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Here is I think the reason for the $42.22, it is the par value of a dollar
wrs - Sun, Sep 13, 2009 - 05:44 PM
The dollar is at par, currently worth .0237 oz of gold based on gold carried at $42.22/oz. I think that was the last valuation put on gold before Nixon repudiated Bretton Woods. It is the FRN that is called elastic money and it takes about $1000 FRN's to buy an ounce of gold which makes the FRN worth about 1/24th of a par value dollar.
When you write a check you write it for a $ amount. However, the check isn't for payment in $ because a FRN isn't a $. When you endorse the check, you agree that your check is equivalent in value to xxx $, even though it's not $, it's just FR Credit money (elastic money).
I know that it states in one of my Fed books, the US was supposed to have at least 25% backing for the dollar in gold. Now that is impossible but it was apparently the law back in the 60s when Bretton Woods was still operational.
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Here is I think the reason for the $42.22, it is the par value of a dollar
wrs - Sun, Sep 13, 2009 - 05:44 PM
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