Thread by @OfficialTRHL

Nixon gets all the credit but it was actually FDR who set the fall of the Gold Standard in motion. #wtfhappenedin1971

Buckle up, kids. it’s story time.

Picture it: America, 1933,

The Lone Ranger had just debuted on American radio

The Blaine Act ended Prohibition in all 50 states.

And America was 4 years deep in the Great Depression.

In March, President Roosevelt declared a nationwide bank moratorium in order to prevent a run on the banks by consumers lacking confidence in the economy.

During the first of three phases, in the spring and summer of 1933, the Roosevelt administration suspended the gold standard.

See friends, the magic of Keynesian economics is that it only works* if you inflate the money supply!

And increasing the amount of gold held by the Federal Reserve would in turn increase its power to inflate the money supply

So in March of 1933, the Emergency Banking Act gave the president the power to control international and domestic gold movements. It also gave the secretary of the treasury the power to compel surrender of gold coins and certificates.

On April 5, 1933, FDR ordered all gold coins and gold certificates in denominations of more than $100 turned in for other money.

It required all persons to deliver all gold coin, gold bullion and gold certificates owned by them to the Federal Reserve by May 1 for the set price of $20.67 per ounce.

On April 20, President Roosevelt issued a proclamation that formally suspended the gold standard. The proclamation prohibited exports of gold and prohibited the Treasury and financial institutions from converting currency and deposits into gold coins and ingots.

In May 1933, the administration once again weakened links to gold with The Thomas amendment to the Agricultural Relief Act, which gave the president the power to reduce the gold content of the dollar by as much as 50%.

The president also was gifted the power to back the dollar with silver, rather than gold, or with both silver and gold, at silver prices determined by the administration.

On June 5, a congressional resolution abrogated gold clauses in all contracts, both government and private.

This is very bad.

Together, these measures weakened the dollar’s link to gold. The dollar nominally retained its value, but the Department of the Treasury would not exchange dollars for gold and forbade the Federal Reserve from doing so.

The second phase of the Roosevelt administration’s gold policy began in October 1933 with the inauguration of the gold purchase plan.

This phase involved the deliberate devaluation of the dollar. The government did this by authorizing the Reconstruction Finance Corporation to buy gold at increasing prices.

These purchases raised gold’s value in terms of dollars, conversely lowering the dollar’s value in terms of gold and in terms of foreign currencies, whose value in gold remained pegged at old prices.

The goal of these programs was to raise American prices of commodities like wheat and cotton, returning them to the level of 1926, before the beginning of the contraction

The third phase began in January 1934, with the Gold Reserve Act and a return to stability.

Lol.

These policies were completely immoral, a flagrant violation of the promises made in the Gold Standard Act of 1900 and promises made to purchasers of Liberty and Victory Loans during World War I and causing apprehension in business men & consumers, thus delaying economic recovery

But most telling is that Austrian economists predicted the downfall of the gold standard would eventually end in a disastrous depression. This would have happened sooner but America has been using this failsafe for decades, it is akin to maxing out credit card after credit card.

We are still seeing this Keynesian snake oil in practice today, with the trillions and trillions of dollars of debt we’ve amassed and an 800% inflation of our currency. This will eventually trigger a greater depression.

It’s eminent and it’s soon.

Austrian economists were right all along. Today it’s more transparent than ever with “The Great Reset” and “Build Back Better” initiatives that our system will collapse.

But it’s not because they failed.

It’s because the government intervened, made everything worse, like they always do.