Question:
What is the Liberty Dollar?
Answer:
The Liberty Dollar is a lawful, inflation-resistant, private, non-government, value based, locally-focused currency which has been voluntarily bartered for eight years, and was designed to be spent within the same micro-economic climate as the U.S. Dollar.
The Liberty Dollar is America’s second most popular currency, with over $20 million in circulation.
The Liberty Dollar model promotes the construction of a grassroots network of local consumers and merchants who use the new currency in every day transactions such that the Liberty Currency functions in parrallel with the commonly used Federal Reserve Notes.
Because Liberty Currency is based on gold and silver, it retains it’s purchasing power in relation to the U.S currency, which, due to its lack of intrinsic value, is infinitely more vulnerable to market fluctuations.
The Liberty Dollar is a voluntary currency, and therefore a good analogy would be that of credit cards:
In the same manner that some merchants accept Visa, but not American Express, certainly some merchants will prefer one currency over the other, but they will NEVER be able to accept Liberty Currency until a customer walks into their place of business wanting to spend it.
So if you happen to possess any Liberty Currency, go out and spend it!
Question:
Will businesses accept the Liberty Dollar as legal tender?
Answer:
First of all, the Liberty Dollar is NOT legal tender. It is instead, a Constitutionally lawful, voluntary currency, and it is perfectly legal for any individual to produce their own money, so long as it is neither represented as legal tender, nor takes on the physical appearance of the FRN.
The legal tender laws were created as a means of legislating worthless, paper money into use. Because people in post Civil War America actually understood money to be only gold and silver, the only way they would accept the fiat money was, quite literally in some cases, at gunpoint, with the full force of the federal government's ability to print money in order to raise an army (does this sound contemporarily familiar?).
Our generation has, for the most part, never actually used lawful money, so some resistance is expected initially.
I love dropping an ounce of silver into the outstretched palm of a 21 year old store clerk, and watching their eyes light up as they wonder at its weight and beauty.
People know intuitively that gold and silver are money, but many need to be educated before they will accept it.
I recently spent a few days in the small town of Asheville NC, where there are over 70 merchants who readily accept the Liberty Dollar, so obviously it works. Austin, TX has a network of over 400 Liberty Merchants, and in Berryville, AK, almost 50% of the merchants use Liberty Currency.
I have spent over $5000 face value in Liberty Currency this year alone, and my reception rate is about 80%. I don't mind being rejected, because sometimes that provides an even better opportunity to discuss the currency.
Check it out and make your own, intelligent decision:
Concern:
I would love to see retailers accept alternative precious-metals currencies. But I don't see how it can happen. Because the supplier / manufacturer / upstream raw materials provider will always want worthless paper. So you're ultimately stuck with whatever diminished value the dollar has at the moment.
Someone tell me I'm wrong...
Response:
Because the Liberty Dollar is not legal tender, it is not accepted by most banks and big retailers, but this is a good thing.
Liberty Currency was designed to be a local currency, so that the money stays, in the local loop as it were, bouncing within a network of local merchants.
When a Big-box retailer such as FacadeMart accepts any form of currency, whether it is in the form of FRN, or even the Liberty Dollar (and some do), the payment in turn goes to the supplier, or to the bank that floated the manufacturing and inventory costs. If the product purchased was manufactured in China, then that money is transferred overseas, re-invested in a Chinese venture, and used to produce more products for which Americans will trade our hard-earned money.
The Liberty Dollar, on the other hand, stays in the local community, and thus invests toward the prosperity of local business ventures.
You won't really understand how it works until you exchange a significant number of FRNS into LD and spend it into circulatory acceptance within your local community.
Again, we have to collectively slough-off the notion that monetary metals such as gold and silver are personal investments, but rather an honest form of currency which, because it complies with God's law, as well as the monetary laws of our nation, will prosper the local economy through transactional investment.
Concern:
The heart of the matter is that money is whatever the people believe it to be. I've looked at the currency system that you are pushing and while it is an ingenious idea - no one is using it. Furthermore, I am skeptical of an organization that will trade silver (their esteemed currency) with FRNs (their despised currency). If they wanted to get away from using FRNs, why do you have to buy their currency with FRNs? Someone here is running a very elaborate shell game.
Response:
Since there is over $40M of Liberty Currency in circulation, and I have personally placed over $10K into circulation, I can tell you most assuredly that SOMEONE is using it.
You make a valid point regarding the exchange of FRNs for LD, and one well worthy of discussion.
The reality is that we live in a Federal Reserve Note world. Along with the Euro, Yuan, Yen and Pound, the U.S. dollar is still one of the premier currencies of global trade.
