What has everyone got against "Liberty Dollars"
GoldenEyeNumismatics
Posts: 13,187 ✭✭✭
For those of you who don't know the "Liberty Dollar" is a privately issued form of currency that is gaining popularity is some regions (primarily in the South I think). The coins are made of gold and silver
I don't see why everyone dislikes them and thinks the guy that makes them (his last name is Von Nothaus, I don't remember his first name) is a fraud. His concepts as to why he created the Liberty Dollar are well justified and, quite honestly, I would probably accept his money if offered it instead of US bills. It's true--an ounce of silver bought 4 gallons of gas in 1960, and it still buys four gallons of gas nowadays--it's relatively inflation proof.
Editted to add:
Alright, plenty of you say that this guy is a crook because he is selling his coins for far over melt, however if people are willing to pay that much for them then I see no moral issue (although there might be some legal complications). People are not forced to buy or accept Liberty Dollars, so therefore it is the consumers choice. If people are willing to pay that much then fine.
This is not a matter of how much metal is in a Liberty Dollar. This is a matter of whether or not you choose to accept them, and if people are willing to, than there is no problem.
And in the event that silver hit $40 an ounce, I'm sure you would all gladly accept Liberty Dollars at face value
I don't see why everyone dislikes them and thinks the guy that makes them (his last name is Von Nothaus, I don't remember his first name) is a fraud. His concepts as to why he created the Liberty Dollar are well justified and, quite honestly, I would probably accept his money if offered it instead of US bills. It's true--an ounce of silver bought 4 gallons of gas in 1960, and it still buys four gallons of gas nowadays--it's relatively inflation proof.
Editted to add:
Alright, plenty of you say that this guy is a crook because he is selling his coins for far over melt, however if people are willing to pay that much for them then I see no moral issue (although there might be some legal complications). People are not forced to buy or accept Liberty Dollars, so therefore it is the consumers choice. If people are willing to pay that much then fine.
This is not a matter of how much metal is in a Liberty Dollar. This is a matter of whether or not you choose to accept them, and if people are willing to, than there is no problem.
And in the event that silver hit $40 an ounce, I'm sure you would all gladly accept Liberty Dollars at face value
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All The Way - And Then Some
I collect Modern Commemoratives
and anything Franklin.
People may not like the US coins/paper money, but so far, I don't believe that we have defaulted on any payment for them, right? So, if something says it costs $20, then handing an OFFICIAL piece of paper with $20 on it (ie...20 dollar bill US Treasury made) is valid.
With the liberty dollars, no one has to accept them nor are they easy to convert if you want to get something that is accepted. Go ahead, try to use them to pay a bill or credit card payment
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
In honor of the memory of Cpl. Michael E. Thompson
<< <i>Correct me if I am wrong, but they have inflated values put on them (ie...they don't have value of what 1 oz of silver would be, but rather $20 or whatever) and they have no true backing other than what someone will accept for them or the value of the silver in them, right?
People may not like the US coins/paper money, but so far, I don't believe that we have defaulted on any payment for them, right? So, if something says it costs $20, then handing an OFFICIAL piece of paper with $20 on it (ie...20 dollar bill US Treasury made) is valid.
With the liberty dollars, no one has to accept them nor are they easy to convert if you want to get something that is accepted. Go ahead, try to use them to pay a bill or credit card payment
The Treasury does the exact same thing. They put a $20 bill in circulation that cost them 4 cents to make. Ultimately, there is nothing backing a $20 except people's willingness to accept it (and the government's "promise to pay" which really doesn't mean anything).
At least Liberty Dollars have some intrinsic value to them
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>At least Liberty Dollars have some intrinsic value to them >>
True, but if you were forced to choose between Liberty Dollars sold at a premium, or American Eagles priced slightly above melt, which would you pick?
<< <i>I have nothing against whatever you are against!!
I'm with him.
Here's a story I picked up with Google.
<< <i>'Liberty Dollars' Can Buy Users A Prison Term, U.S. Mint Warns
By Elizabeth Williamson
Washington Post Staff Writer
Tuesday, October 10, 2006; Page A19
Once upon a time, a "monetary architect" named Bernard von NotHaus decided to make his own money.
