Greetings one and all! For this blog entry I wanted to talk briefly about the history of the almighty dollar. Money and all it’s worth, actually has a very long, complicated, and confusing history. So I will try to compress it as best I can.
Back in the day, some time before 1870 BC (when the first laws were written in Babylon that formalized the use of money transactions), most civilizations used the barter system. A person could go to the market and trade agriculture, minerals, services, and fine hand crafts for one another. This worked somewhat in larger communities but met with a lot of agitation when one side of the bartering party refused to trade for services or a product that they didn’t need or want. So eventually it was decided that there be a form of currency that everyone could agree on that would solve this problem.
For the sake of this blog and it’s length, Gold (not including many other minerals, even sea shells, as a rate of exchange) would be this deciding factor in a lot of civilizations (but not all). The most common form of this mineral being, a coin. So the first bank was created. This bank housed a stock pile of gold and the bank categorized the worth of almost everything everybody wanted. The bank then loaned out gold to business owners and craftsmen whom in turn bought products and sevices with the gold while paying the bank a specialized fee for lending out the varying amounts of gold in circulation. As the invention of printing became popular, banks grew clever and started printing out paper notes declaring that the bank owed a certain amount of gold to a person. So for one, the person did not have to carry around the actual pieces of gold with them. Two, it would protect the gold from being stolen and kept safe in the bank’s vault. This was the creation of the first form of paper money, called trade bills of exchange (or promissory notes). Then in China 1000 AD, came bank notes. After that there was the creation in England, of the tally stick. Keeping in mind, gold coins were still being used.
So let’s fast forward to after 1640 England when the goldsmiths were storing most of the nation’s gold in their banks. From here the creation of credit was established by these bankers. This instituted a slow and dangerously rising scale of profit for the middle and lower classes that did not fully understand the consequences of what credit could have on their livelihood.
So now we enter the confusing part of money’s history. Usually the paper representation of gold was equal to what the bank had in its vault. But everything changed after 1694 in England, and after 1913 in the United States. Bank notes were and still are to this day, printed without the physical backing of gold in the vaults of these privately owned “national banks”. I say privately owned because, the governments do not actually own them. For example, the Federal Reserve is a privately owned bank that loans out its printed money to the government for a fee at a rate of interest. This in turn created the IRS, which is responsible for collecting taxes from US citizens, primarily so the government can pay off the debts from the federal reserve.
On a side note (following in the footsteps of Thomas Jefferson, and Andrew Jackson), did you know that on June 4th, 1963 President John F. Kennedy wrote an executive order called 11110? This order pretty much would have slowly weeded out and eventually dismantled the Federal Reserve’s financial hold over the US government. It would have made the dollar bill, of equal worth and value to actual physical gold, owned by the US government on US soil. Sadly though, JFK was assassinated in November 11th of that same year. And after his Vice President Lyndon Johnson was sworn into office, executive order 11110. Was thrown out never to be heard from again. No other US president has ever stood up to the Federal Reserve since then.
So today, we have higher taxes, higher inflation, lower minimum wages, and more nation wide debt that has ever been recorded in human history. And it’s not stopping.
So, how about a magic trick about money?!
Make Money Multiply:
“The worth of my service is not counted by any weight in gold, but by the wonder it cultivates in a curious heart.”
And finally a quote by a man I must include in this post…
“He who sacrifices freedom for security will not have, nor do they deserve, either one.” – Benjaman Franklin