MATTOLE SELF-SUFFICIENCY PROJECT

What Is Money?

Definition: Coins or other objects, manufactured from gold, silver, or other precious or semi-precious metals, to be media of exchange. Note that this differs from the "dictionary" definition which includes paper "money" or notes.

The best material from which to make money is a substance which has utilitarian value independent of any edict by government, is relatively scarce, is easily divisible, is durable, is portable, and is malleable. Gold and silver meet all of these criteria and have been used as money for more than 2500 years.

US Constitution. Article I. Section 8. "No state shall coin money , or make anything but gold and silver a legal tender in payment of debt."

Article 1. Section 10. "Hence, the money of the United States consists of gold and silver coins." Note that copper and nickel coins are not money, nor are any of the "clad" coins in circulation today.

The coinage act of 1792 defines the dollar as containing 371.25 grains (75 Troy oz or 0.83 oz) of pure silver with another 44.75 grains as a tin and copper alloy to improve durability of the coin. Hence, a bank note redeemable in dollars can be exchanged for money, i.e., gold and/or silver, as specified by the bank note.

According to this definition, paper money is an oxymoron. The "value" of the paper in a paper dollar is less than a penny. Paper is not relatively scarce. The Federal Reserve notes in circulation today have value only through an edict by the Federal Government.

Look on any FNR and you will see "This note is legal tender for all debts, public and private." Isn't this in violation of the Constitution, Article 1, Section 8? This is a government edict that forces you to accept a piece of paper as payment for a debt rather than "real" money, i.e., gold and/or silver.

Last Updated: 23 Mar 2005