$$$ What is a U.S. dollar? $$$

[Travlyr]

Nobody knows. Literally, nobody knows...

https://secure.wikimedia.org/wikipedia/en/wiki/Dollars

On April 2, 1792, U. S. Secretary of the Treasury Alexander Hamilton reported to Congress the precise amount of silver found in Spanish milled dollar coins in common use in the States. Based on this result, the United States Dollar was defined[4] as a quantity of 371 4/16th grains (24.057 grams) of pure silver, or 416 grains of standard silver (standard silver being defined as 1,485 parts fine silver to 179 parts alloy[5]). It was specified that the "money of account" of the United States should be expressed in those same "dollars" or parts thereof. Additionally, all lesser-denomination coins were defined as percentages of the dollar coin, such that a half-dollar was to contain half as much silver as a dollar, quarter-dollars would contain one-fourth as much, and so on.

In an act passed in January 1837, the dollar's alloy (amount of non-silver metal present) was set at 11%. Subsequent coins would contain the same amount of pure silver as previously, but were reduced in overall weight (to 412.25 grains). On February 21, 1853, the quantity of silver in the lesser coins was reduced, with the effect that their denominations no longer represented their silver content relative to dollar coins.

Various acts have subsequently been passed affecting the amount and type of metal in U. S. coins, so that today there is no legal definition of the term "dollar" to be found in U. S. statute.[6][7][8] Currently the closest thing to a definition is found in United States Code Title 31, Section 5116, paragraph b, subsection 2: "The Secretary [of the Treasury] shall sell silver under conditions the Secretary considers appropriate for at least $1.292929292 a fine troy ounce." Silver was mostly removed from U. S. coinage by 1965, as the dollar became a free-floating fiat currency. The US Mint continues to make silver $1-denomination coins, but these are not intended for general circulation.

In 1792, the dollar was defined as 24.057 grams of pure silver. Now it has no definition? The world's reserve currency is undefined. :eek:

Division by zero, like the dollar, is undefined and when calculated gives wrong results. Maybe we could give the Federal Reserve a new mandate.
~ Tell us ... what is this "dollar" to which you refer? ~

[Travlyr]

//

[johnny.rebel]

wtf? how can the dollar not be defined? what does that mean? and what the hell is it worth? that is weird. :confused:

[Zippyjuan]

In the sense of having a gold standard and the price of gold established by the government as being one ounce equal to $22- no, we don't have a definition of what a dollar is. The government does not set the price of anything in terms of dollars or define the dollar as being the fixed amount of some commodity. Instead the dollar is in a more free market- where users decide how many of them they are willing to give up or take in exchange for their labor or for goods and services. It is not fixed in terms of other currencies either (though China attempts to peg its value to a narrow range of dollars). Supply and demand determines its value. It is a medium of exchange- not any store of value- and its exchange rate for goods or services is free to change over time.

[Pauls' Revere]

In the sense of having a gold standard and the price of gold established by the government as being one ounce equal to $22- no, we don't have a definition of what a dollar is. The government does not set the price of anything in terms of dollars or define the dollar as being the fixed amount of some commodity. Instead the dollar is in a more free market- where users decide how many of them they are willing to give up or take in exchange for their labor or for goods and services. It is not fixed in terms of other currencies either (though China attempts to peg its value to a narrow range of dollars). Supply and demand determines its value. It is a medium of exchange- not any store of value- and its exchange rate for goods or services is free to change over time.

backed by everything in our economy.

Chartalism is a monetary theory that states the initial demand for a fiat currency is generated by its unique ability to extinguish tax liabilities. Goods and services are traded for fiat money due to the need to pay taxes in the money.

[Zippyjuan]

Taxes were collected when people used gold for currency too. Fiat is not uniquely taxable.

I agree with you on "backed by everything in our economy".

[Pauls' Revere]

Taxes were collected when people used gold for currency too. Fiat is not uniquely taxable.

I agree with you on "backed by everything in our economy".

True, a tax can be services rendered as well. i.e. work to pay them off.

