vs. One Gold Ounce	1-Jan-10	30-Sep-10	% Gold Gain
Costa Rica Colones	618,358	652,479	5.5%
Croatia Kuna	5,594	7,001	25.1%
Czech Republic Koruny	20,134	23,558	17.0%
Denmark Kroner	5,701	7,142	25.3%
Dominican Republic Pesos	39,642	47,760	20.5%
East Caribbean Dollars	2,853	3,499	22.6%
Egypt Pounds	6,018	7,420	23.3%
Estonia Krooni	11,979	14,994	25.2%
Euro	766	958	25.1%
Fiji Dollars	2,116	2,459	16.2%
Hong Kong Dollars	8,509	10,113	18.8%
Hungary Forint	207,032	265,249	28.1%
IMF Special Drawing Rights	700	837	19.6%
Iceland Kronur	136,181	147,371	8.2%
India Rupees	51,147	58,608	14.6%
Indonesia Rupiahs	10,315,100	11,630,461	12.8%
Iran Rials	10,869,251	13,347,991	22.8%
Iraq Dinars	1,265,793	1,524,275	20.4%
Israel New Shekels	4,136	4,754	14.9%
Jamaica Dollars	98,024	112,069	14.3%
Fiat Currency vs. One Gold Ounce	1-Jan-10	30-Sep-10	% Gold Gain
Japan Yen	102,084	108,834	6.6%
Jordan Dinars	779	925	18.7%
Kenya Shillings	83,234	105,293	26.5%
Kuwait Dinars	315	371	17.9%
Lebanon Pounds	1,650,963	1,967,079	19.1%
Malaysia Ringgits	3,758	4,025	7.1%
Mauritius Rupees	33,812	39,224	16.0%
Mexico Pesos	14,371	16,459	14.5%
Morocco Dirhams	8,666	10,744	24.0%
New Zealand Dollars	1,512	1,779	17.6%
Norway Kroner	6,332	7,685	21.4%
Oman Rials	423	502	18.6%
Pakistan Rupees	92,518	112,539	21.6%
Peru Nuevos Soles	3,168	3,635	14.7%
Philippines Pesos	50,741	57,240	12.8%
Poland Zlotych	3,128	3,808	21.7%
Qatar Riyals	3,997	4,744	18.7%
Romania New Lei	3,227	4,091	26.8%
Russia Rubles	33,265	39,881	19.9%
Fiat Currency vs. One Gold Ounce	1-Jan-10	30-Sep-10	% Gold Gain
Saudi Arabia Riyals	4,116	4,887	18.7%
Singapore Dollars	1,542	1,715	11.3%
South Africa Rand	8,108	9,121	12.5%
South Korea Won	1,277,096	1,486,002	16.4%
Sri Lanka Rupees	125,504	145,586	16.0%
Sudan Pounds	2,452	3,092	26.1%
Sweden Kronor	7,848	8,819	12.4%
Switzerland Francs	1,137	1,278	12.4%
Taiwan New Dollars	35,063	40,755	16.2%
Thailand Baht	36,597	39,531	8.0%
Trinidad and Tobago Dollars	6,949	8,301	19.5%
Tunisia Dinars	1,453	1,851	27.4%
Turkey Lira	1,646	1,891	14.9%
United Arab Emirates Dirhams	4,030	4,787	18.8%
United Kingdom Pounds	679	828	22.0%
United States Dollars	1,097	1,303	18.8%
Venezuela Bolivares Fuertes	2,359	5,603	137.5%
Vietnam Dong	20,278,046	25,352,451	25.0%
Zambia Kwacha	5,092,801	6,317,655	24.1%
Why do central banks and governments around the world continue to overprint and weaken the values of their respective fiat currencies? Countries need to export their products and trade. By having a weaker currency, a country can more easily sell and trade their products throughout the world. The quandary is that not every country can have a weak currency at the same time. Remember, fiat currencies trade in relative terms. Paper currencies are simply valued against one another therefore dollars are always priced in euros, yen, pesos, pounds, and so on. If one fiat currency weakens, one or more of the other fiat currencies strengthens. When nations battle to quicken debasement of their respective currency in the hope to bolster export demand (to perhaps maintain an economic status quo) this is what is called competitive debasement. In the 1930’s the term for this was "beggar thy neighbor."