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A great deal has been made about the necessity of a dollar gold standard in America’s future when the dollar standard collapses, but it occurs to me that the realities of the world’s monetary system is that since 1971 the world has not been on a dollar standard, but on a dollar oil standard.
The reality is that a world monetary standard cannot simply be based upon a currency alone, as many mistake the role of the dollar to be in today’s world. The reality is that any currency must ultimately be based upon a material good, and in the case of the dollar, that material good, or commodity, is and has been oil.
As proof, the only reason the dollar serves as the world currency is because Richard Nixon, following his abandonment of the Bretton Woods phony gold standard in Nixon Shock on August 15th, 1971, enlisted Saudi Arabia to support the dollar.
In order to defend America’s ability to create dollars from nothing and persuade the rest of the world to accept them, Nixon convinced the Saudi’s to accept and price their oil exclusively in terms of dollars. In exchange, Saudi Arabia received the guarantee of American military might. It was this unholy alliance that fixed the dollar as the benchmark to the value of oil and by doing so secured the supremacy of the dollar.
At this point, oil, banking, and the United States government officially became not simply partners, but became merged as one. Whether fact and/or illusion, this simple replacement of oil for gold created the basis for the dollar to serve as the world’s reserve currency for over 40 years.
The problem since then has been that the discipline of gold was no longer around to rein in government spending, which in turn expanded the flexibility in the price of oil. In contrast to the static supply of gold, the myth of peak oil has fluctuated from under $10 to over $130 (WTC), guided by 3rd world consumption driven by central banks creating money from nothing to be stripped and tranched without a commensurate increase in wealth. This in its turn has created an underlying environment akin to Mr. Toad’s Wild Ride for the (in)stability of a dollar-dominated world of high finance, declining trade, no savings, and lack of investment.
This results in the world spending more time trying to keep down its lunch than preparing for its next meal and leaving its children starving.
Besides the havoc the end of any monetary standard creates, the point of all this is that for any currency to dominate the means of exchange in wealth amongst nations, it inevitably must be based upon a commodity; and if that commodity is not gold, it is liable to be subject to interruption and elasticity, all incompatible with stability.
Without stability, there are no savings, no investment, nor new job creation.
You can dethrone the dollar…
The dollar can be, and most likely will be removed as the world’s standard of exchange considering the way our government and the Fed abuses the dollar. Still, it is entirely another thing to replace it.
China cannot for the simple reason that the Party/Military cannot let the yuan float freely because it is the manipulation of the yuan’s value that keeps this nation, so firmly entrenched in such an extreme tyrannical state, alive. The economic tyranny of the Party/Military ruling elite drains too much from the people. Only through a very real system of wage slavery have they/can they hope to maintain themselves and their hold on power.
To allow the yuan to float amongst the currencies of the world as a benchmark or quasi benchmark currency would destroy China from the inside out. China is a country that has to cheat on their currency to stay alive and it’s never going to get better.
This makes China and the yuan a much more vulnerable government and currency than one might be led to suspect.
A Dollar ? Standard: Not Too Many Choices and Only One Good One
To replace the dollar with a basket of currencies is also nearly impossible, because as crazy as it is to have a fluctuating dollar floating along side the fluctuating price of oil, it appears totally sane compared to a basket of various currencies floating against a fluctuating price of oil. This state of fiscal insanity can only be exceeded by a basket of currencies matched against a basket of commodities whose nature of price is continually in a state of flux. Still, this remains the ultimate Keynesian’s wet dream.
What is most important is the role gold will have to play in re-establishing the means of standardizing the exchange of wealth between nations and men when the dollar oil standard of self-manipulation/deception ends, and that day is coming.
At that time, the most logical means to restore a single monetary standard will be for the United States to re-establish the dollar under a gold standard.
To Be or Not to Be
What will it be, a classical gold standard or a phony gold standard? The true purpose of a classical gold standard is to simply control the creation of credit by placing it in the hands of the people. Just as Liberty places the control over government in the hands of the people, the classical gold standard completes and compliments this transfer of power to the American people in an accelerating scale, unique to the efficient economic model inherent to Liberty. For Americans to accept any lesser control over both our government and our money is absurd if we expect to restore the America we all remember and love.
