Chapter XIII Cash is Not a Part of Our Money Supply

"When a person has $10 in his pocket and $100 in the bank, he is in a position to spend $110. These two kinds of money represent his cash resources." The writer forgot to say that he or some other person had to write a cheque against his deposits and draw the $10 out; and when the $10 cash reached his hands, his deposits were $10 less. The very circulation statement (of cash) disproves that cash is apart of our money supply. Circulation Statement of United States Money, May 31, 1957, gives total cash supply at $55,095,658,926, and out of the Treasury and in circulation, only $35,191,638,399; then they whittle that down again, having "in circulation," that is in all of the 12 Reserve Banks and some 14,537 commercial banks" $30,636,348,266. So you see that $24,259,310,640 of the total never leaves the Treasury. . . and to all intents and purposes is dead. There is an interesting observation we may make here: while gold certificates are outlawed, and cannot circulate, and get in Joe Doe's hands, this statement shows that the Treasury has printed for the Reserve Banks $21,964,687,524 Federal Reserve Gold Certificates. Then this same circulation statement shows under kinds of money gold, which, too has been outlawed as circulating money, total $22,620,251,821. If you add this column, and we must admit that every item listed is "money" (when in circulation), you find that the grand total is $79,457,122,476. That indicates that we have just lying around, not active, dead, $48,620,774,190, about $18 billion more than the banks find use for in the circulation of money. It is interesting to note that in 1934, on the insistence of the Reserve folks that we go off the gold standard, take gold coin and gold certificates out of circulation; then raise the price of gold from $20.67 an ounce to $35 an ounce; then buy up all of the gold in sight, the Treasury, not the Reserve authorities paying for it; that now we find that those Reserve boys' Midas hands have gripped Uncle Sam's throat, compelling him to print at no cash outlay to them over $21 billion Federal Reserve Gold Certificates) which gives them title to the gold Uncle Sam bought, and spends millions guarding as if it were a sacred cow. And it is a sacred cow to scheming