[sratiug]

In the sense of having a gold standard and the price of gold established by the government as being one ounce equal to $22- no, we don't have a definition of what a dollar is. The government does not set the price of anything in terms of dollars or define the dollar as being the fixed amount of some commodity. Instead the dollar is in a more free market- where users decide how many of them they are willing to give up or take in exchange for their labor or for goods and services. It is not fixed in terms of other currencies either (though China attempts to peg its value to a narrow range of dollars). Supply and demand determines its value. It is a medium of exchange- not any store of value- and its exchange rate for goods or services is free to change over time.

Ha ha ha ha.... that's funny. Supply and demand, ha ha ha. Those that control its supply, control its demand, you mean. Obviously there is an infinite supply of zeros. 00000000000000000000000000000000000000000000000000 00000000000000000000000000000000000000000000000000 00000000000000000000000000000000000000000000000000 00000000000000000000000000000000000000000000000000 00000000000000000000000000000000000000000000000000 00000000000000000000000

[Zippyjuan]

I would like to hear your ideas on how prices are arrived at.

If there are lots of dollars around and a few goods then sellers will want a lot of dollars for their goods. If there are a lot of goods and not as many dollars then a seller is willing to accept fewer dollars in exchange for his goods and services. Basic stuff really.

[sratiug]

I would like to hear your ideas on how prices are arrived at.

If there are lots of dollars around and a few goods then sellers will want a lot of dollars for their goods. If there are a lot of goods and not as many dollars then a seller is willing to accept fewer dollars in exchange for his goods and services. Basic stuff really.

Where are all these dollars you speak of? Show us what it is.

[Travlyr]

Where are all these dollars you speak of? Show us what it is.
Good point. Show us.

The people of 1792 to 1853 knew exactly what was a dollar and they would "flip" you for it. They also knew when somebody was cheating them. The dollar was clearly defined by statute. It was a specific weight of a rare metal.

Murray Rothbard teaches that silver and gold were chosen by the free markets as money because they were desirable, durable, divisible and scarce tangible elements. The "new and improved" definition of money, paper, and since the invention of the computer, electronic entries, fail the test of scarcity, and they are weak on durability. Therein lies another fundamental problem with our monetary system. Electronic entries can, and likely will, someday disappear at the flick of a switch.

The Coinage Act of 1792 (http://www.constitution.org/uslaw/coinage1792.txt) defined the dollar but did not set its value. Values of commodities are determined by people competing in free-markets. Government was charged with setting the standard ... the weight and purity ... of the elements ... and those standards were NOT to be changed without severe penalty.

The Coinage Act of 1792 called for the death penalty for anyone who made worse the proportion of purity and weight of the silver contained in the dollar. Evidently, they considered debasement a serious crime. Today's money is debased literally every second and few people seem to care. Less informed people even argue it is a good thing to do. As a matter of fact, the main stream media minions "rah... rah... shish... boom... bahs" the debasement of money as if it is a wise choice. It's not. It is a crime.

[Zippyjuan]

Where are all these dollars you speak of? Show us what it is.


There are many dollars. There are metalic dollars, there are paper dollars, and there are electronic dollars. If you feel that your dollars have no value, you are free to send them all to me. Since they are worth nothing, that is exactly what I will give you for them. A metalic dollar:
http://www.mintcoindealer.com/images/George-Washington-Gold-Coin.jpg

In 2005, Congress passed the Dollar Coin Act. It defines the Presidential Dollar coins just as the Coinage Act of 1792 did (the 1792 act was not the "last word" on US money or coins). You are welcome to read it if you are interested: http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_public_laws&docid=f:publ145.109.pdf It also covers Buffalo Gold Coins (a buillion coin) and the new designs for the Lincoln Cent (by definition, 1/100th of a dollar).

[Zippyjuan]

Values of commodities are determined by people competing in free-markets
If you define your currency as say a certain amount of gold, then the government is setting the price of gold- not the free market. In 1833 it was set at $18.93 an ounce. http://www.nma.org/pdf/gold/his_gold_prices.pdf Even in 1918- over 80 years later- it was still only $18.99 an ounce. There is no definition of what a dollar is worth today- absolutely true- that is set by the markets. So is the price of gold.

