fiat money will cause a grater inflation with the unstable and the value were control by the “invisible group”…

The price of gold has not really changed over the last hundred years. In fact, it would make sense that it has only appreciated in value as production went up; as we produce more stuff, you should be able to buy more with the same stuff as before, since there’s the same amount of ‘gold’ or even ‘fiat currency’ chasing an increased amount of product.

In his Excess Speculation recent article in Times of India, Swaminathan Aiyer explicitly explains that although the production of oil has been increasing gradually, the cause of inflation lies “elsewhere”.

Actually, inflation occurs when too much money chases too few goods. Today, no great shortfall in goods is evident. World oil production is rising, though slowly. Mineral and metal production is up. The FAO predicts a record global harvest in 2008.

We discussed it all here.

He also addresses the major root of inflation as—

Money supply expanded fast in Third World countries too (including India). This was partly because central banks bought up dollars in forex markets rather than let their currencies appreciate.

Alas, a flood of money cannot for long lift production alone. Soon it starts raising prices. First the excess money raised housing prices, and everybody was happy. Then it raised stock market prices, and people were very happy. Finally, the flood of money raised consumer prices, and suddenly people are very unhappy.

He also clarifies that there is no link between inflation and forward trading.

There is hardly any forward trading in iron ore, yet its price is up 76-95% in new contracts. By contrast, huge forward trading in sugar has left world prices low. Nickel futures are down from a peak of $60,000/tonne last year to just $22,000. Wheat futures once spiked to $13/bushel but are now down to $9/bushel. There is no clear link between forward trading and skyrocketing prices.

At last, he opposes subsidies and taxation system too—

Today, at last, governments across the globe are reluctantly reducing oil subsidies and starting to fight inflation through a monetary squeeze, even if it means slowing growth. Squeezing money in India alone will produce only limited results. For good results, central bankers of the world should get together for coordinated action. But no such initiative is in sight.

Politicians are quick to take the credit when the economy does well, and to blame others when things go wrong. They must take the responsibility for bad as well as good policies. Banias may be quick to grasp the inflationary potential of bad policies, and profit from it. But the root cause of rising prices lies elsewhere.

What I wonder about is, he is still reluctant to strongly oppose the wrong and clarify and support the right.

One thing which should be kept in mind is, there is no “left” for the right, whatever opposes the “Right” is nothing else but WRONG.

For further clarifications, why don’t you read Francisco’s speech by yourself?
The link is given on right hand side, under the heading “Important Links”.

For your convenience, here it is

http://capmag.com/article.asp?ID=1826