What is a Dollar?

by Stefan B.

“Money is not wealth and that wealth is the organized technological capability to protect, nurture, educate, and accommodate the forward days of humans, whereas money is only a medium of exchange and a cash accounting system. Money has become completely monopolized by the supranational-corporation colossi, which inherently as legal abstractions ignore the problem of how to protect and nurture human lives.”
        – R. Buckminster Fuller, Grunch of Giants

It is a simple enough question, but do you know the answer? What is a dollar? If I were to ask you what an automobile is, you could undoubtedly tell me everything that I had ever wanted to know about who makes automobiles, how to get one, the different types that are available, as well as the relative costs, and advantages of each variation of automobile. So suppose that somebody asked you what a dollar is… Aside from the obvious answer that a dollar is a “Federal Reserve Note”, how is it defined? When congressman Dr. Ron Paul recently put this very question of a dollar definition to Ben Bernanke, the chairman of the Federal Reserve, Mr. Bernanke confidently replied, “My definition of the dollar, is what it can buy. Consumers don’t want to buy gold; They want to buy food, and gasoline, and clothes, and all the other things that are in the consumer basket.” Watch, and listen for yourself:

(Don’t look now Benny, but those consumers whom you speak of, seem to be buying an awful lot of gold at the moment… I don’t think they really trust you very much… shhhh.)

What should strike the average viewer as most concerning is the complete lack of relative value in Mr. Bernanke’s answer. Should we not be somewhat more concerned that our very lives are governed by currency that is without a real definition? Sixty years ago, a dollar bought an entire case of Coke™, and now does not even buy a single bottle. A thousand dollars, once enough to purchase an automobile, is now no longer enough to even insure an automobile. So one thing is very clear: If “a dollar is what a dollar can buy”, then these dollars are certainly a lot less than they used to be, regardless of whether you measure that value in gold, or whether you measure it in “food, and gasoline, and clothes, and all the other things that are in the consumer basket.” Now it would be bad enough if the dollar was only becoming worth less, but what is actually going on here is that it is becoming worthless. Something very important and scary happens when you remove that space from between the two words. At that point, strangely enough, Mr. Bernanke’s definition of a dollar will still be 100% true. A dollar will still be exactly what a dollar can buy: nothing at all.

So, if a dollar is less than it used to be, and soon to be nothing at all, this begs one to ask the simple question, “What did a dollar used to be?” This question is remarkably easier to answer than the question that Dr. Paul posed to Mr. Bernanke, and answering it requires little more than a visit to Wikipedia:

On April 2, 1792, U. S. Secretary of the Treasury Alexander Hamilton reported to Congress the precise amount of silver found in Spanish milled dollar coins in common use in the States. As a result, the United States Dollar was defined as a unit of weight equaling 371 4/16th grains (24.057 grams) of pure silver, or 416 grains of standard silver (standard silver being defined as 1,485 parts fine silver to 179 parts alloy). It was specified that the “money of account” of the United States should be expressed in those same “dollars” or parts thereof.

Upon simple inspection, it would appear that Alexander Hamilton’s dollar is a remarkably different dollar from the one that Mr. Bernanke spoke about. This dollar, which was defined back in 1792, was exactly 24.057 grams of pure silver. So we can take the dollar that Alexander Hamilton spoke about, and we can compare it to the dollar that Ben Bernanke speaks about. As I write this paragraph, silver is selling for US$1.22/gram. Multiply that across 24.057 grams of silver, and you’ll find that Ben Bernanke’s dollar is worth almost exactly 3.4¢ of Alexander Hamilton’s dollar.

This means, more or less, that 96.6¢ out of every American dollar that has ever existed, has been stolen by madmen with a printing press, owned by a private, offshore corporation. I wish I could honestly tell you that this is the bad news, but it is not. The bad news is that these pirates are now coming for the 3.4¢ that you still have left.

Best Regards,
Stefan B.

We are all in this mess together. ~SGTreport.com