To constitute usury the borrower must not only be obliged to return the principal at all events, but more than lawful interest: this part of the agreement must be made with full consent and knowledge of the contracting parties.
Usury is defined in the classic sense as simply the act of charging interest on loans. Over time it has come to mean charging very high interest on loans.
The method of usury is "one of the oldest professions of man." (Forrest M. Smith, III, The Regulation of Interest: Practice and Procedure, 10 ST. MARY'S L. REV. 825, 1979).
First came the Temple Priests, then the Goldsmiths and the commercial bankers of today. The first use of the Fractional Reserve System was in the Temple of Shamash under Hammurabi -- the sixth king of Babylon
Usury has been condemned since biblical times. It was originally considered usurious to make any charge for the use of money. It came to mean interest that exceeds the rate established by law.
Interest comes from the Latin verb "intereo" meaning to be lost. The ancient Israelites called usury "a bite." It is like the slow poison of a serpent:
"Usury does not all at once destroy a man or nation with, as it were, a bloody gulp. Rather, it slowly, sometimes nearly imperceptibly, subverts the victim's constitution until he cannot prevent the fatal consequences even though he knows what is coming. The practice of lending to an enemy was "as a means of destroying him" (Jno. H. Kimmons, Usury: What Is It, and Does the Law of God Forbid It? 163, Undated).
The Mechanism of Debt Creation
A group of powerful industrialists, lawyers, politicians and financiers long ago, created through a series of interlocking corporate structures, trusts and agreements, a secret, self-perpetuating, tax-immune group whose, by now global influence has usurped the sovereignty of borrowing national governments (who serve their lenders). They also control the media, politicians and judiciary. They control the production, distribution and lending of money through the creation of a system of privately-owned and controlled central banks (Federal Reserve in America, Bank of England in the UK).
Its business is conducted in secret meetings which determine the future of all national economies and the timing of expansion (through loans) or contraction (through refusal or withdrawal of loans). It exercises an exclusive monopoly of the issuance of money created out of thin air and issued solely as debt, does not create money to repay the interest, and lives off perpetual national debts that consume future income and under international law cannot be repudiated even by an internal political revolution. This group can demand special privileges and even military force to collect "national" debts. It has the privilege of a guaranteed untaxed income enforced by liens on all public and personal property and collected by the coercive force of the tax structure of the various governments.
The rich rule over the poor -- an ages long fact. The borrower is servant to the lender -- and what is the method used by the lender: the insidious system of usury. The whole case against usury is too large to cover in the space of an article so the following is a concise and brief explanation of the workings of this fraudulent system.
For the many readers who are aware of these little-known facts, the following will serve as a timely reminder and hopefully, an incitement, to inform the many innocents who are daily losing their farms, houses and businesses as a result of this unjust system. Even more urgent is the need to educate the young before they embark on a future relationship with their bank or financial institution. There is no turning back once those loan papers have been signed: you are trapped right up till the day you pay it off.
For the readers who have never been fortunate to know the following, they may well be shocked and even angry. They will be angry at the banks, the Establishment that permits such a swindle, and in fact, thrives off such a swindle.
Money
The most sinister and anti-social feature about bank-deposit money is that it has no existence. The banks owe the public for a total amount of money which does not exist. In buying and selling, implemented by cheque transactions, there is a mere change in the party to whom the money is owed by the banks. As the one depositor's account is debited, the other is credited and the banks can go on owing for it all the time.
"The whole profit of the issuance of money has provided the capital of the great banking business as it exists today. Starting with nothing whatever of their own, they have got the whole world into their debt irredeemably, by a trick. This money comes into existence every time the banks 'lend' and disappears every time the debt is repaid to them. So that if industry tries to repay, the money of the nation disappears. This is what makes prosperity so 'dangerous' as it destroys money just when it is most needed and precipitates a slump. "There is nothing left now for us but to get ever deeper and deeper into debt to the banking system in order to provide the increasing amounts of money the nation requires for its expansion and growth. An honest money system is the only alternative." -- Frederick Soddy, M.A., F.R.S., Nobel Prize Winner, 1921.
Banks have several ways of creating money. Economists use the term "create" when explaining the process by which money comes into existence. In this case creation means producing something that did not exist before. Production in the traditionally recognized sense means the conversion of existing materials into more useable and valuable forms.
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks...will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.... The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” -Thomas Jefferson President of the United States 1801-1809
As we can see from the above, manufacturing money is dirt cheap, and whoever does the "creating" and issuing stands to make impressive profits.
The Supply of Money
"Let me issue and control a nation's money and I care not who writes its laws" -- Attributed to Mayer Amschel Rothschild (founder of the largest financial dynasty ever to exist in its influence and power).
Modern societies are completely reliant on an adequate supply and circulation of money. It is the method by which goods and services are exchanged. Without money, all industry and services would grind to a halt and government would collapse leading to complete anarchy.
The Rothschilds can start or prevent wars. Their word could make or break empires" -- Chicago Evening American, December 3, 1923.
World War II ended the Great Depression. Overnight, the same Bankers who had no money for housing, food and clothing, suddenly had millions to lend for Army barracks, uniforms, rations and weaponry. This was a remarkable reversal in policy by the Bankers. They simply began pumping millions upon millions of dollars back into the economy when war was imminent. The Great Depression ended because of the war!
Wars create huge debts to the Bankers who are able to expand the money supply and lend more money out. In the case of a war, the victor nation would have to seize the assets of the defeated nation, occupy its place in the international trade system, and thus, sometime in the future, be able to pay back all its debts (including interest) to the Bankers who made the war possible in the first place. Big banks, that have traditionally been owned exclusively by a few collaborating families, can change the course of history and have done so for much of this century.
Debt Creation
"Who goeth a borrowing goeth a sorrowing" -- Benjamin Franklin. The first Postmaster General of the United States.
The main method through which new money (not true, real money, but "credit" representing a debt) can go into circulation is when it is borrowed from Bankers. When large amounts of money are borrowed and utilised within society, an illusion of prosperity appears. Thus, when "credit" is loaned out to borrowers, more wealth circulates within society giving the outward appearance of abundance. Of course when it comes to paying that money back, there is the question of usury or interest. As "credit" is borrowed out, interest accumulates at ever-increasing rates.
Europe's Depiction of Debt. A monumental crisis lay ahead...
Arrow widths are proportional to debt amounts.
Questions and Answers
The following are extracts from Rev. Charles E. Coughlin's famous book Money! Questions and Answers which best illustrates the method by which banks produce something out of nothing:
Q. When an individual borrows money from a bank, does the banker lend him money that other private individuals have brought to the bank?