He put a beautiful Lady Liberty and a majestic flaming torch on the silver and gold coins, and he named them "Liberty Dollars." On his Web site, http://www.libertydollar.org , he said: "It is fun to use REAL money. Liberty Dollars are a proven and profitable currency that protects and grows the purchasing power of your money!"
True story, phony money. So says the U.S. Mint, which would like to remind Liberty Dollar users that since the United States already has its own currency, the only thing Liberty Dollars buy in these parts is a jail term.
Liberty Dollars were coined by von NotHaus and an Evansville, Ind.-based group called Norfed, which stands for (sort of) the National Organization for the Repeal of the Federal Reserve Act and the Internal Revenue Code. In the late 1990s, the group began hawking its money as a hedge against inflation, and as a way to compete with the Fed. Von NotHaus makes the pitch online, using a raft of statistics and graphs that he says show the greenback is well nigh worthless.
Norfed Executive Director Michael Johnson says the group isn't aiming to overthrow the American monetary system. "We're not locking horns with the Fed. I mean, that's crazy," he said. Norfed simply wants "to offer a solution to the Federal Reserve Note," a.k.a. U.S. dollars.
Norfed struck the first gold- and silver-backed coins -- which, to avoid charges of making its own money it calls "rounds" -- in 1998 at its private mint in Idaho. Today the group claims to have more than $20 million in Liberty coins and notes in circulation, and about 2,500 merchants who accept Liberty Dollars for goods and services from doughnuts to tattoos.
But there's a potentially more sinister side to all this. A 1999 report by the Southern Poverty Law Center calls Norfed a far-right anti-government group that has "long claimed that American dollars are . . . part of a vast conspiracy by international bankers to defraud the rest of the world." The center links some Norfed devotees to far-right hate groups.
"That definitely is not the philosophy of the organization," Johnson said. "I've been a Republican for most of my life. . . . We are focused on the mainstream. . . . I guess we are libertarian. But definitely not anti-government."
The U.S. Mint acted after federal prosecutors around the country began forwarding inquiries about the coins. "We don't take these consumer alerts lightly," said spokeswoman Becky Bailey. "Merchants and banks are confronted by confused customers demanding they accept Liberty Dollars. These are not legal coin."
Norfed responded to the Mint on its Web site. "Here it is in plain sight . . . the Liberty Dollar is not a coin, not legal tender, and backed with inflation proof gold and silver!"
"Goliath just introduced David to millions of Americans as a nationally recognized underdog," the site continues. "Just as Pepsi went up against Coke with their 'take the Pepsi Challenge' campaign, the Liberty Dollar will take it to the people to decide which currency they should use."
Norfed encouraged people to keep doing "the drop," referring to its advice to drop the coin into merchants' hands so they can feel its weight.
That could land the dropper in prison, Bailey warns, for up to five years. >>
The name is LEE!
<< <i>Liberty Dollars Not Legal Tender, United States Mint Warns Consumers
Justice Determines Use of Liberty Dollar Medallions as Money is a Crime
Washington, D.C. — The United States Mint urges consumers considering the purchase or use of “Liberty Dollar” medallions, marketed by the National Organization for the Repeal of the Federal Reserve Act and the Internal Revenue Code (NORFED), to be aware that they are not genuine United States Mint bullion coins, and not legal tender. These medallions are privately produced products that are neither backed by, nor affiliated with, the United States Government. Prosecutors with the Department of Justice have determined that the use of these gold and silver NORFED "Liberty Dollar" medallions as circulating money is a Federal crime.
NORFED is headquartered in Evansville, Indiana, and the medallions reportedly are produced by a private mint in Coeur d’Alene, Idaho. NORFED claims that more than $20 million dollars worth of Liberty Dollar coins and notes are in circulation.
Consumers may find advertisements for these medallions confusing and should take note of several issues related to them. The advertisements refer to the product as "real money" and "currency." These medallions might look like real money because they:
Bear the inscriptions, "Liberty," "Dollars," "Trust in God" (similar to "In God We Trust"), and "USA" (similar to "United States of America"), and an inscription purporting to denote the year of production.
