It’s been said that “He who has the gold, makes the rules.” That never applied more to the United States than after WWII. At that time, Ft. Knox stored around 75% of the world’s gold, the U.S. was a manufacturing powerhouse, and was a creditor nation! But alas, the United States would go down the fateful road of war & empire. Today, manufacturing is gone, America waved goodbye to being a creditor nation to became the most indebted nation in history — and President Trump needs to check if the gold is still there at Ft. Knox.
Hello, everybody, and thank you for tuning in to the Liberty Report.
With us today, we have Chris Rossini, our co-host, Chris.
Welcome to the program.
Great to be with you, Dr. Paul.
I'm going to surprise the audience today.
I'm going to talk about something I've talked about before.
You'd think maybe they get tired, but it's a big deal.
It's been around for 6,000 years, the economic issue I want to talk about.
And that is, is gold money?
Is it used as money or is it just used for pretty pictures and whatnot?
Well, there's pretty good evidence that's been used in trading and in commerce and in money and whatever.
So we want to talk about that.
And it's important, you know, to find out if a country overinflates and destroys the value of the currency, eventually it gets so bad, like in Venezuela or wherever, they have to revalue and restore a new currency.
And almost always when it gets really bad and the currency gets wiped out, they always use gold to reassert confidence, to get the people to be confident.
If they just say, we're going to print more money, it doesn't work.
So that is, I think we're in the midst of all that.
And it's doing a lot of interesting things in the gold price market.
I don't like to deal with gold as a price.
I like to deal with the value of a currency and talk about a ratio of Federal Reserve notes to gold.
And right now, you're needing more and more Federal Reserve notes to buy an ounce of gold.
And there's a lot of gold shifting around the world.
And there was an old saying, still around, he who holds the gold, write the rules.
And nobody is actually positive who said that, but it sort of is a truism that the people eventually who owns the gold is somebody's been owning the gold.
And right now, you know, they're talking about having a true audit of the gold.
But I've, of course, talked about that a lot.
But it's also one of the reasons why we partner with Birch Gold, because they talk about gold too, but they talk about gold being used as something in investment.
And I talk about it mostly as an economic feature is gold money.
You know, I always ask questions like that.
And yet Birch is in this business.
And what they do is their specialty is having people taking 501ks and IRA accounts with regular stocks and getting them converted without charges of transferring the money.
Then they can put bullion in a gold IRA.
And they say, well, why are you going through all that?
Because the government won't let you just put gold in a regular IRA.
And this is one of the few ways people can do it.
If their savings are in IRAs, if we're on Ks, they don't have much chance to do it.
There are other ways.
This is not the only way.
But if somebody is interested in finding out what Birch Gold has to say about this and what the transfers would be like and when do you do it and how important is it?
Is the gold bull market over?
Is it going to go down?
They're the ones who are involved in the investment part of it.
So if you want some information from Birch Gold, there's a number on our screen and you can text it.
Text Ron at 989898.
And that'll connect you to somebody who will send you free information dealing with this subject of how to make the transfer and help you make a decision.
So, if you're interested in more information of that conversion to try to get bullion as part of your protection against inflation, because I think most people who watch this program realize that I have a pretty strong belief that inflation is going to continue because the government is monetizing debt, and even with the very positive things happening with Musk, you know, there's a lot of questions left.
It's a big problem: $37 trillion of debt.
And I don't see how they can do it without cutting spending.
And they're making that effort.
So we have to encourage that.
But it also gives it rocky around.
So I think even if they're successful, it's going to take them a little while.
And gold started off at $20 an ounce.
The Fed when they took over monetary policy and they were created in 1913, gold was $20 an ounce.
And then Roosevelt, as soon as he got in office, he took the gold away from the people.
Then he revalued it for the government's benefit.
He went from 20 to 35.
And there were predictions then that it wouldn't work.
It didn't work.
And it finally collapsed after 40, 42 years.
And in 1971, the Bratton Woods broke down.
So there have been a lot of period of times, but we're in the middle of another one of those major shuffling around on how will gold be used.
