The Liberty Dollar Raid

Liberty Dollar Scam Update

Yesterday I wrote about the seizure of the assets and records of NORFED dba Liberty Services, Inc. The warrant under…
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ChrisG,

That’s a point many seem to skip over. The fact is that there is only one way to do it - And that’s to start over from scratch. Everything we know about money, value, inflation etc would have to go out the window and then we would have to base everything on the amount of gold (and silver) we do have. So something that costs $10 now might cost $200 (or whatever) after the change.
Think about the shock to the economy if that were to happen.

There is still a value on paper money even without being backed by gold. It’s created by the market. I explain to people that it’s basically a certificate stating one will trade it for x amount of goods and then that person can trade it for x amount of goods to someone else and so forth - thereby forgoing the need to barter everything we need or want.

I agree completely - it would be a major task to even attempt a change at this point. I would venture to say it would be unwarranted to even try it. Indeed one reason the economy has been able to flourish as it has is the flexibility of the system.

Now, if we could just get the government to stay out of it and let the market dictate the value of everything rather than them trying to meddle with interest rates and so forth.

I do not even know where to begin, or if I should even try…but here goes;

Let me start by saying that I do not endorse, nor have I ever dealt in the ALD. I have purchased several of their coins from clients wanting to sell them. I buy them because they are, exactly as stamped, One Troy Ounce of .999 Fine Silver or Gold. I give them a fair market price, relative to the spot price for silver or gold. In my opinion, the Liberty Dollar system is not the best way to invest in precious metals because the buy/sell spread on them is pretty brutal. This is not to say I think NORFED has done anything wrong. I applaud their desired outcome of eliminating the Federal Reserve. The Federal Reserve is neither Federal nor does it have any reserves. It is a cartel of private banks with significant foreign interests. But that is another subject.

I’ll stick to just the things pointed out in Curt’s article.

The First item from the FBI document Curt points out is the FBI’s supposed concern that the Liberty $20 warehouse receipt is not 100% backed by silver. Not true - the $20 warehouse receipt is backed exactly as stated on the receipt — it is backed with one ounce of fine silver. The fact that the silver in the open market is not worth $20 has nothing to do with anything - they could place any ALD Denomination on it - it does not attempt to express its value in US FRN’s (US Dollars). The purchaser of an ALD only cares that it is backed by one ounce of fine silver. Yes, the warehouse receipt is exchanged at the end purchaser point for $20 in FRN’s. The purchaser generally feels that there is likelihood that silver will eventually reach $20 and that there is a benefit in using something for trade besides the US dollar.

It is a form of protest of the policy of the US Government and the Federal Reserve and its insidious tax of inflation which silently affects us all, every damn day, by confiscating the purchasing power of our money.

The ALD is at least backed by something tangible. Do you have any idea what backs the US Dollar in your pocket or bank account? The answer is NOTHING - only Debt. No gold, no silver - nothing but the worlds dwindling willingness to accept a form of currency that diminishes in purchasing power every day as more and more dollars are put into circulation. Now that, my friend, is a scam.

And speaking of scams — the US Mint is currently selling the Silver American Eagle Coin on their web site for $21.95. It contains .999 ounces of silver and is alloyed with copper. At least the ALD was only $20 and had one full ounce of pure silver or represented that amount in an actual reserve.

As to the point about the “Move Up”. Silver, and therefore the backing of the ALD has increased in value as compared to the US dollar from $6.39 on the first trading day of 2005 to $14.30 at the close today. That’s a 224% increase. How’s that FRN in your pocket doing compared to that? The users of the ALD still have (or did, before the raid) one ounce of fine silver backing the warehouse receipt they hold - just the number of “Liberty Dollars” the note is worth has changed from $10 to $20. Wouldn’t it be great if you woke up tomorrow an discovered the currency in your pocket now bought twice as much stuff (like that’s going to happen)? And yes, someone just purchasing the ALD is going to pay the new price. The move ups occur when the price of silver exceeds the cost of one ounce of silver, production cost, marketing and yes, the profit. Most companies need to make a profit - as far as I know, that is not illegal - yet. What NORFED might call a business plan, the FBI labels a “Scheme”. Las Vegas is a “scheme”. The guy who bought his ALD at ten FRN dollars is pretty freaking happy - just like the guy who bought silver in 2005 at $6.39 and is still holding it now at $14.65!

