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The Risk Of A Dollar Crisis Increases By Day

http://www.zerohedge.com/article/gold-just-1-record-nominal-...

Gold Just 1% From Record Nominal High of $1,444/oz – Risk of Dollar Crisis Increases By Day

The U.S. dollar and yen are under pressure again today while gold and silver have taken breathers after yesterday’s gains (see table). Rather than gold and silver rising in price, we are seeing the continual devaluation of the U.S. dollar, the yen and all fiat currencies and thus their prices falling against the precious metals.

Incredibly, the dollar has lost 7.5% of its value in less than 3 months (since January 7th 2011) and more than 17% in just 8 months since August 2010. Hence the nominal record highs in gold and silver. The volatility and sharp falls in the dollar are leading to deepening inflation throughout the world (as seen in the UK inflation rate of 4.4% today).

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http://www.zerohedge.com/article/gold-just-1-record-nominal-...



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Yup !

My wife just came back from the local super market, and said she was in the check out line behind an older man that caused a loud scene, that everybody could hear, when he found out the price on a gallon of milk had been raised 70 cents in only a week.

Here comes hyperinflation !

I'm sure glad I got on the precious metals bandwagon years ago, thanks to reading Ron Paul's stuff .

beesting

fireant's picture

Rogers could be right...

The whole world is betting against the dollar at present. if the euro weakens, all the dollar shorts will run for cover, causing it to spike up quick. That's not to say I disagree with the thread title; only that we could very easily see a short term spike before continuing the long term down trend.

Undo what Wilson did

Thanks for the article link

not sure how many people remember that Ron Paul said a few months back that in the event of there being a Dollar Crisis he will run for president.
I have a feeling Ron will announce his run around April 19th the day his latest book is to be released to the public.

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http://www.dailypaul.com/203008/south-carolina-battle-of-cow...
Love won! Deliverance from Tyranny is on the way! Col. 2:13-15

The dollar does not face a crises. Please stop saying that.

It is the Federal Reserve Note that is in crises.

FRNs are not dollars.

We don't use dollars anymore.

We use FRNs.

The solution is the use dollars again.

Then there will be no crises.

Until and unless people understand these simple facts, we are destined for chaos.

Please stop calling pieces of paper "dollars." That is silly.

A piece of paper cannot be magically transformed into a coin containing 371.25 grains of .999 pure silver by printing the word "dollar" on it.

A dollar is not an abstract currency unit.

A dollar is a standard of weight and measure. (as heretofore specified)

It does not matter what you

It does not matter what you call it. If it's not tied to a commodity it will reach a crisis. It only is a weight and measure if it is tied to something therefore it is no longer specific.

Various acts have subsequently been passed affecting the amount and type of metal in U. S. coins, so that today there is no legal definition of the term "dollar" to be found in U. S. statute

Commerce with all nations, alliance with none, should be our motto. - T. Jefferson rЭVO˩ution

"Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” - BASTIAT

Um, what part of SILVER do you not get?

Please, read my post again.

A "dollar" is a set standard of weight and measure of .999 (or pure) silver, 371.25 grains to be precise.

The U.S. government DOES still have a definition for the dollar on its books - it values its silver stocks at $1.2929 per ounce. That is the inverse of 0.7734. (371.25 grains out of 480 to the Troy ounce)

Current coinage is irrelevant because the U.S. did not invent the dollar, and it is not an abstract unit. It is what it is. No law can change that anyway. All Congress can do is decide how much silver should be in a coin, and put the equivalent denomination on it. (or just put the weight and purity)

If they mint tokens and put dollar denominations on them, that is the fault of the ignorant People for letting them do it, and for accepting them in commerce.

The Federal Reserve Note is NOT A DOLLAR, it is a bank note. No matter what you do to it, you cannot magically change it into .7734 ounces of pure silver.

My point is the DOLLAR is not in crisis. Because there is no crisis in silver. And that, besides, we aren't even using dollars anymore. So where is the crisis from? The FED doesn't issue dollars. They issue their own bank notes. The government doesn't borrow dollars or spend them. For the most part, NO ONE does.

Please, read my post again.

Until and unless you understand that a FRN is NOT a dollar, you won't see the easy and obvious solution and you will continue to perpetuate the myth that the dollar has some sort of problem with it.

A currency should NEVER be "tied" to anything. It should ACTUALLY BE a physical commodity.