One of the most important things, back to the subject I've dealt with for a long time, is we should know what they're doing, you know, at the Fed just with the amount of policy that goes on.
And I've had a little difficulty in getting that information.
But we also, and I brought this up at the Gold Commission, is that we should find out if how much gold do we have?
If we want to go back to the gold, do we still have the gold?
And people ask me that, and I say, I have no idea.
Well, wasn't there an audit back in 1954 and 1974?
And I said, yes, but it was fake.
It was just a fake.
So gold is going to be in the market.
And I think it's something that we should deal with.
I want to close this opening statement by telling a little incident when Bernanke was the chairman of the Federal Reserve Board, because he was there and he always came across as a quiet, dignified person, but he was not on our side anyway.
And he, so I asked him, you know, point blank, I said, is gold money?
And I remember his expression like never before.
He just dropped his jaw, waited and waited.
He probably waited 20 seconds, but that's a long time.
So he finally said, no, gold is not, gold is not money.
And so I ask him, well, why do central banks own gold?
And why do we still own Federal Reserve and the Treasury?
We still own gold.
And the answer there is interesting because we believe, I believe that it's there because it's the ultimate money and they try to get away with it with the standard.
So I said, well, if you hold gold and it's not money, why don't you hold something else?
Why don't you hold diamonds or something?
And he gave me an answer.
He asked me, he says, it's tradition, tradition, the central bank, but I didn't get past that.
What is that tradition?
Tradition is that gold is money from my estimation.
So, Chris, I know you've thought a little bit about this and talk about Trump's efforts to know now to promote the audit of the gold.
I tried again to get an audit done when we had the Gold Commission in 1981, and there were 17 members of the Gold Commission board.
We had a vote.
They voted.
They allowed me to bring that up to the floor of the committee.
They had a vote.
There were 17 members, 15 of them voted, don't audit the gold.
And I said, Why, why, why?
I didn't get to get to quiz the other members, but that's an attitude that goes on.
And, you know, even now, we haven't had an audit.
But, you know, the pressure that Musk can put on and Trump, maybe we will get headway, but I'm afraid they might not find things hunky-dory, and maybe that's why they're stalling.
Monetary Bankruptcy's Legacy00:08:07
Chris, that's right, Dr. Paul.
I agree.
And, you know, this we should go back in history because this is a story that we're living in.
And what better place to go than after World War I?
Because at that time, the U.S. had around 75% of the world's gold.
And as Dr. Paul pointed out earlier, he who has the gold makes the rules.
And after World War I, the United States, with the exception of Pearl Harbor, of course, was untouched.
You know, our country was untouched by the war.
We were a manufacturing powerhouse.
We had the gold.
We were a creditor nation after World War II.
We had it all.
But unfortunately, we would go on to ruin it all.
That's because as the British Empire dissolved after World War II, the American Empire would go into its place.
It didn't have to be this way, but those choices were already made.
And the seeds of America's bankruptcy were planted then when America would venture into empire.
And now here we are, all these years later, and it's the flip side of the story.
We are now 37 trillion in debt.
Forget being a creditor nation.
We're the most indebted nation in the history of the world.
Manufacturing is gone.
We have the whole planet is showered with a thousand bases.
Nobody else does this stuff.
And at the same time, people here are expecting Social Security, Medicare, and a whole slew of welfare.
So we are on the flip side of after World War II.
We had it all.
And now we're wondering, President Trump has to go see is the gold even there.
So what a story this has been.
And we'll see how it goes.
You know, nobody wants to accept the Austrian explanation of where the inflation comes from because too many people buy in to the excuse because it deflects the interest in the Federal Reserve and the government monetizing debt.
So they go along with this and they say, well, the establishment and our universities, they never explain it very well.
And so the people end up believing, well, the left comes by, well, it's gouging.
People making too much money and all this.
And so they think that the gouging doesn't push us up prices.
Well, that's a distortion of the truth.
And others will say, no, it's not business people making too much money.
What it really is, is the unions.
And the unions have problems.
But one of them isn't that they cause the inflation.
They say, yeah, they want higher wages.