How’s that FRN Dollar looking to you now? Using the Federal Governments own numbers (BLS.GOV), in that same period of time you lost at least 22% of your purchasing power in FRN’s. Actual numbers are arguably 50% higher that those provided by the government. Now that is a scam.

As for the “Drop”, have you never bought jewelry, a car, vacuum cleaner or anything where some sort of sales technique was used? Even the FBI’s document states that the training advised that if any resistance was encountered, just pay with FRN’s. Sheesh! Pretty suspicious sounding - I think I’m going to turn in the Kirby salesman to the FBI. Bet they jump all over that.

Oh, and by the way - United States Dollars are in fact fiat currency in every meaning of the definition. Unlike the FBI, I am not trying to editorialize, simply making an observation.

As to the issue of “Uttering Coins of gold, silver or other metal” - NORFED has already been down this road with the US Mint - twice before and allowed to continue operations each time. I find it humorous that the first coin they use for comparison is the 1 ounce Platinum American Eagle. I buy and sell these coins on a regular basis in my business. I would guess that fewer than 1 in 100 Americans has ever even seen this coin and that fewer that 1 in 10,000 has ever held one in their hand. Betcha the cashier at Wal-Mart is not going to accept this Platinum coin as a $100 coin - as indicate on the face of the coin - even though the US Mint sells these for nearly $1500 each (Platinum closed today at $1440 per ounce). When was the last time the US even had a coin in circulation with a value of greater than $1.00…Answer…1932 ! Right before the government confiscated everyone’s gold in 1933 via Franklin D Roosevelt’s Presidential Executive Order number 6102. The cashier at Wal-Mart is not going to be confused - this claim is total BS!

How about a giant copper American Liberty Dollar? — not even going to pass that one at the Tom Thumb!

US and foreign refineries have for years created 1 ounce and larger silver rounds which bear a much greater resemblance to actual US coins than does the ALD coin. The most common designs are the Morgan and Peace Silver Dollars. Several of these designs come very close to the size, shape and weight of the actual US Mint coin. I haven’t heard anyone raiding these guys.

In my opinion, the ALD looks nothing like any common US coin in circulation.

Is NORFED attempting to undermine the US currency system? You bet. And you ought to thank them for it. The nerve of them trying to provide a form of money that is backed by something that has actual value! But criminal - I think not.

Want to talk criminal? Here is what the US Constitution has to say about money:

Article 1, section 10
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

Looks to me like we are not supposed to make any Thing but gold and silver Coin for money.

I don’t think NORFED cheated anyone or intended to commit any fraud. The majority of people that bought the ALD had done better than most people that invest in the stock market. That is, until the raid. With the seizure of the assets that backed the warehouse receipts, those investors are likely to lose their entire investment. They might never see a copper-magnesium dime.

Note the FBI lacks even one mention of any victims. No mention of any holder, distributor, purchaser or merchant complaints in their document. Where are the throngs of innocent victims clamoring for justice? Not to be found beforehand but now that the assets backing the warehouse receipts are gone, we’ll start hearing from them.

Oh sure, they have a “cooperating witness”. I know how they get people to cooperate — trust me — I KNOW!

At the risk of sounding like someone with Ron Paul Derangement Syndrome, the timing it is pretty convenient to his opponents. As he appears to be gaining in popularity, he will no doubt be tainted with his “connection” to this dangerous criminal enterprise to undermine our monetary system. Makes me wonder.

This whole thing just stinks. It’s a trumped up case against a company with no intent to do anything wrong and no victims. The FBI will pick out some facts and create presentations to make it seem like people were getting cheated. Hell Curt, you seem intelligent - due to a combination of your ignorance of the FRN money system, the precious metals market, the function of the ALD system and the FBI’s propagandist presentation — you bought into it.

And now, they will have no problem finding victims to trot out.

