The Nature of Money and Our Monetary System (U.S. Coinage Act of 1792)

Great article on money, our Constitution and the U.S. Coinage Act of 1792.

Do you think our money is being debased today?

The truth is that our current monetary system requires that our money be debased.

This is the very nature of the Federal Reserve’s fractional reserve system. Our fiat money supply – that is backed by nothing - must continue to grow – forever. One of the many downsides of this system is that the value of our money continues to be debased – forever. Constant money supply growth = constant inflation. Constant inflation = constant money devaluation.

By ‘forever’ – I mean until the system collapses. We live in the real world – not fantasyland.

Ask yourself how a system that violates both the Constitution (only Congress has the authority to manage our money supply) and the Coinage Act of 1792 was allowed to gain absolute power over our economy. I assure you – it wasn’t done to benefit the American people. It was done so that a small group of powerful men could control us – just as they control all major economies around the world.

Here’s an excerpt from the article below:

“In 1792 the U. S. Coinage Act was passed by Congress. It invoked the death penalty for anyone debasing money and provided for a U.S. Mint where silver dollars were coined along with gold coins beginning in 1794. The text of Coinage Act of 1792 states: “The Dollar or Unit shall be of the value of a Spanish milled dollar as the same is now current,” that is, running in the market, “to wit, three hundred and seventy-one and one-quarter grains of silver.”

To repeat, A“dollar” is a silver coin containing three hundred and seventy-one and one-quarter grains of silver — and it cannot be changed by constitutional amendment, definitionally, any more than the term “year” can.

Even at the current suppressed value of silver, ($17.06/troy ounce), a "dollar is worth $14.00. The fact that a currently circulated Federal Reserve Note of a "One Dollar" denomination is not worth $14.00 is evidence that a radical debasing of money has occurred sometime in the past and begs the questions: Who was responsible for the debasement, why did "we the people" allow the debasement to occur, and why weren't those responsible prosecuted?”

jg – March 18, 2010
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The Nature of Money and our Monetary System

by: Johnny Silver Bear

(Editors Note: One of the perks of editing "the Bear" allows me to post my own rants. I originally published The Nature of Money in August, 2004.)

As the editor of the Silver Bear Cafe, I try to focus on the ramifications of world events. I try to understand how what's going on now will affect your pocketbook next week, next month, next year. It is my sole intent to help you consider the possibilities which will, in turn, help you prepare for your financial future.

One of the most important aspects of your financial survival concerns your understanding of the nature of money. If you believe that precious metals do not constitute "money", you may have been misled. If you have been misled, who misled you? Why? And "What's wrong with this picture"?

What is money? The whole point of money is suppose to be the provision of a convenient and liquid medium that can be exchanged for less liquid value. It is a go between. One strives to accumulate money so it can be exchanged for something else.

In our illustrious history, we humans have tried everything from salt to sardines as a medium of exchange, but nothing has seemed to work as well as gold and silver. A person bringing a relatively illiquid item to market could swap it for gold or silver, secure in the knowledge that the metal would retain its value for as long as he chose to hold it and would be accepted as payment for anything he wanted when he chose to spend it.

The condition that your gold and silver will retain its value for as long as you chose to hold it is the most valuable characteristic of the "barbarous relics", and provides the fodder for me to champion the cause of precious metals ownership, and for my ensuing attack on the debasement of the American dollar.

Man has an innate desire to obtain and own gold and silver. That we seek to possess precious metals seems as naturally entrenched in our collective psychic as any other instinct. The possession of wealth, in the form of gold and silver, has always represented power and control. There is nothing wrong or unnatural to desire power and control. The power to control one's destiny through the accumulation of wealth is not only natural, it is healthy. This natural desire is the basis of our capitalistic system. The gold standard, as prescribed by our Constitution, is "the Law" that insures that the "power and control" that is provided by wealth, cannot be abused. Those who would seek to abuse the power of wealth would consequently have to break "the Law." "The Law" has been broken.

In 1792 the U. S. Coinage Act was passed by Congress. It invoked the death penalty for anyone debasing money and provided for a U.S. Mint where silver dollars were coined along with gold coins beginning in 1794. The text of Coinage Act of 1792 states: “The Dollar or Unit shall be of the value of a Spanish milled dollar as the same is now current,” that is, running in the market, “to wit, three hundred and seventy-one and one-quarter grains of silver.”