Well, that's what labor has a right to do.
They have a right to lobby for higher wages when somebody's stealing the value of the money because the wages go down.
One thing that is probably pretty well understood is a lot of people adjust and compensate for the price inflation, but the middle class never does.
They get deals.
We raise the welfare benefits and do everything on the surface, but it never catches up.
They always come behind.
And that's why if you look at TV and all, people are putting up with it without dealing with it.
I'm always amazed at, you know, over the years, going way back, I got interested in this probably in the 60s and all.
And that is, it was said and understood by Austrian Economics that it was going to collapse in 1971.
And boy, my eyes got wide open.
This is bad.
And it was bad and it is bad because there was no restraint.
And that's why we're at $37 trillion.
But there's no restraint whatsoever.
But it lasted a while.
I mean, it's lasted since 1971.
And now all of a sudden they're talking about gold.
I think that's very, very important.
And other people have other options and they might disagree with all the things that a person can do to protect.
But I'm also for competing currencies.
I happen to think gold has a pretty good history.
6000 years is a good start.
But some people say, no, you have to have modern, you have to use technology and all this and substitute it.
And maybe it will work as long as you don't cheat.
Don't become a fiat currency, you know, create thin air and deceive the people and commit fraud.
That would be, well, why compete with another fiat currency?
It won't work.
And the people over the many, many centuries have done what we're doing now, destroy the value of the currency.
And many of them have recovered, but their recovery always involved something of value, such as gold and silver, in order to restore the confidence in the government that they're not cheating for the time being.
Chris.
Yeah, Dr. Paul.
And it's tough to reverse the trend because we went on the road to empire and people in their minds think of America as something that it's not because we have this egoism.
And, you know, it's through generations and it gets to us and reversing this.
That's why most countries that become empires, they don't reverse because mentally they probably can't do it.
We went on to empire after the 40s, it started Korea in the 50s, Vietnam.
Then you had the butter, the welfare.
You had the great society from LBJ.
And all this time, they're printing, printing, printing, printing.
And as Dr. Paul mentioned in 1971, other countries were like, you know, these dollars could be exchanged for gold.
They started cashing in their dollars and taking the gold.
And then Nixon said, that's it.
You're not getting any more gold.
We're defaulting on you.
And ever since, it's just been paper dollars and even more wars.
The Middle East, Turka, Libya, we could go all over the world, Ukraine, and it's all just printed money.
And now we've reached a point and Elon Musk is very blunt about it.
He says, if we don't do this, we're going to go bankrupt because you can't have this empire.
And everybody wants their social securities.
But the interest on all this is going to overwhelm.
So something is going to have to give.
Here at the Ron Paul Liberty Report, we say give by getting rid of the empire.
Take care of the people, at least the people here at home.
Give them social Security Medicare, take care of that.
We do not need the empire, tie the people over and then over time you can start weaning off of welfare uh, with your new prosperity.
But something's going to have to give and uh, we say the empire has to go.
Yeah see I, I think that uh we, we should talk about what bus says we're, we're going to go bankrupt and uh, but I qualify it a little bit I, I work with the assumption we're, we are bankrupt uh, we were.
I mean, the conclusion of the monetary type of bankruptcy is when it was doctored up for ever since we had the FED.
But by 1971, after 40, 40 years of uh, not owning the American people, not owning gold, all of a sudden, you know uh, we denied the remaining uh attachment to gold at that time was the fact that if you were a foreigner and foreign banks and all, and you had dollars uh, to keep the system going and to keep us our dollar as a reserve currency, the world,
System's Gold Attachment00:10:33
they had to turn.
They had to turn in uh, if people turned into the federal reserve notes, they got a gold and replacement for it.
So this uh, this.
Then they hit Nixon.
I can remember that incident so clearly.
On a sunday night, Nixon had this emergency speech yeah, and they, they were doing all kinds of things, but the big deal was, no more gold.
If you have some paper money, you're stuck with it.
No more gold, we're not guaranteeing with it.
And the one thing that bothered me about that because uh, I was in my medical practice and that was the early years and, but I also belonged to a Chamber of Commerce and they had like uh, a lot like a review every monday morning about the current events, and I found it interesting.
