Has Paper Currency Failed America?

Chart: U.S. Dollar 1913 to 2012

Throughout the centuries gold has been crowned the currency of  “Captains and Kings” and if the GOP has it’s way, it will again become the standard for the US dollar. The US dropped the gold standard in 1971, under Richard Nixon. At the Republican National Convention, the platform committee called on Congress to establish a “gold commission” which would examine whether or not to restore the country to the gold standard.

Lew Lehrman, author of “True Gold Standard” believes that in order to preserve America’s economic prosperity, it’s not an issue of if – but when.

Lehrman, who was a part of the Gold Commission created by former president Ronald Reagan in 1981, told Larry Kudlow that the nation has had plenty of time to experiment with fiat currency, and the experiment has failed.“The Federal Reserve has had 100 years to test these academic theories about manipulating paper currencies – and all we’ve had are booms and busts.” he said on the Kudlow Report.

A return to the gold standard would keep the money supply constant, and according to Lehrman, generate stability.

He believes that America’s 40 year experiment with a fiat currency has been an abject failure and if the nation is to thrive, we must get back on the gold standard immediately.

What’s Happening with the Dollar Internationally

• Asia’s Mightiest Are Ditching the Dollar! On June 1st, China and Japan began trading using their own currencies. When the yen-to-yuan trade began, it was a huge blow to the dollar that most people didn’t even know occurred.
• The BRICS Just Kissed the Dollar Goodbye. A new agreement among Brazil, Russia, India, China, and South Africa now promotes the use of their national currencies when trading, instead of the greenback.
• Buying Oil without a Single Petrodollar! China is ditching the dollar to buy oil directly from United Arab Emirates. The Chinese National Bank says this agreement is worth the equivalent of $5.5 billion annually. Plus, China and Iran are working on a barter system to exchange Iranian oil for Chinese imported products.
• Trade is Heating Up Down in Africa. China is its largest trading partner, and is doing everything it can to replace the dollar with Chinese currency. Standard Bank, Africa’s largest financial institution, predicts that the equivalent of $100 billion worth of trade between China and Africa will be settled in renminbi in 2015.
• Oil for Rice – It’s Happening! Iran has begun to buy shipments of rice, sugar and soybeans from India, to circumvent U.S. financial sanctions on its oil shipments. Even though India has been unable to pay in full for Iranian oil imports because U.S. sanctions have made it difficult to access U.S. dollars for transactions with Iran… it’s now paying Iran in Indian rupee and gold.

See the interview with ADVFN chief executive Clem Chambers who tells CNBC when gold is going to $2000 » Go Long Gold!

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