Have you ever wished you hadn’t had to unlearn fiat-money propaganda? That someone had stepped in and told you sound from unsound when you were a child? Do you think the kids of today should learn about sound money right from the get-go? A new book, Treasure Hunt in the Enchanted Forest: The Search for Good Money, does just that.
It starts off with a bit of childish mischief that’s a fairly good encapsulation of real inflation. While playing Enchanted Forest Monopoly, Reese the Owlet decides to get the better of her brother Landon by slipping in some extra game money she borrowed from her friend. After catching her, and complaining to Grandpa Owl, Landon figures out how to retaliate: by charging twice as much rent for landing on his properties. The kids see the inflation process in a nutshell, right on the first two pages.
Grandpa Owl then explains why a $20 Double Eagle coin now costs far more than sixty $20 bills. The child reader learns that fiat money goes down in value because it’s much easier to make than gold. Wise old Grandpa Owl then explains what makes sound money. Good money is demandable, portable, divisible, durable, valuable. Fiat money only matches up with three of these criteria. (So does Monopoly money!)
They also learn that inflating the money supply isn’t fair, because someone always gets to use the money first. Although it doesn’t touch on the bailouts, and doesn’t introduce the central bank, any child reading this book will find it easy to understand why the bailouts were so unfair. That’s quite the achievement for a subject thought to be too complex for anyone except a college student or educated adult.
The lesson ends with a definition of Gresham’s Law that a ten-year-old can understand. “Bad money always drives out the good when the good is underpriced.” What better example than silver coins, which disappeared after no longer being made?
Although the lesson is the central part of the book, it’s more than didactic. Its target audience is not precocious kids destined to become professors. Its authors are not hoping for a new crop of sound-money academics fifteen years down the road.
The second half of the book describes a real-life treasure hunt, and teaches kids how they can take advantage of Gresham’s Law. Since it’s too late for silver except for the lucky occasional, the book focuses on the “humble nickel” and “lowly penny.” Fact is, pennies made before 1982 are 95% copper; the metal in them is worth more than double their face value. Nickels, which actually have only 25% nickel in them, are worth slightly more than their face value. This is the “treasure” that Reese, Landon and their friends search out. They learn that penny sorting makes for profit.
As they find more and more, words spreads and they find themselves in the Enchanted Forest’s local paper. They also use their knowledge to help out charitable organizations.
For the sake of the story, the gold standard is described as a metal standard. This way, gold ties in with the activity in the second part of the book. The kids reading about it are encouraged to try it themselves, and the way to do so is spelled out for them. They’re also encouraged to talk about it with their friends and find new ones through it.
This activity may seem esoteric, but penny sorting has gotten to the point where it’s featured on a Nightline segment on November 4th. It’s making the “Enchanted Forest News” for real. Moreover, it’s a wholesome activity that teaches the connection between shrewdness, work and profit. Armed with practical knowledge, work brings a monetary reward. The lesson they’ll learn will help them understand where paychecks come from.
The activity also ties in with another wholesome hobby: coin collecting. In my own penny-sorting, I’ve found wheat cents from as long ago as 1916. Hard-core penny sorters have found wheats from as early as 1909. Some have found Indian Head pennies from beforehand.
Although not directly teaching kids about the gold standard, Treasure Hunt in the Enchanted Forest imparts the background knowledge needed to understand. After reading it, all the kids need is Daddy Owl, Mommy Owl, Uncle or Auntie Owl, or another Grandpa Owl, to explain how the gold standard works and why it’s good. Coin collecting drifts naturally into a discussion of the classical gold standard and why it was subverted by the gold-exchange standard. What better place to start than by differentiating a gold certificate from a contemporaneous Federal Reserve note?
This book is a neat combination of homey and shrewd, charming and sly, and the lessons it imparts are wholesome and needed. Granted that it’s often exhilarating to learn about the metal standard as an adult, but doing so means unlearning the siren songs of fiat money that pervade high schools and universities. Treasure Hunt in the Enchanted Forest starts kids off on the right foot. Once the gold standard is restored, the next challenge is to keep it. Unless the rising generation learns what’s right about the gold standard, we won’t. Treasure Hunt in the Enchanted Forest goes a long way to reaching that goal. May there be many followers in its wake.
You can find out more about the book from its Website: http://www.treasurehuntkidsbook.com .