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A big part in understanding the rethinking the dollar movement is to realize that all dollars aren’t created equal. Not too many people are aware of the different monetary instruments that share the same name, but have different origins.
The most common and generally accepted label for a dollar is connected to the fiat paper currency known as cash. The word cash being a more modern label for the monetary unit known as a dollar in the 21st century isn’t the only form of a dollar in existence.
In actuality there are a total of three forms of dollars associated with this monetary unit. Depending on whom you’re talking to will determine the dollar being referenced. If you were talking amongst political leaders and international bankers you would be talking about the International Dollar. However if you were in a group of economist, financial advisors and citizens the Fiat Paper Dollar. If you were among the monetarily informed, the Lawful Dollar.
These three types of Dollars listed all originate from the United States, but like I said earlier, all dollars aren’t created equal. Each one comes with some Pros and Cons, but to keep matters simple I will highlight the cons.
The most interesting tidbits about the dollars is the value of each of them globally and domestically in the financial world. The International Dollar consisting of US government securities (debt) such as Bonds, T-Bills and Notes for the last one hundred years have been considered safe investments up until 2008 when the financial world turned upside down. The housing crisis and banking scare set in motion a steady decline and interest in other nations wanting to lend money to the United States.
The federal government since 2008 has increased their deficit spending steadily to the tune of total of $10 trillion plus in just the national debt alone. Nations now realize that the U.S.A has no means or desire to repay these Intentional Dollars back and have stopped lending. These International Dollars when purchased by the FED are monetized and then turned into legal tender notes which businesses and citizens work for. If it wasn’t for the government borrowing to pay for its responsibilities there would be no Fiat Paper Dollars (aka Cash) in existence. Not too many people know that every Federal Reserve Note in their possession is a product of the government’s debt.
When the FED buys International Dollars they in return give the banking sector cash to distribute to the people in exchange for labor or goods and services. These Fiat Paper Dollars are now legalized government liabilities created to then recollect through taxation to pay back interest on the International Dollar securities. Both the International and Fiat Paper Dollar debts issued are the liabilities of their respected institutions.
The last form of a dollar is completely different than the other dollars. The Lawful Dollar (Lawful Money) has a long history behind it and prior to 1913 was the norm for thousands of years. The Lawful Dollar or precious metals are precious not because it’s cute but because it’s rare. Monetary metals such as gold, silver and copper have been labeled as money because they can’t be borrowed into existence or manufactured on a printing press. These metals come from the earth and are rare earth metals that can only be mined over time using someone’s skill, labor and sweat.
With governments printing International and Fiat Paper Dollars at extremely high rates these days, those that value their labor and savings need to realize that there is nothing more counterproductive to your career and retirement planning than the first two forms of Dollars. History has shown that those who lack a sound monetary education tend to be on the short end of the stick when governments try to borrow and print their way out of debts.
Rethinking the Dollar is educational information to encourage citizens to take heed at what governments are printing. If the national debt continues to climb, trillions in fiat dollars will be printed. Then the Fiat Paper Dollars you save and depend upon will have more competition with the newly issued paper. The best way to lose your life savings is to not know the fundamentals of all forms of currency.
What are you doing to improve your monetary literacy? How important is it to you to preserve your life’s work? It’s likely that you didn’t learn this information in school. So what do you do now that you know?
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