Answer: No. That is what the bankers would like to have you believe, but it is not true.
Q. How do banks create money out of nothing by mere book-keeping entries?
Answer: By the following manufacturing process:
John Jones, a business man, needs $10,000. He goes to the bank and explains the nature of the business he proposes to conduct. He takes to the bank certified figures indicating the value of his business, factory, farm, home, etc. If the banker is satisfied with the amount of real wealth to be pledged, he gives John Jones a note to sign. This note is a mortgage upon the wealth John Jones owns, and gives the banker legal power to confiscate the wealth, if John Jones does not pay at a specified time the number of dollars he is borrowing. The banker then manufactures the money on his ledgers.
Q. How does he do this?
Answer:
When the banker accepts John Jones' note, on the asset side of the ledger he writes: Assets Liabilities Loans and Discounts...............$10,000 On the liability side he writes: Deposits.......................................10,000 At that instant, there is $10,000 more money in existence and available for use than before the banker made these entries.
Q. What does John Jones do with this bookkeeping money?
Answer:
He goes back to his factory with a bank book, not with actual currency, showing a deposit to his account of $10,000.
Q. What is the exact nature of the item on bank balance sheets called "Deposits"?
Answer:
The "Deposits" are actually and legally nothing but liabilities of the bank. They are the money the bank owes, not what it has. A bank deposit is actually a bank's promise, nothing more.
Q. What can John Jones do with this newly created deposit?
Answer:
He can and does write cheques against this deposit to pay labourers, buy raw materials, and pay general overhead, incident to carrying on the manufacture and distribution of wealth.
Q. How is this possible?
Answer:
Other banks are doing the same thing at the same time. A bank against which cheques are drawn receives the proceeds of similarly manufactured deposits in other banks. Each bank receives cheques drawn on other banks which offset those drawn against it. They all have to work together. If there were only one bank the fraud would be soon discovered.
Q. Is this process honest where John Jones pledges real wealth to secure the banker's fictitious bookkeeping money?
Answer:
No, because it enables the banker to lend purchasing power (money) which costs him nothing but the general overhead of running a bank, and forces John Jones...to pay interest for the existence of bankers' bookkeeping money, with which 95% of...business is transacted.
Q. When the banker manufactured $10,000 and loaned it to John Jones, who began to write cheques, exchanging that bookkeeping money for wealth and services, what happened to the price levels?
Answer:
• They were increased, because there was $10,000 more money in existence than there was prior to John Jones' loan. This new money came into existence, however, without a corresponding increase in the volume of goods and services, thus decreasing the unit value of money already outstanding. The value of outstanding money went down, which meant that the price level went up, i.e., the same amount of goods would then command more money. This principle is well recognised by all economists.
For example, if there are only $10,000 in existence in the egg market and only 10,000 eggs to be had we will say that each egg is worth $1.00. Now supposing that there are $20,000 in existence in the egg market and still only 10,000 eggs to be had. Each egg becomes worth $2.00. It is the old law of supply and demand. The double amount of money represents the demand. But the same quantity of eggs represents the supply. The egg merchants desirous of getting as much as they possibly can per egg will exhaust the supply of egg money.
Q. When John Jones, the business man, is forced to pay his loan at the bank, what happens to the volume of money in the nation?
Answer:
• It is reduced by the number of dollars that John Jones pays.
What happens when a large number of business men are forced to pay their loans?
• A large volume of the necessary medium of exchange is extinguished, i.e., cancelled out of existence.
What is a genuine loan?
• In making a genuine loan the lender advances real money which represents a transfer of real purchasing power. Thus, if "A" earns $1000 working at the production and distribution of wealth, he may exchange that $1000 for wealth, or he may abstain from using or possessing wealth and lend his $1000 to another. If he lends his $1000 so acquired, he is a party to the making of a genuine loan.
Q. Why are bankers as a rule opposed to the existence of genuine money and prefer the existence of so-called credit money?
Answer:
• If bankers are compelled to lend genuine money they are merely acting as agents for some real depositors and thereby are profiting only insofar as they are handling genuine money to the extent of the total amount of genuine money deposited with them. If bankers are privileged to lend credit money it means that they are not lending, as a rule, depositor's genuine money but are lending ten or fifteen or twenty times the amount of genuine deposits. They create credit money or fictitious money by a flourish of the fountain pen. Thus instead of lending only actually, for example, a million dollars of total deposits at 3% with the return of $30,000 profit the bankers are lending under the credit money racket, for example $20 million, $19 million of which is fiction. In this latter case their profit would be approximately $600,000.
• Therefore, bankers are opposed to honest money and to honest lending because of the difference of profits which in the case above would amount to approximately $570,000.
Q. But why should citizens be opposed to bankers making this extra profit?
Answer:
Because this extra $570,000 must be taken out of the sweat of the labourer. It is a social injustice which permits privileged classes to reap where they did not sow.
Q. Do fundamental, religious, moral, ethical and philosophical principles harmonise with private ownership of property employed in or available for use in producing wealth?
Answer:
Yes. Private ownership of honestly acquired property, employed in production is in full harmony with Christian principles.
Q. Is capitalism, as we find it in operation today, in perfect harmony with good moral, ethical and philosophical principles?
Answer:
Emphatically, no. Masquerading under the title of capitalism, modern capitalism is notorious for the following errors which are contrary to human nature and to good government.
Modern capitalism borrows money at interest for non-productive and destructive purposes.
Modern capitalism, while professing in the belief in private ownership, concentrates the wealth in the hands of a few and deprives the mass of private individuals from owning the tools of production.
Modern capitalism professes to believe in the private coinage and regulation of money...
Q. Does social justice imply that its followers adhere to the doctrine of modern capitalism?
Answer:
No. In the four above mentioned errors of modern capitalism, social justice is opposed to this economic system.
Q. Did Karl Marx ever attack private money creation privileges and international bankers?
Answer:
No, his whole system proposed not the abolition of illicit private money creation and destruction powers, but its consolidation under a system of complete economic, political and religious domination of the entire world by a few internationalists.
Q. Do all people have equal opportunity under our present money system?
Answer:
No, they do not.
"They say to us that we all have an equal opportunity, and that it is our fault that we do not become rich. They seek, however, in every way possible, to prevent us from taking the only opportunity we have to all become successful for they know that if we did, it would end their exploits." (From "Why is Your Country at War" by Charles A. Lindbergh, Sr. in a speech urging the passage of a bill to provide an honest money system.)