Therefore we must trade our current, universally accepted medium of exchange in order to obtain our Liberty Currency.
Thus far, my conscience has been able to handle the prospect of dumping worthless paper in exchange for REAL MONEY.
Beginning in 2006, the Liberty Dollar will begin trading in some high visibility, BIG money transactions which will very likely add to its viability in the world of commerce. I am not at liberty to discuss the details, but suffice it to say, even the managed media will not be able to stifle the significant economic events which we are about to witness.
As I had mentioned before, there are not many people left in the U.S. who did not grow-up with the Federal Reserve Note as their only currency, so we are still on the upward slope of the learning curve.
Again, the wait and see approach is understandable, but for those who wish to take immediate action and start re-constructing their own local economy, beginning with a new foundation, the timing is perfect.
Even though the use of monetary metals is one of mankind's oldest, documented mediums of exchange, the reality is that we do indeed have a REAL MONEY learning curve which needs to be surmounted, one Liberty Dollar at a time.
Concern:
Be it noted, right up front, that I see nothing at all wrong with owning monetary metals.
But if someone can explain to me how this scheme is any different from "Government issue" and "Inflation", I'd be impressed.
Someone is making those things, and they are making a killing on them.
Response:
I will make an attempt at your most challenging concern first, by addressing government issue money and inflation:
I prefer Webster’s 1967 definition for the term inflation:
An increase in the volume of money and credit relative to available goods, resulting in a substantial and continuing rise in the general price level.
In this case, the money is the debt-based, federal, fiat currency which is printed, distributed electronically, and fractionally loaned, and yet which holds no value excepting the promissory collateral of slave-taxes, the assets and resources of the U.S., and the very property which we now call home.
On the other hand, we have silver and gold, which according to Webster’s definition, would classify as available goods, are finite in nature, and therefore rather constant in terms of their barter value relative to other available goods such as food, clothing and shelter.
Our current fiat money charade has reached the peak of its viability in terms of its perceived value: middle eastern oil is being traded in Euros, Asian bond-holders are questioning the value of their return on investment for the creation of Federal Reserve Notes, and an increasing number of Americans are resisting their roles as human collateral on a debt which now exceeds 8 trillion dollars.
The prices of both silver and gold are rising in relation to the de-valuing Federal Reserve currency, because, let’s face it the FRN is worth less and less every day.
Prices for goods and services will go up, but not because the face value of the Liberty Dollar is $20. Rather the LD price is responding to the inflationary nature of the fiat money, which has been feverishly printed, recklessly loaned, and debased to the point of hair-trigger market vulnerability.
$20 for an ounce of silver is a very reasonable price if one were to obtain and peruse inflation data, which accurately accounts for housing, fuel prices, and other taxes.
Silver is the investment of a lifetime, and due primarily to the fact that silver demand is far in excess of output, three years running. More industrial uses for silver are discovered every day, and other nations, such as China and Mexico, are seriously considering a return to commodity-based currencies.
And recalling Webster’s definition of inflation: as silver’s monetary popularity increases, so too will its value in relation to the worthless FRN.
I try to think of the Liberty Dollar as very healthy competition to the current crop of government bills, and not so much a cause of inflation, but rather, an inflationary barometer.
As for the profitability, you are correct that we are profiting through the use of the LD, but most likely not in the manner which you are expecting.
The Liberty Dollar provides a hierarchy in terms of passing the profit of the LD.
As an RCO, I can obtain one $10 face value Silver Liberty for $1.50 above the broker price, which typically averages about $1.70 above spot price.
With silver at $7.75, you can see that I don’t have much profit margin within the $10 base of currency, because I have to pass the SLD on to merchants and associates for $9.63 each, so I am not making much right now.
At the $20 base, I will pay $3 above the broker price, which means my profit margin will be much higher, and associates and merchants will also obtain a far greater relative margin.
Because it is a voluntary currency (as opposed to "legal tender," which most people falsely believe to be real money), merchants are free to either accept or reject Liberty Currency, very much akin to a merchant accepting VISA, but not American Express.
However, I must reiterate that I have an average 80% recidivism rate, and even when silver was less than $5 on the spot market, my reception rate was about the same.
The reality is that beauty is in the eye of the beholder.
My personal experience has proven that most people have an innate recognition of silver and gold as real money, and therefore are more likely to accept it at its face value.
That face value, by the way, was not chosen arbitrarily, but instead has been carefully calculated and structured in relation to the 30 day Moving Average for monetary metals.
Again, it is the devaluation of the Federal Reserve Note, also called inflation, which is forcing the price of silver skyward, and since the FRN is debt based, then the Liberty Dollar, arguably is infinitely more valuable.