Depict images that are similar to United States coins, such as the torch on the reverses of the current dime coin, 1986 Statue of Liberty Commemorative Silver Dollar and 1993 Bill of Rights Commemorative Half-Dollar, and the Liberty Head designs on the obverses of United States gold coins from the mid-1800s to the early 1900s.
However, despite their misleading appearance, NORFED "Liberty Dollar" medallions are not genuine United States Mint coins, and they are not legal tender.
The advertisements confusingly refer to NORFED "Liberty Dollar" medallions as "legal" and “constitutional." However, under the Constitution (Article I, section 8, clause 5), Congress has the exclusive power to coin money of the United States and to regulate its value. The United States Mint is the only entity in the United States with the lawful authority to mint and issue legal tender United States coins.
Under 18 U.S.C. § 486, it is a Federal crime to pass, or attempt to pass, any coins of gold or silver intended for use as current money except as authorized by law. According to the NORFED website, "Liberty merchants" are encouraged to accept NORFED "Liberty Dollar" medallions and offer them as change in sales transactions of merchandise or services.
NORFED tells "Liberty associates" that they can earn money by obtaining NORFED "Liberty Dollar" medallions at a discount and then can "spend [them] into circulation."
NORFED’s "Liberty Dollar" medallions are specifically marketed to be used as current money in order to limit reliance on, and to compete with the circulating coinage of the United States. Consequently, prosecutors with the United States Department of Justice have concluded that the use of NORFED’s "Liberty Dollar" medallions violates 18 U.S.C. § 486, and is a crime.
The United States Mint has a Consumer Alert with photos of Liberty Dollars at http://www.usmint.gov/consumer/index.cfm?action=HotItems >>
I take this all to mean that you can use Liberty Dollars all you want just as long as you dont try to use them a legal tender which is what most merchants expect.
The name is LEE!
They really piss me off because their headquarters are in my hometown. Also just look at the links page on their page. It goes to freakville and beyond.
I emailed them once and asked if I could buy liberty dollars with silver. Guess what their answer was.
A great big no. Guess what they want your payment in. Evil Federal Reserve Notes.
Buy one but buy two at your own risk.
Aside from that it's a beautiful "coin".
Never view my other linked pages. They aren't coin related.
<< <i>The Treasury does the exact same thing. They put a $20 bill in circulation that cost them 4 cents to make. Ultimately, there is nothing backing a $20 except people's willingness to accept it (and the government's "promise to pay" which really doesn't mean anything).
At least Liberty Dollars have some intrinsic value to them >>
Your "except" is the definition of money sir. You are trivializing the very thing that makes money money. Our acceptance.
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>US MINT says its illegal to try and pass off your own currency. >>
No they say it is illegal to try and use metal tokens as money. 18 U.S.C. § 486 specificly relates to the use of gold, silver, or other metals as money. There is no law that forbids the use of paper scrip as money. So Norfeds paper currency is perfectly legal under the law.
<< <i>Correct me if I am wrong, but they have inflated values put on them (ie...they don't have value of what 1 oz of silver would be, but rather $20 or whatever) and they have no true backing other than what someone will accept for them or the value of the silver in them, right? >>
"true backing" IS the value of the silver in them.
<< <i>People may not like the US coins/paper money, but so far, I don't believe that we have defaulted on any payment for them, right? >>
This $20 bill used to be redeemable for nearly an ounce of gold...the current $20 bills are worth 3 cents on the dollar...sounds like a default to me...
One day everybody will wake up and Von NutHouse will be long gone. Who wants to bet there's no storehouse of silver as they claim? Seems if they have a giant vault of silver somewhere they'd accept payment for Liberty Dollars in Silver. The only way to buy Liberty Dollars is with CASH. FEDERAL RESERVE NOTES.
Von NutHouse gets all the real money and everyone else takes all the risks. If anyone gets in trouble he'll claim his web page is crystal clear. He's the kind of clown that you have to re-write the laws for.
John
Never view my other linked pages. They aren't coin related.
