On 4 March 2009 the Armenian Dram went poof, on 6 February 2009 the Kazakhstan Tenge went poof, in October 2008 the Iceland Krona went poof, during 2008 the British Pound went poof and the Continental Dollar went poof prompting the Founding Fathers to craft particular monetary powers and disabilities in the United States Constitution.
Nevertheless, the United States Dollar or Federal Reserve Note Dollar went poof multiple times last century including on 5 April 1933, 4 June, 1963, 24 June 1968 when silver certificate redemption was completely ceased, and 15 August 1971 during the Nixon shock. The current Federal Reserve Note United States Dollar, an illusion issued by an entity engaged in quantitative easing, will eventually go poof as the Treasury Bill bubble bursts.
FIJI DOLLAR ILLUSION EVAPORATES
On 15 April 2009 Bloomberg reported, “The Reserve Bank of Fiji said today it has devalued the Fiji dollar by 20 percent with immediate effect.”
Currency illusions, like the Fiji Dollar, can be summoned and evaporated by hairless monkeys pounding buttons on a keyboard resulting in someone’s lifetime of savings or pension purchasing 20% less bananas. This theft amounts to immoral taxation without representation being a form of confiscation through inflation and is a taking of property without due process of law.
WHAT IS GOLD AND SILVER
Gold, aurum in Latin, is a chemical element with the symbol Au and atomic number 79. Gold’s melting point is 1,337.33 Kelvin, 1,064.18 °Celsius and 1,947.52 °Fahrenheit.
Silver, argentum in Latin, is a chemical element with the symbol Ag and atomic number 47. Silver’s melting point is 961.78 °C or 1,763.2 °F.
WHAT IS A DOLLAR
The term ‘dollar’ is found in Article 1 Section 9 and the Seventh Amendment. Like the terms ‘day’ or ‘year’ the term dollar has a specific definition.
Dr. Veiera, J.D., the preeminent legal expert on the monetary jurisprudence, addresses the issue What Is A Dollar? Under the Coinage Act of 1792 the definition of a Dollar is found in Section Nine: ”DOLLARS or UNITS - each to be of the value of a Spanish milled dollar as the same is now current, and to contain three hundred and seventy one grains and four sixteenth parts of a grain of pure, or four hundred and sixteen grains of standard silver.”
GOLD AND SILVER CANNOT EVAPORATE
Water’s boiling point is 99.974 °C or 211.95 °F. The average temperature on the surface of the earth is 15 °C or 59 °F.
Gold’s boiling point is 2,856 °C or 5,173 °F. Silver’s boiling point is 2,162 °C or 3,924 °F. The temperature on the surface of the sun is 5,400 ºC or 9,800 ºF. Additionally, gold is extremely resistant to corrosion and can sit at the bottom of the corrosive ocean for centuries and still retain its luster.
I suppose gold could poof on the surface of the sun but on earth physical gold cannot evaporate when used as a currency in ordinary daily transactions or when hoarded safely in vaults. At all times and in all circumstances gold remains money. You can always trade gold for bread.
On 20 May 1999, Alan Greenspan testified before Congress, “Gold is always accepted and is the ultimate means of payment and is perceived to be an element of stability in the currency and in the ultimate value of the currency and that historically has always been the reason why governments hold gold.”
ACCOUNTS RECEIVABLES FOR GOLD AND SILVER CAN EVAPORATE
During the 1990’s Mr. Rubin had devised the gold leasing scheme with the intent being elucidated by Dr. Greenspan’s testimony in 1998 that, ”Nor can private counterparties restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise.”
The Gold Anti-Trust Action Committee, GATA, has alleged that central banks are engaged in a gold price suppression scheme. This scheme may include the COMEX’s participation along with Deutsche Bank, the European Central Bank and many others. Mr. Robert Landis, a graduate of Princeton University, Harvard Law School and member of the New York Bar, asserted in August of 2005 that “Any rational person who continues to dispute the existence of the rig after exposure to the evidence is either in denial or is complicit.”
