What is money? Money is simply a universally recognized medium of exchange; money is simply the highest level of refinement of the system of barter (trade). Cattle and bushels of grain were inconvenient to carry around everywhere one desired to purchase something; man needed a small item of practical and intrinsic value that was nonperishable, and of easily determined quality and purity. Metals met these requirements perfectly.
While iron and steel are useful for tools and weapons, they are relatively commonplace elements. Iron lacks the beauty and rust resistance desirable for daily use items such as cups, silverware, and items worn close to the body. Coins of iron would quickly rust in humid environments.
Gold, silver, and copper are precious metals that fill the need for scarcity, along with the rust resistance and beauty that man desires for some items. In addition to being too scarce to use for farm implements, gold and silver are too soft to work well for tools; however, modern man has found gold and silver useful in electrical applications.
The universal standard for money has been precious metals for thousands of years. While this metal could be in the form of nuggets, dust, or chunks, it was found that coins were the preferred method of trade. A coin has an easily determined weight, country or mint of origin, and purity. Coins have been the money of the civilized world since the days of ancient Greece.
It must be noted that for a people group to adopt money implies that it is able to produce everything that it needs to survive. Once physical needs are met, money is useful to smooth the trade necessary to procure things that individuals cannot make for themselves. Money is only of value in a state of society.
To clarify this, let us imagine: (1) a man stranded alone on a tropical island, (2) that the remote location of the island makes it unlikely that he will be rescued for months, (3) and that the island is filled with small animals. Our hypothetical man will find much more value in a .22 rifle and 100 rounds of ammo (worth perhaps 10 ounces of silver in society) than he would find in 100 ounces of silver.
In truth, the silver would be of no value to the lone man on the island, unless he could melt it down and form some item he needed. However, when returned to a well provisioned society, the silver coins would once again have great value.
As gold is rarer than silver, it has a higher trade value. Silver is the money of the common man. A common man would only rarely need to employ gold to purchase something. This was understood by Americas’s Founders.
I trust that it is now apparent why money is a precious metal coin of a know weight and purity. Paper money redeemable in absolutely nothing -such as Federal Reserve Notes- is a fraud and a lie. The Coinage Act of 1792 specified that a dollar coin would contain 371.25 grains of silver.
The U.S. Constitution specifies that Congress has the power “To coin Money…” and that no State may “make any Thing but gold or silver Coin a Tender in Payment of debts”. Congress may not legally print paper “money”, and it certainly many not delegate this authority (that it does not have) to a private banking corporation.
The Federal Reserve is not an agency of the United States government; it is a private, for profit banking corporation. If that surprises you, perhaps you should go read Eustace Mullin’s Secrets of the Federal Reserve or Griffin’s The Creature From Jekyll Island. Ron Paul’s End The Fed is also worth reading, but does not give the full story. George Bancroft’s 19th century work A plea for the Constitution of the U.S. of America wounded in the house of its guardians is also worth reading.
Copyright (c) 2016 by Joseph Charles Putnam of Orange County, Indiana. All rights reserved.