[Travlyr]

If you define your currency as say a certain amount of gold, then the government is setting the price of gold- not the free market.
The Coinage Act of 1792 (http://www.constitution.org/uslaw/coinage1792.txt) legally defined the dollar as a specific weight and purity of precious metal. Price levels fluctuate, weights and purity are standards that can be accurately measured. Value = price x weight x purity. The price of metals are determined by competition in the marketplace, and they cannot be accurately determined by government, or Harvard educated men.


For decades the price of gold was set to $22 an ounce.
Price fixing always distort value. That is why the founders did not specify a value, and that is also why we have so many problems today both economically and socially. The price fixed gold standard of the past failed in efficiency. Central planning controls always fail to deliver equal opportunity. I mean really, only a minority of people are capable of managing their own life; it is ridiculous to believe that anyone can be so gifted as to efficiently manage the economy of millions, or billions, of people. The only reason that they are controlling the money supply now is to steal from the taxpayers to give to the elite. This fact is obvious to anybody who reads "The Secret of the Federal Reserve" - by Eustace Mullins. (http://labvirus.wordpress.com/2010/02/03/rip-eustace-mullins/)

[Zippyjuan]

I guess you guys need to help me out here. I am trying to figure out just what portion of a definition of a dollar is missing to claim that there is no definition of a dollar. There are dictionary definitions- a unit of currency in use in many countries including the USA. It is comprised of 100 cents. Then we have statutes and laws which define the physical size, shape, metal (or paper- cotton really) content and purity of coins (and paper notes) as recently as 2005. What are you missing? I agree that it is not defined as a fixed amout of some commodity such as gold or silver. The market lets people decide how much of a commodity a dollar will buy- that is not set by the government.

[sratiug]

There are many dollars. There are metalic dollars, there are paper dollars, and there are electronic dollars. If you feel that your dollars have no value, you are free to send them all to me. Since they are worth nothing, that is exactly what I will give you for them. A metalic dollar:
http://www.mintcoindealer.com/images/George-Washington-Gold-Coin.jpg

In 2005, Congress passed the Dollar Coin Act. It defines the Presidential Dollar coins just as the Coinage Act of 1792 did (the 1792 act was not the "last word" on US money or coins). You are welcome to read it if you are interested: http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_public_laws&docid=f:publ145.109.pdf It also covers Buffalo Gold Coins (a buillion coin) and the new designs for the Lincoln Cent (by definition, 1/100th of a dollar).

I'll send you some paper ones if you'll send me these in return. After all, a dollar is a dollar... right?
http://ep.yimg.com/ca/I/rarecoins_2129_465994

[Travlyr]

I guess you guys need to help me out here. I am trying to figure out just what portion of a definition of a dollar is missing to claim that there is no definition of a dollar.
Wikipedia (https://secure.wikimedia.org/wikipedia/en/wiki/Dollars) states that the "dollar" is undefined by statute, so I started this thread based on that quote:
"Various acts have subsequently been passed affecting the amount and type of metal in U. S. coins, so that today there is no legal definition of the term "dollar" to be found in U. S. statute."

There are dictionary definitions- a unit of currency in use in many countries including the USA. It is comprised of 100 cents.
This dictionary definition is meaningless. Like sratuig suggested, send me a silver dollar, and I'll send you an ETF dollar. They are both dollars according to the dictionary definition, but they have quite different values.

Then we have statutes and laws which define the physical size, shape, metal (or paper- cotton really) content and purity of coins (and paper notes) as recently as 2005.

Okay. Here is why clear perpetual definitions are important.

In 1792, a man said, "I own $100.00." everybody understood that he owned 2405.70 grams of pure silver = about 85 oz. of silver, or ~ $2400.00 of purchasing power today.

In 2010, a man said, "I own $100.00." everybody understands that he owns 100 units of currency = about 3.5 oz. of silver, or ~ $100.00 of purchasing power today.


