If you look at the current political climate in the U.S., you would say the opposite, however, out of historical political fiscal policies we have an unstable dollar as a financial monetary standard.
Article 1, Section 8 of the Constitution grants Congress the power “to coin money, [and] regulate the Value thereof.” However, over 30 years of extreme national debt increases and average of 1 trillion under the current administration, is sending another message. The Federal Reserve has been manipulating the economy with raising and lowering interest rates along with buying and selling its own assets instead of regulating. All of their actions results in a fluctuating dollar and one struggling to maintain any stability on the world market.
Fixed and reliable standards are a necessity for the dollar to ensure economic growth and fiscal management. Prior to 1971, the postwar Bretton Woods system provided a fixed gold quantity as well as rules for commercial and financial relations among the world’s major industrial states. It was also out of its rules standards which established the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD) which evolved into today’s World Bank Group. What came after the Bretton Woods system in 1971 was the United States then terminated the conversion of the dollar to gold. Upon its departure it also began the era of the dollar as a fully ‘fiat currency’ with nothing to back it other than the federal government.
So today we have a situation in the U.S. where the gold standard has become the standard where the dollar manipulates its price. When the dollar fails on the world market out of poor economic policies and manipulative regulatory practices by the Federal Reserve, combined with billion dollar casino investing global financial services gambling assets, gold comes to its rescue.
It is a matter of time before investors realize the true stability of gold, its buying and saving power that we return back to the the days prior to 1971. So we need gold backed by a dollar not vice versa. Gold through all economic times of difficulty from the Great Depression to the Great Recession, and even during major historical events has grown in value.
Article 1, Section 10 of the Constitution grants States the power “make any Thing but gold and silver Coin a Tender in Payment of Debts”. So the advent of the aftermath of 1971 has allowed the Federal Reserve to grant itself the factor in assessing the gold standard and its value. The financial gold standard is changing from the Federal Reserve standard. In 2011, Utah became the first state in the United States to accept gold and silver coins as legal tender. South Carolina and North Carolina issued legislative currency bills in response to hyperinflation, depression, financial failures by the Federal Reserve. All in result of the Constitution banning states from issuing and printing their own currency and paper money. Colorado and ten other states are looking into the same action in accepting gold and silver as legal tender.
In the world gold market we see the largest gold mines are producing from 788,000 to 2,025,000 ounces of gold, found in Papua, New Guinea. Michail Prokhorov former President of ONEXIM Group, Russia’s largest gold producer netted him $13.2 billion. After moving into politics and giving up his position, ONEXIM Group investment fund represents $25 billon in assets since 2007.
Growth, stability, emerging markets and production, and now States reverting back to the gold standard, the dollar is beginning to bow to the precious metal’s stability and worth.