To repeat, A“dollar” is a silver coin containing three hundred and seventy-one and one-quarter grains of silver — and it cannot be changed by constitutional amendment, definitionally, any more than the term “year” can.

Even at the current suppressed value of silver, ($17.06/troy ounce), a "dollar is worth $14.00. The fact that a currently circulated Federal Reserve Note of a "One Dollar" denomination is not worth $14.00 is evidence that a radical debasing of money has occurred sometime in the past and begs the questions: Who was responsible for the debasement, why did "we the people" allow the debasement to occur, and why weren't those responsible prosecuted?

Fiat money, (money not backed by anything), was something so abhorrent to our Founding Fathers that they didn't even discuss it as an option. The Constitutional gold standard provided that the Country's citizens could not be robbed by means of inflation. An interesting original draft by the Founders would have allowed for "bills of credit", or paper money but that was struck out. It seems that during the Revolutionary War, when paper money had been issued, a promise to back the notes for gold or silver was a "no confidence" disaster, causing counterfeiting by the British and other forms of fraud.

The end result were notes of no value, plummeting to less than a penny per dollar. Sound familiar? This is why the Founding Fathers decided to mint only gold and silver coins as "money." They provided for a U.S. Mint where silver dollars were coined along with gold coins beginning in 1794. The mint was intended to provide a service for "We the People", a facility where we could bring our precious metals, aquired by panning or mining or barter, have the metals assayed, minted and returned to us.

" The people of the states empower the Congress to coin money and regulate the value thereof and also of foreign coins." From Article I.8.5

This provision in the U.S. Constitution gave Congress the Right to produce a national coin, set the weight, fineness, and value. Also, Congress could specify the value of a foreign coin in terms of the national coin of the United States.

" No state shall ...coin money; emit bills of credit; or make anything but gold and silver coin a tender in payment of debts." From Article I.10.1

It is clear from this provision that the State's could not create their own coin nor could they make anything but the gold and silver coins issued by Congress as legal tender for the payments of debt. This is a Constitutionally mandated gold standard.

No further paper money was issued by the U. S. Government for over eighty years. The Founders did allow, however, private banks to act as depositories for the United States and to collect taxes. People were issued redeemable bank notes which circulated as currency. Alexander Hamilton was initially responsible for the "National Banking System". Unfortunately, he realized his error in promoting this type of banking too late, and by the end of the Civil War there were thousands of banks issuing thousands of different kinds of bank notes.

In 1862, during the "War for Southern Independence", Lincoln radically debased the currency by having millions of "greenbacks" printed so he could pay for the "trappings of combat" needed for his "sacking of the South". (see death penalty above)

In 1872, Supreme Court Justice Stephen Field, aware of the rages of inflation, attempted to block an unconstitutional overextension of powers by the Bank of the United States. He wrote:

“The arguments in favor of the constitutionality of legal tender paper currency tend directly to break down the barriers which separate a government of limited powers from a government resting in the unrestrained will of Congress. Those limitations must be preserved, or our government will inevitably drift from the system established by our Fathers into a vast, centralized, and consolidated government.”

Drift, it did, and is now moored on the precipice of the economic abyss.

In 1878, in a rare state of clarity, Congress began to redeem "greenbacks" into gold which put the United States back on the gold standard until 1933.

It was well known amongst intelligent politicians, (who have, apparently, remained in the minority), that the gold standard protected citizens against the controlling tendencies of the government by offering an absolute hedge against the depreciation or devaluation of the currency. Gold provided an agent of maintenance and liquidity within and beyond national borders. Above all, it raised a mighty barrier against authoritarian interferences through the manipulation of the economic markets. Within the constraints imposed by the gold standard, America's economy remained relatively healthy until 1913.

On December 23, 1913, the U.S. Congress passed the Federal Reserve Act, placing control of this nation's money into the hands of a private corporation. This corporation was made up entirely of bankers. Calling itself the Federal Reserve, so as to seem official, it replaced the national bank system. Treasury notes were recalled and Federal Reserve notes were issued with a promise to redeem them in gold on demand. The forces behind the Federal Reserve, (American and Western European banking interests), remained tethered by the limits imposed by the gold standard, but this would soon change.

In 1920, the 66th Congress passed the Independent Treasury Act.

In 1921, the United States Congress abolished the U.S. Treasury, and, as a result, all of our country's bullion and all other instruments of value, ( i.e...moneys in trust funds and other special funds that had been kept in U.S. Treasury offices and vaults), were systematically transferred to the coffers of a private corporation!

