• Tag Archives US Treasury
  • Sign the Petition to Audit US Gold Reserves

    For many years, the Gold Anti-Trust Action Committee (GATA) has been gathering official government documents that indicate the US gold reserves are insufficient and cannot cover the paper obligations assigned to them.  Through leasing and swap agreements with other nations, the details of which are hidden from the public, the nation’s gold could be in jeopardy and at the very least, over-reported. Some people have even openly speculated that the Fort Knox facility contains mostly empty space.

    There is now a movement to have the gold reserves audited.  As the description in the petition notes, the reserves have not been audited since 1953!  Prior to that, there were semi-regular audits. In the last 60 years, there has been too much turmoil to simply assume normality in this matter. A prudent and measured action is necessary.

    It’s amazingly easy to create a White House account and sign the petition – all you need is a valid email address and zip code.  If the petition gets at least 25,000 signatures, the White House must take action to take the issue to the next step for further study.   Read and sign the petition today.

    Fort Knox

  • Is More QE Coming, Or Not?

    Posted on by JonK Comment

    With the Fed purchasing 61% of all the US debt, it’s somewhat confusing why potential precious metals investors want to see more QE before making their move. And as the following chart from the St. Louis Fed shows, the money supply is still at uncharted, nose-bleed levels and showing no signs of decreasing.

    US Dollar Money Supply

    Nevertheless, analyzing a derivative of the TIPS Spread to identify when the Fed might reintroduce even more easing is what the economists over at Agora Financial have been doing.  As the chart below shows, the Fed may be waiting for the “Breakeven Inflation Rate” to drop below 2.2% prior to accelerating those printing presses.

    Five-Year Forward Break-Even Inflation Rate

  • Subtle Fleecing of the U.S. Currency

    January 5, 2012

    The changes have been subtle and even span generations, which accounts for few people even noticing. Yet, looking back over the history of the US currency, one immediately sees that the citizens have been fleeced!

    In 1929, all newly issued US currency was standardized in size and general appearance. For example, the $10 bill would now always be printed with Alexander Hamilton’s portrait. At this time, it’s interesting to note that bills were issued in different series

    All these issues had the same general appearance, but differed primarily in their obligation to the bearer of the bill.

    For example, here is a Federal Reserve Note from 1928. (Click on images for better clarity.)  The obligation is stated as “REDEEMABLE IN GOLD ON DEMAND AT THE UNITED STATES TREASURY, OR IN GOLD OR LAWFUL MONEY AT ANY FEDERAL RESERVE BANK”

    1928 10 Dollar Federal Reserve Note

    Similarly, here is a Gold Certificate from 1928. This is not a note, but rather a certificate representing a specific amount of gold on deposit at the Treasury. Starting at the top of the bill and ending at the bottom, the whole concept is written as “THIS CERTIFIES THAT THERE HAVE BEEN DEPOSITED IN THE TREASURY OF THE UNITED STATES OF AMERICA TEN DOLLARS IN GOLD COIN PAYABLE TO THE BEARER ON DEMAND”

    1928 10 Dollar Gold Certificate

    But in 1933, Franklin D. Roosevelt took America off the Gold Standard, thus citizens were no longer able to redeem their bills for gold coin. Gold Certificates were not printed anymore. Furthermore, the words “IN GOLD” were removed from the obligation statement of the Federal Reserve Note, leaving the redemption option to “LAWFUL MONEY” as can be seen in this 1934 note:

    1934 10 Dollar Federal Reserve Note

    The US Constitution doesn’t contain the words LAWFUL MONEY. But Article 1, Section 10 prohibits states from making “any Thing but gold and silver Coin a Tender in Payment of Debts;”  While gold was withheld from the public at this time, silver was still accessible and Silver Certificates were still redeemable for silver coin.

    1933 10 Dollar Silver Certificate

    The Treasury, therefore, had to keep silver in their vaults in order to keep the promise of redemption. But the value of silver was increasing and people were trading in their certificates for the real metal. The Treasury’s silver was drying up. As the certificates were redeemed, they were destroyed as no new silver was put in the vault to maintain proper backing.

    Finally, in 1964 the Treasury halted silver redemption. All that was left then, was the Federal Reserve Note, which was now being printed with a completely relaxed obligation.

    1963 10 Dollar Federal Reserve Note

    There is no longer any promise to redeem anything on demand of the bearer. Only a statement is made that this fiat paper note is “LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE.”  Even though there is nothing but more paper backing this bill, citizens yearn for more of this stuff as if it’s worth something more than the empty promises of the issuing government.

    They might have spruced it up a bit recently, but as the saying goes, it’s like putting lipstick on a pig…. it’s still a pig!

    2004 10 Dollar Federal Reserve Note


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