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<p>[QUOTE=&quot;Conder101, post: 163990, member: 66&quot;]I could buy that as an explanation for the old recall in 1933 since the government knew it was going to need to inflate the money supply for all the new government programs to try and get us out of the depression.&nbsp; They problem was in order to create more money they needed more gold since by law the two were linked.&nbsp; So the recall gave them the extra gold and then the official revaluation of it in effect doubled yet again the amount of money they could produce.</p><p><br /></p><p>The argument for the Great Society programs doesn&#039;t hold up becuase the free market price of silver had already reached the point where the coins were worth more as metal than as money and they were already disappearing into private hoards.The composition was changed because every coin produced was costing the government more than the face value to make.&nbsp; There was no sign that the rise in silver prices would stop anytime soon so just lowering the weight or fineness would only have delayed the inevitable.&nbsp; So they simply removed the silver completely.</p><p><br /></p><p><br /></p><p>I don&#039;t think so, many times in the past societies have switched back from a fiat currency to a precious metal one.</p><p><br /></p><p><br /></p><p>It can be done.&nbsp; The key is to make sure that the value of the precious metal content is sufficiently below the face value of the coin.&nbsp; Here&#039;s a simple example.&nbsp; Start with a revaluation of the dollar say 100 old dollars equals one new dollar.&nbsp; This makes gold around six dollars an oz.&nbsp; Now I take about a half oz of gold and make a coin with a face value of ten dollar (Basicly use the old standard for an eagle)&nbsp; Now sure you could hoard that coin away but you&#039;d be losing money to do so.&nbsp; If you just want the gold you could buy the same amount on the open market for three dollars, but the coin you say would be hoarded is ten dollars.&nbsp; Yes Greshams law would still work, but the gold bullion would be the good money forced out by the &quot;bad&quot; overvalued precious metal coinage which would circulate.&nbsp; Under this set up Silver is nowabout 11 cents an oz.&nbsp; A silver dollar would have about 8 cents worth of silver in it and a face value of a dollar.&nbsp; But it would have the purchasing power of 100 of todays dollars.&nbsp; All the rest of the coins would be inproportion.&nbsp; A &quot;new&quot; cent would have the buying power of todays dollar.&nbsp; Go to the vending machine, a coke is now one cent.&nbsp; We might want to bring back the half cent piece.</p><p><br /></p><p>And I haven&#039;t really changed anything other than revaluing the dollar.&nbsp; Sure everyones income goes down 100 to 1, but so do your bills.&nbsp; So 10 dollars in your new income goes just as far as 1000 dollars did in your old one.&nbsp; All it has done is restored the purchasing power to the dollar that it had a century ago.&nbsp; And other countries shouldn&#039;t care because what do they care if they get 100 dollar or one new dollar as long as it buys the same thing.[/QUOTE]</p><p><br /></p>

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