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<p>[QUOTE=&quot;medoraman, post: 1177518, member: 26302&quot;]Wow, lots of confusion. First, on Cloud&#039;s point, there can never be enough currency to back up every asset, and doesn&#039;t need to be. There is actually too much currency right now, (including US debt, which is how ollars are traded around the world in large sums), we would be better off with less currency. When someone buys something, they trade cash for the asset, then in turn trade their cash for another asset. Having as many US dollars as assets in the country would destroy the economy.</p><p><br /></p><p>Second, the Federal Reserve is not the US Bank. It was not created to coin money, that would be the US mint. Yes, one of the first functions of the US mint was to coin US citizens gold and silver, but its main job was to coin enough to facilitate trade. There were two Banks of the US, but both went out of business. The Fed is a separate institution with leadership appointed by the US, who remits profits to the US.</p><p><br /></p><p>Third, there was never &quot;enough&quot; gold and silver to go around. Gold coins were never seen by most people. Even when our coinage was made out of gold and silver people had a strong preference for currency, as witnessed by their ready acceptance and use of it wehn they could have just as easily used gold coins. I don&#039;t see the government &quot;taking away&quot; gold and silver, I see people preferring paper currency for ease of use. Yes, eventually after over a century the great depression and then inflation&nbsp; took away our ability to use these PM in coinage effectively, but it wasn&#039;t a government conspiracy. All modern economies inflate, since deflation is so very corrosive and hard on many people, and generates a contractionary psychology in people. Given that, most governments will choose inflation if they have to.</p><p><br /></p><p>Chris[/QUOTE]</p><p><br /></p>

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