Gold giddy. Yet another ridiculous idea.

The Kentucky senator also believes an audit can confirm that the precious metal “still has value” and can implicitly provide “value to the dollar.”

“That’s why we don’t get rid of it. We’ve got it. The IMF has it, the World Bank has it. Most central banks worldwide have gold, and it’s an implicit trust that the dollar still has some backing,” Paul told host Lawrence Jones.

Then there’s the question, what is a gold bar? There are many different purity levels in the government’s bars, ranging from 99.99% all the way down to 90% pure.

Now let’s get to basics; Gold is not money. And gold does not back the U.S. dollar. Gold is nothing more than a metal. It is desired because it is pretty, fairly rare, a good conductor of electricity, and easily malleable. Iron, silver, and numerous other substances are far more useful.

Gold doesn’t back the dollar, simply because the price varies wildly, and the federal government can, and often has, adjusted the exchange value of gold for dollars.

If gold backed the dollar, a $20 gold coin would be worth $20. But it isn’t. A $20 gold coin is worth close to $3,000 at current gold prices, and a different amount to coin collectors.

So, how can one reasonably claim that the U.S. dollar is “backed” by gold? It isn’t and never has been. There could be an argument that the U.S. dollar once was backed by silver, in that the government offered to buy and sell silver at $35 per ounce.

However, that silver “backing” no longer exists, and no such buy/sell agreement exists for gold.

The government also stores silver at various locations, including the West Point Mint in New York and the Denver Mint in Colorado. Will the Musk gang also measure our silver holdings?

So, what backs the U.S. dollar if not silver or gold? Answer: The full faith and credit of the U.S. government. Click the link to read more about “full faith and credit.

Finally, the Musk jaunt is asinine for yet another reason. Gold represents only a minuscule fraction of federal government assets.

As of Feb 28, 2021, Fort Knox had about $6 Billion of the $11 Billion in gold owned by the federal government.

Compare that to M1 Abrams Tanks: We have about 4,650 of those tanks, with a unit value of $14.5 million. In total, our tanks are worth about  $67 Billion. Think about that. All the gold owned by the federal government is worth just one-sixth of our MI Abrams Tanks.

Just one aircraft carrier, the USS Gerald R. Ford, is worth $16 Billion.  Our B2 Stealth bombers are worth $15 Billion. Is Musk going to forget about tanks, carriers, bombers, and all other military hardware that totals Trillions of dollars, but focus only on gold?

And then, there are all the other federal assets: The federal government owns approximately 640 million acres of land, which is about 28% of the total land area in the United States. Will Musk inspect those to see how they are being used? The U.S. federal government owns and operates approximately 5,399 dams. Should Musk look into them, too?

The U.S. government stores various strategic and precious metals, including copper, nickel, palladium, uranium, and platinum; I don’t know how much of each, but each one is more useful than gold and perhaps monetarily more valuable. Do they deserve a Musk visit?

THE BOTTOM LINE

Gold is a minimally functional, lovely-to-look-at metal that comprises a miniscule amount of federal assets. It is not money, nor does it back the U.S. dollar. Those Abram tanks are worth more and do more to back the dollar than gold bars.

Musk is visiting Fort Knox to get his face on TV, not for any practical purpose. It is just one more extremely nonsensical idea from the current administration.

The irony is that Musk is the head of the mythical Department of Government Efficiency, and he is wasting thousands of federal dollars to go on a useless, nonsensical jaunt. That’s “efficiency”?

Rodger Malcolm Mitchell

Monetary Sovereignty

Twitter: @rodgermitchell

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A Government’s Sole Purpose is to Improve and Protect The People’s Lives.

MONETARY SOVEREIGNTY