What is Fiat Money? — by James Jaeger

The term “fiat money” − more correctly “fiat currency” − is becoming more wide-spread than it was seven years ago when we put out a movie called FIAT EMPIRE. I certainly didn’t invent the term, so I am just going along with the economic jargon as best I can. But for anyone that doesn’t understand what fiat currency is, it’s reasonably simple. Here’s a primer.

Fiat currency is PAPER currency that is issued by government “fiat” or decree. The reason it’s issued by government decree, or fiat, is because ordinarily no one would accept or use it because it can no longer be REDEEMED for gold or silver. After all, it’s just PAPER. “Redeem” simply means the act of taking your PAPER currency into your local bank and having them give you GOLD or SILVER in exchange for it. In other words, the bank will redeem specie as evidenced by your paper. They will give you the amount of gold or silver specie written on the FACE of your paper bill (its “face value”). If the face of your paper bill says “$10 Silver Certificate” (instead of 10 dollars or 10Federal Reserve Notes) the bank will give you 10 “dollars” worth of silver.

So how much silver is this? Well, it depends on the current definition of the “dollar” when you try to redeem your silver.

What most people don’t understand is a “dollar” is a unit of WEIGHT. So, once a “dollar” is defined (by some authority or the free market), the bank knows how much silver to trade/give/redeem you for your $10 Silver Certificate.

Pursuant to the Coinage Act of 1792, a dollar is defined as 371.25 grains of pure silver. Since 1 ounce = 437.5 grains, a dollar contains exactly .849 ounces of pure silver.

Thus when you go to the bank with your ten dollar ($10) Silver Certificate, the teller will give you 8.49 ounces of silver in COIN form. Since silver is a soft metal (gold as well) the coins are never 100% pure silver. So a COIN’S weight is always a composite of silver and some other hardening metal, as in this example. Thus the bank would redeem the $10 Silver Certificate most likely with a $10 Eagle, two Half Eagles or ten silver dollar coins.

But if any of this has confused you, the good news is this: YOU DON’T HAVE TO GET LOST IN ANY OF THESE DETAILS.

You can define a “DOLLAR” as whatever you want. The government can define a “DOLLAR” as whatever it wants. The free market can define a “DOLLAR” as whatever it wants. That last – the free market − is the ONLY valid definition.

But when we go back onto a Gold Standard (as many say we will), we will probably have a new Coinage Act passed by Congress to get things started. Just as there have been two other Federal Reserve Systems (central banks) over the years, there have been about six Coinage Acts. The earliest one I am aware of was the Coinage Act of 1792 and the most recent one was the Coinage Act of 1965.

The Coinage Act of 1792 established the original definition of what a dollar was to be, how much silver there was supposed to be IN a dollar COIN or redeemed for a PAPER dollar certificate. This is what we could go back to when the Gold Standard is reinstated.

But we all remember the infamous Coinage Act of 1965. At least, we should. That was the Act of a misguided Congress that turned our quarters, dimes and half dollars into clad tokens. On 23 July 1965 the Congress, operating in its own interest and in the interest of greedy New York bankers against the interest of WE THE PEOPLE, removed all the silver from DIMES and QUARTERS and debased the silver content in the HALF DOLLARS down to 40% from 90%. They then made up the weight and size of the coins with copper. Remember that ugly copper sandwich that suddenly appeared in the middle of all coins starting in 1965?


It alarmed me. That VERY day I KNEW something was wrong in America. Just like the JFK assassination, I remember the exact place I was when I first saw the new quarters. I thought to myself: “What the hell? They took the silver out of these. Who did this? Who gave them permission to cheapen the quarters we all use?”

Well, the answer to this question is: the elite banks and the U.S. Congress. These two entities conspired to debase the currency, not only by lowering and removing the silver content, but by making none of the paper Silver Certificates redeemable in silver. They had already accomplished this with Gold Certificates long ago; now they were robbing U.S. citizens of their silver.

Why were they doing this?

If you go Wikipedia − which has become a dictionary of establishment propaganda − it says: “This act (the Coinage Act of 1965) was in response to coin shortages caused by the rising price of silver.”

