The Eventual Return Of The Silver Dollar...

I agree that our money should be made of precious metal. Unfortunately, authorities in government are staying up late at night trying to figure out they can possibly make coins cheaper.

It isn't realistic to physically make coins out of precious metal again. The USD would have to be deflated significantly in order for say a 1 oz. coin of silver to be worth $1. If the gold or silver standard were too return, the only difference is that the existing coins and paper would be backed by metal held by the government instead of a "promise".

Since Gold can be flattened to about the thickness of a piece of paper, why not make our currency out of Gold. The thicker, the higher the value. Of course there are those vending machines all over the USA that would have to be changed. Of course forgeries would be significent. How about elemenating all paper money and return to all coinage? Now lets see about buying a car for $25,000 in coins. Oh that is why we have plastic.
All joking of course. The future will not have any currency, coinage, etc. Only plastic cards. It is starting now if you just look around. Visa advertising is indicating that now. I predict the last hold out will be the gum ball machine.

Bloody unrealistic. What's the point having gold and silver as reserves when it's historically known that the value goes up and down quitely wildly. In fact, what's the point hoarding so much bullions sitting right at the vaults when they don't even make any kind of investment profits?

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It would be a sacrifice of the present for the benefit of the future

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Excellent point! Our Founding Fathers made sacrifices for the hope of a better future. The Constitution they gave us is clear what the Federal government can and cannot do.

Change is often difficult, especially today when we expect an immediate payout for our efforts. The longterm goal is overlooked in favour of a quick score.

To relate this back to coins, it is no different than comparing the collector that plans to keep them for a long time, possibly to pass down to future generations; or the short term investor hoping to turn a quick profit. Coins, IMHO, are not the way to make fast money.

All said, anything we do to correct our broken system will have to be for the future long term benefit.

I'm not sure that returning to a gold standard is actually the answer... although until recently I thought it might be.

It seems that the best answer would be for our government to actually make the money, as opposed to the Federal Reserve (a private international consortium of banks including JPMorgan Chase, Citibank, Bank of America, and many more). THAT's the main problem- the US isn't in charge of its own money! We need to return to the Greenback system.

The exception is coins... the US mints those. The other 99+% of US Dollars in existence (composed of Federal Reserve Notes and computer/ledger entries) are essentially created out of thin air by private banks.

If you are interested in learning more, I *HIGHLY* recommend Ellen Brown's "Web of Debt" (ISBN: 0979560802). I bought it on Amazon, but I'm sure it is widely available. The book explains in detail the past and present of the Federal Reserve and its widespread role in shaping not only America, but indeed the entire world.

You'll never look at the world the same way again, and "The Wizard of Oz" will take on a whole new meaning for you (it was written as an allegory of the monetary system!).

If anyone here does read the book, I'd love to hear what you think. It has played a big role in my newfound interest in politics.

Regards,
~neuron

I disagree that we'll ever eliminate cash completely. I think that there is a significant amount of the lower class who only lives on cash. As the middle class falls out, that is just going to increase. Then again, even food stamps are now distributed on plastic, so maybe I don't know what the heck I'm talking about.

My 2C: I mean no offense, but unless there are some redeeming subtleties that have not yet been announced, this is a pipe dream, and a not very well thought out one at that. Here's why:

First, the enormous energy it would take to dismantle the Federal reserve, the effects that such a reckless dismantling would have on global markets, the effects on our whole culture when those markets collapse, is just inconceivable. Plus, who can believe it? Does anyone think that next January 20, a couple of hundred thousand bureaucrats are just going to hang up their hats and go home? Certainly not. That's why I never pay attention when politicians start promising to reform the federal government.

Second, bullion, like most commodities, is intolerably unpredictable in price, and it's a dream to think Congress would give the Nevada silver industry, even if they could, the inconceivably huge job and bounty of producing sufficient silver for United States coinage; can you imagine how much it would take to mint just the billions of quarters we go through every year? And we can't just ignore the rest of the silver-producing world, by legislative fiat, so Nevada politicians could start riding the Tiger.

Third, the bullion market is now financed with currency, not the other way round. And it's thinly financed at that - bullion is cumbersome to change hands so it's not as easy to dump it, and you never know from one day to the next whether it would be a good idea to do that or not; that's partly why most investors stay away from bullion altogether.

In the long run, the current gold frenzy is a fad, and a whole lot of people are going to lose a whole lot of money. Gold was $925 last month and is now around $880; for most of 2007, it was around $750. I don't care if it goes up to two thousand; You can't back up currency with something that volatile. Plus, the idea that the President of the United States could, much less should, direct the Congress to undertake such folly is frankly unsupportable under our Constitution, which, among other things, specifically excludes the coining of money from Presidential powers and gives it to Congress. I'm sorry, but IMO, it's like believing in magic.