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REPUBLICAN Congressman and presidential candidate Ron Paul this week laid out the case for Silver Coins as a competing currency to the US Dollar.
Paul was questioning Federal Reserve chairman Ben Bernanke, who appeared before the House Financial Services Committee, shortly after Bernanke delivered his opening testimony.
The Congressman argued that Silver Coins have held their value better than paper currency during Bernanke's tenure as Fed chairman.
"I have a silver ounce here," said Paul, holding up a Silver Coin.
"This ounce of silver back in 2006 would buy over four gallons of gasoline. Today it'll buy almost eleven gallons of gasoline. That's preservation of value."
Paul added that inflation amounted to "stealing wealth".
"If you loaned me a hundred Dollars and two years from now I gave you ninety back you'd be pretty upset," Paul told Bernanke.
"It's theft. If I don't give you your full hundred dollars back...I'm stealing ten dollars from you. Somebody's stealing wealth, and this is very upsetting."
Americans on fixed incomes, Paul said, are "really hurting" as a result of rising prices.
"Their inflation rate is very much higher than the government tries to tell them," he said. "This argument that prices are going up about 2%, nobody believes it."
Silver, Paul said, "is what the market has always said should be money", rather than so-called fiat currencies such as the Dollar.
"What you've done in the last six years is destroy the value of paper money," Paul told Bernanke.
"At the same time real money is preserved"
Paul has long advocated precious metals playing a role in the monetary system, having served on the US Gold Commission which reported in 1982. His minority report arguing for a return to gold was later published as The Case for Gold.
In questioning Bernanke this week, Paul went on to ask whether the government should allow different currencies "to run parallel" in the United States.
"They do around the world...Why wouldn't we legalize competing currencies?" asked Paul.
"Why can't people put this in a mattress?" he asked, holding up a Silver Coin, "and get four, five times as much of the value in a few years?"
"Nobody prevents you from holding silver or gold if you want to," Bernanke replied.
"It's perfectly legal to do that. It's also perfectly fine to hold other currencies."
Paul however replied that this is "nothing near real money", since there are hurdles to the ownership of Silver Coins.
"That's not money when you pay taxes to buy a coin or you have capital gains tax," Paul said.
"If you have to settle a lawsuit it's always settled in depreciating Federal Reserve notes, it's never settled in the real contract."
One attempt at privately issuing Silver Coins as a "parallel" currency ended last year with the conviction of Bernard von NotHaus. Von NotHaus was convicted after minting Silver Coins he called Liberty Dollars.
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