The rising price of silver, eh? What a bunch of horse. How can silver rise in “price” when “price” is DEFINED in silver. Point one. Point two: As G. Edward Griffin explains on page 141 of his book, The Creature from Jekyll Island, Wiki has used the old fallacy known as “the misleading theory of quantity” again. Thus, if there is NOTHING else you take away from reading these words, PLEASE come away with at least this one thing:


The fallacy of QUANTITY is the NUMBER ONE way apologists for FIAT CURRENCY (money NOT redeemable in silver or gold) attempt to INVALIDATE the Gold Standard. It’s the number one way they attempt to BRAINWASH you into using PAPER currency, i.e., fiat currency.

The reason is simple. These people (elite bankers and corrupt congressmen) want us all using PAPER money BECAUSE THEY CAN ENDLESSLY PRINT PAPER MONEY − BUT THEY CAN’T PRINT UP GOLD OR SILVER.

By getting gold and silver out of the picture any way they can − removing it from coins, not redeeming paper bills for it, blatantly confiscating it as they did in 1934, defaulting on foreign redemptions as Nixon did in 1971, AND by making the false claim of “shortages” − they can literally print up (known as “monetizing debt” or “quantitative easing”) as much currency as they want to expand the WELFARE-WARFARE state.

Again, the reason the QUANTITY of silver or gold available is of no concern is explained on page 141 of Mr. Griffin’s book. If there is ever a shortage of silver, the definition of a silver dollar can be REDEFINED by Congress in the full light of day and after sufficient public debate (unlike the way the Federal Reserve Act was passed). For instance, I said above that, pursuant to the Coinage Act of 1792, a dollar is defined as 371.25 grains of pure silver. Well, if there were to be a “shortage” of silver and everyone was freaking out, a dollar COULD be redefined by an act of Congress as 300.00 grains of pure silver instead of 371.25 grains. BUT this would not even be necessary, for the market would automatically redefine the ratio of silver by weight to the number of paper certificates representing each ounce.

Thus, when one sees what is really going on, statements like − “This act was in response to coin shortages caused by the rising price of silver.” – are revealed for what they are: ignorant or misleading pronouncements that serve the interests of a partnership between the banking elite and a rogue Congress that’s attempting to confiscate the value of the nation’s money supply. Thus, what an ignoramus of a statement like this is essentially saying is: “Oh, we can’t make any more silver coins because the price of silver is too high.” This may sound reasonable to the general public, but what the banking frauds who say things like this have failed to mention is: no more silver coins SHOULD be made. Why would anyone WANT to make more silver coins than the number of silver coins that have already established themselves in market circulation? Bear in mind that using silver coins PREVENTS fraudulent bankers and their rogue accomplices in Congress from INCREASING the money supply. Think about it. When the money supply is INCREASED, WHO GETS THE INCREASE OF MONEY? Well, that should not be hard to figure out. The GOVERNMENT and the BANKS get the increase. That’s WHY they conspire to get control over coinage and printing of the nation’s currency and eliminate GOLD and SILVER with whatever excuses they can dream up. This is also WHY the Framers of the U.S. Constitution stated in Article I, Sections 8 & 10 that money must be GOLD or SILVER COIN and no BILLS OF CREDIT are permitted.

What’s a BILL OF CREDIT? It’s essentially a Federal Reserve Note − what we use as “money” now that the banking frauds have extracted all the silver and gold out of our money supply. So technically, the “money” we are now using is illegal (unconstitutional), and the congressmen that played a part in effectuating the overt or covert transition to it are actually partners with the elite New York banks in a long-term criminal conspiracy. See the movie FIAT EMPIRE for details (http://www.MoviePubs.Net/singles).

Given these considerations − and the idea that you can fool some of the people some of the time but you cannot fool all of the people all of the time − is it any wonder millions are protesting (both through the Tea Partydemonstrations and now the Occupy Wall Street Movement) across the country, and even the world, as fiat currency is also the source of the European debt crises as well?

The reason for the mass protests is because millions of people have had the VALUE sucked out of their lives in exactly the same way the Federal Reserve System and its rogue congressional partners sucked the SILVER out of our quarters back in 1965.

Wake up. It’s time to put value back into our money and remove from power the bankers and government officials that played a part in this worldwide monetary scam. It’s also time to end the unjust enrichment of the corporations that surround these banks, as Jefferson once warned there would be.

