The chickens have come home to roost

after a 4 year absence...

The reason we have a written Constitution is so that every player in
our game will know what the rules of the game are.

One of the rules of the game is that the state--that is, the US
Government--shall be the sole issuer of the money of the United
States. US Constitution, Article 1, Section 8, paragraph 5:
"Congress shall have power...to coin money, regulate the value
thereof, and of foreign coin,..." The reason this is in the
Constitution is because we use money to exchange value and the money
must be a store of that value.

Nothing in the Constitution says that the US Government has to make
any money that it creates redeemable in gold, silver, or any other
commodity. In fact, the Constitution is silent on that issue. (And I
do not advocate "hard money" ie, money based on an equivalent amount
of some other commodity.)

But now we have a real problem with our money. It seems that some
people have discovered that they can create credit and pass it off as
money. Some people have gotten fabulously wealthy doing this, sorta
like the oligarchs in Russia back in the Clinton/Yeltsin years.

Now we have "Collateralized Debt Oblisgations" and various other
products that have been sold to, uh, people who really should know
better than to buy this stuff.. But they did, and have they created a
huge problem.

From what I can gather from a wide variety of sources, the problem
with mortgage debt alone is about $2 trillion dollars--in base debt--
not counting derivatives stemming from that.

A huge shakeout is about to take place, with some property values
plunging.

When this is over and we get a cognizant president, can we re-order
how we issue money here in the US?

James Hogan

.

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