Folks holding the warehouse receipts are gonna want to kick someone’s ass!

ChrisG,

You’re saying it’s better to have a monetary system that is based on nothing, except debt maybe, that is controlled by the whim of a handful of private investors who can inflate and deflate the system whenever they choose as opposed to a system that is controlled by a finite material that does not create itself out of thin air? That sounds stupid. Even with “400,000 tons of gold” as you put it, it’s already here. It exist if we choose to use it or not. Gold confiscation wouldn’t have happened if the government wasn’t trying to push an alternative fiat money supply that they could regulate. Just because you have 400,000 tons of gold being held doesn’t mean that everyone wants to claim in on it, and really as long as the gold is there they don’t need to because their notes are just as “good as gold”. Implementing a gold standard doesn’t mean that we have to take all jewelry and anything gold away from everyone to get the standard going. Gold already has a value that is based on how much is being held and how much is in circulation. Having a gold standard would almost, but not completely, do away with inflation. At least inflation like we’ve seen since they’ve done away with the gold standard and let private bankers control the system. It also secures the economy. Right now the only real reason the USD still has any real worth outside of the US is because we basically force every other country who wants to buy and sell oil to buy and sell oil in USD. No mater what anyone thinks the real problem with Iran is, it is probably the fact that they are starting to sell oil in other currencies to countries like China. This is really bad for the USD because once other places have alternatives to buying and selling oil in other currencies, do you think they’re going to keep using USD just for good will? I think not. So in reality the only thing that can save our economy from crashing completely would to go back to a gold standard. How could we do this you ask? Well simply put start following the laws we have regarding this kind of thing, you know in the Constitution? Anything not found in the Constitution that is unconstitutional should be made null and void, no matter how long it’s been going on. That takes care of the FR and the IRS hands down. Revolutionary? Yeah well don’t expect the government to do it on its own. That’s the problem with American’s now. No one wants to do anything about anything. Everyone just wants to make a bad system worse instead of following the rule of law that was put in place for us, and eerily, specifically for this. Read some quotes by the founding fathers. They knew what they were doing when they only gave the government permission to “COIN” money and nothing else. I would rather be telling be it needs to happen than it’s not going to happen. Encourage people to get pissed off about this and every other thing our government is doing out of its authority against us. Consumption tax sounds like a good idea at first but it’s just another life support system for an out of control gluttonous government, when really we should be cutting it down by two thirds if not more. Something that is interesting and I think would solve some problems related to government and government spending would be to go to a Unicameral Nonpartisan system. It might sound crazy and dangerous, but the state of Nebraska has been doing it since the 50’s and it’s saved them money on taxes and helped the legislation process tremendously. There are a lot of things we need to do, and that’s just it, WE need to DO them. Our beast of a government isn’t going to deflate itself. We can start by shaking up the House and Senate in 2010, if the economy hasn’t collapsed by then.

Even more of a Devil’s Advocate:

What will stop these Fed Bankers, or any other cabal with a lot of money, from simply cornering the gold market. I know it was tried with silver and failed, but that was decades ago. Considering power-mad men like Soros make a living from doing just that, I have to wonder how this system would be safeguarded from such attempts.

I do not want to sound contrarian, but I am trying to see how this system will not be hijacked by the same people you claim control the current system.

I am also trying to see how we will get a super-majority of Americans to accept this and act on it. Lastly, I am trying to see how this will be implemented without massive economic upheaval.

Your damn right the warrant was justified seeing as how the outfit in question was defrauding people….read the warrant.

Agreed.

Many companies are minting “rounds,” but not one has a stamp that says “Twenty Dollars” along with USA….what idiots.

Tim,

The victims of this fraud would be the people who lack the intellectual capacity to determine that an item that looks like a US monetary device such as a coin or note that is marked with US monetary denominations including the dollar sign, is not in fact money.

The check you mentioned is not money either, it’s an I.O.U. backed only by your credit worthiness and good standing in the many banking and verification services.

Now, can anyone say if any other countries are using a gold standard or similar?