From 1913, until 1933, under the authority of the U.S. Congress, the Federal Reserve held control of all of our country's gold. They then proceeded to loan us back our gold, at interest. We paid interest for the use of our own gold! What's wrong with this picture? What could have incited our Senators and Representatives to allow that to happen? In order to keep up with the ever rising debt service, we borrowed more of our own gold. We kept borrowing more and more of our own gold to pay more and more interest, until all the gold was gone. At that point, the country went bankrupt. Guess what happened next.

The bankers foreclosed on America. I know what you're thinking. Me too.

On March 9, 1933, the U.S. declared bankruptcy, as expressed in President Franklin Delano Roosevelt's Executive Orders 6073, 6102, 6111, and 6260.

On April 5th, 1933, one month after his inauguration, President Roosevelt declared a National Emergency that made it unlawful for any citizen of the United States to own gold, (see death penalty above), and "unconstitutionally" ordered all gold coins, gold bullion, and gold certificates to be turned into the Federal Reserve banks by May 1st under the threat of imprisonment and fines. This was technically, a national confiscation of gold and silver. This unlawful precedent set by Roosevelt would eventually lead us to the catastrophic situation we find ourselves in today.

Our bankrupt nation went into receivership and was reorganized in favor of it's creditor and new owners, a private corporation of international bankers. (Since 1933, what is called the "United States Government" has been a privately owned corporation, and the property of the Federal Reserve / International Monetary Fund.)

Without a word of truth to the American people, all our good faith and credit was pledged as the surety for the debt by the same slime ball Congressmen who created the mechanism that allowed it to occur.

Those Congressmen, knew such "De Facto Transitions" were unlawful and unauthorized, but were mysteriously coerced into sanctioning, implementing, and enforcing the complete debauchment of our monetary system, and the resulting changes in all aspects of government, society, and industry in the United States of America.

From the onset of the Federal Reserve, fractional reserve bankers set out to win the war of misinformation. They did this, in part, by attempting to advance the pseudo tenets of Keynesianism, monetarism, and supply-side economics.

John Maynard Keynes, although a great friend of the bankers, was probably the most heinous influence on freedom, liberty, and the free market in the 20th century. He was a Fabian socialist and a Globalist, (is that redundant?), who provided an intellectual cover for inflationism. He is best known for authoring bogus economic theories, undermining Western values and philosophy, and providing a floor plan whereby the banksters could more easily deceive the people. It was Keynes who coined the phrase, “barbarous relic” in reference to gold. It was Keynes who desecrated the U.S. Constitution with almost every breath.

"Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose."

During the first half of the 20th century, each of four world leaders did the exact same thing within ninety days of their ascension to power. Each made it illegal for the citizens of their respective countries to own gold. Those leaders were: Mao, Stalin, Hitler, and Franklin D. Roosevelt. All four were acutely aware of the restrictions that a gold standard imposed on their abilities to wage war.

The bankers hate gold as money for the same reason. Gold as money acts as a barrier to the expansion of credit money. By pandering the lure of unlimited credit, the banksters went about recruiting politicians through out the world. The opportunity to wage war on borrowed money turned out to be irresistible to Empire. Wars have always been very important to the banking cartels. They are very expensive. Time and time again, through loans to governments, the cartels have provided the funding for great conflicts. Imagine, being able to go to war with unlimited funds. Better yet, imagine the inability to go to war because of the lack of unlimited funds. The temptation extended to the power mongers was too great. The credit was made available with a single catch. The gist of the pitch went something like this:

"Sure we'll loan you all the money you want, on the condition that you enact laws making all the citizens of your individual countries responsible for the interest payments, through taxation"

One by one the leaders of every government on earth sold out, and agreed to demonetize gold, thereby allowing the continued power grab of the banking cartels through the issuance debt based currency. The result has been the methodical fleecing of the general population through the debasing of the dollar by 97%. (see death penalty above)

On May 22nd, 1933, Congress enacted a law, against Constitutional mandate, declaring all coin and currencies then in circulation to be legal tender, dollar for dollar, as if they were gold. The President was unconstitutionally empowered to reduce the gold content to the dollar up to 50 percent. (see death penalty above)

On June 5th, 1933, Congress stabbed the gold standard out of existence by enacting a joint resolution (48 Stat. 112), that all gold clauses in contracts were outlawed and no one could legally demand gold in payment for any obligation due to him. (see death penalty above)

