Currency duties

The chief duty of the National Government in connection with the currency of the country is to coin money and declare its value. Grave doubts have been entertained whether Congress is authorized by the Constitution to make any form of paper money legal tender. The present issue of United States notes has been sustained by the necessities of war; but such paper should depend for its value and currency upon its convenience in use and its prompt redemption in coin at the will of the holder, and not upon its compulsory circulation. These notes are not money, but promises to pay money. If the holders demand it, the promise should be kept.

Expansion and collapse

One has to realize that most slumps are caused in the first place by two problems. First the government long ago intervened in the economy to create a financial system (the so-called fractional reserve system) which is inherently unstable. It then compounds the problem by creating far too much money, which enters the economy as debt, and which leads first to economic bubble and then to bust.

Watch what gold is doing

[W]hen I used to trade and Mr. Volcker was Fed chairman, he said something like ‘gold is my enemy, I’m always watching what gold is doing,’ we need to think why he made a statement like that. If you’re a central banker or one of the congressmen or senators, watch what gold is doing because this is a no-confidence vote in fiscal and dollar policy.