Washington, D.C. – West Virginia Congressman Alex Mooney recently proposed legislation “to define the dollar as a fixed weight of gold.” Mooney harshly criticized U.S. monetary policy, citing the 96 percent loss since “the end of the gold standard in 1913,” which in real life terms means that means a dollar in 1913 would now be only be worth .04 cents.
“The United States dollar has lost 30 percent of its purchasing power since 2000, and 96 percent of its purchasing power since the end of the gold standard in 1913. Under the Federal Reserve’s two percent inflation objective, the dollar loses half of its purchasing power every generation, or 35 years,” the bill stated.
The legislation notes that the “international gold exchange standard from 1914 to 1971 did not provide for a United States dollar convertible into gold, and therefore helped cause the Great Depression and stagflation.” H.R. 5404 goes on to explain the purported advantage of having a gold-backed dollar that is actually convertible to gold.
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“The gold standard puts control of the money supply with the market instead of the Federal Reserve. The gold standard means legal tender defined by and convertible into a certain quantity of gold. Under the gold standard through 1913, the United States economy grew at an annual average of four percent, one-third larger than the growth rate since then and twice the level since 2000,” Mooney said.
Some experts, however, have questioned whether the U.S. actually has enough physical gold to back the U.S. dollar, as the country is notoriously secretive about its physical gold reserves and there has never been an full independent audit of its gold.
America is believed to possess roughly 8,133.5 tons of physical gold in its official reserves, with 58 percent reportedly held in Fort Knox, Kentucky, 20 percent at West Point in New York, 16 percent at the U.S. Mint in Denver, Colorado, and 5 percent believed to be held at the New York Fed.
Ronan Manly, a precious metals expert for Singapore’s BullionStar, told RT that he believes that actual U.S. gold reserves are likely smaller than claimed.
“The entire story around the US gold reserves is opaque and secretive. There has never been a full independent audit of the US gold reserves, and the custodians of the gold, the US Mint and the Federal Reserve of New York will not let anybody into the vaults to view the gold or to count it,” Manly told RT.
Manly also raised doubts about the purity of the gold stored in American vaults being up to industry standards.
“Even the details that have been provided on the supposed US gold holdings show that a majority of the gold bars are low purity and in weights that don’t conform to the industry standard ‘Good Delivery’ gold bar specifications,” Manly said. According him, this gold can’t be traded on the international market because of the low quality.
While some may have doubts about the U.S. gold supply, the legislation maintains returning to “the gold standard puts control of the money supply with the market instead of the Federal Reserve,” while keenly noting “The Federal Reserve’s trickle down policy of expanding the money supply with no demand for it has enriched the owners of financial assets but endangered the jobs, wages, and savings of blue collar workers.”