On January 30th, 1934, the Gold Reserve Act was passed, giving the Federal Reserve title to all the gold which had been collected. This act also changed the value/price of gold from $20.67 per ounce to $35 per ounce, which meant that all of the silver certificates the people had recently received for their gold now were worth 40 percent less. (see death penalty above)

On January 31st, 1934, after President Roosevelt fixed the dollar at 15 and 5/21 grains standard to gold. Russia and the central banks of Europe were very excited and began buying up gold in huge quantities. This planned redistribution of our country's wealth was one of the most important objectives of the Globalist's agenda. Thus a dual monetary system began which offered the gold standard for foreigners and Federal Reserve notes for Americans. (see death penalty above)

Between 1934 to 1963 all Federal Reserve notes issued had a promised to pay, or to be redeemed in "lawful money." Over a short period of time the wording on the Federal Reserve notes began to change until there was no redemption in silver promised. This was done slowly enough that the people didn't see it coming. (see death penalty above)

On November 2nd, 1963, new Federal Reserve notes with no promise to pay in "lawful money" was released. No guarantees, no value. (see death penalty above)

In 1965 silver in coins were reduced to 40 percent by President Lyndon Johnson's authorization. (see death penalty above)

President Lyndon Johnson issued a proclamation on June 24, 1968, that all Federal Reserve Silver Certificates were merely fiat legal tender and could not be redeemed in silver. (see death penalty above)

On December 31, 1970, President Richard Nixon signed into law an amendment to the Bank Holding Company Act, which, among other things, authorized the treasury to totally debase coins to a worthless value in non precious metal. (see death penalty above)

"Single acts of tyranny may be ascribed to the accidental opinion of a day. But a series of oppressions, begun at a distinguished period, and pursued unalterably through every change of ministers, too plainly proves a deliberate systematic plan of reducing us to slavery." - Thomas Jefferson

Since the seventies, the unfettered issuance of debt money has continued to debase our currency more rapidly than ever before. In the last three years, the debasement has accelerated exponentially.

"The abandonment of the gold standard made it possible for the welfare statists (government bureaucrats) to use the banking system as an unlimited expansion of credit. In the absence of the gold standard, there is no way to protect savings from confiscation through inflation... Deficit spending is simply a scheme for the "hidden" confiscation of wealth. Gold stands in the way of this insidious process." - Alan Greenspan

The world governments continue to babble that tired Keynesian rhetoric insisting that gold and silver have become obsolete, relics of the past. Yet in the 4th Quarter of 2006 global gold and silver demand was the highest on record, and, some of the world's largest investors are presently taking major positions in precious metals.

The cartel wants economic growth, lots of borrowers, and lots of opportunities to lend newly created funny money at interest. You can't blame them for wanting that. If I could print up all the funny money I wanted and could then lend it out at interest, I'd be happy too. That is, I would be happy to lend it if I didn't have a soul. The ravages of inflation have heretofore been thoroughly exposed and the results are blatantly apparent in our inability to successfully engineer our lives without debt. Fractional reserve banking has provided for the theft of the life blood of our nation.

Compounding the problem is the fact that the world is no longer capable of sustaining economic expansion. We are beginning to witness emerging nations, like China and India sucking up natural resources at a rate that is way past rechargeable. We are entering a period of civilization where the keyword is sustainability, not growth.

The debasement of our currency continues with abandon.The purchasing power of the dollar is quickly eroding. It is down 30% in the last three years. Conversely, the value of gold is up 30% in the last three years. Because the dollar is the reserve currency of world, every commodity, from rice to timber, from oil to precious metals, will continue to rise, priced in dollars.

The U.S.A. is currently breaking all records for the longest period of time that a nation's economy has endured after abandoning the gold standard. Our country has been foreclosed on in the past, and its just about to be foreclosed on again. It's just a matter of time. The "endgame" is near.

" I believe that banking institutions are more dangerous to our liberties than standing armies . . . If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] . . . will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered . . . The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." -- Thomas Jefferson -- The Debate Over The Re Charter Of The Bank Bill, (1809)

The last thing that the powers that are engineering the devaluation of the dollar want to happen is for the world to wake up to the fact that precious metals represent un-inflatable money. Both gold and silver are rising in price. This rise is currently fueled mostly by the dollar's demise. When the resulting "demand panic" kicks in, and it will very soon, the value of precious metals will "go ballistic." Oil is already being affected by "demand panic." It's price is rising in all currencies, not just the dollar.