By redefining the dollar, the "powers that be" devalue the currency which reduces the purchasing power of earnings for the people and transfers that purchasing power to the "powers that be". Debasement of currency is theft and fraud.


What are you missing?
~ $2300.00 out of every $2400.00 that I've saved. :(

Note: Today's APMEX Buy Price: $28.43/oz Silver Eagles.

[johnny.rebel]

There are many dollars. There are metalic dollars, there are paper dollars, and there are electronic dollars. If you feel that your dollars have no value, you are free to send them all to me. Since they are worth nothing, that is exactly what I will give you for them. A metalic dollar:
http://www.mintcoindealer.com/images/George-Washington-Gold-Coin.jpg

In 2005, Congress passed the Dollar Coin Act. It defines the Presidential Dollar coins just as the Coinage Act of 1792 did (the 1792 act was not the "last word" on US money or coins). You are welcome to read it if you are interested: http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_public_laws&docid=f:publ145.109.pdf It also covers Buffalo Gold Coins (a buillion coin) and the new designs for the Lincoln Cent (by definition, 1/100th of a dollar).
http://ep.yimg.com/ca/I/rarecoins_2129_465994
zippy, i want in on this deal too. i'll trade you dollar for dollar my presidential dollar for your silver dollar. as many as you want. heck, act now and i'll double my offer. i'll trade you two of my shiny presidential dollars for each of your silver dollars. two for one for a limited time only - limited to 20 years or more. a dollar is a dollar... you get two for one. can't beat that deal. ;)

[Fox McCloud]

If you define your currency as say a certain amount of gold, then the government is setting the price of gold- not the free market. In 1833 it was set at $18.93 an ounce. http://www.nma.org/pdf/gold/his_gold_prices.pdf Even in 1918- over 80 years later- it was still only $18.99 an ounce. There is no definition of what a dollar is worth today- absolutely true- that is set by the markets. So is the price of gold.

this is a grave mistake that's made by a number of individuals in today's world, and doesn't seem to show up in professional or academic circles (seems they prefer to focus on the "not enough gold" or "it will result in deflation" arguments).

It's a mistake to state that the government was fixing the price of gold to a certain value---they were defining a dollar as a specific amount of gold, nothing more--the problem here is because people tend to think of the dollar as being some independent entity/unique trading commodity...when it really isn't.

The dollar was nothing more than a unit of account...a measurement if you will. Defining the dollar as being so many ounces/grams of gold is no more price fixing that defining a gallon as being a certain measurement of water---the value of both doesn't change, in the slightest.

if the government would have let the market pick its own currency (and measurement, which most likely would have been grams or ounces), then this wouldn't be nearly as difficult to see or understand, and hardly anyone would make this argument.

See: http://www.amazon.com/What-Government-Money-Percent-Dollar/dp/0945466447/ref=sr_1_1?ie=UTF8&s=books&qid=1291004324&sr=1-1

[Zippyjuan]

If A is defined as equal to B, then B is worth A. If governement defines a dollar as equal to B ounces of gold, then B ounces of gold costs A dollars. They have set the value (in terms of dollars) for the price of gold.

[Zippyjuan]

http://ep.yimg.com/ca/I/rarecoins_2129_465994
zippy, i want in on this deal too. i'll trade you dollar for dollar my presidential dollar for your silver dollar. as many as you want. heck, act now and i'll double my offer. i'll trade you two of my shiny presidential dollars for each of your silver dollars. two for one for a limited time only - limited to 20 years or more. a dollar is a dollar... you get two for one. can't beat that deal. ;)

Thank you for the offer. I am not the one attempting to claim that there is no such thing as a dollar (since it is "undefined"). You seem to agree that dollars do have value since you are willing to exchange them for something else.

[Dr.3D]

If A is defined as equal to B, then B is worth A. If governement defines a dollar as equal to B ounces of gold, then B ounces of gold costs A dollars. They have set the value (in terms of dollars) for the price of gold.

