Money has to be paid by real money-gold, silver.
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Bhagavad-gita As It Is Bhagavad-gita As It Is by A.C. Bhaktivedanta Swami
Unabridged, unrevised reprint of the 1972 MacMillans ed. $14.95 Buy it now.
[Posted June 11, 2007] Srila Prabhupada

Got Money?


A.C. Bhaktivedanta Swami

Note: As of 11 June 2007, the national debt amounts to 8.847 trillion US dollars.

 APFN.org - DAN BENHAM  A Phone Call To The Fed

 Federal Reserve NoteCALLER - According to the US Treasury, the Federal Reserve pays $20.60 per 1,000 denomination or a little over two cents for a $100.00 bill, is that correct?
MR. SUPINSKI - That is probably close.
CALLER - Doesn't the Federal Reserve use the Federal Reserve Notes that cost about two cents each to purchase US Bonds from the government?
MR. SUPINSKI - Yes, but there is more to it than that.
CALLER - Basically, that is what happens?
MR. SUPINSKI - Yes, basically you are correct.
CALLER - How many Federal Reserve Notes are in circulation?
MR. SUPINSKI - $263 billion and we can only account for a small percentage.
CALLER - Where did they go?
MR. SUPINSKI - Peoples' mattresses, buried in their back yards and illegal drug money.
CALLER - Since the debt is payable in Federal Reserve Notes, how can the $4 trillion national debt be paid-off with the total Federal Reserve Notes in circulation?
MR. SUPINSKI - I don't know.
CALLER - If the Federal Government would collect every Federal Reserve Note in circulation would it be mathematically possible to pay the $4 trillion national debt?
MR. SUPINSKI - No.
CALLER - Am I correct when I say, $1 deposited in a member bank $8 can be lent out through Fractional Reserve Policy?
MR. SUPINSKI - About $7.
CALLER - Correct me if I am wrong but, $7 of additional Federal Reserve Notes were never put in circulation. But, for lack of better words were "created out of thin air " in the form of credits and the two cents per denomination were not paid either. In other words, the Federal Reserve Notes were not physically printed but, in reality were created by a journal entry and lent at interest. Is that correct?
MR. SUPINSKI - Yes.  go to story

No question of value
excerpt from conversation, Toronto, June 17, 1976
Money

Paper Currency is Cheating A.C. Bhaktivedanta Swami

So to stop this inflation, the government must stop this paper currency. Then the inflation... There will be no more inflation. But that they will not do. They want to cheat people. "In God I trust. Take this paper and you be satisfied that you have got thousand dollars." That's all. This cheating is going on. Why should you pay me paper? Give me real dollar, in gold. That they have none. They haven't got. more
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Hari-sauri: How would you control inflation, how would you solve the inflation problem?

Prabhupada: Inflation problem, I suggested, make gold coins as medium of exchange.

Hari-sauri: That means that there'll be the same... it'll have the same value all over the world.

Prabhupada: No question of value. Money has to be paid by real money-gold, silver. No paper.

Hari-sauri: But whether it's gold or paper, isn't it all just representative of...

Prabhupada: No, medium of exchange.

Hari-sauri: Yes.

Prabhupada: If I have to pay you, if you don't accept paper, then I'll have to give you gold or silver, and international exchange is going on. Then there is no inflation, because you'll not accept paper, so what is the use of printing notes? They are printing notes without any gold reserve.

Hari-sauri: Nothing. It's just imaginary wealth.

Prabhupada: That's it. Bank will give you loan, they are eager to give you loan, and you haven't got to pay anything in gold and silver. One check, that's all. And with that check you can purchase lots of commodities and hoard it, and price will be increased. If I have to pay gold for [indistinct], then I have limited source. The price will not increase. This is the only way. Introduce gold only, gold and silver. In the British period in our childhood there was practically no notes. Silver. If I have to take payment from you, one thousand rupees, you will give me so much silver. For counting, counting, I have to see whether it is.... There were some imitation, counterfeit. So each coin you have to see, they were saying like that, that, "For thousand rupees I have to occupy so much space."

Hari-sauri: And weighed so much.

Prabhupada: Yes, and weight was so much. The time was not so bad. If you take some cash, thousand, two thousand rupees with you, you can safely walk on the street. Now if somebody knows that he has got thousand rupees cash with him, maybe he will be killed. The bank, they are so much afraid, they keep police in bank, police guard, always.

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