USD today has no gold behind it whatsoever. The fraction is not 54% nor 15%. It is 0%.
By Daniel at 30 November, 2009, 1:12 am
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It has traveled the path of all previous fractional money in history and already has degenerated into pure fiat money. The fact that most of it is in the form of checkbook balances rather than paper currency is a mere technicality; and the fact that bankers speak about “reserve ratios” is eyewash. The so-called reserves to which they refer are, in fact, Treasury bonds and other certificates of debt.
Our money is “pure fiat” through and through.
The second fact that needs to be clearly understood is that, in spite of the technical jargon and seemingly complicated procedures, the actual mechanism by which the Federal Reserve creates money is quite simple. They do it exactly the same way the goldsmiths of old did except, of course, the goldsmiths were limited by the need to hold some precious metals in reserve, whereas the Fed has no such restriction.
The United States went “bankrupt” in 1933. [President Roosevelt Executive Order 6073, 6102, 6111, 6260; Senate Report 93-549, pgs. 187 & 594, 1973]
Pursuant to Title 12, USC Sec. 411, a “dollar bill” (Federal Reserve note) is NOT a dollar. It is a promise to pay face value – in dollars – in the future. That promise was repudiated in 1933 – over 76 years ago.
- TheRed.PillPlease
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