The Funding Act of 1790 — Hamilton Mobley

During the American War for Independence, the Continental Congress had printed paper dollars, to be redeemed in silver and gold dollars- called specie- after the war. Well, they printed too many paper dollars and didn’t have enough specie, creating a debt and inflation problem because people wanted to get paid in good money. The Funding Act of 1790 was their solution: For every 100 silver dollars owed, pay 1 silver dollar.[1]

The following is part of the text from the funding act, formally called, An Act making provision for the Debt of the United States,

“Whereas, justice and the support of public credit require, that pro vision should be made for fulfilling the engagements of the United States, in respect to their foreign debt, and for funding their domestic debt upon equitable and satisfactory terms:
[…]
Sec. 3. Be it therefore further enacted, That a loan to the full amount of the said domestic debt be, and the same is hereby proposed; and that books for receiving subscriptions to the said loan be opened at the treasury of the United States, and by a commissioner to be ap pointed in each of the said states, on the first day of October next, to continue open until the last day of September following, inclusively; and that the sums which shall be subscribed thereto, be payable in certificates issued for the said debt, according to their specie value, and computing the interest upon such as bear interest to the last day of December next, inclusively; which said certificates shall be of these several descriptions, to wit:
Those issued by the register of the treasury.
Those issued by the commissioners of loans in the several states, in cluding certificates given pursuant to the act of Congress of the second of January, one thousand seven hundred and seventy-nine, for bills of credit of the several emissions of the twentieth of May, one thousand seven hundred and seventy-seven, and the eleventh of April, one thou sand seven hundred and seventy-eight.
Those issued by the commissioners for the adjustment o f the accounts of the quartermaster, commissary, hospital, clothing, and marine depart ments.
Those issued by the commissioners for the adjustment of accounts in the respective states. Those issued by the late and present paymaster-general, or commissioner of army accounts.
Those issued for the payment of interest, commonly called indents of interest.
And in the bills of credit issued by the authority of the United States in Congress assembled, at the rate of one hundred dollars in the said bills, for one dollar in specie.”

Like the Founding Fathers, Americans in 2025 have a debt and inflation problem. The government is printing too much money, we have too much debt, and the paper dollar (Federal Reserve Note) is becoming worth less every day.[2]

Unlike the Founding Fathers, our paper money is the world’s reserve currency. We can pay off our debt by simply printing money. However, that won’t last forever. Since the 2008 financial crisis, and after 20 years of selling gold, central banks and nations started buying gold again.[3][4]

The US dollar is actually the Federal Reserve Note. It is a bill of credit, meaning that people used to take their dollar bills to the US Treasury or Federal Reserve, and have their bills paid in gold and silver dollars. Being the leader of the victors of WWII, the victors met at Bretton Woods, NH in 1944 and agreed to back their currencies with the Federal Reserve Note; but, in 1971, the USA stopped paying out gold and silver. We had effectively defaulted.[5]

That is why everything has gotten so expensive since 1971.[6]

If gold and silver become the world reserve currency again, then the paper dollar will be defined by its exchange rate in gold and silver again. Maybe we simply print the money necessary to pay the debt, but maybe we settle the debt in gold and silver at Fort Knox at a 100 to 1 ratio- likely significantly higher. E.g. the paper dollar is already at a 3,400:1 ratio to gold, costing $3,400 per ounce of gold. A 100:1 ratio here would settle the debt at $340,000 per ounce of gold.

Either way, it is a higher paper dollar price for gold and silver- and everything else.

Forget 1970’s inflation. Here comes the 1790’s!

Physical bitcoin is money when the paper dollar isn’t worth a continental.[7]