Today, June 5, 1933: FDR Ends Gold Standard, Bans Private Ownership of Gold [VIDEO]

Prior to the election of America’s longest serving socialist president, our money was backed by gold. Anyone holding our paper currency could demand to exchange it for gold at a set price. In 1913, the gold standard was officially made part of the Federal Reserve and the price of gold was fixed at $20.67 per ounce. The same law mandated that the Federal Reserve kept enough gold on hand to equal 40% of the currency issued at the time.

On March 4, 1933, Franklin Delano Roosevelt was sworn into office for the first time. The day after his inauguration, Roosevelt closed all of the banks, announcing a Bank Holiday in response to the nation’s financial crisis. Many Americans had rushed to their banks and demanded to exchange their paper currency for gold and Roosevelt acted to stop the run on gold.

On March 9, 1933, Congress passed the Emergency Banking Act at the strong insistence of Roosevelt, which was so strong and swift acting that many members of Congress were not even given enough time to read the bill before having to vote on it. The act allowed for banks to reopen their doors for business after being inspected by bank examiners and found to be financially sound.

The Emergency Banking Act also gave Roosevelt a number of powers in the case of a banking crisis as defined in Title I:

On March 13, 1933, many of the banks were allowed to reopen for business and for the most part, it appeared that the Emergency Banking Act was a success.

On April 5, 1933, acting upon the authority he assumed from the Emergency Banking Act, Roosevelt pulled all gold coins and certificates of $100 value or more to be pulled from circulation. Everyone who owned any of the gold coins, bullion or certificates worth $100 or more, were required to turn them in to the Federal Reserve by May 1, 1933. Each ounce of their gold would be exchanged for $20.67 in cash or non-gold standard certificate.

By May 10, 1933, around $300 million in gold coins and $470 million in gold certificates had been turned into the Federal Reserve.

On this day, June 5, 1933, Roosevelt, with the aid of Congress, finalized his plan to take America completely off the gold standard. No longer was our currency backed by gold. Instead, our currency was basically valued at the value placed on it by the Federal Reserve, which also played an important role in international banking and currency values. All gold coins and bullion was required to be turned over to the Federal Reserve. No private ownership of gold coins or bullion was allowed in the US.

In 1934, the federal government, now in possession of most of the gold supply in the country, raised the value of gold from $20.67 per ounce to $35 per ounce. This move was made to increase the strength of the Federal Reserve by 69%.

On August 15, 1971, President Richard Nixon declared that gold would no longer be set at a fixed value for the purpose of currency conversion. This allowed the price of gold to start climbing.

In 1974, the ban on ownership of gold coins or bullion ended when President Gerald Ford signed the legislation. Without any links between gold and the value of our currency, the price of gold has steadily increased to a current price of around $1,240 per ounce.

They stopped making silver coins after 1964 because it was tying the dollar to a precious-metal standard.

Many who did not trust fiat were exchanging their paper dollars for silver quarters, dimes and half-dollars at the bank.

A silver dime was worth a dime in 64, today that same silver dime is worth 1.40 it buys pretty much the exact same amount of goods today as it did in 64. A Large Coke at a fountain was a dime.. today closer to 1.50

Silver and gold are real money... can’t have real money since the fed can’t play with it easily and they sure as $hit can’t print it :-)

A 2016 Silver Eagle coin will cost you about 20 dollars today. They are real legal tender with a marked value of one dollar. They have exactly one ounce of .999 silver in them and a teeny bit of copper. They are at a slight premium compared to old 90% silver coins which go for about 14 times face value.

Gold holdings were a primary part of the monetary base, and the ‘bank money’ aka ‘credit money’ portion of the money supply was built on this by bank lending. Revaluation of specie from 20 to 35 had the immediate effect of increasing the monetary base by a third, allowing a larger amount of credit money to be loaned against gold holdings.

It was the ‘credit money’ portion of the money supply that had evaporated as thousands of banks failed 1930-33. The gov’t couldn’t force banks to loan and therefore rebuild the money supply, but they could increase the base of ‘high powered’ money by revaluing gold itself. Not sure if that made any difference at all other than making Americans think that FDR was stealing their gold. Of course, during the Great Depression you were lucky to have a silver dollar to your name, much less gold, but the principle was still the same.

The first problem with FDR closing the banks is this imo. Although the delegates to the Constitutional Convention had discussed the idea of constitutionally delegating to the feds the specific power to regulate INTRAstate banking, the delegates had decided against it. This is evidenced by the following excerpt from the writings of Thomas Jefferson.

“A proposition was made to them to authorize Congress to open canals, and an amendatory one to empower them to incorporate. But the whole was rejected, and one of the reasons for rejection urged in debate was, that then they would have a power to erect a bank, which would render the great cities, where there were prejudices and jealousies on the subject, adverse to the reception of the Constitution [emphasis added].” —Jefferson’s Opinion on the Constitutionality of a National Bank : 1791.

Also, by refusing to let citizens exchange paper money for gold, FDR wrongly interfered with state sovereignty as evidenced by the Constitution’s Clause 1 of Section 10 of Article I.

Article I, Section 10, Clause 1: No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts [emphasis added]; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

Also consider that when citizens do business with banks, such business may be regarded as contract work, not commerce. And if such is the case, then a previous generations of justices had also clarified that contracts are not commerce, effectively indicating that Congress has no Commerce Clause (1.8.3) authority to regulate contracts regardless if the parties involved are domeciled in different states.

"4. The issuing of a policy of insurance is not a transaction of commerce within the meaning of the latter of the two clauses, even though the parties be domiciled in different States, but is a simple contract [emphasis added] of indemnity against loss." - Paul v. Virginia, 1869. (The corrupt feds have no Commerce Clause (1.8.3) power to regulate insurance.)

Note that both Jefferson and James Madison, Madison genererally regarded as the father of the Constitution, had warned patriots about the corrupt federal government unconstitutionally expanding its powers in small steps.

”I believe there are more instances of the abridgement of freedom of the people by gradual and silent encroachments by those in power than by violent and sudden usurpations.” —James Madison, Speech at the Virginia Convention to ratify the Federal Constitution (1788-06-06)
”To take a single step beyond the boundaries thus specially drawn around the powers of Congress, is to take possession of a boundless field of power, no longer susceptible of any definition.” —Thomas Jefferson, Jefferson's Opinion on the Constitutionality of a National Bank : 1791
”The system of the General Government is to seize all doubtful ground. We must join in the scramble, or get nothing. Where first occupancy is to give right, he who lies still loses all.” —Thomas Jefferson to James Monroe, 1797.

Remember in November !

When patriots elect Trump, they also need to elect a new, state sovereignty-respecting Congress that will not only work within its Section 8-limited powers to support Trump’s vision to make America great again, but also repeal all federal laws and executive orders that Congress cannot justify under its Section 8-limited powers.

Note that such a Congress will also probably be willing to fire state sovereignty-ignoring activist justices.

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