Them there's GOLD in them hills!

As the global economies continue their daily march away from the paper currency system and towards an all-out barter system, gold prices have have risen exponentially. Today the the price of gold broke the the psychological $1000/ounce mark.

No wonder M.C. Hammer is willing to send you cash if you stuff all of your tacky jewelery in an envelope and mail it to him. http://www.cash4gold.com/

How did this happen? Is it like the Ayn Rand book 'Atlas Shrugged'? Is this what that other nut, Ron Paul, was blabbering on and on about during the 2008 Republican primaries? Well, sort of.

The U.S. Treasury system was on what was known as the Gold Standard until 1971 when President Richard Nixon did away with it.

The Gold Standard was a system that directly connected a nation's currency system to the value of gold. The main advantage of this system is that a currency's value is relatively stable. The disadvantage (for borrow & spend governments) is that there is only so much gold in the world.

At the time, the total amount of mined gold was appx. 14,000 tons.

14,000 tons x 2,000 pounds (per ton) x 16 ounces (per pound) = 448 million ounces

448M ounces x $1000/per ounce (today's price ) = $4.9 Trillion total.

As you can see, this just isn't enough wealth, so the bogus Federal Reserve Standard had to be implemented. It's interesting to note the man who sold President Nixon the idea of dumping the Gold Standard was his Undersecretary of Treasury Paul Volker.

The same Paul Volker that President Obama just chose as the head of his Economic Recovery Advisory Board? The very same.

CHANGE? Doesn't appear that way.

Even before Nixon got America off the Gold Standard, the Federal Reserve was moving that way. If you've ever seen old U.S. paper money, there was a:

GOLD CERTIFICATE

SILVER CERTIFICATE

Until 1934, the bearer of a Gold Certificate One-Dollar bill could bring it to the Treasury and trade it for one dollar's worth of gold, typically as a gold bullion. But then there wasn't enough gold in the treasury to back up all the paper currency that was printed, so the Treasury switched to a Silver Certificate.

Then until 1968 the bearer of a Silver Certificate One-Dollar bill could bring it to the Treasury and trade it for one dollar's worth of silver, typically as a silver liberty dollar. But then there wasn't enough silver in the treasury to back up all the paper currency that was printed, so the Treasury switched to a Federal Reserve Note.

The only thing that backs up today's Federal Reserve Note is the bearer's faith in the U.S. Treasury Department. Scary.

Maybe Ron Paul wasn't such a nutjob after all.