Central banks will disagree;
Keynesian economists probably disagree;
Too-Big-To-Fail banks don’t care;
But I think the following is generally accurate regarding the devolution of gold and silver money.
IN THE BEGINNING: Gold and silver coins were used as real money for several thousand years. Gold and silver were universally recognized as a store of value.
140 YEARS AGO: The $20 Gold Double Eagle Coin was globally recognized as money. It contained 0.9675 ounces of gold and its purchasing power was unquestioned.
137 YEARS AGO: The $1 Morgan Silver Dollar was universally appreciated and valued. The silver dollars contained 0.77 ounces of silver, were pretty, used in daily commerce, and minted by the millions in the U.S.
AND THEN CAME PAPER MONEY:
The U.S. government issued Gold Certificates and Silver Certificates that were officially exchangeable for gold and silver. These intrinsically worthless pieces of paper were valuable because they were considered “as good as gold” or silver.
Eventually the gold and silver certificates disappeared and Federal Reserve Notes replaced them. The Federal Reserve Notes looked similar to gold and silver certificates, but sadly, they were nothing more than a piece of paper that represented
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