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4 Responses to What is Fiat Money? — by James Jaeger

  1. stan says:

    Under our current system, the only way money comes
    into existence is when it is borrowed. When you go to
    a bank for a loan, say $100,000, you pledge
    (promissory note, usually in addition to collateral)
    to REPAY the loan according to the terms of the loan
    document. The bank accepts your pledge and lists it as
    a $100,000 bank asset (electronic “credit” entry) then
    gives you worthless printed paper currency whose only
    backing is your pledge to repay. At that moment, the
    money supply of the United States increases by
    $100,000; the money has been created out of thin air
    (normally the bank doesn’t actually give you the
    currency but, instead, transfers the credit entry to a
    bank account in your name or transfers it directly to
    a third party, as is the case in a
    mortgage loan scenario).

    The same thing is done with the Congress, only the
    Congress does not sign pledges that IT will repay
    loans….it signs pledges that YOU and I will repay
    the loans (“the good faith and credit of the United

    Let’s say the Congress “appropriates” $10 Billion in a
    bill to provide free school lunches for the students
    of selected schools, or for selected students in a
    list of named schools. $10 Billion immediately goes
    into circulation when it is paid to the schools, and
    the Federal Reserve adds $10 Billion to the mythical
    “national debt” list. The Fed has printed 100,000
    one-hundred-dollar bills, at a total cost of less than
    $0.02 per bill ($2,000) and, in exchange for that
    “generosity,” the American people are “obligated” to
    “repay” both the mythical $10 Billion “debt” PLUS
    INTEREST on the created-out-of-thin-air $10 Billion.

    How would you like to have a printing press and a deal
    like that? You would print up currency and, instead of
    being owed for your printing, you would be “owed”
    based upon the face amounts of the bills you printed.
    Not only would you be entitled to be
    “repaid” money you never had or lent, but you would be
    entitled to interest on it for every day it remained
    unpaid. How long would it take you, “lending” money to
    the drunken-sailor Congress, to amass a fortune?

    Wouldn’t you be satisfied if no one ever paid anything
    to you on the principal, so long as they perpetually
    paid you a percentage of their incomes toward the
    ever-accruing INTEREST?

    The families who own the Federal Reserve are satisfied
    with that arrangement too, and there is nothing they
    won’t do to protect and preserve it. NOTHING!

    I’ve mentioned the Rockefellers. Let’s look a moment
    at the Rothschilds. Perhaps you’ve heard of the House
    of Rothschild. The House of Rothschild controls wealth
    of approximately $450 TRILLION.

    Imagine that in comparison to the mythical “national
    debt” of six to eight TRILLION….a single family
    dynasty worth 65 times as much as the entire United
    States government has accumulated in “debt” over a
    period of 75 years.

    The Rockefeller family controls wealth of
    approximately $125 TRILLION. Together the two families
    control about 70% of the wealth in the entire world,
    and both are stockholders of the Federal Reserve. No
    presidential candidate has been elected as
    president of the United States, since William Howard
    Taft, without the personal blessing of Lord Rothschild
    (whoever is head of the Rothschild family at any given
    time). The Rothschild dynasty is the most powerful
    institution on earth, and it unmistakably runs the
    Federal Reserve (and with it, the United States) with
    an iron fist.

  2. stan says:

    Federal Reserve operatives (CIA, et al) manipulate
    politicians and heads of state into committing their
    troops to fight wars all around the globe. Nations at
    war must purchase weapons, ammunition, armaments, and
    equipment. To do that, they have to
    borrow money. The Fed lends “money” (don’t forget, it
    creates it out of thin air) to both sides, and its
    stockholders profit from their enterprises in the
    so-called “gun trade” (which includes airplanes,
    ships, aircraft carriers, submarines, tanks, trucks,
    all the tools and armaments of war). War is a very
    profitable racket, plain and simple, fought by the
    poor and enjoyed by the profiteers. The United States
    currently has a military presence in 130 of the
    world’s 245 countries. Do you suppose that’s because
    “We the People” want them there? Or could it be that
    what “We the People” want matters not, but that what
    the money powers want is what counts?