They are bullion rounds that may be used as barter if the recipient is of a mind to accept them. The great majority of people would, under normal circumstances, reject them. One of the unstated definitions of money is that it is widely accepted as money. These are not.
MOO
TD
My opinions on the issues? von Nothaus is a creative guy as far as a private minter, starting out with the Royal Hawaiian Mint and then the Norfed designs. He has used a multi-level marketing approach to promoting his Liberty Dollars, IMO, which is a type of scheme that I don't really approve of, but fits nicely with the demographic of the anti-tax/nativist/hard money/survivalist/millenialist milieu. In the end the pieces are merely silver rounds, IMO. If you enjoy them fine, if not, pass on them. Beyond that there is the propaganda angle, which has been less than effective and will likely remain so, IMO.
<< <i>The Treasury does the exact same thing. They put a $20 bill in circulation that cost them 4 cents to make. Ultimately, there is nothing backing a $20 except people's willingness to accept it (and the government's "promise to pay" which really doesn't mean anything).
At least Liberty Dollars have some intrinsic value to them >>
This is the real problem with Liberty dollars. A dollar (the type the US mints) is like a bond (or a loan) and therefore its value is derived from the willingness and ability of the issuer to return your capital when you request it. Since dollars don't have maturity dates, it is up to the holder of the note to determine maturity.
The US has a 100% willingness to repay. This point can be debated but that would simply be a waste of time. More importantly, the US also has the ability to pay. The issuer of the liberty dollar does not. The two simply can't be equal in terms of value.
And I agree with others, this guy should be locked up.
<< <i>
<< <i>Correct me if I am wrong, but they have inflated values put on them (ie...they don't have value of what 1 oz of silver would be, but rather $20 or whatever) and they have no true backing other than what someone will accept for them or the value of the silver in them, right? >>
"true backing" IS the value of the silver in them.
<< <i>People may not like the US coins/paper money, but so far, I don't believe that we have defaulted on any payment for them, right? >>
This $20 bill used to be redeemable for nearly an ounce of gold...the current $20 bills are worth 3 cents on the dollar...sounds like a default to me...
I will gladly take all of your 20 dollar bills at 3 cents. Let me know how many we can get done. Thanks.
<< <i>The US has a 100% willingness to repay. >>
Not that I have any particular interest in "Liberty Dollars" (I don't), but even assuming that the US has a 100% willingness to repay, with what would one be repaid, should one decide they'd like to be repaid?
<< <i>
And I agree with others, this guy should be locked up. >>
When I see this guy selling "$1,000 face value," 1-oz gold rounds for about 50% over spot, I have to agree.
<< <i>
<< <i>The US has a 100% willingness to repay. >>
Not that I have any particular interest in "Liberty Dollars" (I don't), but even assuming that the US has a 100% willingness to repay, with what would one be repaid, should one decide they'd like to be repaid? >>
What would like to be repaid with (if I understand your question)?
<< <i>What would like to be repaid with (if I understand your question)? >>
I didn't have anything specific in mind. The claim was:
The US has a 100% willingness to repay.
and my question was regarding the identity of the *whatever* that the US is willing repay with. I'm sure the *whatever* is not going to be up to me to decide, so I'm curious what the government might consider my options to be.
<< <i>
<< <i>What would like to be repaid with (if I understand your question)? >>
I didn't have anything specific in mind. The claim was:
The US has a 100% willingness to repay.
and my question was regarding the identity of the *whatever* that the US is willing repay with. I'm sure the *whatever* is not going to be up to me to decide, so I'm curious what the government might consider my options to be. >>
My guess is, barring Armageddon, the US will simply raise interest rates. You will get more future dollars for today's dollar. Fiat money is inflationary and I don't disagree that over time its purchasing power erodes. But to say the US government is going simply fall down and not make good on its debt (somehow) would equate to the entire world economy blowing up. Again, my guess is the "somehow" is higher interest rates.
In other words, if the government tells us to cram it--you should load up on guns and canned food.