It is my view, (and one that is shared by a great many others), that the failure of our current monetary system is eminent. The purpose of this examination has been to "wake you up", and make you aware of the facts that support my take on things. Hopefully it has increased your respect for the intrinsic value of precious metals. From an economic standpoint, gold and silver will lend heartily to our salvation. Gold and silver will soon regain their positions as the anchors of an honest monetary system. The market will demand it, and the "powers that be" will have no choice but to let the market have its way.

The presence of gold and silver in your portfolio will insure that you will emerge from the abyss with your capital intact. There is still time for you to reallocate a portion of your equity into the commodity sector, including gold and silver bullion, and gold and silver mining stocks. This move could well provide you with an unequaled measure of security. The gold standard is part of our Constitutional legacy. The subjugation of the Constitution is the root of all economic evils. If enough of us get together on this, we might be able to "Right the Republic". Very soon, as early as next year, a lot of people will be glad they held gold and silver.

Its not what you don't know that will screw you up, it's what you know that is wrong. The spin you hear from the mainstream media is intended to mislead you. Open your eyes and face the future. If you leave your head in the sand and ignore it, you are only leaving your butt exposed for the world to kick. This all may sound like gloom and doom, but when you get a handle on what is going to happen, you will have a future filled with opportunity. Fortune favors the Informed.

Kenneth Parsons, aka Johnny Silver Bear, is an IT professional in Texas and the President of Silver Bear Communications, Inc. Mr. Parsons has been involved in the advertising and promotion industry for over twenty-five years. He is the editor of the Silver Bear Cafe and, as such, is responsible for shaping the content of "The Bear". Mr. Parsons has served as CEO for Fiberscape Communications, Inc., a web site development / hosting and streaming multi-media company in Richardson, Texas since 1997. He is a Jeffersonian and a passionate supporter of the U.S. Constitution. He is also an outspoken advocate of gold money and equal tax rates. You can contact Mr. Parsons with questions or comments via email at johnny@silverbearcafe.com

Were America’s Founding Fathers Wrong for Advocating Death for QE Measures? -August 11 2010

Couldn’t have said it better myself.


If the Founding Fathers of our nation felt that anyone who debased our currency should be punished by death, I think we can all agree that they placed the highest priority on keeping our money free from private (banking) hands – thereby keeping us a truly free, sovereign nation. 

They knew that a sovereign nation must remain free from outside interests – including international bankers and their schemes.  Why isn’t anyone in a position of power today saying or doing anything about this (Ron Paul excluded)?  Why isn’t mainstream media saying anything?

If we consider that our Constitution grants the power to create and regulate our money to Congress and Congress only – and the Coinage Act of 1792 specifies exactly what a U.S. Dollar is – why have we allowed a private international banking cartel to take over our banking system – issue their own version of the U.S. Dollar (in direct violation of the Coinage Act) and debase our currency – for almost 100 years?

JFK gave us our answer almost 50 years ago – and we did not heed the warning.

“We are opposed around the world by a monolithic and ruthless conspiracy that relies primarily on covet means for expanding its sphere of influence – on infiltration instead of invasion – on subversion instead of elections – on intimidation instead of free choice. It is a system that has conscripted vast human and material resources into the building of a tightly knit, highly efficient machine - that combines military, diplomatic, intelligence, economic, scientific and political operations. Its preparations are concealed, not published. Its mistakes are buried, not headlined. Its dissenters are silenced, not praised. No expenditure is questioned, no secret is revealed.” –JFK

As you’ve seen me say many times – there is a bigger agenda at work here.  The people behind the Federal Reserve are debasing our currency – in order to destroy it – and us.  We - the people of the United States - and our currency stand in the way of world government and a world financial system with one global currency. 

We are being deceptively attacked – not with weapons of war – but with economic weapons. 

These are weapons that the vast majority of us do not see – and do not understand. 

We have been blinded from the truth – so that an evil agenda can move forward.

This is why our Founding Fathers provided such a harsh sentence for debasing our currency.  They lived under British rule and understood how a nation can be controlled through its currency.  They understood the danger and took the necessary precautions.  They gave us the tools to remove the Fed and their debt based monetary system that guarantees the destruction of our currency.

The ‘beast’ has lulled us to sleep.

