WHAT ARE FEDERAL RESERVE NOTES?
Federal Reserve notes are not “dollars,’ but they are “legal tender.” Whenever a contract payable in “dollars” fails to specify payment in a certain form of “dollars,” the payee must accept whatever sort of “dollars” are defined in the law as “legal tender.” The law states, “United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts. Foreign gold or silver coins are not legal tender for debts.” 6 The law defines Federal reserve notes as “obligations of the United States *** receivable for all taxes, customs, and other public dues.” 7 ANOTHER GOLD STANDARD? The Gold Bullion Coin Act of 1985 8 provided for the American Eagle gold coins containing one troy ounce (denominated “$50”), one-half troy ounce (denominated “$25”), one-fourth troy ounce (denominated “$10” [sic]), and one-tenth troy ounce (denominated “$5”). ANOTHER SILVER STANDARD? The Liberty Coin Act of 1985 9 provided for 0.
