Ron Paul: Restore the Dollar

by Ron Paul

We frequently hear the financial press refer to the U.S. dollar as the “world’s reserve currency,” implying that our dollar will always retain its value in an ever shifting world economy. But this is a dangerous and mistaken assumption.

Since August 15, 1971, when President Nixon closed the gold window and refused to pay out any of our remaining 280 million ounces of gold, the U.S. dollar has operated as a pure fiat currency. This means the dollar became an article of faith in the continued stability and might of the U.S. government.

In essence, we declared our insolvency in 1971. Everyone recognized some other monetary system had to be devised in order to bring stability to the markets.

Amazingly, a new system was devised which allowed the U.S. to operate the printing presses for the world reserve currency with no restraints placed on it– not even a pretense of gold convertibility! Realizing the world was embarking on something new and mind-boggling, elite money managers, with especially strong support from U.S. authorities, struck an agreement with OPEC in the 1970s to price oil in U.S. dollars exclusively for all worldwide transactions. This gave the dollar a special place among world currencies and in essence backed the dollar with oil.

In return, the U.S. promised to protect the various oil-rich kingdoms in the Persian Gulf against threat of invasion or domestic coup. This arrangement helped ignite radical Islamic movements among those who resented our influence in the region. The arrangement also gave the dollar artificial strength, with tremendous financial benefits for the United States. It allowed us to export our monetary inflation by buying oil and other goods at a great discount as the dollar flourished.

In 2003, however, Iran began pricing its oil exports in Euro for Asian and European buyers. The Iranian government also opened an oil bourse in 2008 on the island of Kish in the Persian Gulf for the express purpose of trading oil in Euro and other currencies. In 2009 Iran completely ceased any oil transactions in U.S. dollars. These actions by the second largest OPEC oil producer pose a direct threat to the continued status of our dollar as the world’s reserve currency, a threat which partially explains our ongoing hostility toward Tehran.

While the erosion of our petrodollar agreement with OPEC certainly threatens the dollar’s status in the Middle East, an even larger threat resides in the Far East. Our greatest benefactors for the last twenty years– Asian central banks– have lost their appetite for holding U.S. dollars. China, Japan, and Asia in general have been happy to hold U.S. debt instruments in recent decades, but they will not prop up our spending habits forever. Foreign central banks understand that American leaders do not have the discipline to maintain a stable currency.

If we act now to replace the fiat system with a stable dollar backed by precious metals or commodities, the dollar can regain its status as the safest store of value among all government currencies. If not, the rest of the world will abandon the dollar as the global reserve currency.

Both Congress and American consumers will then find borrowing a dramatically more expensive proposition. Remember, our entire consumption economy is based on the willingness of foreigners to hold U.S. debt. We face a reordering of the entire world economy if the federal government cannot print, borrow, and spend money at a rate that satisfies its endless appetite for deficit spending.

  • robin

    The first part of Ben Swann’s interview with President Obama. The first question is about the kill list. Watch Obamas eyes as it is a tell tale sign of someone who is lying. He will do two more segments this week which I will post.

    • French Canadian

      Ben Swann is a very smart guy. He did a good job here.

  • still waiting lol

  • Marshawn

    I beez rootin fo Barak Obama cuz he a nigga jus like me, ya heard!!!! He fo all types of peeples like dem cracka whites, dem spiks, dem kikes, and alz other. Ron Paul hates niggas like me and obama. I ride till I die fo sho wit my nigga obama.


  • Thank you, Dr. Paul!

    I hope you’re having a good vacation, but I really would’ve like to have seen you in the White House as Commander-in-Chief.

  • Citizen

    Return to the Coinage Act of 1792

    The Dollar is DEFINED as 371 4/16 grains of pure silver
    Thus the Free Market defines the value of the Dollar..

    NOT the money changer Banksters!

    If Mittens wins, Iran will be bombed!

  • Did not know this about the USD! Now I understand our interest in being involved in Middle Eastern politics alot better. Thank you Ron!

  • can someone make visual animations for these?