    “War is just a racket. A racket is best described, I
    believe, as something that is not what it seems to the
    majority of people. Only a small inside group knows
    what it is about. It is conducted for the benefit of
    the very few at the expense of the masses.” – Smedley
    D. Butler (1881-1940) Major General, U.S. Marine
    Corps, Retired “I spent 33 years and 4 months in
    active service as a member of our country’s most agile
    military force- -the Marine Corps. I served in all
    commissioned ranks from second lieutenant to Major
    General. And during that period I spent most of my
    time being a
    high-class muscle man for Big Business, for Wall
    Street and for the bankers. In short, I was a
    racketeer for capitalism. I suspected I was part of a
    racket all the time. Now I am sure of it. Like most
    members of the military profession I never had an
    original thought until I left the service.” – Smedley
    D. Butler (1881-1940) Major General, U.S. Marine
    Corps, Retired

  3. stan says:

    How far will the international bankers go to protect
    their money, their investments, their POWER, and their
    anonymity? Earlier I said there is NOTHING they won’t
    do. Let’s look a little more closely at that issue.
    Andrew Jackson was a populist who bitterly opposed the
    banking industry and fought the central bankers tooth
    and nail. In 1835, Richard Lawrence (“a crazed lone
    gunman”) attempted to shoot President Andrew Jackson.
    Both his revolvers miraculously failed to fire and he
    was arrested. He was acquitted on temporary insanity
    grounds. He later confessed that wealthy men from
    Europe had paid him to kill Jackson and promised to
    get him off if he were caught.

    Abraham Lincoln needed money to fund the war and he
    refused to borrow from the banks, which demanded
    interest ranging from 24% to 36%. He elected instead
    to print and issue $450 million in U.S. Treasury Notes
    (in accordance with the Constitution),
    in 1862 and 1863, and no interest was paid to anybody.
    He denied the bankers the profit they had expected to
    reap as a result of the war they very likely

    Lincoln said, “The money powers prey upon the nation
    in times of peace, and conspire against it in times of
    adversity. It is more despotic than monarchy, more
    insolent than autocracy, and more selfish than
    bureaucracy.” Shortly after that public statement, he
    was assassinated by John Wilkes Booth, “a crazed lone

    After Lincoln’s death, Otto Von Bismarck made the
    following statement: “The death of Lincoln was a
    disaster for Christendom. There was no man in the
    United States great enough to wear his boots. I fear
    that foreign bankers with their craftiness and
    tortuous tricks will entirely control the exuberant
    riches of America, and use it systematically to
    corrupt modern civilization. They will not hesitate to
    plunge the
    whole of Christendom into wars and chaos in order that
    the earth shall become their families’ inheritance.”

    President James A. Garfield opposed central banking
    and fiat currency, and he was assassinated by “a
    disappointed office seeker” Charles Julius Guiteau on
    July 2, 1881.
    William McKinley condemned the central banking trusts
    as “dangerous conspiracies against the public good.”
    He was assassinated in 1901 by a “crazed lone

    On June 4, 1963, President John F. Kennedy signed
    Executive Order 11110, that resurrected the
    Government’s power to issue and coin its own currency,
    bypassing the Federal Reserve, and paying no Message
    Page 9 of 12 4/8/2007 interest on money it “borrowed”
    (printed) from itself. Pursuant to this Executive
    Order, more than $4.3
    billion in “United States Notes” were brought into
    circulation, as an interest-free and debt-free
    currency backed by silver reserves in the U.S.
    Treasury, in $2 and $5 denominations. $10 and $20
    United States Notes were never circulated but were
    being printed by the Treasury Department when Kennedy
    was assassinated on November 22, 1963. It is obvious
    that President Kennedy knew the Federal Reserve Notes
    being used as the purported legal currency were
    contrary to the Constitution of the United States of
    America, and that he intended to put the illegal and
    unconstitutional Federal Reserve out of business. John
    F. Kennedy vs The Federal Reserve

    Also on November 22, 1963, on the tarmac at Love Field
    in Dallas, Texas, the new President Lyndon B. Johnson
    signed orders to immediately withdraw the $4.3 billion
    in United States Notes that had been issued by
    Kennedy. No one would suggest that Lee Harvey Oswald
    notified Johnson’s staff in advance to prepare such an
    order and have it on the plane in Dallas for him to
    sign. Who could have known LBJ would become president
    on that date?

    As has become the preferred method of assassinations
    orchestrated by the banking cartel, “a crazed lone
    gunman” was set up as the patsy. Executive Order 11110
    has not been repealed, rescinded, or amended. Yet no
    president has since used it in any attempt to restore
    Constitutional government to the United States of
    America. It’s safe to conclude they have been more
    devoted to remaining alive than to resurrecting the
    defunct Constitution.