The inevitable outcome of this system is the diminishment of money in circulation to the point where a depression will be imminent. Money increasingly disappears into the Bankers coffers leaving less and less in circulation. Debtors struggle against each other, vying for new loans which will mean more "created" money and more interest. The banker accrues vast sums of real money and credit that he will gamble on the stockmarket, etc. The Banker will also accumulate all types of property assets, snatched from bankrupt farmers, businessmen etc.
The Banker who produces nothing of value, gradually gains a stranglehold over the resources of future generations. The borrowers have become the servants of the lenders and their slavery is secured through the ever increasing burden of debt.
The bankers always win
Though millions of financial transactions are carried out every year, very little money actually changes hands. 95% of all "cash" transactions are done by cheque. The Banker is perfectly safe in "creating" the so-called "loan" by writing the cheque or deposit slip, not against real money, but against your promise to pay it back! The cost to the banker is stationary and wages.
We create our own slavery
"Banking was conceived in iniquity and was born in sin. The Bankers own the earth. Take it away from them, but leave them the power to create deposits, and with the flick of the pen they will create enough deposits to buy it all back again. However, take it away from them, and all the great fortunes like mine disappear, and they ought to disappear, for this would be a happier and better world to live in. But, if you wish to remain the slaves of Bankers and pay the cost of your own slavery, let them continue to create deposits" -- Sir Josiah Stamp (President of the Bank of England in the 1920s, the second richest man in Britain).
We are ruled by a capitalist financial system that has usurped the power of government, and set about to pauperise and control the people. It is now a centralised power-thirsty machine which promotes war, steals the people's wealth and uses every type of propaganda to keep its position.
The Bankers realise that an under-educated, ignorant and confused population is easier to subvert than a healthy and intelligent people. The ruling Establishment therefore promotes all manner of degeneracy, decadence and corruption including drug use, sexual perversion and trivialities.
Through the use of high technologies including; cash machines, computer transfers, automated banking, and the internet, the Bankers and their associates can exert almost total control over a nations finance, and thus increase their powers to amass even more wealth through their use of usury. When all transactions are processed in this manner, the cashless society will have been reached -- a Banker's paradise. The cashless society will be the ultimate instrument in social control; no more tax evasion, no more "extra undeclared earnings", no existence outside the system.
So what can we do about this incredibly deceitful system ? We can warn as many people as possible about it, and show them ways to avoid it or minimize the long term damage to their way of life. The danger that lurks behind usury must not under any circumstance be supported or encouraged. When enough people realise this iniquity they will develop alternative methods of raising funds. They will come together in new community structures; independent from the old, decrepit worn-out Establishment.
For the love of money is the root of all evil; and the evil that exists at the base of materialistic societies will one day be rooted out and forever destroyed.
Three of the worlds most prominent religious texts all agree that usury should be forbidden. Below is a summary of the main points:
USURY – The Religious Viewpoint
The Old Testament
The Old Testament "classes the usurer with the shedder of blood, the defiler of his neighbor's wife, the oppressor of the poor, the spoiler by violence, the violator of the pledge, the idolater, and pronounces the woe upon them, that they who commit these iniquities shall surely die." Id. at 2. The usurer was put in the same category with extortioners, Sabbath-breakers, those who vex the fatherless and widows, dishonor parents and accept bribes (Ezekiel 22). The usurer was also classed with the liar, the unrighteous, the backbiter, the slanderer and perjurer, and denied the right to inherit the New Jerusalem (Psalm 15). The usurer is further classed with the meanest and lowest of men and the vilest of criminals (Ezekiel 18).
Before the Babylonian captivity, Ezekiel denounced the practice of usury as a great evil and mentioned the practice of oppressing strangers as part of the great wickedness. Interest repayments on loans, even to resident strangers was forbidden in the year of Jubilee (Leviticus 25:35-37) whereas in regular years it was permissible to charge interest to strangers (Deuteronomy 23:19-20). Zechariah forbade "the oppression of the stranger, classing it with oppression of the widow, the fatherless and the poor...". Malachi "enjoins regard for the stranger's rights."
Solomon gave us the proverb, "the borrower is servant to the lender."
Old Testament injunctions against Usury
Exodus 22:25 If thou lend money to any of my people that is poor by thee, thou shalt not be to him as an usurer, neither shalt thou lay upon him usury.
Leviticus 25:36 Take thou no usury of him, or increase: but fear thy God; that thy brother may live with thee.
Leviticus 25:37 Thou shalt not give him thy money upon usury, nor lend him thy victuals for increase.
Deuteronomy 23:19 Thou shalt not lend upon usury to thy brother; usury of money, usury of victuals, usury of any thing that is lent upon usury:
Deuteronomy 23:20 Unto a stranger thou mayest lend upon usury; but unto thy brother thou shalt not lend upon usury: that the LORD thy God may bless thee in all that thou settest thine hand to in the land whither thou goest to possess it.
Nehemiah 5: 7-10
I pondered them in my mind and then accused the nobles and officials. I told
them, "You are exacting usury from your own countrymen!" So I called together
a large meeting to deal with them 8 and said: "As far as possible, we have
bought back our Jewish brothers who were sold to the Gentiles. Now you are
selling your brothers, only for them to be sold back to us!" They kept quiet,
because they could find nothing to say. 9 So I continued, "What you are doing
is not right. Shouldn't you walk in the fear of our God to avoid the reproach
of our Gentile enemies? 10 I and my brothers and my men are also lending the
people money and grain. But let the exacting of usury stop!
Psalm 15:5 He that putteth not out his money to usury, nor taketh reward against the innocent. He that doeth these things shall never be moved.
Proverbs 28:8 He that by usury and unjust gain increaseth his substance, he shall gather it for him that will pity the poor.
Proverbs 22:7 The rich ruleth over the poor, and the borrower is servant to the lender.
Isaiah 24:2 And it shall be, as with the people, so with the priest; as with the servant, so with his master; as with the maid, so with her mistress; as with the buyer, so with the seller; as with the lender, so with the borrower; as with the taker of usury, so with the giver of usury to him.
Jeremiah 15:10 Woe is me, my mother, that thou hast borne me a man of strife and a man of contention to the whole earth! I have neither lent on usury, nor men have lent to me on usury; yet every one of them doth curse me.
Ezekiel 18:8 He that hath not given forth upon usury, neither hath taken any increase, that hath withdrawn his hand from iniquity, hath executed true judgment between man and man.
Ezekiel 18:13 Hath given forth upon usury, and hath taken increase: shall he then live? he shall not live: he hath done all these abominations; he shall surely die; his blood shall be upon him.