  • French Canadian
    • robin

      French Canadian,
      I guess we were hoping for too much and Ron Paul wanted to make it clear he is retired now and will work on his son’s campaign for president in 2016. Ben said he will try and have Gary Johnson on his program because many of us have questions. My husband will not vote for him because he is a globalist.

      • French Canadian


        Your husband says Gary Jonhson is a globalist???????????????????????????

        LOL… you think Alex jones would have endorsed him if he was a globalist? Not a chance in a million! Gary Jonhson a globalist… that’s the funniest thing I have ever heard. It’s close to paranoia in my book…lol

      • French Canadian


        I forgot.
        Ron Paul said he would work for his (treasenous) son for 2016? He will waste his energy on him. Good luck! RAND will never be President, the honest fredom lovers would never give him back the trust they had in him and that he lost. I sure would never vote for him if I was an American.

        Besides, If Rombama or Obamney wins the election, there might no be a 2016 year… or election. America will no longer be with these two scumbags.

        This is the only thing that I do not like about Ron Paul… he is not a fighter… wouldn’t fight the RNC corruption… don’t want to fight the system by going Independent. He quits to easily. Words are easy fights… but actions are what counts.

        He could have save the world if he would have become President… doesn’t he know this? Wasn’t it worth a LAST effort? I don’t get him. It blows my mind!

        • robin

          French Canadian,
          I’m not sure what the purpose was for going on the Jay Leno show except to tell his supporters he is retired now=no independent runs and that he will be working on his son’s campaign in 2016. The fact he has not confronted things that should have been to protect his son and because he doesn’t want to step on any toes, has been his Achilles heal and the most disappointing part of this campaign. It’s like rolling over and playing dead. There is a time for passive resistance and a time to confront the fraud and corruption head on if it is ever going to change. I guess the difference between Ron Paul and many of us is we know we don’t have the luxury of time.

  • Marygreely1954 just posted a video Audit of the Federal Reserve Reveals $16 Trillion in Secret Bailouts (September 3, 2012)”. I thought maybe something had been done. On the video, it detailed the billions of dollars doled out to banks around the world.

  • Surfisher

    RNC’s Tampa = Concentration Camp USA

    (preview of things to come…?)

  • Tony

    Love ya Ron Paul, but i’m gonna vote for Gary Johnson.i voted for you in 08.And i will always remember you for expaining what my grandfather was trying to teach me……God Bless

  • French Canadian

    I hope brain dead warmonger neocons will finaly understand that Iran is nobody’s ennemy. Never been at wars with others. Iran just don’t want to be part of the Banksters scam. Can you blame them?

    It has nothing to do with them getting nuclear power… the only resason for the obsession to go to war with Iran is because they resist the Banksters fraud.

  • It’s really disheartening when someone who speaks the truth and know what the problem is and how to fix it is appear as radical and unelectable. That’s how screwed up US is. I think American democracy as a political and governing system has run its course just like any form of govt and kingdom usually last about 200 years or so before crumbling to ruins. US really needs to reinvent itself.

  • Surfisher

    RNC’s Tampa = Concentration Camp USA

    (preview of things to come…?)

  • I’m pleased just to have seen the man speak and have the opportunity to shake his hand. It’ll be the last political affiliation of my life. Just can’t play this game any longer. I’d rather live in the woods collecting rain water than support these disgusting pieces of shit any longer.

  • the likes were at 150 earlier too lol its so funny. theyr scared.

  • Not gonna happen. But tnx for the heads up. I rarely watch commercial tv but Leno is just now coming on and I’ll enjoy Dr Paul regardless of the discussion.
    Oh nice, Chris Christie is on Fallon right after. Heh heh, the PR arm of the Dem Party needs some distraction from their train wreck of a national convention. Paul getting a rousing applause during the intro… Cya, it’s starting 😀


  • What’s to talk about? It passed the House and is stalled in the Senate because Harry (I’ve always been for a Fed Audit) Reid won’t allow it to the floor for debate or a vote. Party politics trumps productive legislation once again.

  • I wish I could meet Ron Paul just once before everything goes to shit.