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Politics : Dutch Central Bank Sale Announcement Imminent?
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To: paul ross who wrote (3633)2/22/1999 12:16:00 AM
From: Hawkmoon  Read Replies (1) of 81846
 
Article I, Section 10. No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility.

Not to be lawyerly, but the above bolded statement dictates that STATES cannot issue notes not backed by gold. It says nothing about the Federal Gov't.

We must remember that in the early days any state or individual bank could issue currency so long as it was backed by sufficient gold.

There is no prohibition (that I've been able to find) against the Federal gov't establishing a Federal Reserve bank and issuing money not backed by gold.

States had a different level of responsibility to back up their currencies since the Federal Gov't was ultimately responsible for them as the lender of last resort.

Next question??

Btw, would you care to discuss the mechanics of how the Dollar would once again be backed by a gold standard?

What would you recommend as the conversion ratio for gold/dollars??

Do you think we can mine enough gold to meet the requirements for conversion between gold and dollars??

And were we to drastically increase the mining of gold to meet the demand for capital, would that decrease the rarity of gold to the extent that it no longer was considered "special"??

Regards,

Ron
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