[-empyre-] NIxon, not FDR - Geflecht

Cynthia Beth Rubin cbr at cbrubin.net
Thu Apr 23 08:34:40 EST 2009

Without getting into the argument here, it was Nixon who took the USA  
off the gold standard in 1971.  Some of us even remember when this  

I recommend Thomas Friedman's column written in 1994,  just after  
Nixon's death:
The World; A Nixon Legacy Devalued By a Cold War Standard



On Apr 22, 2009, at 3:11 PM, Nicholas Ruiz III wrote:

> From: jeff pierce <zentrader at live.ca>
> To: -empyre- <empyre at lists.cofa.unsw.edu.au>
> Sent: Thursday, April 9, 2009 10:41:30 PM
> Subject: Re: [-empyre-] Geflecht
> Michael,
> Per wikipedia
> Fiat money is money declared by a government to be legal tender.[1]  
> Fiat currency achieves value because a government accepts it in  
> payment of taxes and says it can be used within the country as a  
> "tender" (offering) to pay all debts. In effect, this allows it to  
> be used to buy goods and services. The most widely-held reserve  
> currency, the US dollar, is a fiat currency. Federal Reserve Notes  
> receive no backing by anything. In another sense however, they are  
> "backed" by all the goods and services in the United States economy  
> because they are declared legal tender by the Federal government.
> The one thing that all fiat currencies have in common is they all  
> fail in the end, as they really aren't worth anything and inflation  
> takes over, in the most severe cases hyperinflation. The US dollar  
> used to be backed by gold but FDR so unwisely took us off that back  
> in 1933. In fact, he also made it illegal for private citizens to  
> even hold gold as required everyone to turn in their gold for a  
> predetermined amount set by government. Some fear that the US  
> government are going to try that trick again and that's why so many  
> investors hold their gold offshore. I couldn't believe it the first  
> time I heard that.
> One other note to pay attention to in the definition above is it  
> says the currency is backed by "all the goods and services in the  
> United States economy", and the big problem is that we don't really  
> export much these days. Most manufacturing has went abroad and we  
> are now mostly a service based economy. Seems like everything is  
> made in China, India, or Mexico so it makes you wonder, what really  
> is backing our currency?
> The only thing that makes it worth anything is because the  
> government says so and everybody goes along with that. We are  
> currently the world's largest debtor nation with China holding a  
> massive amount of US dollars. Things could really get bad for the  
> value of our dollar when they start dumping their dollars. China  
> has already voiced concerns about a new reserve currency because  
> their scared about US defaulting on it's debt.
> We're about to hit critical mass soon regarding the amount of debt  
> this country has taken on. Just think about the interest that the  
> government owes to the Federal Reserve, it's staggaring to  
> comprehend. If Obama continues down this path of insane fiscal  
> policies, you're going to see taxes on the public double soon.
> Jeff

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