Executive Order 11110: The Last Challenge to the Fed
July 25th, 2011
Given that the dollar is projected to fall off the cliff in the near future, it is no surprise that the push for sound money is gaining more and more followers, and the idea of owning gold or silver is becoming popular. Critics scoff at the idea of sound money as a dangerous fantasy that could severely damage our economy (as if our economy wasn’t damaged enough already). However, the push for sound money has a fairly recent history, which has sadly been forgotten.
On June 4th, 1963, President Kennedy signed Executive Order 11110. In short, it was an order for the Treasury to issue certificates backed by silver bullion, as well as to mint silver dollars that would be considered money. These silver certificates took the form of dollars for the most part, and the notes would say that whatever the denomination on the bill was, it would be repaid in silver “to the bearer on demand”. Simply put: if you had $1, it was worth $1 in silver.
Unfortunately, the executive order didn’t stand the test of time. That November, President Kennedy was assassinated in Dallas, sparking conspiracy theories that the Federal Reserve had a hand in his death, though this hasn’t been proven. In 1964, Treasury Secretary C. Douglas Dillon halted the swap of silver certificates for silver dollars, and on June 24, 1968, barely five years since the executive order was announced, swapping dollars for silver coins ended, and America went right back to the exclusive Federal Reserve system.
Even though this program is now in the history books, it does prove that sound money can be used without severe shock to our financial system. Also, the economy did not crash during the time this program was going on, so it can be used again to much the same effect.