It remains to be seen just how much lower the value of the U.S. dollar will descend in relation to the stable, monetary metals.
I hope I have adequately addressed your concerns regarding the Liberty Dollar, and since it is my favorite topic, I welcome further inquiries.
Concern:
The Liberty Dollar concept has one serious flaw: most goods do not cost exactly $10 or $20 or some multiple thereof: the necessity to make change occurs most of the time. This change, at present, appears to be in the FRN domain. I don't see any real freedom from the FRN venue until there are smaller denominations of LD coins. Also, paper money is a lot more convenient to carry than large coins.
Response:
The timing of your concern is perfect.
Just yesterday (November 12th), a group of Liberty RCOs pooled their resources in order to produce the die for the 1/4 oz. Silver Liberty.
The 1/2 oz. Liberty is already being produced, and of course, the paper warehouse receipts run the gamut from $1 all to way to $500.
Additionally, because Liberty Currency possesses a face value, you can use it in conjunction with Federal Reserve Notes.
Example:
This past Thursday night I purchased two sandwiches.
The total was $11.32 (CA prices). I gave the clerk one $10 Silver Liberty Dollar, one $1 Federal Reserve Note, and $32/100 of an FRN in pot metal.
Since we are discussing different denominations, this is a good juncture to mention the State Monetary Initiative:
Thus far eighteen states (25 as of 31 March, 2006) have signed on to the State Monetary Initiative, and have paid the die customizing fees for the minting of a new, state specific, $20 face value, 2006 Silver Liberty Dollar. I am very proud to be one of the founding members for the new California Republic Liberty Dollar, and I am eagerly anticipating my first delivery of CA Liberties in early 2006.
As of October 28th, the 18 States that have initiated the production of the state Silver Liberty Dollar are: New York, Michigan, Washington, Texas, Mississippi, Connecticut, Florida, New Mexico, North Carolina, Indiana, California, Massachusetts, North Dakota, Idaho, Pennsylvania, Colorado, Illinois, and Georgia.
Exciting times ahead for REAL MONEY!
Question:
Spot price on silver is currently $7.76 ask, 7.74 bid. (That’s Friday's close. Which means that I can go buy one ounce of silver for that price, plus whatever commission the seller is asking. Which will put me OTD at under $10, surely. Or possibly under $9, if I'm buying in quantity.
So what you are saying is that I’m taking a $2 hit by using "real" money, instead of paying FRNs.
How am I not better off paying in FRNs, and exchanging the balance for some other reputable silver bullion in one or one half ounce form, and keeping it until I need it?
Don’t get me wrong. I like the idea of some form of solid currency that has intrinsic value. But I don't see where the premium I'm paying to use that particular one is worth it. And, just to be asking, are y’all recalling the one ounce coins now that you are re-issuing them, or are you revaluing them to $20? Do the people who are holding them profit? Or the folks minting them? Or who?
Answer:
You will initially take a "hit" as you put it, but in my eyes those FRNs are well spent because that initial profit goes to two U.S. companies: Sunshine Mint, and Liberty Dollar, both of which will need to remain profitable in order to maintain a steady supply of Liberty Currency.
After all, this is not a bag of junk silver, but an alternative currency system we are discussing.
Again, we are talking about a very elaborate currency system, which involves not only the minting of silver and gold, but also the order fulfillment, security, storage, insurance and independent auditing fees for the electronic currency and warehouse receipts.
Profitable businesses remain in business, and I want the Liberty Dollar organization to be profitable so that I can obtain the product at my level, and in turn provide silver and gold currency to others at a profit. I want to be able to prosper and finance my dreams, not the least of which is the return of true liberty to these United States.
Remember, the vast majority of our nation’s citizenry has no clue as to what transpires in the creation of the Federal Reserve Notes that they blindly accept as money, and once accepted in competitive parity with the FRN, the Liberty Dollar will be no different.
In this case, it won’t be the BIG bankers, self-seekers disguised as public servants, and foreign T-Note holders that will profit from the creation of money.
Instead, part of the profit will go to Patriotic citizens who, for the love of nation, have invested their time and energy towards the re-introduction of an honest monetary system.
So who would you rather see reaping the profits?
The ultimate profit of course, is an historically proven, modern day Economic Renaissance brought about in part by widespread usage of monetary metals.
As for the re-minting fees:
$1.50 per one-ounce SLD for the first sixty days after move-up, not including shipping, and $3 each thereafter.
The mint will reap most of the profit for the first sixty days, and then Sunshine and Liberty Dollar will split the difference.
Believe it or not, people are already returning their $10 SLDs for re-minting so that they will have their $20 SLDs soon after the move-up (this actually took place on 24 November 2005).
