Nixon 1971 defaults GOLD BARS - worth $60 billion dollars.

[linagee]

I'm not sure whether to like or dislike this. Like for providing the video. Dislike because Nixon is a crook.

[linagee]

Suspend temporarily???

[canman1878]

Could someone explain this to me in laymans terms?

Is Nixon saying that if the US has a large gold reserve that the value of the currency is dependent on the market value of gold determined by the speculators?

[Kaecyus]

@canman1878 Because in the 60s the US did a form of Quantitative Easing (ie printing more money) to represent the same amount of gold in the US Treasury, the currency became worth less. Sort of like chopping an onion into slices (before), then dicing it and having each diced chunk worth as much as a slice (after).

Then the US tried to hide this and call it 'speculation' (similar way to fuel prices now), and thus removed gold conversion to make US$ a baseless currency.

[Kaecyus]

@canman1878 But normally baseless currencies would fail, right? That is where the US had it's strength; the US was just too big to fail, like the banks. The largest currency in the world couldn't default because of how much Import/Export business was conducted with the US Dollar.

[BrazilianTribe]

@canman1878 what he is saying is a twisted manner to explain that the the US is stopping delivering gold bars regarding its contracted obligations in exchange for the printed dollars, while simultaneously blaming the speculators for such necessity. He accuses speculators of attacking the dollar. In short words, he does not want to pay his obligations anymore, and it's because he is running out of gold.

[Civsuccess2]

Nixon is a smart man. Without devaluation, foreign nations would sell stuffs to US in exchange for US dollars and its gold. Pretty soon, US will run out of gold and lose all the wealth.

[BrazilianTribe]

@Civsuccess2 ok, but ... that is not being smart, that's being a scammer.

The US in 1945 had contracted obligations IN EXCHANGE for a concession from all countries: it's that they all would accept US currency in their int'l trade, PROVIDED that such currency was gold-convertible. Then, from 1945 on, the US started printing paper-money as if there was no tomorrow, devaluing the paper-currency that the countries had in their pockets, which is ultimately a form of CONFISCATION.

[Civsuccess2]

@BrazilianTribe That's because foreign nations does not exchange for US dollars. They exchange for gold. Foreign nations violated this contract by taking the gold out of US. It is true that US does not refund all nations who deposited in US with gold. Yes, it's somewhat a confiscation. It's all for the good of US pp.

[gigie555]

This speech is an important event in history. Nixon devalues the dollar and hence the dollar will be a fiat currency, backed by nothing except the economic output of the US.

The current dollar has managed to survive these forty years but now the chickens have finally come home to roost. There are now too many dollars out there, many of them held by foreigners, and the economic output of the US is not enough to to back those dollars.

The price of gold is reflecting this monetary stress.

[goldenthroat86]

@gigie555 You realize that it's not just the dollar. NO currency is backed by gold, silver, or anything else.

[XLTheAngelsRage]

@goldenthroat86 Gadafii ? if that's how you spell it among other things is believed to be killed because he was almost done with a new currency system. It was using gold pieces as currency. /watch?v=GuqZfaj34nc

[skywolf8113]

@goldenthroat86 exactly why the world is in the horrible economic situation we see.

[tyronebiggums3]

Forbes on Gold backed dollar, 8/11/11:

watch?v=R0tf30QFhOo