That is the beauty of a gold backed dollar. When the value of gold goes up, the value of the dollar goes up with it. Now if the government was setting the value of gold, then it wouldn't change and thus having a gold backed dollar would be worthless.

Stop looking at the dollar as being a standard of value. It's the metal backing it that would be the standard of value for the dollar.

Look instead at what that amount of gold is able to purchase. If it can purchase more than it did earlier, then the value of the gold went up and the government had nothing to do with the change in value of the gold. That of course would also mean the value of the dollar became greater.

[Zippyjuan]

I don't see the dollar as a standard of value. It is simply a medium of exchange and its value changes over time. The value of gold compared to other goods and services also changes over time.

[sratiug]

Thank you for the offer. I am not the one attempting to claim that there is no such thing as a dollar (since it is "undefined"). You seem to agree that dollars do have value since you are willing to exchange them for something else.

Which one is the real dollar Zippy? The paper one or the silver one?

[Travlyr]

If A is defined as equal to B, then B is worth A. If governement defines a dollar as equal to B ounces of gold, then B ounces of gold costs A dollars. They have set the value (in terms of dollars) for the price of gold.
I really wish you would just download, and read, Murray Rothbard's "The Mystery of Banking (http://mises.org/Books/mysteryofbanking.pdf)" because Mr. Rothbard was an excellent writer & teacher. But since you won't do that, I'll try and share the best I can the way I understand it.

I agree with this, the price of silver in terms of dollars was fixed in 1792 when the uniform standard measure of 24.057 grams of pure silver defined a coin. The coin was named "dollar." That policy decision established a monetary basis that was used as a medium of exchange to trade all other goods and services. Prices of all goods and services were allowed to fluctuate based on the laws of supply and demand relative to silver, gold and copper. Silver, gold and copper maintained static values. Gold was valued at 15 times silver. Bimetallism failed as a currency because gold was not allowed to fluctuate with silver.

The dollar is no longer defined by a weight and purity of silver, or gold, which allows the "white shoe boys" the ability to manipulate the value to their advantage and the advantage of whoever they want to prosper.

[Travlyr]

I don't see the dollar as a standard of value. It is simply a medium of exchange and its value changes over time. The value of gold compared to other goods and services also changes over time.
I don't see the dollar as a standard of value either. And that's the problem.

It was a store of value when it was defined as a measure of silver & gold. It still should be. Those were the "good ole days" when "the wealth was spread around a little bit".


With the "white shoe boys" in control, a man can hold $100,000 in a bank. If that bank pays 2% interest and inflation is 3%, then he loses 1% purchasing power. It's dishonest in favor of the golfers.


If his money was based on a commodity, then he would make 2% plus the 3% of inflation. He would gain 2% purchasing power. His money is a medium of exchange and a store of value. It's honest money.

[Seraphim]

I don't see the dollar as a standard of value either. And that's the problem.

It was a store of value when it was defined as a measure of silver & gold. It still should be. Those were the "good ole days" when "the wealth was spread around a little bit".


With the "white shoe boys" in control, a man can hold $100,000 in a bank. If that bank pays 2% interest and inflation is 3%, then he loses 1% purchasing power. It's dishonest in favor of the golfers.


If his money was based on a commodity, then he would make 2% plus the 3% of inflation. He would gain 2% purchasing power. His money is a medium of exchange and a store of value. It's honest money.


HEY HEY HEY. I am a golfer. Fucker.

:p

[Travlyr]

HEY HEY HEY. I am a golfer. Fucker.

:p
lulz :p ... ;)

[johnny.rebel]

Thank you for the offer. I am not the one attempting to claim that there is no such thing as a dollar (since it is "undefined"). You seem to agree that dollars do have value since you are willing to exchange them for something else.
i missed the claim that there is no such thing as a dollar, or it doesn't have value. who is claiming that? how about if i up my offer to 3/1. 3 of my presidential, etf, susan b. anthony, metalic, paper, 300 pennies, 12 quarters, your choice, for 1 of your silver dollars. if a dollar is a dollar like you claim, then here is your chance to triple your dollars.