GATA alleges that the central banks have less than half the gold claimed. The bullion bank agents like JP Morgan and Goldman Sachs, who is threatening legal action against the owner of investigative financial journalism site GoldmanSachs666.com, may face large amounts of liability from dealing in these types of derivatives.
The recent nine weeks of silver backwardation along with the problematic ETFs GLD and SLV show the feigned value of financial instruments subject to counter-party risk in contrast to tangible assets. Fractional reserve banking, which Murray Rothbard argues is a form of embezzlement in The Case Against The Fed, and other types of Ponzi scams always end causing financial, economic, social and political damage.
GATA’S PRESCIENT WARNING
On 31 January 2008 GATA’s Wall Street Journal full-page advertisement presciently warned, “The objective of this manipulation is to conceal the mismanagement of the U.S. dollar so that it might retain its function as the world’s reserve currency. But to suppress the price of gold is to disable to baromter of the international financial system so that all markets may be more easily manipulated. This manipulation has been the primary cause of the catastrophic excesses in the markets that now threaten the whole world.”
Not only mere commodities gold and silver are essential checks and balances in the American political machinery.
Article 1 Section 8 Clause 5 states that Congress has the power “To coin money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures.” Article 1 Section 10 Clause 1 states that ‘No State shall … coin Money; emit Bills of Credit; make any Thing but gold and silver a Coin a Tender in Payment of Debts.” The Ninth Amendment states “The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retain by the people.” The Tenth Amendment states “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”
While the constitution does not define money it does specify that it is coined rather than printed. What the constitution is silent on is often as important as what it pronounces because every power exercised by government must have a core authorization in the constitution. If an action is not expressly authorized then it is prohibited.
TENTH AMENDMENT ASSERTIONS
A majority of states have begun formally asserting their Tenth Amendment rights.
For example, Governor Rick Perry issued a press release declaring, “I believe that our federal government has become oppressive in its size, its intrusion into the lives of our citizens, and its interference with the affairs of our state. That is why I am here today to express my unwavering support for efforts all across our country to reaffirm the states’ rights affirmed by the Tenth Amendment to the U.S. Constitution. I believe that returning to the letter and spirit of the U.S. Constitution and its essential 10th Amendment will free our state from undue regulations, and ultimately strengthen our Union.”
An interesting historical and tangential point is that the 1836 Texas Constitution explicitly reserved the right to secession which as Lysander Spooner explained was “a right that was embodied in the American Revolution.”
CRIMINAL ACTION IN PLAIN SIGHT
But these facts are a small subset of a gargantuan truth: the gold price suppression scheme sustains a monetary system that is immoral and in conflict with the foundational law of the United States.
Because there is no root authorization in the constitution for the Federal government to make anything legal tender and because the States are prohibited from making anything but gold and silver legal tender, even some illusion issued by the Federal government or a privately owned Federal Reserve, therefore the FRN$, an illusion, is in conflict with the supreme law of the land.
While the Coinage Act of 1792 has been superceded by additional legislation Section 19 provided, “That if any of the gold or silver coins which shall be struck or coined at the said mint shall be debased or made worse as to the proportion of fine gold or fine silver therein contained … shall embezzle any of the metals which shall at any time be committed to their charge … every such officer or person who shall commit any or either of the said offences, shall be deemed guilty of felony, and shall suffer death.”
The immoral and unethical world’s reserve currency, in conflict with the supreme law of the land, is an inherently unstable and unsustainable illusion. The monetary, economic, social and political system built upon this illusion does not collapse but evaporates.
President Obama appoints known tax evaders, such as Treasury Secretary Timothy Geithner, to high tax eater posts to bailout their friends in an attempt to prevent the consequences of basic economic law. On the other hand, today the 15th of April ‘We The People’, the tax eater’s bosses, are threatened with death if we fail and resist paying homage using little irredeemable legal tender tickets.
As the FRN$ political currency illusion continues evaporating there will most likely be a deflationary implosion coupled with a hyper-inflationary explosion. The Great Credit Contraction has begun and is unstoppable as capital, both real and fictitious, either burrows down the liquidity pyramid to safety and liquidity or evaporates.
Disclosures: Long physical gold and silver with no position in US Treasury Bills (TLT), JPM or GS.