Will we wake up in time?

jg – August 11, 2010
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An Open Challenge to Paul Krugman: Were America’s Founding Fathers Wrong for Advocating Death for QE Measures?

Submitted by smartknowledgeu on 08/11/2010 01:07 -0500

www.zerohedge.com

http://www.zerohedge.com/article/open-challenge-paul-krugman-were-america’s-founding-fathers-wrong-advocating-death-qe-measur

In light of the US Central Bank’s (I refuse to use their misleading self-anointed US Federal Reserve moniker) most recent grandstanding policy decision that has been referred to as "QE light" that precedes the inevitable QE2 launch sometime in the not so distant future, I present an open challenge to Paul Krugman and all like minded economists, Nobel prize winning or not, that support the monetary policy of dollar debasement. This will be a straightforward challenge issued by our Founding Fathers, in particular the first US Treasury Secretary, Alexander Hamilton, who scripted the US Coinage Act of 1792. The one question I want to see Mr. Krugman and his supporters answer is this:

“If monetary debasement can truly create economic recovery, why did our Founding Fathers establish, in the US Coinage Act of 1792, that any persons discovered to be deliberately debasing US money ‘shall be guilty of felony and shall be punished by death’?”

Note that the punishment was not imprisonment, not even hard labor, but death. Why did our Founding Fathers, who had just gained freedom from the draconian monetary policies of the British monarch King George through the American Revolution and the Treaty of Paris in 1783 deem that monetary stability could not be separated from the conditions of freedom? Why did they deem the act of monetary debasement so insidious that anyone found guilty of deliberately debasing US money would not be imprisoned but should be punished by death? And why is monetary debasement today accepted as the “right thing to do” and “normalized” by prominent economists like Paul Krugman?

So this is all I ask of you Mr. Krugman - to repudiate Alexander Hamilton and explain why he was wrong. I don’t want the employment of deft politician-utilized “block and bridge” techniques that fail to ever address the question, or responses that entail long-winded dissertations on the relationships between monetary base, monetary supply and monetary velocity that fail to answer the question. Please merely be so kind as to answer the one question inspired by Alexander Hamilton and posed to you above and explain your position.

On August 3, 2010, I posted a 3-part video series in regard to the Central Banks’ use of ideological subversion to mislead the masses. Step two of the process of ideological subversion requires the participation of academics to disseminate deceit if the deceit is to not only be widespread but successful in taking root in the consciousness of society. The role of academics in shaping the discourse about the rationality of monetary debasement is critical to the belief system embraced by young impressionable minds for decades into the future as once a false belief takes root it is spread from one generation to the next. In other words, the widespread adoption of the erroneous belief that monetary debasement is beneficial to the economic health of nations would be impossible without you, Mr. Krugman. The Bank of Japan is another Central Bank guilty of executing the act of monetary debasement for decades. And again, academics that reside both within and outside of Japan ensure that the Japanese do not understand how monetary stability is inextricably linked to their most sacrosanct right of freedom.

For those of you reading this that understand why the enforcement of monetary stability is central to your freedom, and I’m sure there are many of you, you must realize that you are among the very small minority of the world’s population that understands this. I have posed this challenge to Paul Krugman because he has the extremely powerful bully pulpit of the New York Times, Princeton University and mass media distribution channels to disseminate his opinion, to hundreds of millions, that monetary debasement is of great benefit to recovering economies.

Today, academics have drawn the focus away from the immorality of the monetary debasement component of quantitative easing by refocusing discussions on the useless debate of whether or not QE assists economic recovery. This type of useless debate only serves as a distraction tactic to draw attention away from the more paramount issue of whether QE destroys the wealth of citizens and therefore is an enemy of freedom.  So with this in mind, let us look at the exact language of the US Coinage Act of 1792, scripted by the first US Treasury Secretary and one of the Republic of America’s founding fathers, Alexander Hamilton.

Section 12. And be it further enacted, That  the standard for all gold coins of the United  States shall be eleven parts fine to one part alloy; and accordingly that eleven parts fine to one part alloy; and accordingly that eleven parts in twelve of the entire weight of each of the said coins shall consist of pure gold, and the remaining one twelfth part of alloy; and the said alloy shall be composed of silver and copper, in such proportions not exceeding one half silver as shall be found convenient; to be regulated by the director of the mint, for the time being, with the approbation of the President of the United States, until further provision shall be made by law.

