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| Uploaded on Tuesday 9 September, 2014 to the money trust |
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| Presidential Executive Order 6102 and the Gold Reserve Act of 1934 |
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President Franklin D. Roosevelt's executive order forcing people to give their gold up to the Federal Reserve was very unpopular. Those who owned large amounts of gold and could shift them out of the United States, before the deadline, had their assets transferred to safe havens, like e.g. to Switzerland. The following year, the United States officially abandoned the gold standard and the Gold Reserve Act of 1934 passed the House, requiring that all tangible gold, and gold certificates held by the Federal Reserve, be surrendered and vested in the sole title of the United States Department of the Treasury. Then, in 1937, a new depository opened in Fort Knox for storage and safekeeping, called the United States Bullion Depository.
Not everyone was convinced that FDR's executive order 6102 was constitutional. The Fifth Amendment reads “…nor shall private property be taken for public use, without just compensation”. People questioned (a) if there was sufficient just cause to force people to give up their gold and; (b) if the sum of $20.67 per troy ounce could be deemed 'just compensation' when one considers an exchange of gold (hard money with intrinsic value that appreciates over time) for fiat money (legal tender money with no intrinsic value that depreciates over time).
The stated reason for the order was that the economic depression was worsening, with gold hoarding contracting the money supply. The Federal Reserve Act of 1913 required 40% gold backing of Federal Reserve notes issued; hence a compelling reason for the federal government to consolidate gold.
But over the years, so has the national debt continued to soar; at a ratio well in excess of what can be generated through taxes. With ever increasing GDP per capita and inflationary trends of money supply, some skeptics believe that the vaults inside Fort Knox have been depleted. The U.S. Mint holds several metric tons of gold on its accounts at book value of $42.22 per ounce—the official price of gold during 1972. It seems that what Fort Knox now holds as assets are gold certificates, dating back to 1972, but not necessarily tangible gold; a concept made possible by fractional reserve gold banking. |
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