Federal Reserve Admits: We Have No Gold
The following exchange between Congressman Ron
Paul (R-TX) and the Fed’s attorney Scott Alvarez proves, without
a shadow of a doubt, that The Federal Reserve has no gold
backing the US dollar.
Most in the alternative news sphere suspected it
– now it’s fact.
The Federal Reserve does not own any gold at all.
We have not owned gold since 1934, so we have not engaged in any
gold swap.
What appears on our balance sheet is gold
certificates…Before 1934 the Federal Reserve did, we did own
gold. We turned that over by law to the Treasury and received in
return for that gold certificates.
The exact relationship between the Federal
Reserve, the US Treasury and these non-tradeable gold
certificates is not exactly clear, but an attempt to explain
what’s actually going on has been put forth by
goldnews.com:
In any case, we can analyze the implications of
the basic facts and come to a couple of conclusions:
1) The widespread notion that the Fed owns gold
is false. The corollary to this is the mistaken belief that the
Fed understates its gold holdings on its balance sheet by only
reporting certificates based on the $42.22 statutory gold value.
The Fed does not in fact own the US gold stock multiplied by the
market price of gold, unless the Treasury defaults and even then
its not clear. The Fed does, however, own a claim to currency
totalling $11.1 billion and this value has a remote chance of
going up significantly if the Treasury revalues its gold and
maintains the practice initiated in the Par Value Modification
Act.
2) The fact that the Fed owns no gold, nor claims
to any gold, means the fundamental value of the dollar lacks any
backing besides dollars themselves, not including Fed building
and equipment. Dollars are in essence worth a lot less than many
people thought, and the Fed is much more impotent in using the
prowess of their assets, and conducting monetary policy in
general, than many believed. In all, Alvarez’s clarification
strengthens the case for gold’s high dollar value immensely.
An interesting perspective, and one, if true,
suggests that the value of your dollar in terms of gold is
actually much less than believed – like close to zero. Our
currency is not only not backed by gold, but in the event of a
dollar meltdown the only assets backing the world’s reserve
currency are worthless toxic mortgages purchased by The Fed in
recent years from insolvent banking institutions.
The only thing holding this thing together at
this point is market confidence. When that goes, everything else
goes with it.
Author: Mac Slavo
Date: June 6th, 2011
Website:www.SHTFplan.com
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