I recently stumbled upon this picture.
Through 1964 American quarters and dimes were made of 90% silver. Starting in 1965 the inner core is pure copper and the outer covering is copper mixed with nickel. I was discussing this with some friends so I decided to look up some history I recalled about Rome’s debasement of their currency. The first link I found was the below comment and this link to a FEDERAL RESERVE BANK OF ST. LOUIS work book for kids grade 8-12.
“Commodus (AD 177–AD 192) debased the Roman denarius to about 70 percent silver. Septimius Severus (AD 193–AD 211) debased the Roman denarius to about 50 percent silver. With the added currency, the government could pay for more soldiers and pay existing soldiers more.”
What is incredible is that the Romans “slowly” debased their currency by recalling the money, melting it down and reissuing with a lower percentage of silver. The US government did it quickly by going from 90% to 0% in 1 year! Subsequent dollars were created by adding numbers in the Fed ledger with nothing backing the new money!
Fort Knox holds about 4,580 metric tons of gold which is worth about $250 billion dollars. The US government budget was $6.27 trillion in 2022.
The Government budget deficit in 2022 was $1.38 trillion in 2022.
“A Cantillon effect is a change in relative prices resulting from a change in money supply.” –SWFI
Be Close to the President and Congress
Cantillon also had a theory in which the beneficiaries of the state creating the currency is based on the institutional setup of that state. This essentially means, “he who was close to the king and the wealthy”, likely benefited from the distributional choices of currency through the system. –SWFI
Realizing that the government is constantly creating new money and decreasing the purchasing power of the money you hold in your bank account, what is the average person to do?
See my other posts for a potential answer.