When old money dies
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If you want to know who rules a country, don't look at the flag or the
constitution, look at the money. The great rulers of the past had a name for it
–the coin of the realm.
Not just a description of currency, but a declaration. Whoever could strike
the coin – whoever could put a face on the metal, set its weight, guarantee its
value, and demand it be accepted in payment of debts –was the realm itself.
To change the coin was to change the fundamental order of things.
Roman emperors understood the importance of it. In fact, the first act of a
new Caesar was almost always to strike a new denarii bearing his face.
When Henry VIII began debasing England's silver coinage in the 1540s – a move
remembered as the Great Debasement – he funded his wars against France and
Scotland, but he quietly destroyed a generation of English savers in the
process.
When Napoleon issued the franc germinal in 1803, he was not reforming a
currency, he was declaring a new France.
I want to show you today that the coin of the American realm is changing
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– for the fourth time in our nation's history.
And like every prior change, this one will carve a sharp line between those
who understand what is happening and those who don’t.
Not Worth A Continental
In June of 1775, the Continental Congress had a problem…
They had declared a war (against Britain) they could not afford. They had no
taxing authority, no treasury and an army in the field that needed paying.
So they did what every government in history has done when it ran out of
options, they printed.
Over the next six years, Congress issued more than $241 million in what they
called Continental currency – paper notes backed by nothing more than the
promise that, when the war was eventually won, they would be honored at face
value.
By 1780, those notes were worth one-fortieth of their face value. By May of
1781 they had ceased to circulate entirely. The phrase "not worth a
Continental" entered the American language and stayed there for two centuries
afterward.
Benjamin Franklin made an observation about the Continental currency that its
depreciation had acted, in effect, as a tax to pay for the war.
That is the first and most important lesson of American monetary history.
When a government cannot raise money, it raises it through the quiet
destruction of the currency. The bill arrives one way or the other. Someone
always pays.
The Wildcat Era
What followed the Continental disaster was chaos.
For the first eighty years of American history, there was no single dollar.
The Spanish silver dollar – the original "piece of eight" – circulated
alongside the U.S. coin and remained legal tender across the country until 1857.
Mexican silver pesos passed from hand to hand across the southern states.
State-chartered banks issued their own competing notes, each backed by
whatever bonds, real estate (or in some cases nothing at all) the bank in
question happened to have on its books.
Historians refer to it as the wildcat era.
By the 1830s, an American merchant doing ordinary business might handle a
dozen different currencies in a single day.
None of them, in any practical sense, was the true coin of the realm.
America had a flag, a freshly composed anthem and a constitution. But it
didn’t yet have sovereign money. And that meant it did not quite yet have a
fully sovereign government either.
Lincoln's Quiet Revolution
In 1861, with the Union army needing funds the Treasury did not have, Abraham
Lincoln signed legislation authorizing the federal government to issue Demand
Notes – the first federal paper currency to achieve wide circulation in the
United States.
The notes carried Lincoln's own face on the $10 note, the first time a
sitting American president had appeared on the nation's money.
The federal dollar became the sole coin of the realm. Every dollar in every
wallet now bore the same imprint, answered to the same authority, and rose or
fell on the credibility of the same institution.
For the next century the dollar was anchored, in one form or another, to gold.
The U.S. Treasury would in principle exchange any paper dollar for a fixed
weight of metal.
That promise was tested through depressions and wars, refined by Roosevelt's
gold recall in 1933, and codified at Bretton Woods in 1944 – when the dollar
became the centre of the entire global financial system.
Until, very suddenly, it didn’t.
Nixon Pulls The Plug
The promise held until the afternoon of August 15, 1971.
That day, Richard Nixon went on television and informed the world that the
United States would no longer convert dollars into gold.
The Bretton Woods system – and with it the gold anchor that had backed the
American coin in some form for nearly a century – was finished.
The dollar became just a piece of paper backed by nothing more than the
dubious credibility of the issuing government.
To rescue that credibility, in 1974 the United States cut a now-infamous deal
with Saudi Arabia. Oil – the commodity every nation on earth desperately needed
– would be priced in dollars.
Every other OPEC nation followed within a year. The coin of the realm had a
new anchor. Not gold, but oil.
That deal in the desert set in motion the greatest accumulation of private
wealth the world has ever seen. America transformed from a country of roughly
180,000 millionaires in 1974 to one of nearly 24 million today.
But that arrangement – the petrodollar – quietly expired in June of 2024.
Which brings me to the underlying reason I am writing to you today.
The Fourth Reset
For the fourth time in American history, the coin of the realm is being
supplanted.
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This isn’t about crypto, or stablecoins, or central bank digital currencies –
the things the financial press has been writing about for years now.
In my view, it is something far more consequential.
A new monetary architecture
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, already signed and sealed in the back rooms of Washington, backed by a
coalition of more than sixty nations…
Being initiated by President Trump through a series of executive orders and
bilateral agreements that bypass Congress entirely.
If history’s any guide, what is about to happen will draw a sharp dividing
line through this country once again.
On one side, those who understand what is being built and position themselves
accordingly.
On the other, those who keep saving, investing, and spending as though the
old coin still ruled. As though the realm itself were not being remade beneath
their feet.
My team and I have spent months tracing exactly what is being assembled, who
is involved, and what it could mean for every dollar you have saved and
invested.
The full story is laid out in my new documentary
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– including the name and ticker of one asset I believe gives you immediate
exposure to what’s coming.
Here’s everything you need to know about America’s new money.
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Good investing,
Porter Stansberry
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