When all else fails, blame Richard Nixon. Funny nose, ya know...

From two sources:


"The Constitution requires US currency be minted in gold and silver.

Article 10: 'No state shall emit bills of credit, make any thing but gold and silver coin a tender in payment of debts, coin money.' The Founding Fathers knew that irresponsible govts print paper money, backed by nothing, overspend and devalue the currency, causing 'inflation", and destroying the economy. That has been happening for decades and is accelerating at a tremendous rate NOW.

When the govt began issuing paper money it was backed by real gold and silver.
In 1913, the Federal Reserve System was created by Congress; a private company, owned by member banks, and controlled by the bankers. The bank notes were redeemable for gold/silver.

In 1933, FDR stopped the minting of gold coins and paper money was no longer backed by and redeemable for - gold. You couldn't even own gold, that was illegal. You had to return it to the Treasury for paper money. But 'collectors' could keep their gold coins. But they were no longer usable currency...just like you can't go in a store today and buy bread with a gold coin! Federal Reserve Notes are not backed by, or redeemable for gold/silver.

The mint made silver coins through '64, then reduced the silver content to 50%, and then finally in 1970 silver coins ceased. This was due to inflation (we were warned it could happen by Thomas Jefferson, see first paragraph). In 1971, the govt ceased allowing foreign banks to redeem US dollars for gold. This was when the gold standard ceased.

And here:


"1933 or 1971, depending on how you view what 'gold standard' means...

'A true gold standard came to fruition in 1900 with the passage of the Gold Standard Act. The gold standard effectively came to an end in 1933 when President Franklin D. Roosevelt outlawed private gold ownership (except for the purposes of jewelery). The Bretton Woods System, enacted in 1946 created a system of fixed exchange rates that allowed governments to sell their gold to the United States treasury at the price of $35/ounce. 'The Bretton Woods system ended on August 15, 1971, when President Richard Nixon ended trading of gold at the fixed price of $35/ounce. At that point for the first time in history, formal links between the major world currencies and real commodities were severed'. The gold standard has not been used in any major economy since that time.'"