Why Money is Worth Anything….

In 1933 in order to give credibility to the Gold Standard executive order 6102 was issued by President Franklin Roosevelt. The order criminalized the possession of monetary gold by any individual, partnership  or corporation. There is nothing in the constitution that allows for such an order and it was challenged in court.  Its enforceability was always in question but many Americans blindly submitted. The privately owned Federal Reserve Bank paid $20.67 per ounce for the gold they received. Later the exchange rate was set  at $35 per ounce  for international transactions where it stayed until 1971.

Debt Ceiling Hocus-Pocus Illusions

Raising the debt ceiling means printing more money (electronically).  After the debt ceiling is raised the Department of  Treasury will print up some new government notes, bonds and bills and sell them to the Federal Reserve. The Federal Reserve will then create  some new money and give it to the US Treasury. All this does is dilute the existing currency and weaken the value of the dollar. Businessmen  pay close attention to the actions of the government in regard to creating new money. The second the debt ceiling is raised, they raise prices to compensate for the diluted currency. Raising the debt ceiling will accomplish nothing in the long term except put government deeper into a debt they can not pay back.