Ezekiel 18:17 That hath taken off his hand from the poor, that hath not received usury nor increase, hath executed my judgments, hath walked in my statutes; he shall not die for the iniquity of his father, he shall surely live.
Ezekiel 22:12 In thee have they taken gifts to shed blood; thou hast taken usury and increase, and thou hast greedily gained of thy neighbours by extortion, and hast forgotten me, saith the Lord GOD.
The New Testament
The New Testament continued the prohibition of usury: "In the fullness of time the Messiah came, and no part of the moral law was abrogated. The prohibition of usury as to the Jew was extended, to include mankind, and the permit as to the stranger was declared inoperative and void. The Jew was taught to sympathize with strangers remembering that they were once strangers in Egypt."
Jesus taught (Luke 6:34-35) "love ye your enemies, and do good and lend, hoping for nothing again." Usury was the basis for Jesus calling the money changers thieves: "The commerce of the world is conducted on principles as much at variance with the teachings of the master, as are the practices of a sneak thief or burglar. So the Master taught, as with whip of cords, he indignantly drove its representatives, from the sacred precincts of the Temple, denouncing them as thieves. Every well-informed mind knows that the money changers in the Temple, on that startling occasion, were at the very center of the Jewish Banking system, and of the pitiless and grinding commerce of Palestine."
Assuming there is a stranger exception, "where is the authority for the practice of usury on our brethren?" The taking of interest is "subversive of the principles of a sound state policy, contrary to good morals, and opposed to the teaching of God's Word." The meaning of "usury" has been changed "to mean exorbitant interest.
The ecclesiastical doctrine of interest was the greatest obstacle to modern banking. It was primarily based upon:
1) Aristotle's condemnation of interest as an unnatural breeding of money by money
2) Christ's (supposed) condemnation of interest (Luke 6:34) and the reaction of the Fathers of the Church against commercialism and usury in Rome. (Will Durant, The Age of Faith 630, 1950).
The moral condemnation of this ancient practice has been summarized: "It comes as news to most people to learn that practically all important ethical teachers -- Moses, Aristotle, Jesus, Mohammed, and Saint Thomas Aquinas, for instance -- have denounced lending at interest as usury and as morally wrong" (Lawrence Dennis, "The Squirrel Cage of Debt," Saturday Review of Literature 661, June 24, 1933).
New Testament injunctions against Usury
Matthew 25:27.Thou oughtest therefore to have put my money to the exchanges, and then at my coming I should have received mine own with usury.
Timothy 11 6:10 For the love of money is the root of all evil.
Luke 6:34-35 love ye your enemies, and do good and lend, hoping for nothing again.
Matthew 25:26-27; Luke 19:22-23 only the hard, austere man, one whose conscience will not interfere with his reaping where he has not sown, and taking up where he has not laid down, would extract usury, for he makes the lord of the parable tell the servant of it: You say I am a hard and austere man, then why did you not act accordingly, and earn me my usury as my nature demanded?
The Apostle Paul, in telling his vision, said: "And I saw another multitude of men and women, and worms consumed them. But I lamented and sighing asked the angel and said, 'Who are these?' And he said to me: These are those who exacted interest ON interest, and trusted in their riches and did not hope in God that He was their helper." Antinicene Fathers, Vol. IX, p. 160.
The Apostle Peter publicly told his vision: "And in another lake, full or pitch and blood and more bubbling up, there stood men and women on their knees: and these were usurers and those who had taken interest. . ." Antinicene Fathers, Vol. IX, p. 146.
The Koran
Riba (Usury) is of two major kinds:
1. Riba An-Nasia - Interest on lent money
2. Riba Al-Fadl - Taking a superior thing of the same kind of goods by giving more of the same kind of goods of inferior quality, eg.,dates of superior quality for dates of inferior quality in great amounts.
The definition of Interest, the literal meaning of interest or Al-Riba as it is used in the arabic language means to excess or increase. In the Islamic terminology interest means effortless profit or that profit which comes free from compensation or that extra earning obtained that is free of exchange. Riba has been described as a loan with the condition that the borrower will return to the lender more than and better than the quantity borrowed.
A muslims main concern when it comes to financial transactions should be to avoid Riba in any of its forms, despite the fact that the basic foundation of the world economics and finance today is that of Riba and dealing in usury.
The Prophet has foretold us of a time when the spread of Riba would be so overwhelming that it would be extremely difficult for the muslim to avoid it. This situation calls for muslims to be extra cautious before deciding on what money payment of financial methods to use in any personal or business transaction.
To make sure that we are safe from Riba, we have to learn which transactions lead to it.
Interest in Pre-Islamic Times
Imam Malik reports on the authority of Zaid Ibn Aslam that in the period of ignorance (pre-Islamic times) interest was changed according to the following scheme. One person had a right to the property of another person. It may have been a general right because of the amount lent or the price of something purchased or in any other form. A time was set when the claim would be settled. When the appointed time arrived the creditor would ask the debtor if he wanted to settle the claim or pay interest with an extension of time. If the claim was settled then there was no increase in the payment. Otherwise the debtor would increase the amount payable and the creditor would extend the period further.
Koranic injunctions against Usury
Hadith - Sahih Bukhari, Volume 3, No. 299; Narrated ‘Aun bin Abu Juhaifah, r.a.
My father bought a slave who practised the profession of cupping, (My father broke the servants instruments of cupping). I asked my father why he had done so. He replied, "The Prophet forbade the acceptance of the price of a dog or blood, and also forbade the profession of tatooing, or getting tatooed and receiving or giving Riba (Usury), and cursed the picture makers."
Hadith - Sahih Bukhari, 2.468, Narrated Samura bin Jundab, r.a.
He speaks of in a dream related to the Prophet (SAW) that there is a river of blood and a man was in it, and another man was standing at its bank with stones in front of him,facing the man standing in the river. Whenever the man in the river wanted to come out , the other one threw a stone in his mouth and caused him to retreat back into his original position.The Prophet was told that these people in this river of blood were people who dealt in Riba (usury).
The Noble Qur'an - Al-Baqarah 275-281
275. Those who eat Ribâ (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitân (Satan) leading him to insanity. That is because they say: "Trading is only like Ribâ (usury)," whereas Allâh has permitted trading and forbidden Ribâ (usury). So whosoever receives an admonition from his Lord and stops eating Ribâ (usury) shall not be punished for the past; his case is for Allâh (to judge); but whoever returns [to Ribâ (usury)], such are the dwellers of the Fire - they will abide therein.
