Detailed Summary–Part I
Banking and Monetary Reform
 

Immediate Relief and Results
 

• Eliminates approximately $1 trillion of the nation’s public debt
• Reduces future private debt by approximately $1 trillion
• Immediately eliminates some private debt, especially for many homeowners
   

The Federal Reserve System
 

• The Federal Reserve Act of 1913 is amended
• The Federal Reserve System is abolished and replaced by a new Treasury Reserve System
• Control of the currency is moved from private control of the Fed to public control of Congress and the new Treasury Reserve System
   
• Congress sets the standards for the new monetary system but the people create as much or as little currency as they need
• Functions of the Federal Open Market Committee are transferred to the Board of Governors of the new Treasury Reserve System
• A new mechanism, the Treasury Reserve Account, is created to provide the Treasury Reserve System Board of Governors a better method to fine-tune the money supply, effectively eliminating inflation
   
• The Treasury Reserve System Board of Governors will continue using the previous three mechanisms for controlling the money supply: 1. Setting reserve requirements. 2. Setting the national discount rate. 3. Purchasing U.S. Treasury securities on the open market.
• All U.S. Treasury securities purchased by the Treasury Reserve System Board of Governors will be immediately turned over to the U.S. Treasury and cancelled out of existence.
   

Monetary Policy
 

• People are provided with several alternatives for currency
• Constitutional currency is restored
• Currency becomes debt free as the people stop paying interest payments for their use of a public utility
   
• Unlike previous policy, the new Treasury Reserve Board is provided one very specific mandate: maintain a stable currency
• Expansion of the economy is returned to the free market
• Private coinage is encouraged
   
• Exchange ratios for the various currencies are published at least weekly
• Printing of redeemable gold and silver certificates is allowed
• Postal money orders are made available in denominations of gold and silver coin
   

Banking
 

• Returns the banking industry to serving public interests
• For secured loans, compound interest is outlawed and replaced with a monetization fee
• Provides stricter banking controls by imposing excise taxes to discourage high or runaway monetization fees
   
• On secured loans obtained from a fractional reserve bank, principal must be paid in full before the bank begins collecting its monetization fee
• Eliminates the facade for banking insurance (FDIC)
• Except for fraud and criminal activities, virtually eliminates bank failures
   
• Banks are prohibited from using as reserves any commercial paper
• Only Treasury credit-notes can be used as bank reserves
• Banks are prohibited from purchasing government issued debt, effectively removing banks from influencing monetary policy
   
• Checking accounts against gold and silver deposits are prohibited
• Commingling of funds among the various money accounts without owner’s permission is prohibited
• All currency deposits with banks are general warrant deposits and custody accounts.