Wednesday, April 18, 2012

As Predicted, a Coinage Debasement is in the Works

I have been predicting for two years now that the government will debase the nickel.  Here are several articles where I predict this is coming.   Once you understand the economic forces behind these events, such predictions are not difficult, the only variable is timing.    Two years ago, the prediction was made.  Now we see the legislation authorizing the immediate debasement of the nickel. 

Currently, the nickel is 25% nickel and 75% copper.   It costs more than a nickel to make a nickel. The root cause of this is the over-printing of dollars, but they want to cover the problem by stamping "nickles" out of steel.   They want to debase the coinage.    They did this in the 1960s when they quit using silver to make quarters, dimes, and half-dollars.  They have so debased the currency that those silver "half-dollars" from the early 1960s have a melt value of over $11 each.  

Thus they have debased the dollar to 1/22 of the value it had on the day I was born.     Therefore 95.5% of its value has been siphoned off in my lifetime.  This amounts to a hidden tax increase/ wealth transfer.   Who got the siphoned off wealth?  The government, and global banks and corporations closely associated with it.

In the 1980s they debased the penny.   Pennies after 1982 (and some in 82) are made of zinc rather than copper.     The nickel was the last coin they left honest, and now they seek to change that.  To add insult to injury, the bill contains a line which authorizes them to add coloration to the steel nickels so that they will look the same color as real nickels made of nickel.   

I don't want the debased currency to look like the undebased currency.   They should look different, because they are different.  And because if they continue their insanity, they may destroy the dollar.   If that happens, there may be an interim period in which we have to use coins for trade according to their melt value, not their face value.    The nickels that contain nickel will still be worth a nickel.  The steel nickels won't be.  By making them look the same, they will actually make it harder to use the coins honestly, but then that seems to be the government's trend lately.

3 Comments:

Anonymous Anonymous said...

I don't foresee any issues with magnetic nickels...

2:57 PM, April 25, 2012  
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