by James Wesley Rawles, Survival Blog:
I recently coined the acronym DAFFYS, to describe the majority of Americans. DAFFYS stands for Deluded American Fiat-Fooled Yellen-era Serfs.
Most Americans are under the foolish delusion that they have “money” in their bank accounts. But it is not true money (gold or silver “dollars” as defined in the Coinage Acts of 1792 and 1834). Instead, much like the folding paper currency, those accounting entry digits represent “Federal Reserve Notes” (FRNs), with no intrinsic value. FRNs are issued “at will” (by fiat) by the Federal Reserve cartel. They are created out of thin air, through the process of fractional reserve banking. Created out of nothing, they are also redeemable only for nothing – just other FRNs, in different forms, including debased (clad) coinage.
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Starting in 1965, FRNs became non-redeedmable. The 90% silver coins minted up until 1964 were quickly swept out of circulation by the public and tucked away, for family safekeeping. There were 40% silver half dollars for a few more years, but those too soon vanished from circulation. People realized what was going on, and they pounced on that real money. So many folks were stockpiling silver coins that there was a coin shortage for several years. Eventually, the U.S. Mint caught up, producing nearly worthless silver-plated copper slugs, to circulate ersatz dimes, quarters, and half-dollars.
WE’RE BEING ROBBED
As the money supply increases, wages go up. Your average dimwitted DAFFYS see “more money” in their wallets, and hence they feel like they are getting ahead. But they are not when inflation outpaces wage increases. And generally, sadly, that is the case. So DAFFYS might feel richer, but they are actually getting poorer.
We are being systematically robbed two ways, every year:
1.) A tax rate that averages no less than 30% combined, at local, state, and federal levels.
2.) A currency inflation rate that now exceeds 12%. (The much lower “official” rate is a lie, because it excludes food and fuel price increases.)
THE YELLEN ERA
The Yellen Era began when Janet Yellen ascended to the chairmanship Federal Reserve banking cartel. (She chaired The Fed from February 3, 2014 to February 3, 2018.) During her tenure there, Yellen consistently voted to keep interest rates artificially low. In typical D.C. Revolving Door fashion, not long after leaving The Fed, Yellen became Secretary of the Treasury, under Joe Biden.
Most DAFFYS mistakenly believe that the Federal Reserve is a government department. It is not. Rather, our nation’s Central Bank is a private corporation that represents corporate banking interests. You won’t find the Federal Reserve in the “Government Pages” in the front of the phone book. No, it is back in the White Pages, somewhere below the Federal Express company. Again, it is a corporation. The seven members of the Federal Reserve Board of Governors are nominated by the President and confirmed by the Senate. But that is all done with a wink and a nod. Everybody knows that the banksters run the whole show, and that only those cronies who are hand-picked by the corporate banking elite ever get nominated to the Federal Reserve Board of Governors.
Inflation is so insidious that very few Americans recognize its full effects. Most DAFFYS have a vague realization that their “money in the bank” (or in a wallet, or tucked under a mattress) gradually loses its purchasing power. But only if someone steps back and looks at the big picture can they see the substantial amount of wealth that has gradually been robbed from them. In effect, inflation is a hidden form of taxation.
Remember: We are slaves to taxes and slaves to inflation. Austrian School economist F.A. Hayek warned us about this in his classic book The Road to Serfdom. Hayek wrote in mostly rhetorical and speculative terms, but we are now living it, folks. The well-entrenched banksters and politicians are the only winners in this game. They are the royalty in the back row, and we are the pawns on the chessboard.
I have found the Inflation Calculator website to be quite useful. It traces inflation back to 1913. That year is a good starting point for calculating their figures, because that year saw both the establishment of the Federal Reserve and the Federal Income Tax. (The 16th Amendment was supposedly ratified on March 15, 1913 – but that has been disputed.) At first, Congress placed a flat 3-percent tax on all incomes over $800…
OUR INFLATED DOLLAR
On the Inflation Calculator page, you can see that $1 in 1913 had the same purchasing power as $30.49 does, in 2023. Or, another way of looking at it, is that we’ve been robbed of 29/30ths of the purchasing power of the Dollar.
In 1913, $2.00 was the typical unskilled field laborer’s pay for one day of work. (Roughly $720 per year.) The national average skilled wage was $1,296 per year (with an average 42.5-hour work week.) State and government workers were paid an average of $699 per year.
That one dollar (back then made of silver or redeemable for silver, on-demand) would have bought you any of the following in 1913:
- 50 pounds of potatoes
- 30 Hershey chocolate bars
- 3 pounds of coffee
- 4 pounds of sirloin steak
- 5 pounds of round steak
- 3 gallons of milk
- 3 dozen eggs
- 11 pounds of rice
- 20 loaves of bread
- 27 pounds of white baking flour
Today, a dollar won’t even buy you one candy bar.
And ponder these other prices for 1913:
- Model T Ford Runabout (1913 was the first year of production): $680
- Typical bicycle: $11.95
- Colt Model 1911 .45 ACP pistol: $19.75
- L.C. Smith Field Grade Sidelock shotgun: $25 (Fancy Trap Grade: $55.)
- A good quality suit of men’s clothes: $5 (Premium quality: $14.65)
- The average house ranged between $3,400 and $4,800 – that varied, regionally.
Consider this: It is not the value of merchandise that has changed. Nay, it is the value of a U.S. Dollar that has changed, losing value drastically. In 1913, a $20 gold piece would buy you a nice Colt revolver or automatic. In 2023 the gold contained in that same $20 gold piece (as valued in current dollars) will still buy you a nice Colt revolver or automatic.
THE HEMISECTURING INTERVAL
The Rule of 72 is a gauge that investors often use to determine how quickly their money will double in value. If you divide 72 by the annual interest rate, you can approximately determine the amount of time it takes for an investment to double. The same rule also works with inflation, but in reverse. The Rule of 72 also approximates the length of time for money to lose half its value.
Most economists look at the cumulative effects of inflation as an upslope in costs. I prefer to visualize it as a downslope in purchasing power.
Starting in 1913, it took 31 years for the Dollar to lose one-half of its purchasing power. ($1 worth of goods in 1913 cost $2, in 1944.) I call these thresholds “hemisecturings” — the points in time where something is reduced by half. Yes, I recognize that hemisecturing is a term that is mainly used in geometry, but I believe that my use of it in this context is apropos. Think of it as a Kindergarten lesson: “Bobby has a pie that is cut into eight slices. Joe takes four slices of Bobby’s pie. How much of the pie does Bobby have left?”)