The US money is backed by the market, I value a $100 bill based on what I can do with, I have employees willing to provide me with time and labor in exchange for it and there is no shortage of merchants ready and waiting to exchange my $100 for something they have as well. On the other hand it’s much harder for me to spend gold and silver.

Concerning the inflation everyone seems to keep mentioning…

What cost $100 in 1891 would cost $2164.02 in 2006. An increase of about 2164%

Also, if you were to buy exactly the same products in 2006 and 1891, they would cost you $100 and $4.62 respectively.

That looks horrible, but wait. As with everything else, inflation is relative…

An unskilled worker in 1891 had an average daily wage of $0.84 per day. Lets adjust that with the CPI… $18.18 or $2.27 an hour in 2006 dollars.

Now, how many unskilled workers do you know who earn $18 per day? or $2.27 an hour? I’m guessing not that many considering even McDonalds pays upwards of $8 an hour - that’s about as unskilled as one can get. An 8 hour day at McD’s in 2006 would pay twice as much in real dollars as it would have in 1891.

Now given that information and that a little research shows historical wages and inflation to have been both lower and higher than now in real dollars, what’s the difference?

The only difference I can really see is with labels and numbers. If something costs $1.2 billion but I earn $600 million an hour is it really any different? Other than the headache one could get from calculating how much a Snickers bar is.

Again, I ask how this will realistically be done (see above) and who cares if you have a piece of metal in you pocket if no one will accept it?

Tim,

I’m 32 years old and retired. I’ve never put a penny into a 401(k). I owned my own before my 25th birthday. I was able to do this because I understand how money and free markets work. Gold, United States Federal Reserve notes, and anything else of value all have one thing in common…

Where there value is derived.
Anything and everything is only worth what the market says it is. This is true for money, goods, services, commodities, collectibles, and so on. Does the price of gold not fluctuate? Of course it does.

Today gold is at $797
December 1996 $369.55/oz
Thats a 215.67% difference in 10 years (21.5%/yr).
But it went down 97: December 29, 1997 $293.90 - which, off the top of my head is about a 21% drop. In less than a year. Now, when was the last time the US dollar did that? Does it do it as often as Gold? Do you want your wages and currency based on something that constantly fluctuates like that?

Gold remained steady at around or below $300 until 2003 when it worked it’s way over $400, 2005 saw $500 an oz., March 06 $600, then September 07 $700 and working it’s way to $800 now.

All of my rambling just goes to this point, if we are on a gold standard and the supply & demand cycle for gold fluctuates as it does, how do we cope with a 20% or more fluctuation in the value of our currency on a regular basis?

The gold standard is not currently used by *any government or central bank* having been replaced completely by fiat currency. There is a reason for this!

The total amount of gold that has ever been mined is estimated at ~125,000 tonnes - this entire planetary stock would be USD $3.1 trillion (at $797/oz.) The amount of USD in circulation is +/- $8 trillion.

So to restate ChrisG’s question, which no one seems to want to answer, Just what process could possibly facilitate the transition to a gold standard?

I’m going to assume, perhaps incorrectly, that one who is advocating the return to a Gold standard would be a follower of the Austrian School of Economics, or at least has studied Allen Greenspan’s 1966 paper “Gold and Economic Freedom”. I say incorrectly because most everyone I’ve discussed this topic with supports the idea simply because Ron Paul has said something about it.

The Gold Standard is opposed by the vast majority of governments and economists, because the it has frequently been shown to provide insufficient flexibility in the supply of money & in fiscal policy, because the supply of newly mined gold is finite & must be carefully husbanded and accounted for. In theory, paper money printed based on the finite amount of gold will go up in value as it becomes more rare.

So again, what steps could be taken to eliminate or minimize the negative limitations of such a standard on modern economies?

What about the very real and likely possibility that other nations would not use a GS?
How do you deal with that?
Or the fact that as population increases the gold would not, therefor, it would just have to increase in value, which would cause it’s own inflation & deflation issues?

I’m not saying that the current system is perfect, in fact it does have some issues. Primarily that the Fed manipulates interest rates to combat perceived ills in the economy rather than allowing the market and fiscal responsibility to correct them. It’s all about supply and demand, and there is much more demand than there is gold supply.