They seem to like to hype their longevity, and have several First and Fifth anniversary items to choose from. (Some items, such as at least one certificate-replica, are worthless even by their standards.) They do have piedfort pieces (vocabulary term meaning "double-thick planchets" I just learned from airplanenut while discussing a French coin) and even 2.5" 5-oz silver pieces at $100.
Even their obverse appears to be an appeal to collectors. Want to bring back Miss Liberty? Well, here she is. But man, that is one unflattering portrait! Their 2007 business strike is promoted with "Miss Liberty has never looked better!" and the description goes on to say that since they haven't yet sourced a new reverse die -- which still says 2006 -- these double-dated pieces with a new obverse are going to be numismatic rarities!
Edited for clarity
<< <i>If it means anything, I got an email from him asking me to list them in the So-Called Dollar book. >>
Since SCDs are mostly medals and not coins, is he saying Liberty Dollars are medals and not coins?
<< <i>If any y'all want to pay $20 for an ounce of silver, I can supply you with as many American Silver Eagles at that price as you like. >>
I don't think that's the issue. The issue is whether they will redeem it at face value and whether merchants will accept it at face value.
Think about all the Presidential dollars that are out there. They contain 5.8 cents of metal but people are perfectly happy paying a buck for them. The Mint is laughing all the way to the bank supplying people with as many at that price as they like. It has to do with redemption and acceptance, not face value vs. intrinsic value.
<< <i>
Think about all the Presidential dollars that are out there. They contain 5.8 cents of metal but people are perfectly happy paying a buck for them. The Mint is laughing all the way to the bank supplying people with as many at that price as they like. It has to do with redemption and acceptance, not face value vs. intrinsic value. >>
And redemption and acceptance have everything to do with federal law. Honest question: how many societies or countries have ever had two different and independent money systems co-existing throughout them? What was the outcome?
Another honest question: isn't the number of minted coins released from the Mint regulated by law or other mechanisms independent of Mint control?
<< <i>redemption and acceptance have everything to do with federal law. >>
It seems to me that merchants can choose what to accept, even Liberty Dollars. The US government can require US dollars for payment to US government branches but merchants can probably accept other forms, e.g. Euros, Yen, Pesos, and perhaps even Liberty Dollars.
<< <i>Honest question: how many societies or countries have ever had two different and independent money systems co-existing throughout them? What was the outcome? >>
The US did for a long time when foreign money circulated in the US. This was before fiat money came into existence. Many small countries that have economies that revolve around tourism also readily accept their own country's currency, US money and Euros.
<< <i>Another honest question: isn't the number of minted coins released from the Mint regulated by law or other mechanisms independent of Mint control? >>
The amount of money the Mint makes is tied to US monetary policy so it's not completely under their control but just take it a couple of levels higher and consider the entity of the US government, then yes, the number of minted coins and released is controlled by the US government.
It seems to me that a USA merchant accepting ALD might as well call it a barter transaction. Given that there's no traditional USD-ALD exchange rate established as there is for foreign currencies [regardless of what NORFED says], I wonder how one would report that income on tax returns; that sounds like a real headache.
<< <i>Thanks Zoins, lots of interesting points in your post -- much appreciated.
It seems to me that a USA merchant accepting ALD might as well call it a barter transaction. Given that there's no traditional USD-ALD exchange rate established as there is for foreign currencies [regardless of what NORFED says], I wonder how one would report that income on tax returns; that sounds like a real headache. >>
For your tax returns, you would probably use the same exchange rate you used in the transaction. The IRS just wants their cut and probably won't care you did transactions in ALDs as long as it looked reasonable on the books.
I don't mind this lawsuit, I think it's time either (a) ALD was put out of business or (b) it was legitimized. In the CNMI Freedom Tower Dollar case, the operation was shut down by a lawsuit brought by the NY Attorney General in a matter of months. Why has ALD been allowed to exist since 1998? Why haven't they been sued and forced to stop issuing ALDs? I checked the legal references on the US Mint website and, to me, it seems that only 1 out of the 4 might apply to ALDs and that the others may be FUD. If they are illegal, they should be shut down and put out of business. If they are really legal, the US Mint should remove the notice from their website and clear the air. Either way, a lawsuit would probably help get to the bottom of things.