276. Allâh will destroy Ribâ (usury) and will give increase for Sadaqât (deeds of charity, alms, etc.) And Allâh likes not the disbelievers, sinners.
277. Truly those who believe, and do deeds of righteousness, and perform As-Salât (Iqâmat-as-Salât), and give Zakât, they will have their reward with their Lord. On them shall be no fear, nor shall they grieve.
278. O you who believe! Be afraid of Allâh and give up what remains (due to you) from Ribâ (usury) (from now onward), if you are (really) believers.
279. And if you do not do it, then take a notice of war from Allâh and His Messenger but if you repent, you shall have your capital sums. Deal not unjustly (by asking more than your capital sums), and you shall not be dealt with unjustly (by receiving less than your capital sums).
280. And if the debtor is in a hard time (has no money), then grant him time till it is easy for him to repay, but if you remit it by way of charity, that is better for you if you did but know.
281. And be afraid of the Day when you shall be brought back to Allâh. Then every person shall be paid what he earned, and they shall not be dealt with unjustly.
The Noble Qur'an - Al-Imran 3:130
O you who believe! Eat not Ribâ (usury) doubled and multiplied, but fear Allâh that you may be successful.
Conclusion
Islam has encouraged men to earn their own provision and provide for their families. The condition is that the earning has to be according to the Shari’ah. These rules can be found under the heading of trade in the books of jurisprudence. Interest is amongst those conditions which all dealings must be free from.
GOLD
What is Gold?
Gold is a remarkable, rare metal, with an unparalleled combination of chemical and physical properties. It is the only yellow metal and bears its name from the Old English word for yellow, 'geolu'. It is also the only metal that forms no oxide film on its surface in air at normal temperatures, meaning that it will never rust or tarnish.
Gold's chemical symbol, Au, comes from the latin word for gold, aurum. In the Periodic Table of Elements, gold is classified as a transitional metal with the following characteristics;
• Symbol: Au
• Atomic number: 79
• Atomic mass: 196.96655 amu
• Number of protons/electrons: 79
• Number of neutrons: 118
• Melting point: 1,064.43°C (1,337.58°K, 1,947.97°F)
• Boiling point: 2,807.0°C (3,80.15°K, 5,084.6°F)
• Density @ 293°K: 19.32 grams per cubic centimeter
• Crystal structure: cubic
Gold may be alloyed with various other metals to give it special properties. In its pure form, gold has a metallic luster and is sun yellow, but when mixed or alloyed with other metals, such as silver (Ag), copper (Cu), zinc (Zn), nickel (Ni), platinum (Pt), palladium (Pd), tellurium (Te), and iron (Fe), creates various color hues ranging from silver-white to green and orange-red. Usually, red, yellow and green golds are made by adding varying amounts of copper (Cu) and silver (Ag) to produce alloys of 10 to 14 carats. White golds have traditionally been made by alloying nickel (Ni), zinc (Zn) and copper (Cu) with gold, but more recently silver (Ag) and palladium (Pd) have replaced the zinc. These color variation treatments to gold are mostly used in jewelry.
Fineness is a metallurgical term indicating the purity of gold and is expressed in parts per 1,000. Minted coins and bars have a fineness of 999.9 parts per 1,000. The purity of gold in an item or the amount of gold in an alloy is measured with a unit called a carat. An item of fine or pure gold is 24 carat, with lesser carat values indicating the proportion of fine gold content as a fraction of 24. For example, an 18 carat gold item contains 18/24 (or 3/4) fine gold and 6/24 (or 1/4) alloy by weight.
Properties of Gold
An unparalleled combination of chemical and physical properties make gold invaluable to a wide range of everyday applications. One of the most important of these properties is gold’s virtual indestructibility.
Gold is the most non-reactive of all metals. It is called a "noble" metal (an alchemistic term) because it does not oxidize under ordinary conditions, meaning that it will never rust and never tarnish.
Gold's physical properties of high electrical conductivity and chemical inertness make it an excellent and reliable conductor, particularly in harsh environments, where temperatures can range from -55°C to 200°C. The use of gold in circuitry ensures reliability of equipment operation, particularly in the vital activation of safety airbag mechanisms in motor vehicles or deployment of satellites and spacecraft.
No other metal is as ductile or as malleable as gold. A single ounce of the metal can be drawn into a wire five miles long. Gold can be hammered into sheets so thin that light can pass through.
High purity gold reflects infrared (heat) energy almost completely, making it ideal for heat and radiation reflection. Gold-coated visors protected astronauts’ eyes from searing sunlight on the Apollo 11 moon landing.
Gold is also an excellent conductor of thermal energy. It is used in many electronic processes to draw heat away from delicate instruments. For example, the main engine nozzle of the space shuttle uses a 35% gold alloy.
History of Gold
Gold was probably first found on the ground and used by prehistoric man as a tool. The first known use of gold was in parts of central and eastern Europe, in 4000BC. Highly sophisticated gold art objects and jewelry dating back to around 3000BC have been discovered by archaeologists in the Sumerian Royal Tombs at Ur, in what is now southern Iraq. The Egyptians used gold to adorn their kings in life and death and, by 1500BC, gold had become a standard medium of international trade. Similarly, goldsmiths of the Chavin civilization in Peru were making ornaments by hammering and embossing gold by 1200 BC.
There are many stories and legends that relate an association of famous people and places with gold. The gold mask that intricately details the facial features of King Tutankamen, the youthful ruler of ancient Egypt, retained its untarnished brilliance when it was uncovered in 1927, after being entombed for more than 3000 years. The Old Testament tells of the wealth of King Solomon's Mines and how his fleet would return from legendary Ophir laden with gold for his treasury. The Queen of Sheba would visit Solomon bearing gifts of gold in appreciation for his advice and wisdom.
According to Greek legend, Midas, king of Phrygia, was granted a wish by the god Dionysius in exchange for a favor, that everything he touched would turn to gold. He begged to have his power removed after realizing how foolish he had been. The search for the Golden Fleece by Jason and the Argonauts was probably based on the method of gold recovery used. At that time, miners extracted most of the gold from alluvial sands in rivers and streams. By washing the gold bearing sand through the sheepskins, gold particles would be trapped by the wool fibres. The fleece would then be dried and burnt in a fire leaving remnant blobs of melted gold.
Around the fifth century BC, the Greek, Chinese and Arabic cultures began to develop ideas about alchemy, in a pseudo-scientific attempt to change base metals into gold. Alchemists searched for the Elixir or Philosopher's Stone, a substance of high purity that would not only convert metals to gold, but also restore health and provide immortality. These alchemists provided the basis for the modern science of chemistry.
