What Happened To Using Silver & Gold In Circulatio

Hi nos,

The questions you ask are far from being simple and for the most part doesn't have much to do with the coin collecting hobby.
Your question would be a good topic for an article.

After World War I the world was left in an economic mess. Many countries owed each other money and a lot of our dollars were shipped over seas. The 1920's came while we were living high on the hog, Europe was trying to rebound from the war. Then October 29, 1929 came. The stock market colapsed like a building with no foundation. The stock market boys had been buying short and when the demand finally came there was no money to pay.

People wanted to get there money out of the banks because they were afraid they would lose it. The government knew how many gold notes were still in Europe and knew they didn't have the gold to back it up. They needed to collect all the gold owned by the private citizen in an effort to protect them from a rush of gold notes from europe and the rest of the world.

In 1934 the order was given for everyone to turn in their gold. There was some allowences but for the most part the private ownership was over. Then as the rest of the world had already done. The United States fell into the big Depression.

In 1963 the Government began replacing the silver certificates with the new Federal Reserve Note. They figured by 1965 most of the old silver certicicates would be worn out and by the Coinage Act of 1965 went off the silver standard. While they made legal tender coins that were not before, the penny and Trade dollar ect, The government was set to stopped redeeming our currency.

In 1968 they made their final move. They set a time limit on the redemption of the final silver certificates. June 28, 1968. The government would no longer redeem ANY gold or silver certificate and were free to print as much money as they wanted without the fear of having to redeem it.

The last move was to allow the citizenship to again own gold. Since the government had no worries about being forced to redeem their currency for gold allowing people to own it again created business activity for which they collected taxes.

There is a lot more to this story but I tried to keep it brief. If you have any questions please feel free to ask.

catman

Consider how tiny a One Dollar Gold Piece was in the 1850's when gold was $20.00 an Oz. Now at $440.00 an ounce, think how little even a $20.00 piece would have to be to indicate intrinsic value. I suppose we could have clad gold pieces.....Mikejust kidding around

Yes he does! Couple of cans of cat food and a collectable coin or two and he could be yours for the weekend!

nos,

Gold, with few exceptions, became illegal to own. If you manufactured jewelery or were a licensed smelter or a related field you were permitted to have enough to conduct your business.

The law applied to ANY gold bullion, coin, bars, rounds ect.. Again with a few exceptions.

catman

"Gold, with few exceptions, became illegal to own." That doesn't sound very American or Constitutional at all...I am quite surprised that even though it may have been necessary that it passed that you'd think it only would have been for contemporary US gold coins of the time.

quote:

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Originally posted by nos

"Gold, with few exceptions, became illegal to own." That doesn't sound very American or Constitutional at all...I am quite surprised that even though it may have been necessary that it passed that you'd think it only would have been for contemporary US gold coins of the time.

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Hey nos whats happening !!!

in reality only a small fraction of the gold then and even now is used in the production of coins,

what needs to be remembered is that our old currency was actually in the form of bonded notes that allowed the bearer to demand gold or silver in exchange,with more notes issued than ounces of gold the government had no choice ,although I for one do not agree that they did not have control,, it was in fact by the governments own doing that more was promised than what they had the ability to pay that the problem occured.

a problem that we still see in use in todays economy.

Rick

(LOL) Gee Old Dan. Your post is driving my Siamese nuts..! She trying to catch the letters on the screen.

catman

How about a picture?