The Incredible Shrinking Dollar

Source: http://www.foxnews.com/story/0,2933,510390,00.html

March 24, 2009

The one thing tonight is a question: why?

Why is no one in the media or government speaking out when huge U.N. countries — like China, Russia and France — publicly attack the U.S. dollar and support dropping it as the world's currency?

Maybe it's because most people simply don't understand the consequences of what that would mean for America.

Fortunately, I've been reading up on this for a while now, so let me try to explain it in plain English:

Before World War II, we were on the gold standard. For every dollar we printed, there was a dollar's worth of gold in the vault. After World War II, a bunch of countries got together and said: You know, this whole "putting gold into a vault" thing is really tedious. What do you say we just value gold at $35 an ounce and base our currencies off that?

It was the beginning of the end.

America could now issue paper money as basically IOUs to the world, where each dollar could buy a dollar of gold; gold that didn't have to actually exist.

Now, fast forward to 1971:

After the free spending of the Vietnam War and Great Society, America only had three realistic options: stop the war, stop the Great Society or slow everything down so that we accumulated enough gold to afford it all.

Instead, we chose a fourth option: If you can't win the game, change the rules.

That year, Richard Nixon abolished the fixed price of gold, and, for the first time ever, our printing presses could start running 24/7 without regard to that pesky little thing called collateral.

I'm 45-years-old and when I was growing up this country was the world's biggest lender. But because we left the gold standard, we are now the world's biggest borrowers. If we can't afford something, we just go into our basement and print up some more money.

If you did that, you'd go to jail for counterfeiting — since nothing is backing that money up. Now, finally, our country is going to pay a penalty as well.

After monetizing $2 trillion of debt in the last two weeks alone, our lenders are saying enough is enough. They want out.

As Rupert Murdoch, CEO of FOX News Channel's parent company, recently said: "We are in the m1idst of a phase of history in which nations will be redefined and their futures fundamentally altered."

Call me a suck-up if you want, but I couldn't agree more. Our future is being altered right now, right in front of your eyes. And yet no one seems to care.

Again, I ask you the same question I started with: why?

What do you think? Send your comments to: glennbeck@foxnews.com

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