Chapter 63 2. The historical status of the silver dollar

Silver became legal tender in the United States beginning in 1792 with the Mint Act of 1792, which established the legal status of the U.S. dollar.One dollar contains twenty-four sterling silver.One gram, the price of gold and silver is 1:15.The dollar, the most benchmark measure of U.S. currency, is based on silver.Since then, the United States has maintained a dual-track system of gold and silver currencies for a long time. In February 1873, under the pressure of the Rothschild family in Europe, the "Coinage Act of 1873" abolished the monetary status of silver and implemented a single gold standard. Most of the gold mines and gold supply in the world, they actually control the money supply throughout Europe.The origin of silver is more dispersed than that of gold, and the output and supply are much larger, making it more difficult to control. Therefore, around 1873, the Rothschild family coerced most European countries to abolish the currency status of silver. Implement a full gold standard.The United States is also a step in this overall step.This bill aroused strong opposition in the silver-producing states in the western United States. People called this bill the evil law of 1873, and then a vigorous grassroots movement supported silver.

In order to balance the influence of bankers with European backgrounds in the New York area, the U.S. Congress passed the "Bland-Ellerson Act of 1878," requiring the U.S. Treasury Department to purchase 200 to 4 million dollars a month. The dollar-silver-gold-silver ratio was reset to 1:16.Silver coins had the same legal force as gold coins and could be used to pay all public and private debts.Like gold certificates, the Ministry of Finance also issued silver certificates. One dollar of silver certificates directly corresponded to one dollar of silver coins for easy circulation. Later, the "Bland-Ellerson Act of 1878" was replaced by the "Sherman Silver Purchase Act of 1890". The new act increased the amount of silver that the Treasury Department had to purchase. , the Treasury must increase purchases by 4.5 million ounces per month.

Since the establishment of the Federal Reserve in 1913, Federal Reserve bonds have been issued. By the time of the Great Recession in 1929, Federal Reserve bonds had gradually occupied a major share of currency circulation.By 1933, Fed notes were still redeemable for the equivalent in gold. In 1933, there were gold certificates and U.S. government bonds in the field of currency circulation. The U.S. government bond is the first legal currency in the United States issued by Lincoln during the Civil War, namely the Lincoln green coin.Its total circulation is limited to $346,681,016.In 1960, it accounted for only 1% of all money in circulation in the United States.

In addition to the four major currencies mentioned above, a small number of other forms of money coexist. After Roosevelt abolished the gold standard in 1933 and outlawed the possession of gold, gold certificates were withdrawn from circulation.In the U.S. currency circulation field, there are only Federal Reserve bonds, silver bonds and U.S. government bonds. Due to the inherent shortage of U.S. government bonds and the upper limit of issuance, international bankers do not regard them as a major threat.Silver coupons are much more troublesome. Since the U.S. Treasury Department is required by law to purchase silver all the year round, by the 1930s, the U.S. Treasury Department already had a huge reserve of more than six billion ounces of silver, roughly close to 200,000 tons. It is also quite impressive. If all monetization is realized and the U.S. Treasury Department directly issues silver certificates, it will definitely become the biggest nightmare for international bankers.

After Roosevelt helped international bankers abolish the gold standard in 1933, the currency circulation in the United States was actually under the silver standard, and the three major currencies were freely convertible into silver. If the currency status of silver is not abolished, the great cause of cheap currency and deficit finance will be severely hampered. The dream of international bankers is to use inflation, a more efficient financial tool, to plunder the wealth of citizens without anyone noticing. Plans will be hampered. With the implementation of World War II and large-scale deficit finance, coupled with the huge expenditures for rebuilding the European economy after the war, as well as the involvement of the Korean War and the escalation of the Vietnam War, the Fed’s large-scale issuance of treasury bonds and currencies has gradually been discovered by the market. Since the 1940s, the people have continuously exchanged banknotes for silver coins and silver ingots, causing the astronomical silver reserves of the Ministry of Finance to shrink sharply.The electronic industry and aerospace industry, which began to flourish in the 1950s, had a sharp increase in demand for silver, which made things worse. By the time Kennedy entered the White House in the early 1960s, the silver reserves of the Treasury Department had dropped sharply to 1.9 billion ounces.At the same time, the market price of silver has soared, and it has gradually approached the monetary value of silver coins.Twenty-nine dollars.When the silver coupons were exchanged for physical silver, the silver coupons would naturally withdraw from circulation, and the effect of Gresham's law that bad money drives out good money emerged.

All of this is the background for Kennedy to sign Presidential Decree No. 11110. The defense of silver and the abolition of its currency status became the focus of the struggle between Kennedy and international bankers.