Toilet paper with fancy pictures and writing does not a money make. But it does create lots of fools.

I know what you meant. But it

I know what you meant. But it clearly states congress defined the dollar the way you claimed and since then have created new definitions but now because of the fiat currency there is no current definition. I try not to use wikipedia but what I posted before is what it says. I would love to have a commodity currency but a dollar is our currency as of now.

I see nothing wrong with a currency being tied to a commodity. As long it is tied directly it will still have the same aspect. But as when they retied the Dollar to gold nobody got gold because of the convienence of the paper notes.

Commerce with all nations, alliance with none, should be our motto. - T. Jefferson rЭVO˩ution

"Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” - BASTIAT

I'm not sure if you are confused, or you just use the wrong

terminology.

The CURRENT definition in the US Code is that a dollar equals .7734 ounces of silver.

The dollar is NOT our currency. The Federal Reserve Note and the subsidiary token coins, are our currency. They both trade far below their face value.

The dollar is however, the unit of account of the US government.

However, they are not using it properly. Instead, they are counting FRNs and things priced in FRNs as if they were priced in dollars, which they clearly are not.

The dollar is not abstract. It cannot float. Technically, it can't be redefined. It is what it is.

The currency should not be "tied" to a commodity.

It should BE a commodity.

There is a huge difference.

There should be NO PAPER NOTES. Period. Paper is the problem.

There is no dollar crisis. There is a Federal Reserve Note crisis.

Are you going to try to prove that a Federal Reserve Note is a dollar? Please do, that would be quite amusing.

Actually the original

Actually the original definition was it was equivalent to the Spanish dollar. That's how the value was first defined. Congress since has redefined the dollar several times. I don't know how you assume they haven't redefined it. As soon as they changed the amount of alloy to silver ratio in the dollar coins the American dollar was changed in definition.

Commerce with all nations, alliance with none, should be our motto. - T. Jefferson rЭVO˩ution

"Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” - BASTIAT

Also just FYI the fact that

Also just FYI the fact that they sell their silver at 1.29 does not make it a definition

Various acts have subsequently been passed affecting the amount and type of metal in U. S. coins, so that today there is no legal definition of the term "dollar" to be found in U. S. statute. Currently the closest thing to a definition is found in United States Code Title 31, Section 5116, paragraph b, subsection 2: "The Secretary [of the Treasury] shall sell silver under conditions the Secretary considers appropriate for at least $1.292929292 a fine troy ounce."

Commerce with all nations, alliance with none, should be our motto. - T. Jefferson rЭVO˩ution

"Everyone wants to live at the expense of the state. They forget that the state wants to live at the expense of everyone.” - BASTIAT

What statute is that?

What is the cite for that US Code section you mention?
It would be handy to know.
Thanks.

Let it not be said that we did nothing.-Ron Paul
Stand up for what you believe in, even if you stand alone.-Sophia Magdalena Scholl

It's in Title 31 USC, Section 5117 I believe.

It has been some time since I looked it up. There may be another reference, but I just read that section and it seems fairly familiar.

The official book value of silver for the US Government is $1.2929 per ounce. That defines a dollar as 371.25 grains pure - the same as in 1789.

They also continue to mint Half-Dollars, Quarters, and Dimes every year in the 1873 90% standard. (at about $1.38 to the ounce - Congress mucked with the coinage in 1873)

Yes, they mint "dollar" coins and fractional coins in cupro-nickel and manganese brass as well. But this does not "define" what a dollar is. There has never been an "official" definition of a "dollar" used in the law, primarily my guess is because it pre-existed the United States. The original coinage act came the closest to this definition by equating it with the Spanish Milled Dollar then in general circulation.

In short, by valuing silver supplies on the government's books at $1.2929 per troy ounce, they are recognizing that a FRN is not a dollar, and that a dollar is the equivalent of 371.25 grains pure silver.

(Incidentally, they value gold at $42-2/9 to the ounce or $42.2222.

This isn't a pretty and clean as some would like, but it certainly doesn't make the claim that a FRN is a dollar.

no luck

That was not it.
The section right before that specifies the Treasury shall sell minted silver coins for at least a price of $1.292929 per fine troy ounce of silver and no limit set on a maximum price, but there is nothing defining dollar.
Thanks anyway.

Let it not be said that we did nothing.-Ron Paul
Stand up for what you believe in, even if you stand alone.-Sophia Magdalena Scholl