Section 13. And be it further enacted, That the standard for all silver coins of the United States, shall be one thousand four hundred and eighty-five parts fine to one hundred and seventy-nine parts alloy; and accordingly that one thousand four hundred and eighty-five parts in one thousand six hundred and sixty-four parts of the entire weight of each of the said coins shall consist of pure silver, and the remaining one hundred and seventy-nine parts of alloy; which alloy shall be wholly of copper.

Section 14. And be it further enacted, that it shall be lawful for any person or persons to bring to the said mint gold and silver bullion in order to their being coined; and that the bullion so brought shall be there assayed and coined as speedily as may be after the receipt thereof, and free of expense to the person or persons by whom the same shall have been brought.

Section 19. And be it further enacted, That if any of the gold or silver coins which shall be struck or coined at the said mint shall be debased or made worse as to the proportion of the fine gold or fine silver therein contained, or shall be of less weight or value than the same out to be pursuant to the directions of this act, through the default or with the connivance of any of the officers or persons who shall be employed at the said mint, for the purpose of profit or gain, or otherwise with a fraudulent intent, and if any of the said officers or persons shall embezzle any of the metals which shall at any time be committed to their charge for the purpose of being coined, or any of the coins which shall be struck or coined at the said mint, every such officer or person who shall commit any or either of the said offenses, shall be deemed guilty of felony, and shall suffer death.

On March 20, 2009, in the article “Fiscal Aspects of Quantitative Easing”, Mr. Paul Krugman wrote:

“The big policy news this week has been the Fed’s decision to buy $1 trillion of long-term bonds, going beyond the normal policy of buying only short-term debt. Good move…”

“The Fed is, however, creating a new liability: the monetary base it creates to buy these bonds. In effect, it’s printing $1 trillion of money, and using those funds to buy bonds. Is this inflationary? We hope so! The whole reason for quantitative easing is that normal monetary expansion, printing money to buy short-term debt, has no traction thanks to near-zero rates. Gaining some traction — in effect, having some inflationary effect — is what the policy is all about.”

“I’m not complaining; I think quantitative easing (it’s really qualitative easing, but I give up on trying to fix the terminology) is the right way to go.”

One thing is clear, Mr. Krugman. Either those men that are universally accepted to be among the greatest American patriots of all time were terrorists for desiring the sentence of death for anyone that destabilized money, OR you are massively wrong. Both of you cannot be right. Your defense of your position needs to repudiate the very founding fathers of the REPUBLIC (not the democracy) of America and needs to explain why you are spreading a diametrically opposing viewpoint to the wishes of America’s founding fathers.

When prominent academics such as yourself, Mr.Krugman, support monetary policies that our Founding Fathers believed to be tyrannical, this supports a misguided and delusional belief system, the mistakes of which are exponentially multiplied by financial journalists that ensure that misinformation becomes not myth but part of a new reality that bankers desire. I cannot recall the hundreds of times have I seen misleading headlines like “Japanese markets fall sharply in the last month on the back of a strengthening Yen” (or replace "Japanese" with another nationality and "Yen" with another nation's currency). Such headlines, by nature, imply that a rising Yen is undesirable when in reality, such policy is enormously beneficial to a nation of savers. Monetary debasement punishes anyone that saves their money instead of spending it right away. Financial journalists, unable to comprehend monetary policy accurately because of academics that spread deceit instead of truth, continuously script headlines that fall victim to the con game of ideological subversion.

Quantitative easing is a banker-created euphemism for monetary debasement. Please explain to Alexander Hamilton, who surely is rolling over in his grave after reading your words Mr. Krugman, why a great American patriot like Alexander Hamilton was so wrong.  Billions that have been subjected to and that have suffered a much lower standard of living as a result of monetary debasement policies  enforced by Central Banks around the world await your answer. If we are going to emerge from this global monetary crisis with a sustainable solution that benefits all citizens of the world as we all desire, you must not remain silent in responding to this question.

 About the author: JS Kim is the Chief Investment Strategist and Managing Director of SmartKnowledgeU, a fiercely independent wealth consultancy company that guides investors in the best ways to invest in gold and silver as well as other strategies to profit from the progression of this global financial crisis. His Crisis Investment Opportunities newsletter has significantly beat all major developed stock market indexes since the first day of its launch, outperforming the Australian ASX 200, the UK FTSE 100 & the US S&P 500 by 308.89%, 304.87%, and 300.85%* during the period of June 15, 2007 to May 12, 2010 (*in a tax-deferred account).