The discovery of America by Christopher Columbus was thought to be an indirect result from the endeavor to uncover the source of China's gold, which had riches beyond any of those of Europe. The lure of gold led the Conquistador's to murder and pillage the central American civilizations of the Aztecs and Incas. These Spanish invaders melted down centuries old artifacts and icons of exquisite craftsmanship into ingots.
About 600BC the Greeks began to use gold coins and many 'city-states' minted their own money in order to conduct trade between states. The rarity and metallic properties of gold made it the ideal choice in the development of coinage.
Currency has remained one of gold's primary uses. It is considered so valuable that we measure all other values by it. In 1944, the International Monetary Fund and the World Bank were created, setting a new international currency standard in terms of gold.
Gold is still considered to be an extremely safe form of financial security, many preferring to hold gold coins and bullion rather than government bonds because of its intrinsic value. Gold has long been used as a store of wealth, with most countries and financial organizations holding gold as part of their financial reserve.
Importantly, gold is still regarded throughout much of the world as a store
of financial value, particularly in many developing countries. However it has
many other vital uses in modern life.
Did You Know?
• The Olympic gold medal was first presented in 1908. Before then, winners received silver medals. Today's gold medal is actually made of silver, guilded with at least six grams (0.21 ounces) of pure gold.
• Onboard computers in the Galileo space probe are protected from short circuiting using Heavy Ion conductors made from silicon and gold.
• The ‘Pathfinder’ robot that took close-up pictures from the planet Mars, used an intricate gold circuitry to transmit information back to Earth.
• The most detailed, precise images ever of Neptune and Uranus were captured by the Keck telescopes, which used gold-coated mirrors.
• Every telephone contains gold in the miniature transmitter in its mouthpiece. Because of its ability to convey a superior signal, gold is also used to coat phone jacks and connecting cords.
• Airforce One, the airplane used by the President of the United States, is protected from heat-seeking missiles by gold-plated reflectors.
• Motor vehicle airbag deployment systems use gold-plated sensors which signal the airbag to deploy. Gold is the only metal resistant and reliable enough to use in these life-saving devices.
• One ounce of gold can be stretched into a 50m long wire or hammered into a sheet covering 100 square feet.
• The World Cup trophy is 32cm high and is made of solid 18ct gold.
• Gold fetched its highest-ever price of $870 per ounce on January 21, 1980.
Uses of Gold
Electronics,Telecommunications,Computers/Semiconductors
Millions of computers are manufactured worldwide each year and gold plays an active role in their many components. The most important use of gold is as a fine wire that connects circuits to the semiconductors, or the "brains" of the computer. This "bonding wire" is specially refined (up to "five nines" or 99.999-percent pure gold) and has an average diameter of one hundredth of a millimeter - smaller than the diameter of a human hair. Gold is also used as a paste with which a circuit is printed on a ceramic base to produce a printed circuit board. In other areas, each key on the computer keyboard strikes gold circuits that relay the data to the microprocessor. Computer games also use printed circuit boards that have gold circuitry to connect the logic units in the game package. Computer peripherals, where there is frequent plugging and unplugging, use gold-coated contacts to assure consistently clean, corrosion-free contacts and reliable signals. Gold is essential in computer circuitry because of its electrical conductivity and because it does not degrade over time.
Automotive
A major problem for fuel cells in automotive applications is the tendency of the oxygen-reducing platinum cathode to dissolve during the repeated potential cycling required for braking and acceleration. Zhang et al. (p. 220; see the news story by Service) found that nanometerscale gold clusters deposited on carbon-supported platinum particles effectively inhibit dissolution during electrochemical cycling experiments in a perchloric acid electrolyte. Surprisingly, the gold does not significantly inhibit the catalytic O2 reduction, despite the low activity of gold alone in this reaction. X-ray absorption near-edge spectroscopic studies suggest that the presence of gold raises the platinum oxidation potential.
Spacecraft
The space age has brought new demand for gold to filter out the intense solar radiation that exists outside the earth's atmosphere. Thin layers of gold on astronaut's visors protect eyes from both ultraviolet and infrared solar radiation. Gold coatings on spacecraft also help keep temperatures low inside the vehicle. Gold's resistance to corrosion in space leads to its use in coating bearings, thereby overcoming serious mechanical problems that plagued some early satellites having exposed moving parts.
To protect the onboard computers in the Galileo space probe from short circuiting as a result of heavy bombardment, NASA developed a Heavy Ion Counter (HIC). The HIC contains silicon wafers with gold electrodes that detect the heavy ions as they penetrate the wafers. Use of the HIC allows NASA engineers to monitor the functioning of onboard computers and make adjustments when necessary.
The Pathfinder "robotic geologist" that took close-up color pictures of rocks and soil on Mars and analyzed the planet's chemical makeup, relied on sophisticated electronics to direct its landing and movement. In addition, intricate gold circuitry enabled sophisticated computer technology to transmit the Pathfinder's information back to Earth.
Telephones
Behind the protective cover of every telephone mouthpiece is a miniature transmitter that contains gold in one of its central components, the diaphragm. A gold-plated dome in the diaphragm works with the other mouthpiece components to transcribe voice vibrations into an electrical current. Gold is used in this application because of its permanence, particularly in public phones that are exposed to outdoor weather conditions.
Because gold conveys a superior signal, and does not corrode or tarnish, it is used to coat billions of contacts for phone jacks and connecting cords throughout our nationwide telephone system. The phone wall jacks are goldcoated to assure the customer of the convenience of moving the phone from one wall jack to another while maintaining clear static-free conversation.
TVs and DVDs
The microcircuitry in televisions is composed of fine lines of gold circuits connected by hair-thin gold wires to the micro-electronic circuit chips that process broadcast signals into a TV picture. Cables connecting television sets to videocassette recorders are gold coated to assure clear relay of the television signal.
Medicine and Health
Gold is valuable to modern medicine because it is non-toxic and biologically benign, one of the most efficient conductors of electricity, and its density enables it to be seen under electron microscopes. And although gold is virtually indestructible, it is a soft metal, easy to work with, shape, flatten or draw out into microscopic strands. Gold has been used in medicine since 1927, when it was found to be useful in the treatment of rheumatoid arthritis .Because it is non-toxic and biologically benign, gold is perfect for many medical applications. Surgeons use gold instruments to clear blocked coronary arteries. In another medical procedure, gold pellets are injected into the body to help obstruct the spread of prostate cancer in men. Gold is also used in lasers, which allow surgeons to seal wounds quickly or treat once-inoperable heart conditions. Thin gold wires are used in many surgical procedures to provide strong and inert support.