So the review had to do with Nixon's speech and uh, they said that uh and and and, and the federal and uh, the catch, this is when I really gained a lot of respect for the Chamber OF Commerce.
This is when the Chamber OF Commerce, they were putting on taxes and tariffs and all kinds of stuff and destroying the currency.
And they did that and the Chamber OF Commerce, you know, supported it.
They said, this boy, this looks good.
And the stock market skyrocketed that particular day.
The monday after uh, Nixon announced that it was biggest day in in the history of the of the dow.
The numbers were small, but percentage wise it was a.
It was a big deal and I thought something is screwy here.
It's the business community.
Uh, are they stupid or do they have some advantage in that system that is coming to a close, or whatever what it was.
But it prompted me to start talking about the issue because I found the issue very, very interesting and very, and then, as time went on, very important.
And then, when it finally, with a light bulb turned on, for me everything depends, Depends on the money.
So, if you're in debt and you don't have money and you want to go to Ukraine and spend $100 billion, where do you get the money?
Do you go to the people's houses and say, You haven't paid enough taxes?
We want more money, sell your house.
No, they don't do that.
They decided that they would just steal from the people by printing money and stealing the value of the money so they didn't have to invade our houses to take the money.
And that opened up the door.
The 70s were terrible for financial reasons.
Gold, percentage-wise, just think of what that percentage was.
Gold was, you know, the so-called market was $35 an ounce.
By the end of that decade, it was $800.
That's huge.
It had a lot of adjustment to do over the years.
But, you know, the fiat currency probably, in my estimation, well, I know it lasted longer than it deserved, but it lasted longer than I would have predicted in 1971.
But I'm not a bit surprised, but it still is awe.
This is still a bit of awe about where we are now with the price of gold, even though percentage-wise, it's no big deal compared to the 80s, and the 70s.
So that is why gold up at $3,000 is a big deal.
But I hope I'm totally wrong because I think it can go much bigger because the problems are worse percentage-wise today than they were after the Bretton Woods broke down.
Chris?
Yeah, very good, Dr. Paul.
I'll finish up with my closing statement.
FDR is the only president to visit Fort Knox.
So this is a pretty big deal for President Trump to want to go there.
I have a quote from him: We're going to go into Fort Knox to see if the gold is there.
If the gold isn't there, we're going to be very upset.
And quote, and Elon Musk says it would be cool to do a live video walkthrough of Fort Knox, and it would be cool.
I would like to see that.
We also know a senator, a great senator from Kentucky, and Fort Knox is in Kentucky.
It would be great to see him there because he has been calling for auditing Fort Knox, the gold.
So is the gold there?
I think there's gold there, but who knows?
Would I be surprised if the place is empty?
No, I wouldn't be surprised.
I mean, look at our government.
Look at what Doge has exposed.
I mean, the stuff that is done, would it be so shocking that they would steal gold?
No, but I think gold is there.
If anything, if it's honest, that there's an audit, not somebody saying, all right, yeah, the gold's there and that's it, then it's good.
You know, it's the more transparency, the better.
And it'll also show if the gold is there that America does have something.
It does have some assets stored somewhere.
So we'll see how it goes.
You know, this is something that we have to realize about the audit and what's happened in the past and what could happen in the future.
Because, you know, governments can lie to us.
I don't know if people realize that, but they can tell you lie, misinformation.
So the audit was a fake.
I mean, they had like 17 major areas and they opened up one area and then they looked at a few, no assets made at all.
And the one person that was at that audit that I knew got to know because he understood Austrian economics and he was a history teacher, and that was Phil Crane.
And he was there.
And of course, he wasn't satisfied, but what can you do?
The official was, oh, the gold was there and they didn't find any problems and that sort of thing.
But we'll get to the point where there has to be a redefinition.
They'll have to restore confidence because the dollar will lose confidence.
That doesn't mean that we'll be Venezuela.
It could be, but I think people will finally wake up and we have to restore confidence by talking about sound money.
And that is going to be the challenge.