<< <i>
<< <i>Correct me if I am wrong, but they have inflated values put on them (ie...they don't have value of what 1 oz of silver would be, but rather $20 or whatever) and they have no true backing other than what someone will accept for them or the value of the silver in them, right? >>
"true backing" IS the value of the silver in them.
<< <i>People may not like the US coins/paper money, but so far, I don't believe that we have defaulted on any payment for them, right? >>
This $20 bill used to be redeemable for nearly an ounce of gold...the current $20 bills are worth 3 cents on the dollar...sounds like a default to me...
>>
Frank, you again prove what others have stated...you are ignorant.
"true" backing has no play in this. If I pay $20 for a piece of currency, I want (inflation notwithstanding) to make sure I get $20 when I use it.
Not this "true backing" BS you speak of.
And, I don't care what the $20 bill is worth (gold wise). The gold certs and silver certs are old news. Learn to live in today's world. The money issued by the government is only as good as the government. If it defaults, then the money is no good. However, the US government has NOT defaulted. Your little bit about the gold/silver certificates is not valid for today's world and I think you know that.
These "liberty dollars", as people have said, are all about enriching 1 person/group by playing of people's distrust/hate of the government. They do NOTHING for me so why would I want them? I would rather, honestly, have our government make money off of me by using the government's currency, than someone else. At least the government gives me schools, roadways, etc.
What does norfed do for me?
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
<< <i>Bernard von Nothaus just filed suit against the US Mint, Director Moy, et al, claiming they damaged his business when they issued negative press releases and such in regards to Liberty Dollars. He claims that the business has pretty much dried up as a result.
My opinions on the issues? von Nothaus is a creative guy as far as a private minter, starting out with the Royal Hawaiian Mint and then the Norfed designs. He has used a multi-level marketing approach to promoting his Liberty Dollars, IMO, which is a type of scheme that I don't really approve of, but fits nicely with the demographic of the anti-tax/nativist/hard money/survivalist/millenialist milieu. In the end the pieces are merely silver rounds, IMO. If you enjoy them fine, if not, pass on them. Beyond that there is the propaganda angle, which has been less than effective and will likely remain so, IMO. >>
By the fact that he, himself, calls it a BUSINESS, you know he isn't in it for others but only himself.
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
<< <i>These "liberty dollars", as people have said, are all about enriching 1 person/group by playing of people's distrust/hate of the government. They do NOTHING for me so why would I want them? I would rather, honestly, have our government make money off of me by using the government's currency, than someone else. At least the government gives me schools, roadways, etc.
What does norfed do for me? >>
Technically it's the Federal government making money off of you using the government's currency and the state/local governments that give you schools. The Federal government, however, does give us the underfunded No Child Left Behind program which has been argued to make schools worse.
I agree on the roads and find them very useful and valuable. I'll make an exception for The Bridge to Nowhere which I don't think I'll be using anytime soon, if ever.
For some people, it may be what NORFED doesn't do for them that may be meaningful, i.e. NORFED doesn't start wars without concrete, achievable objectives that result in Americans dying and budget deficit growth. Just a hypothetical.
<< <i>At least the government gives me schools, roadways, etc. >>
Actually, the government doesn't give you those things- it takes money from you and uses that money to pay other people to build them.
Or, it just prints its own money to spend, which devalues the money you currently hold, which means that over time, you have to spend more and more of the money you've saved to buy the same things, which is essentially the same as taking the money from you in the first place.
Either way, you pay.
<< <i>
<< <i>The Treasury does the exact same thing. They put a $20 bill in circulation that cost them 4 cents to make. Ultimately, there is nothing backing a $20 except people's willingness to accept it (and the government's "promise to pay" which really doesn't mean anything).
At least Liberty Dollars have some intrinsic value to them >>
Your "except" is the definition of money sir. You are trivializing the very thing that makes money money. Our acceptance. >>
And what if people are willing to accept Liberty Dollars. Money is based upon are exceptance, and if people are willing to accept Liberty Dollars (and many are willing) then is there any legitimate support that they cannot be used as money?