Now, concerning “The differnce[sic] is that prices tend to significantly lead salaries.”

Can you provide a source for this? I’m not suggesting you’re incorrect, I’m just checking - considering I’ve researched salaries and CPI back to 1800’s. I might also add that inflation predates the switch from the gold standard.

Feel free to correct me if I’ve made a mistake of fact anywhere. I’ll be patiently waiting for someone to supply an answer…

Thanks for not answering the “how” question. I now have just as little faith in this gold baked economy “pie in the sky” as you do the fiat economy the whole world uses.

Again, as food for thought, what is to stop these people you fear so much from simply taking control of a gold economy? What is to stop another executive order outlawing gold (metals)/land/resource ownership? All it takes is one little push and everything you own is confiscated. It happened when the local gov’t of New Orleans confiscated firearms of law abiding citizens after Katrina (and the people were robbed soon afterwards by gangs the police chose not to disarm) and it could happen again.

What will happen if no other country uses a gold standard? Will we honor their currency? What is to stop them from simply taking all the gold through cashing in of notes or hoarding currency? How will we stop counterfeiting of notes and coins (ye old “wooden nickel”)? How will coiners or whoever is controlling the currency (government or private) keep maverick coiners from operating?

“Miracle” does seem to be an understatement regarding how a 6bn+ person world economy is going to function on a gold standard, let alone a 330+ million person US economy.

And no, I do not have a better answer than fiat currency but I do not see how these people in the warrant thought they could start their own system without confiscation happening as in the paragraph above. I also do not see how it ever would work without a massive social upheaval or complete destruction of current societal norms.

But thanks for answering the question as best possible.

Niggardly eliiment: A person Groupe or or assosiationone who is Covitious Overbearing ,Bruttle Miserly , Stingy Parasomonious,
THEM Banker and YOUR CONGRESS Government.
A Niggard: is Not a Color But an Attitude
or Mind control
One Who is Poluted, Corupted, Vulgar and Offensive
EVERY AMERICAN AND applies to all in and Out of america that formed and allowed the Federal reserve bank and the 16 amendment to be put into Law, and enforced
You and them the U.S.Govermnent
“No state is to make anythig but gold and silver coin a tender in payment of Debt” (it’s the Law) Law Breakers
The reason is that in order for you to get gold or silver you had to mine it,( Life forfiture )or Steal it,(risk your life).
But in order for the next person to get it from you , You made sure they gave a certain amount of Life forfiture,or equel value for it in exchange.and prevented The Bankers from making you a Slave withe their toilet paper with green ink on them, that ruins the toilet paper
But With the Zionist Jew controled Fed Res Nts all they have to do for the printing of the .004cents note, is to change the amount on the corners and put you into slavery for one hour, One Day Or one year with out they, that issue it,NOT give Up One Hour or minute of theri life, for your lost life,and made you their SLAVE Income is a profit derived from a transaction not YOUR work ,You lost one hour of your life to get what you think you are being paid FOT.But in fact you still owe them for the debt you received to the Government that aloowed you to break the Law with Themin the first place

I think the point is being missed, that no one, including Ron Paul, has suggested returning to the gold standard. What has been advocated is allowing a competing currency to exist. This would break what is arguably a monopoly on currency by the Fed, which IS a private corporation. There seems to be a debate on how people would be “forced” to accept Liberty Dollars, and quite simply, they would not. If one chooses to trade with liberty dollars, or gold bars, or bushels of wheat, or aluminum cans (oh, wait, we already do that, it’s called scrap metal) then that is their right. The point is CHOICE and FREEDOM to do what you want. The greatest value I personally see is for long term savings. Even the best dollar investments are hard pressed to keep up with inflation, ask anyone who is on a fixed income. If someone had been saving in gold or silver, they would have watched their saving grow and grow over the years. As someone pointed out, that ounce of silver will still buy as much gasoline as it did 20 years ago, only the dollars have changed. Another obvious fraud perpetrated by the Fed to seal their monopoly and generate sensationalist headlines.