And I have followed a lot of what Burry Rothbard wrote over the years.
And matter of fact, he was one of my aides when I had, we were doing the gold commission.
And we talked a lot about gold.
And there's certain things that, you know, the nature of gold.
And I like to know what the history of gold and money was.
And one of the earliest supporters of gold was Aristotle when he explained what money was all about.
And he says, to be true, money and honest money, it should have a means of exchange.
You ought to be able to use it.
People trust it and they could trade.
And there should be a store of value.
If you happen to have a pocket full of gold and you didn't spend it, it's not like you had a pocket full of Federal Reserve notes.
And if you wait too long, you lose value.
Gold doesn't do that.
But the most important thing to get started, you have to have a unit of account.
To me, it's like building a huge building.
And the unit of account is the measurement that the builders have to use and the engineers use.
And are they going to use a rod, a yard yard, or a metric system and measure?
What if that changed every day and you were building this building and you didn't have a unit of account?
Well, that's what happens in economics.
If you don't have a unit of account and it's always changing and the Fed is rigging the interest rates, it confuses the people, the savers and the investors and all.
So you have to have a definition.
And that's why I think I hope somebody's accumulating gold for that purpose.
So they want to define it.
I'd like it to be more private, but the central banks, it looks like they're accumulating, but they have to have a definition of the unit of account.
And usually over the centuries, it has been an ounce of precious metals.
And it can last.
And the Benzentine Empire lasted like a thousand years that Bazan was used, but it was gold and was definable.
And it was amazing.
Here, you know, if you get 100 years, that's a big deal.
But once you destroy the value of the currency and you can't define it, that destroys the calculations that are so necessary in an economic system.
And it also affects savings accounts.
How do people, if people saved what you did 20 or 100 years ago, people would probably at no loss of value.
That wouldn't be a big deal.
But now today, like I mentioned, if you save, if you put Federal Reserve notes in an investment in dollars, it goes down and faster than you find places to save money.
So it's the other thing people have to realize is that prices are important and people see that, but there's more to it than that.
It's the distortion of the interest rate.
And I think that the one big distortion, the deficit has to be taken care of.
It'll end up being liquidated through inflation.
But the other thing is the malinvestment, all the mistakes made.
That's easy to understand.
You know, when interest rates are lower than market and there's a boom area someplace and they could use 100 houses, they might end up building 500 houses because the interest rates are like, hey, it's a good deal.
We've got to do it.
But eventually the debt is still there.
People have to pay back.
So sound money is so important.
I think it's so important because guess what it would be like if our government could never get involved in a war where they had to print the money.
And especially when we become the initiator of so much tragedy around the world, when we go in and get involved in coups and changing governments and all around, they can't do that if they don't have the right to the printing presses, the authority.
They don't have a right to it.
They have the authority that's taken illegally.
And so there's so much advantage to having a sound currency.
I'm delighted to know there's a big debate going on.
Overcoming School Nonsense00:01:46
And hopefully, you know, they've Musk has quoted me a couple of times.
And so he's been friendly.
I don't happen to know him.
I've not met him.
And I think even Trump is open to this.
But you know what the key is?
The key for some might not be as dedicated to the Austrian School of Economics, but they might sense what the people want.
You know, when the people decide they're sick and tired of the system and you become a political force where you contribute, I think that's why there's a strong leaning or at least verbiage directed towards libertarianism from the current administration and people like Musk.
I think that's good.
I think the ideas are out there.
And that's where I think I become the optimist because I think organizations like the Mises Institute and the other various great libertarian groups that they are overcoming all the nonsense we were taught in school for so long.
I keep telling people, you know, I went to government school essentially all my life.
And it finally dawned on me that it was a bunch of nonsense.
So I had to spend a lot of time reading something else to unlearn the things that the government schools taught.
And hopefully I did it in the right direction because I love freedom much more than authoritarianism that wants to tell me what to do in everything I do in my life and taking over the government and spending the money on waste and fraud.
And I think we're making a step in the right direction and I wish them well.
I want to thank everybody for tuning in today to the Liberty Report.