Dentistry
Most gold used in dentistry is in the form of alloys, which are mixtures of gold and other metals, such as platinum, palladium, silver, copper and zinc. Gold is non-toxic and biologically inert, which makes gold ideal for use in dental procedures. It is easy for the dentist to manipulate, but strong, stiff, durable and tough -- it never wears or tarnishes. It is also very resistant to chemical attack and does not corrode. Fifteen percent of all gold consumed in the United States is for teeth fillings and dental bridgework.
Eye Surgery
Accidents, disease or surgery may cause a condition called Lagophthalmos, which is the inability to close the eyelids fully. In order to keep the eyelids moist, doctors previously resorted to sewing the eyelid half shut, but a new gold eyelid implant is now the current form of treatment. These gold "eyelid load implants" are surgically inserted into the upper lid and allows the eye to blink normally. The muscle that opens the eyelid works to hold the eyelid open; then, when the muscle relaxes, gravity exerted on the gold causes the eyelid to drop. Gold is the best choice for this device as it does not corrode and will not react with tears.
Lasers
One of the most promising new areas of medical treatment is in the use of ion lasers, the interior surfaces of which are coated with gold to control the focus of the beam. In one development, gold vapor lasers create a high intensity red light with the required wavelength to seek out and selectively destroy cancerous cells without harming healthy neighboring cells. A new lightweight laser, designed by the military and using gold plated contacts, enables medics to seal battlefield wounds in the field, thereby reducing blood loss and improving survival chances for the seriously wounded. In hospitals, this new design will allow lasers to be brought to critically injured emergency patients without moving them, saving minutes and lives.
Surgeons use gold instruments to clear clogged coronary arteries. Injection of microscopic gold pellets helps retard prostate cancer in men. Some forms of cancer are treated with colloidal gold. Lasers with gold-coated parts literally give new life to patients with once-inoperable heart conditions and tumors.
These gold-reliant lasers are revolutionizing medicine - from pinpoint destruction of cancerous cells to rapid emergency surgical procedures, to delicate surgery on eyes and brain tissue that was previously not possible. Most recently, gold-coated lasers are being used to rejuvenate skin tissue damaged by burns and injuries, while leaving the surrounding healthy tissue unaffected. Because of its inert and benign nature, gold can be used inside the human body without fear of corrosion or harmful physical reactions in most cases.
Chemistry
Gilding Glucose by Jake Yeston
The relative inertness of gold has been long been valued for the manufacture of jewelry and other prized items that must resist oxidative tarnishing. Recently, however, homogeneous as well as nanometer-scale colloidal gold has proven increasingly useful in chemical catalysis. Comotti et al. explore the potential of gold particles supported on carbon to catalyze the aerobic oxidation of glucose to gluconic acid. Given the relative fragility of this highly functionalized substrate, industrial production of gluconic acid has relied on mild enzymatic methods. A comparison of two aqueous glucose oxidations--one catalyzed by a commercial enzyme preparation and the other by suspended Au/C--shows that under optimized conditions, the gold exhibits comparable activity to the enzymes, requiring only mild heating and vigorous stirring of a basic solution. – JSY J. Catal. 244, 122 (2006).
Jewelry
Gold has been prized by people since the earliest times for making statues and icons and also for jewelry to adorn their bodies. Intricately sculptured art objects and adornment jewelry have been uncovered in the Sumerian royal Tombs in southern Iraq and the tombs of Egyptian kings. Significant buildings and religious temples and statues have been covered with thinly beaten sheets of gold. Due to its rarity, gold has long been considered a symbol of the wealth and power of its possessor.
In 2001, it was estimated that 2870 tons of gold were produced worldwide. About 80 percent of that gold production was used to make jewelry, the majority of which was sold in India, Europe and the United States of America. Gold jewelry is universally popular, loved for its lustrous yellow color and untarnishing character. In many Asian countries, such as India, Thailand, and China, gold is important to religious ceremonies and social occasions, such as the Chinese New Year and Hindu marriages in India.
Gold is Money
By Warren Pollock, August 08, 2003
The value of gold pertains and relates directly to the metal having acceptance as currency. Gold finds its optimum value when it can be used as a currency to store wealth, guarantee paper, or effect transfer in goods and services.
Perceived or functional demand for anything creates value. Societal culture and structure will dictate what has importance be it a baseball card, oil, an automobile, a house, or labor hours. Value can be transitory or it can endure as gold has throughout civilized history.
Currency translates through uniform quantification the relationship in societal value between the desirable commodities, services, and outcomes. Both complex and all but the most basic societies need currency to effect the transfer of wealth. Gold provides a physical foundation point in currency throughout history, between nations, and across culture.
Integrated and global societies have highly complex currency systems largely predicated on common values. Law, stability, and property rights allow people to enjoy the benefits of a fast moving multiplied economy with a high velocity of money. Liberty may be an additional component or its presence may be reflected in the rights to protection of property. The three basic precepts, of law stability and property rights, combined with currency provide the very basis for productivity and most importantly these conditions foster investment and innovation with the objective of societal returns.
In the United States, unlike many other nations, value may be found in things tangible or intangible and in property either physical or intellectual. Investment and re-investment in productive enterprises result in economic success. The four pillars of economic success are law, stability, property rights, and currency. These supports are critical components of advanced economies.
However, Law property rights and stability, are inherently more fragile than perceived. Politics, culture, war, natural resource depletion, population pressure, mismanagement, malfeasance, events, and even collective rather than objective opinion can drastically detract from the core requirements for societal success.
The comfort of highly functional economies provides false shelter and harbors erroneous perception in security. Therefore as the foundation currency, gold, has a role, in all types of economies from the most basic to the most integrated.
By political objective, the correlation between gold and currency has become temporarily more distant since the 1970's. Just thirty years later some banks and societies are moving back towards the fundamental of gold today. A short-lived politically biased counter-trend does not represent a speck of time in relation to the history of gold.
Worldwide political objectives, as well as cultural experience, are not congruent or unified to common interests defined primarily by western thought and influence. It can be definitively said that interests are currently trending apart. Gold will become more valuable as currency in a predictable long-term enduring countertrend. History speaks to this and it will outlast us all.
Today specific economic, political, regional, and international circumstances have the propensity to drive a stronger correlation between gold and its role as currency.