A classical gold standards only requirement is that it needs to be matched with a regulator of banking solvency, much as the Suffolk Bank proved while serving the New England states from 1816 to 1861. During this era, less than two dozen New England banks failed while the rest of America opened and bankrupt thousands and thousands of banks, saved only on occasion by the states suspension of gold and silver specie (coin) payment. A Suffolk system will remove and replace the current Federal Reserve Bank and America’s central bank. Two-fifths (2/5th) of all shares will be owned by Congress and the remainder publicly traded with ownership share percentages restricted.
Contrary to popular belief, this does not require anyone to walk around with gold coins in their pockets. In fact, just about the only real change we will see are the words “Gold Certificate” across our paper currency which now reads “Federal Reserve Note”.
Creating the Illusion of Gold
A phony gold standard is a sham and creates only the illusion of stability. It’s purported value is to settle debts between nations and not men, but its true purpose is to leave credit and money creation in the hands of the cunning, ambitious, and unprincipled men that President Washington warned the nation of, as he concluded his condemnation accusing them as the, “ the customary weapon by which free governments are destroyed.”
In Washington’s case, he was describing his experience with America’s first private central First U.S. Bank, which un-amazingly is the very same problem we have today with America’s current private, central, Federal Reserve Bank.
The point being that in the havoc to come, a natural attraction and demand for stability will force the world to gravitate towards a gold standard, and at that time America needs to be prepared, or better yet, to have front run this crisis and have a classical gold standard enacted and pending.
The Key to Liberty: Anticipating the Crisis
One does not simply move into a classical gold standard over-night. The transition, once announced can take up to five (5) years as currencies have to printed, exchanged, and sufficient gold supply established, as the defacto system becomes the fact by its date of enforcement. So it is best not to have to make the transition in a panic, because crisis is the type of environment where the speed of establishing anything can be used to saddle the nation with a phony gold standard or some other theft by deception.
This is why it is so important for the American people to have re-established their authority over Congress and the government by restoring the Consent of the Governed that is first defined in our Declaration of Independence. This forces Congress to reclaim all their enumerated powers of running the nation as defined in Article I, sec 8 & 9 of our Constitution, one key power of which is now in the private hands of “cunning, ambitious, and unprincipled men” made possible by the Federal Reserve Bank that they own.
Thus the peoples rule over both government and our dollar based upon gold reserves we must either own or re-confiscate from our stateside international vaults of exchange, only. Suffice, America’s re-issued dollar based upon these gold reserves will be the strongest and most logical candidate to replace the oil based fiat dollar standard we know today. Simply eradicating the Federal Reserve Bank and its creditor account against our nations debt gives America a huge leg up. Gold will do the rest.
Liberty has never been a passive exercise no more than tyranny, thus giving weight to the importance that America must proactively get ahead of the curve. This completes the creation of Liberty because without it, America cannot carry forward the Great Experiment; but instead, America will continue to wander aimlessly just as it does today.
In summary, America must take this preemptive action before the ultimate crisis comes, because this is when we are most vulnerable.
Pax Americana, The New World Order: The Superiority of Liberty
Such action would not only catapult America back to her zenith of power, but would enable America to resume her role in the Great Experiment of the liberation of the world from tyranny. America, in order to defend herself, must then take the revolution of Liberty to the world and Liberty must define all American foreign policy, just as it must serve domestically.
History defines revolution as the bankruptcy of government, and arguably in today’s world, this means the entire world is either in, or approaching, revolution, including the United States of America. Our task, our survival, hinges upon America’s ability to exploit the moral and economic power of Liberty and the opportunity of crisis, and then continue the nobility of America’s Great Experiment to carry the Light of Liberty to all nations, and thus extinguish the evil of tyranny that afflicts all men and women, everywhere.
For once we re-establish Liberty, we will be forced to either conqueror the world for Liberty, or prepare to defend ourselves, because Liberty and tyranny are so incompatible they must come into conflict. And the best way to win with Liberty is to force that conflict, because tyranny cannot stand long before it, and must submit.
How simple to attain, but how foreign Liberty has become to Americans. But the sooner we get started, the sooner we will arrive. Serfs Up America!
Wm W.Fawell is the author of “New American Revolution: The Constitutional Overthrow of the United States Government”, and originator of the Super Pac, Elect A New Congress (C 00522839), and its soon to be released website, www.electanewcongress.com, complete with a plan to empower all 162,000,000 registered America voters to elect a new Congress on November 6th, that is devoted to the restoration of Liberty for all Americans. (next: America’s Foreign Policy of Oil vs an American Foreign Policy of Liberty)