I appreciate your questions, and I hope that you will strive to learn more about the Liberty Dollar.
By the way, the Liberty Dollar is not the only alternative, precious metal currency.
I am in no way affiliated with The Phoenix Dollar, but I welcome the competition.
Question:
I’m only going to ask if no one remembers the lessons of New Orleans? Remember that a gold wedding band got you laughed at while a bottle of water got you on the rescue boat.
Answer:
I agree wholeheartedly with you that we need to stock up on the necessities in the event of a societal infrastructure breakdown like the one we recently witnessed in New Orleans.
However, this discussion is really geared towards the type of money we will use in our day to day trading, assuming continuity in transportation, supply infrastructure, and day to day merchant activity.
I will add however, that with a silver liberty, sunlight, a water supply, a one liter coke bottle, and a T-shirt, I can produce many gallons of potable water per day for weeks.
Silver is an intrinsically valuable chemical element with more industrial uses than any other metal, not the least of which are its anti-bacterial, and anti-viral properties.
When The Feces Strikes the Oscillating Blade, silver WILL be worth its weight.
Question:
So, how come you aren't selling this on EBay?? I searched for $10 Silver Liberty and didn’t find it.
Answer:
I have heard of them being sold on E-Bay, but not by me.
Please read the entire FAQ, and you will better understand that the Liberty is designed to function as a currency, and not necessarily as an investment (of course I wrote this when silver spot was $7.50, and now it is $11.75).
Over the course of 6 months, I had visited the same station and purchased over $500 in gas using $10 Silver Liberties, only to find out, very recently, that an enterprising gas station employee had been re-selling them for $15 each, perhaps even on E-Bay.
If you want to obtain Liberty Currency, I recommend that you go directly to the source.
Question:
I don’t see that much difference. Both are wanting you to trust them. Can I see the gold and silver the Liberty Dollars are based on?
Answer:
There is a vast difference, in that the electronic and paper Liberty Currency is audited on a monthly basis in order to ensure that the currency is 100% backed by gold and silver.
Liberty Associates are permitted to visit the mint and view the storage facility.
If you to go to the Federal Reserve and request a tour of the gold and silver which backs-up their currency, you will learn the following lesson:
The U.S. Dollar is not based on gold and silver. It is based on debt.
If the Federal Reserve tour includes a visit to the precipitous edge of a bottom-less pit, then you will see what backs your money.
Concern:
I have read this whole discussion through (whew!). What hasn’t been mentioned (I guess I could have missed it) is how our dear .gov will view this "new" competing currency (that is how it is described on the website) and if it would continue to be ALLOWED to exist shoulder to shoulder with the FRNs (in a manner of speaking).
Isn’t there something in the Constitution that only allows the .gov to mint "coin of the realm" (so to speak)? I, too, like the idea of a bona fide monetary currency that actually is WORTH something (like the old gold standard). As I see it, people will continue to look at the Liberty Dollars as an investment, rather than as currency for a very long time to come.
Answer:
Following are some comments from various custodians of the current "coin of the realm" as you so aptly put it, regarding the legality of Liberty Currency:
Claudia Dickens, spokeswoman for the U.S. Treasury Department’s Bureau of Engraving and Printing, said American Liberty Currency(the original name for the Liberty Currency) is legitimate.
"There's nothing illegal about this,"
Dickens said after the Treasury Department’s legal team reviewed the currency.
"As long as it doesn't say legal tender there’s nothing wrong with it."
"It’s not counterfeit money,"
concurs Ron Legan, Special Agent in Charge of the Seattle, Wash., Secret Service field office. Having investigated this regulatory matter closely, he concludes that the silver certificates are well within the highly restrictive boundaries of American monetary guidelines.
"We determined there wasn’t a federal currency violation,"
he explains. Although Legan concedes to being "skeptical" of NORFED, he admits there have been no "defrauds" or "complaints" filed against the political organization. Despite giving the newly coined cash a clean bill of health at the Treasury level, Legan believes ALC may possibly fall within the purview of another federal regulatory agency, such as the Securities and Exchange Commission (SEC). Still, the existence of any possible parallel investigation remains unclear at this time.
Art Rolnick, director of research for the Federal Reserve Bank of Minneapolis says:
"These (NORFED) guys are right when they say there is nothing in the Constitution explicitly allowing a national bank. But the Constitution gives Congress the authority to regulate money and the value thereof, and courts have upheld Congress’ implied powers."
"If these (NORFED) people want to issue their own money, so be it. It will be interesting to see what the public thinks," Rolnick said.
So be it!
Not counterfeit.
Nothing illegal.