Both mainstream and outlying contingencies can and will drive gold to become more attractive as currency. Therefore a portfolio that has a percentage weight in gold proportional to the probability of specific circumstances will be well served.
Finding that proportional level of gold to probability of circumstance presents some challenge. However, and in general, the level of gold holdings per capita needs to be much higher to adequately reflect the probabilities in which its application would be useful.
Inflation, in a paper money system or fiat money system, has to be considered part of the normal range of economic activity. If the economy were trending to inflation gold would rise inversely to unsecured paper. The value of gold stays constant while the currency devalues as it loses purchasing power.
Central banks have spent much of their efforts curtailing inflation. The pariah of inflation has been the watchword of every central bank simply because inflation inherently exists in unsecured paper money systems.
War also provides potential accelerants to inflation. I make this statement with the caveat that for structural reasons this may not apply in total to the present circumstance in the Untied States.
Gold provides a natural hedge against this normal and mainstream economic contingency of inflation yet few people hold even 1% of their portfolio in gold to offset the high probability of inflation over time. Most people are totally unprepared for the mainstream, recurring, and relativity frequent contingency of inflation.
Presently I believe the globe may be in a period of "stagnation-deflation". "Stagnation-deflation" implies that a mix of deflation and inflation are present in a slowing economy. Both an economic boom and "stagnation-deflation" represent outlying economic events one deviation outside the norm. ""Stagnation-deflation"" provides opposite traction to the dislocation of a boom.
In "stagnation-deflation" returns that can be derived on investments trend lower therefore gold appreciates because the opportunity cost for holding gold decreases. Simply put, more people want to hold gold to offset uncertainty and holding gold does not cost much because alternate investments do not provide meaningful returns. Perhaps after adjustment the United States will correct to the normal economic range. However, political interests are reticent to allow an adjustment to occur to take the energy out of a corrective force so in the near term therefore the US could shift to a more severe outcome as the potential energy of chronic and structural imbalance compound rather than release.
Unless the currency, stock, and debt markets shift to sustainable levels and valuations, and in the process wipe out wealth, the probability of the "worst case" scenario increases. In politics the "art of the possible" in pleasing a constituency has much to do with short term perception rather than need or circumstance. Gold has absolute neutrality to politics and it has an incredibly long time horizon.
I qualify these "worst case" events as two standard deviations away but that does not mean that they are not probable. War and structural imbalances such as deficits can drive a bad situation to a worse outcome.
Where do we go from here? We can go into a recovery, which would bring us into a normal economic range. Inflation is one of the possibilities because the economy would bounce off a higher money supply, as the velocity of money would increase through accelerated economic activity. Gold speaks directly to the inflation potential of this outcome. Or we move to outlying contingency two standard deviations from the mean.
The two extreme potentialities are hyperinflation and/or a liquidity trap.
A liquidity trap, depression, zero-bound, call it what you want circumstances become so unpleasant that Gold might be the least-worst option. Gold becomes a Hobson's choice, "no choice at all." Gold as currency thrives in inflation therefore hyperinflation would also drive gold towards the role of currency.
In either worst case the risk of confiscation of gold, government intervention, or command of the economy increases because of social considerations. A question to ask would be whether or not government tends to reward the individuals who are making the best personal economic choices?
What is the likelihood of these probabilities? Would these contingencies warrant one percent of one's investments to be in gold? What measures can be effective in diversification both to gold and in relation to gold holdings?
Presently the United States stands engaged in a war. Gold also finds its value as currency because war represents a major uncertainty and it can cause rapid dislocation.
Whether or not people in the United States believe that Gold has value today many cultures, central banks, and individuals are quite convinced that gold provides utility as currency. Unfortunately the common call to any asset class usually means that the best time to enter has been exhausted. With objective consideration gold deserves to be present at appropriate levels as part of any portfolios.
Gold as a safe haven and asset diversifier
The world geo-political and economic structure is currently undergoing major change, some have even called the situation an "upheaval." This means that the investment outlook, particularly for certain parts of the world, is more unpredictable than usual. Under these circumstances, it is logical to conclude that investment portfolios should diversify a proportion of their assets into real (non-paper) assets such as gold and silver for protection against a potential decline in the paper markets.
The reason is basic:
The economic forces which determine the price of gold are different from, and in many cases opposed to, the forces which determine the prices of most financial assets. The price of an equity depends on the earnings and growth potential of the company it represents. Likewise, the price of a bond depends on its safety, its yield, and the yields of competing fixed income investments. The price of gold, on the other hand, depends on different factors: worldwide physical supply and demand for gold, movements in foreign exchange rates, inflation, interest rates and political turmoil. The effects of all these factors are somewhat complex and variable. But the important point to remember is simply that they cause the price of gold to move independently of the prices of financial assets.
“Among the precious metals, gold drove out others...because it was more efficient from the standpoint of effecting transactions at the least cost. The dollar became the dominant international money in a world of paper currencies...because, among the alternatives, it best satisfied the characteristics of an international money.” Nobel Laureate Robert Mundell - In a paper about Gresham's law
I think we are moving full circle back to gold, but gold will circulate as currency in a way that overcomes the impediments that stopped it from circulating as currency in the past.
It was the intention of the founding fathers of America to have all money as either gold or silver and they were so insistent on it that they went so far as to write it into the U.S. Constitution.
Article I, Section 10, provides that "No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
Gold was considered coin of the realm at least until 1913 when the Federal Reserve Act was implemented. In truth, it was a blow to the Constitution. FDR provided the final blow when he ordered the confiscation of all gold held by U.S. citizens in 1933.
A 1944 agreement made in Bretton Woods, New Hampshire, helped to establish a fixed exchange rate in terms of gold for major currencies. The International Monetary Fund was also established at this time. This agreement governed currency relationships until 1971, when a floating exchange rate system was adopted under Nixon and the fixed exchange rate mechanism was abandoned "closing the gold window" and the link with gold was finally severed. Before its breakdown, the agreement was useful in maintaining order and accomplishing common objectives among the states that created it.
The dollar is very important for what it is, i.e., a proxy for U.S. debt. It is not a ‘store of wealth´ as so many believe. Instead it is a piece of paper backed by absolutely nothing, printed and emitted by the U.S. government as a way of postponing the settlement of its debts. Better yet, it is an undeclared “bond”, which can never be redeemed, except by receiving more of the same.
Clearly, debt and usury are like slavery. Clearly, the borrower is the servant to
the lender.
The clear answer to the problem of how usury enslaves people is to avoid debt,
and avoid using debt currency. The use of gold and silver as money will bring
economic freedom and prosperity..
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