    In 1968, Robert F. Kennedy ran in the Democratic
    Primaries as a candidate for President. He was winning
    and there could be no question that he would handily
    defeat LBJ to become the next president. Having served
    as his brother’s Attorney General and close personal
    confidant, there could be little doubt that he would
    likely resume JFK’s quest to rout out the firmly
    entrenched banking cartel, as Andrew
    Jackson had successfully done, though the resulting
    national stability was short-lived.
    So, RFK had to be eliminated too, there seemed to be
    no other way to avert another confrontation. Once more
    a mind-controlled robot (Sirhan-Sirhan), who had been
    indoctrinated and just waiting to be used, was planted
    in the Ambassador Hotel at RFK’s last political rally
    and “armed” with a pistol loaded with blanks. As
    television cameras watched, he fired upon RFK at
    point-blank range, directly from his front, and RFK
    collapsed and was immediately killed, though the
    autopsy report shows the two bullets which killed him
    entered from behind his right ear and just beneath his
    right shoulder blade, both leaving powder burns on his
    skin and clothing. Sirhan-Sirhan, another “crazed lone
    gunman” was convicted and imprisoned with little
    fanfare, appeasing a gullible, grief-stricken
    populace, eager to believe most anything they were fed
    by the government and the media.

    President Ronald Reagan opposed the Federal Reserve
    and spoke against the Income Tax System publicly until
    he was shot, but not killed, by a “crazed lone gunman”
    named John Hinckley, a patsy said to be obsessed over
    actress Jodi Foster, and the official cover story
    claimed he shot Reagan to impress her. Reagan,
    apparently understanding how easily he could join
    Abraham Lincoln, James A. Garfield,
    William McKinley, and JFK, remained surprisingly
    silent on banking matters thereafter.

    Then there was Congressman Louis T. McFadden (quoted
    above) who survived two assassination attempts. His
    voice opposing the Federal Reserve was loud, and
    somebody wanted him silenced.

    Huey Long, Governor of Louisiana and U.S. Senator for
    Louisiana, was a champion of the people and a vocal
    opponent of the Federal Reserve and FDR’s New Deal,
    was assassinated in 1935 by “a crazed lone gunman”
    named Dr. Carl Weiss, conveniently the son-in-law of a
    judge who opposed Long.

    Father Charles Edward Coughlin, a Michigan Catholic
    priest, was very vocal about eliminating the Federal
    Reserve as the best way of ending the Great
    Depression, and his voice was loud. He was one of the
    first political leaders to use radio to reach a mass
    audience, as more than forty million….then estimated
    to be a third of the nation….tuned to his weekly
    broadcasts during the 1930s. He received 80,000
    letters weekly from listeners.

    The FDR administration, puppet of the Federal Reserve,
    passed legislation requiring
    licenses for radio broadcasters and denied Father
    Coughlin’s application. Not to be silenced, he began
    publishing a newsletter and reached a huge following
    until the FDR administration withdrew his access to
    Message Page 10 of 12 4/8/2007 the U.S. Postal system.
    He was effectively silenced and was reduced to being
    only a parish priest in Michigan until his death in
    1979 at the age of 88. Had they not been able to
    silence him, would they have killed him? Who knows?

    Four American Presidents have been assassinated. The
    major thing they all had in common was their
    opposition to central banking and the issue of
    worthless fiat currency which enslaves the American
    people. All actively worked against the international
    bankers and all were killed. Though Reagan survived,
    banking was the thread that linked him with the four
    who did not survive to complete their elected terms.
    Andrew Jackson was the only one who fought the banks,
    survived an assassination attempt, and won. His
    tombstone reads “I killed the banks,” but doesn’t
    mention he was ever President of the United States.

    • straydog01 says:

      Very interesting and very in-depth response. It seems that you have done your homework on this matter. I find this topic very interesting in great part to the details you outline above. It’s not hard to tie everything together if you just follow the money. I see that you mentioned Smedley Butler in one of your responses….I just posted “War is a Racket” on here a couple of weeks ago. If people would just read that they would see and understand that not just war, but everything in the political realm is unfortunately only about money. Thanks for the history lesson and the in-depth response….I invite you continue following my blog and please continue to comment on my other posts. Take care and DOWN WITH THE FED!

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