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A Return to the Gold Standard is a Must

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Money printer extraordinaire and Federal Reserve Chairman Ben Bernanke is at it again. He and several of his central banking buddies in Europe and Asia are going to lend dollars to non-U.S. banks that lack adequate liquidity to operate. Many of the recipient banks are feeling the pinch because of their exposure to the Greek debt crisis.

Of course this isn’t the first time the Fed has lent our money to foreign banks to stave off their insolvency. In July of 2009, Bernanke testified in front of Congress that the Fed had loaned over $550 billion to foreign banks during the height of the financial crisis in 2008. And thanks to the Dodd-Frank Wall Street Reform and Consumer Protection Act a one-time General Accounting Office audit uncovered a remarkable $16.1 trillion in Fed loans to various banks including non-U.S. ones during the same time frame.

Now, it’s bad enough the Fed has and will again use our money to bailout foreign banks that were irresponsible. But, the latest round of foreign bailouts comes at a time when it is being reported that tent cities filled with homeless folks are becoming commonplace across America and some Americans are resorting to dumpster diving to feed their families. Is this what America is coming to? Our central bank helps Greek citizens retire at fifty while our citizens live in nylon igloos while wallowing in trash dumpsters for their next meal? Worse yet, besides Ron Paul, no member of Congress or the Obama administration has expressed any outrage over the foreign bailouts.

The whole sordid affair is yet another reason why we need to return to a gold standard to protect the integrity of the dollar. As Congressman Paul has stated many times, we must return to the constitutional mandate requiring gold and silver be used as money. Article 1, Section 10, Clause 1 of the Constitution states in part, “No State shall…emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts…”

Many anti-constitutionalists will argue that the clause only applies to the states and the federal government can use what it wants for money. Thus the current fiat dollar system is legal.

But upon closer examination of history, the anti-constitutionalists are proven wrong once again. During the colonial period of our country’s history, the Spanish milled (silver) dollar was the predominant medium of exchange in the original Thirteen Colonies. . In July of 1785, Congress voted unanimously to make the dollar the monetary unit of the United States to emulate the Spanish milled (silver) dollar. On August 8, 1787, Congress resolved that the new American dollar would contain three hundred and seventy-five grains and sixty-four hundredths of a grain of fine silver. This measure of silver made the new American dollar equal in value to the Spanish dollar.

At the same time in Philadelphia, the Constitution was being written by many of the same people who adopted the silver dollar standard for the country in the Continental Congress. Thus, these men as well as their Constitutional Convention colleagues were well aware that the silver dollar had become and was the official monetary unit of the United States. As a matter of fact, the term “dollar” is referred to twice in the Constitution – Article 1, Section 9, Clause 1 and in the Seventh Amendment.

Where it is not mentioned is under Congress’ powers in Article 1 Section 8. Additionally, gold and silver are not mentioned there either. The only requirements for money in that section are that Congress has the power “…to coin money and regulate the value thereof…” And a month before the Constitutional Convention adjourned, Congress did just that by making the silver dollar with three hundred and seventy-five grains and sixty-four hundredths of a grain of fine silver the monetary unit of the country.

About Kenn Jacobine

  • zingzing

    my point, kenn, is that business cycles exist with or without the fed…

  • Clavos

    The Fed was born on an Island off the coast of Georgia.

    Jekyll Island

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Georgia, and (Dr) Jekyll to boot.

    It spells “sinister” from the very beginning.

  • troll

    …certainly sinister of Daddy W to air plans for his scheme only in the most obscure trade rag and its financial supplement where this secret proposal appeared

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    That is a hell of a find.

    I suppose the Bank of England has a longer history as a central bank.

  • http://blogcritics.org/writers/irene-athena Irene Athena

    2/9/1935 Saturday Evening Post “…I was as secretive – indeed, as furtive – as any conspirator….I do not feel it is any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System….We were told to leave our last names behind us. We were told, further, that we should avoid dining together on the night of our departure. We were instructed to come one at a time and as unobtrusively as possible to the railroad terminal on the New Jersey littoral of the Hudson, where Senator Aldrich’s private car would be in readiness, attached to the rear end of a train for the South…If it were to be exposed publicly that our particular group* had gotten together and written a banking bill, that bill would have no chance whatever of passage by Congress.”

    *Those attending
    National City Bank president Frank A. Vanderlip, author of this article.
    Senator Nelson Aldrich and his personal secretary Arthur Shelton.
    former Harvard University professor of economics Dr. A. Piatt Andrew.
    J.P. Morgan & Co. partner Henry P. Davison.
    Kuhn, Loeb, and Co. partner Paul M. Warburg.

    “The purpose of the meeting was to come to an agreement on the structure and operation of a banking cartel. The goal of the cartel, as is true of all of them, was to maximize profits by minimizing competition between members, to make it difficult for new competitors to enter the field, and to utilize the police power of government to enforce the cartel agreement.” G. Edward Griffin, author of “The Creature from Jekyll Island”

    I agree, Kenn. While troll posted links that predate the 1910 meeting by a few years where Warburg tries to make the case to the public for need for a new banking arrangement, the plans made on Jekyll Island for the Federal Reserve and a government-protected banking cartel were made in the utmost secrecy, because, by the admission of one of the participants, they knew that Congress would not approve.

    The Federal Reserve’s secrecy is finally coming to light to a broader segment of the population. I’ll post it again: Note the dogged refusal by Bernanke to reveal to Bernie Sanders the names of the recipients of $2.2 TRILLION in loans of money of OUR money.

  • troll

    that does sound pretty damned conspiratorial now don’t it…

  • http://blogcritics.org/writers/irene-athena Irene Athena

    *shrugs* To me it does.

  • http://blogcritics.org/writers/irene-athena Irene Athena

    I can’t imagine that DEFENDING the secrecy of the Federal Reserve would be part of the Occupy Wall Street’s agenda, but if it ever becomes that, count me out.

  • troll

    commercial announcement

    there’s a sizable end the Fed group in the occupy movement Irene…make your voice heard there

    we’ve had teaparty members address the assembly in albq making points on which all can agree and work from constructively

    when they get around to ‘god bless america’ I’ve noticed the general enthusiasm level drops off but the general rule is to show respect for all voices

    /commercial announcement

  • troll

    didn’t see #59 before #60…was agreeing w/ your #56 in my #57

  • http://blogcritics.org/writers/irene-athena Irene Athena

    It was hard for me to see a difference in the tone of #54 and that of #57. I’ll take your word for it that there was one.

  • troll

    hmmm – consider the possibility that based on the quote you posted I decided that what I posted didn’t preclude conspiracy at the time actual decisions were made

    does that help you distinguish the doubt in my 54 from agreement in 57?

  • http://blogcritics.org/writers/irene-athena Irene Athena

    I have new-found confidence in my power of persuasion. :) Peace to you.

  • troll

    :-)

  • Igor

    There will be no Gold Standard allowed by the industrial and financial interests that control the USA because then the economy will be out of their control and they can´t play the games they play to seize peoples money.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    @64

    Atta girl, but how could you ever doubt it?

    By the hordes of disbelievers?

  • Kenn Jacobine

    And I would add the inflation the banking cartel has caused all to profit themselves is precisely what destroys the lower and middle class. Our jobs are shipped overseas, prices rise making ends hard to meet, and savings and pensions lose value.