The Paper Dollar - Its Value?

The paper dollar in U.S. currency is not worth paper it is printed on today. Up until 1938, a dollar was worth its weight in gold because it was backed by the gold standard and minted in coins and Federal Reserve Notes. In other words, a dollar was worth a dollar when it was backed by DOLLAR'S worth of gold. According to the American Patriot Friends Network (APFN,1996), the U.S. Congress followed a bimetallic standard under which gold and silver served as dollars dating back to 1792. Later, from 1878 until 1938, the U.S. dollar was exclusively on the gold standard. Federal Reserve Notes or dollar bills were first issued in 1914 when the gold standard was in practice. The gold certificate bills were engraved on the reverse side with a note that basically stated that the dollar bill was redeemable in gold in gold on demand at the Treasury Department of the United States or in gold or lawful money at any Federal Reserve Bank. This means that the dollar had real value which made it legal to use in exchange for goods and services.
Americans seldom think about the paper dollars they use as money today. After all, money is a very complicated and little-known subject considering our giant economic system. American simply assumes that their paper dollars are worth the printed face value on the note. But that simply is not true in today's economic system. The United States is worth trillions of dollars in goods and services that economists call Gross National Products (GNP). The United States buys more than it produces in goods and services which translate in debt that totals in the trillions. This means that we owe other nations for accepting our dollars for their goods and services.
In 1938, America was in the grips of a great economic depression. Speculators had traded stocks and bonds at inflated values backed by unchecked credit. The common practice was to borrow money to buy stocks at a low value then wait until the market rose and sale the same stock at a higher value. Its sort of like gambling with someone else's money with the promise that you will pay them back if you win. The problem with the stock market crash of 1929 was that stock values fell and speculators could not pay their creditors back the money they had borrowed to buy stocks with because the stocks had no redeemable value. The dollar had been backed by gold and stocks were backed by speculation which to deliver on demand. Panic struck and people made runs on their banks to withdraw dollars that were backed by gold but the huge debts completely wiped out the gold certificates. As a result of the stock market crash, debt on every economic level rose tremendously. Everyone owed someone and no one had anything of value to pay their debts. The circulation of dollars stopped and the economy came to near standstill.
According to the APFN (1996), President Franklin Delano Roosevelt issued an executive order to recall all gold and gold certificates in 1938. In 1939m Congress passed the Gold Reserve Act which devalued the dollar. President Roosevelt then proclaimed that the dollar would be reduced in value t 59 percent of what was established by the Gold Standard Act of 1900. This essentially made a dollar worth 0.59 cents, or worth less than its printed value. The U.S. could no longer promise anyone that its money could be redeemed for its face value in gold. In fact the U.S. dollar was turned into what the world knows as fiat money because it has no direct redeemable value. The dollar is now certificates of indebtedness which require taxpayers to pay annual interest on their own money.
The U.S. Congress gave the responsibility of making or printing money to the central bank. The dollar is no longer on the gold standard an nothing backs our Federal Reserve Notes U.S. Bankers no longer redeem lawful money worth its printed value in gold. Congress added In God We Trust to dollar bills to give them a favorable image to the world. It is as if the U.S. is saying that we are a God fearing nation and we trust God will help us pay our debt. The dollar itself has no value and therefore it is not real. The dollar is a promissory note that carries the burden of debt with it. As the costs of goods and services go up our dollars buy less and less until the cost of living threatens our very existence. You work hard for your money but what is your money worth.



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