Introduction to the People's Commission for Using Gold as Money in the USA
The 'People's Commission for Using Gold as Money' is a project of 'Safer Investing Group'. The Commission is a grass roots multi-state organization aimed at implementing a Private Gold Standard in the USA as defined in chapter 4 of Dave's book 'Monetary Revolution USA' . Of course, the requirement to use gold is in the Federal Constitution in Article 1, Section 8 as; The Congress shall have the power to .... Coin money, regulate the Value thereof,...'. Only metal can be 'coined'! Then Section 10 says; 'No State shall,....coin money,...,make any Thing but gold and Silver Coin a Tender in Payment of Debts;..' These terms have been ignored by Congress. They created the 'Federal Reserve System' (our central bank) so they could manage the monetary system and make new money and credit 'out of thin air.' Our approach will be 'bottom up' where we lobby State governments to have them convert to gold first, then the Fed and Washington's role will wither. The states of AZ, TX (plus a Depository), UT, and OK have already approved gold and silver for use as money. Details vary (see descriptions below). Remember, Gresham's Law says; 'Good money drives out bad!' This approach is important because the self-serving Legislators in DC will never vote to end their supply of fake 'fiat' money to pay for their wars, welfare, and subsidies to donors..
Key provisions of the Plan are:
a) The government would have a shared role in the monetary system, except its sole and proper legal role to verify/audit reserves that mints claim to hold for redemption of 'representative' money (per item c). This could be done by private firms also.
b) The Federal government would 'coin' money, but Private mints would be allowed, with license optional, and would issue both gold coins (perhaps just a gold disk in the center), and 'representative' paper notes and token coins (per item c below) if redeemable for gold. They would be required inform the public of the amount of gold they physically possess (not just a certificate for an 'unallocated' share of gold held by a third party) for redemption of notes and tokens. Minting by the government Treasury would be optional and have no privileges over private mints, thus allowing competing currencies. Other precious metals (such as silver) could be used, but gold has usually been preferred by the free market (users of money; see 'Monetary Rules' in chapter 4 of Dave's book). The private mints will decide which metals to use, based on market demand, which will vary by geographical area. Market demand will also determine the value of gold relative to other metals.
c) 'Representative money' such as paper notes and base-metal 'token' coins could be used (they are just 'receipts' for the real money, which is gold), but by law would be subject to redemption for gold by bearer on demand. No specific percent of reserves for money issued would be required. If users of a mint's money were not confident of adequate gold reserves for redemption, they would use money from another mint. This gives incentive for mints to be honest and provide a good product. The Free Market at work!
d) There would be no central bank or legal tender laws, and multi-state branch banking would be allowed (with license optional),
e) 'Weight of gold' would be the unit of account. This means prices would be set as a weight of gold (with stated fineness, such as 14 carat). The weight and fineness would appear on the coin, and no 'name' such as 'dollar' would be required. Names make it too easy for governments to change the amount of gold they represent. Gold will have no 'price' (in 'dollars', etc.), and is not 'backing' for 'money', because it IS money. It is also a store of value.
f) The conversion of the US Monetary System to using gold as money would follow the 'Six-Step Plan' shown in chapter 4 of Dave's Monetary book. Note that M3 is used as the amount funded by our supply of gold, with 100% reserves for redemption, which means all holders of US cash and Treasuries are funded ('Federal Reserve Notes' would be redeemable, but would be converted to 'new' money within two years). Other plans have used M1, and as low as 20% reserves, which amounts to repudiation of long term debt, and increases the risk of a 'redemption run'.
Other nations would be informed of US plans, but no international planning conferences would be held (they would just slow the process and dilute the gold content). Once the US (or maybe Germany first !) converts to gold, I predict all other nations will have to or Sellers will not accept their trash fiat paper! As gold money becomes dominate, no 'reserve currency' system will be needed, then currency manipulation (pegs, monetary inflation, etc.) and the foreign exchange industry will end. Good! The primary benefit of using gold is to end the government's ability to create money 'out of thin air' to fund its excessive spending for wars (all US wars since the Revolution have been for political and economic goals, not homeland defense), welfare, and subsidies to get votes. It also complies with Article 1, Section 8, of the US Constitution which empowers the government to 'coin money' (the Founders had recent experience in the abuse and damage caused by fiat - no gold backing- money), and in Section 10 for States to '...not make anything but gold and silver coin a tender in payment....'. Note the absence of authority to create a central bank, or a private bank such as the Federal Reserve System, which acts like one!.
Here are five Key Issues and benefits that are part of using Gold as Money:
1) There is always ‘enough’ gold because its value (purchasing power) per ounce/gram, with a near-fixed supply (mining only increases the supply by about 1.5% per year), APPRECIATES with more demand (growth of GDP). The opposite is true (ie, depreciation) in a shrinking GDP. It stays in balance based on supply and demand. We are all accustomed to constant depreciation due to excessive expansion of the money supply and debt by the Fed (monetary inflation; reduced purchasing power) to fund the excessive spending of government and banks!
2) There is more incentive to save because of the appreciation in item 1 above. Thus there is more capital for private investment.
3) Most nations run short of money if they import too much, and suffer loss in currency value (reduced exchange rate) if they create new money to pay for it. BUT, the issuer of the world’s primary reserve currency (today the USA) can issue new money with little short-term effect on value. This has been called our ‘exorbitant privilege’ ! The imports reduce domestic purchases and production and thus cause ‘offshoring’ of jobs, technology, and factories. This would be ended by conversion to a gold standard because it does not allow unlimited creation of new money.
4) When any major nation converts to a gold standard (today it could be USA, Germany, or China since they all have the GDP size and tonnes of gold needed), then all nations would have to, or no merchant or bank would accept their trash fiat paper (or at least impose a big forex discount). Also, the ‘reserve currency’ concept would wither because all gold standard currencies would be ‘good’ (if reserves were strong), and thus the IMF, World Bank, BIS, G20, etc. would become obsolete and wither.
5) The market value of gold money in a transaction is equal to the market value of the good or service being bought or sold, not just a ‘symbolic’ amount (such as ‘face value’) that people have agreed on
History shows us that a monetary system using precious metals as money is the path to peace and prosperity, and ALWAYS works. Conferences will be held in locations across America to discuss how to make the federal government adopt our Private Gold Standard. Educating members of the U.S. Congress and State legislators will be a priority. State branches of the Safer Investing Group will be setup to organize this work The next conference will be announced soon. Stay Tuned. If you wish to be added to our news list, or attend a conference, send me a message at RedickD@AOL.com.
Description of State Laws on Use of Gold and Silver as Money
Refer to Dave's Book 'Monetary Revolution USA'. Chapter 4, for a description of the People's Commission's
x The states of AZ, TX (plus a Depository), UT, and OK have already approved gold and silver for use as money.
Description of the People's Commission's Plan to Introduce the New State Money.
Refer to Dave's Book 'Monetary Revolution USA'. Chapter 4, for more details.