I recently watched "The Money Masters." It is available on Youtube, Google Video, etc. I do not know who produced it nor their original motivation. It is dated, around ten years old I would guess. It is also approx. 3 hours long, but worth the time in my opinion. While I do not agree with all of their conclussions, their content appears well researched.
One of their key arguments, if I can explain it adequately, is that neither the current Fed Reserve system nor a gold standard are the way to go. Either are too easily manipulated and create artificial extremes of inflation and deflation.
One of the key points made was "If the government can issue a bond, it can issue a dollar bill." As I understand it, the government issues bonds. The Fed buys bonds with its printed currency. As soon as it is issued, it immediately has interest attached. This is why we WILL NEVER BE ABLE TO PAY OFF THE NATIONAL DEBT WITH THE CURRENT SYSTEM IN PLACE. We end up having to sell more bonds (borrow money) to service the debt, all the while the new money borrowed is issued with attached interest (debt). Again, the answer is not in going back to a gold standard.
A bond is simply an I.O.U. by, in this case, the US government. It is backed by the taxing power of the government. The question then becomes, why do we need the middle man and all the nonsense involved. Remember, the Federal Reserve is not Federal. It is not a government entity, but rather a private corporation given special treatment and rights by our government. It is perhaps the truest example of a monopoly in existence.
If we simply cut out the Federal Reserve, we could issue our own notes instead of bonds, free of interest that would continue to accumulate, necessitating the borrowing of new funds, in a never ending debt cycle. In a matter of a few years our country could pay off our national debt. We could enter a new cycle of prosperity that is almost unimaginable.
Not possible you say. As it turns out, there are plenty of examples of such systems including our own country before the revolutionary war. Another fascinating example is its use in England up until 1826 in the form of the Tally Stick. Under this system, England experienced an unparalleled period of prosperity.
It seems that all the government would have to do upon issue of this new currency is make it acceptable for the payment of taxes. This validates it in the minds of citizens, allowing them to accept it in trade and commerce.
This post is getting long, so I will pause for review and comment. I am sure I am not giving the idea its full justice. I am also sure that the Fed and the powers behind it would fight this to the death. But, it makes a whole lot of sense does it not......