Anyone with a strong interest in precious metals and currencies is probably already aware that there is a sizeable body of opinion in the U.S.A. that believes paper money is essentially a fraud on the people. They feel that the American Republic was essentially stolen from the American people through the creation of a central bank issuing debt-backed paper currency.
It is a point of view that has gained more traction in recent years as the price of gold skyrocketed with the advent of a massive program of “quantitative easing” by the Federal Reserve, i.e. the issuing of enormous amounts of debt-backed paper money into the financial system. The establishment’s answer to a massive global crisis of debt that shook global markets in 2008, was the creation of still more debt to stabilize the system. The argument goes that the price of gold did not so much rise as the “price” of paper dollars collapsed; likewise the bull market in stocks was actually a very strong bear market in U.S. dollars as priced against real assets represented by corporate equity.
Islamic State has “Gold Bug” opinions about debt-backed paper currency… and are beginning to take additional steps to get their own strictly metallic currency system up and running…
What you might not be aware of unless you live in the Middle East or take a keen interest in that region, is that Islamic State has exactly the same “Gold Bug” opinions about debt-backed paper currency, or any paper currency at all for that matter, and are beginning to take additional steps to get their own strictly metallic currency system up and running, building on recent announcements made in the same vein.
Of course, it is one thing to disapprove of or be suspicious of debt-backed currencies and the creation of ever-larger amounts of sovereign debt, and quite another thing to believe that paper currencies are by nature diabolical instruments used by the illuminati to control and enslave the peoples of the world. Islamic State tend towards the latter view, and what is very interesting about this is how this view corresponds with the views of far-right and neo-Nazi groups in the U.S.A. There is a story to be told about how elements of Islamist political thought were profoundly influenced by American far-right and German Nazi propaganda of the 1930s and 1940s, to the point where the same views are now being re-exported by groups such as Islamic State. Islamist political thinkers before the 1930s disapproved of debt-backed currencies, but did not see such instruments as part of a global conspiracy. Of course, a combination of political events of the mid-20th century has made it easy to promote this view by pointing to constant wars and global conspiracies.
FDR: Give up the Gold
In the early 1930’s the President of the United States of America, Franklin Delano Roosevelt, promulgated a law banning the private ownership of gold. He ordered all citizens to surrender their gold in all forms and no person could hold more than $100 in gold coins, except for collector’s coins. He also made it unlawful to export gold for payment abroad, unless it was transacted through the Treasury. The penalty for defying Roosevelt was 10 years in prison and a $250,000 fine. The price of gold backing the dollar was set at $35 an ounce.
Roosevelt emphasized that his new law was enacted in order to prop up the dollar system and prevent a complete meltdown of the financial system. But American conspiracy theorists have always seen this as a highly suspicious move. Far-right American propaganda portrayed Roosevelt and a small clique as manipulating financial markets and credit, with the aim of ensuring the population was subject to “debt enslavement”.
Nixon Closes Gold Window
On 15 August 1971, President Richard Milhous Nixon announced to the world that the United States was closing the gold window in a move that many analysts say ushered in a decade of inflation and economic stagnation and empowered the men and women at the Federal Reserve to control monetary policy for the American people.
Ever since that fateful day foreign governments have been unable to exchange their dollars for gold and the United States and the rest of the world have been operating on a fiat monetary system, i.e. the money is not backed by gold or anything else. Back then, ‘Tricky-Dicky’s move was viewed by those on the right as an effort to keep the country in debt. And forty years later, they continue to view it as such.
They point to the effects of a floating dollar over the last four decades-- sharply rising inflation throughout the world, elevated interest rates and the balance of payments that swung from a persistent surplus to a chronic deficit.
ISIS Rhetoric
This rhetoric on the evils of the fiat debt-backed currency system is echoed by ISIS which is now using it as a call to arms for its efforts in building institutions of what they call a functioning state by issuing its own silver, gold and copper currency. ISIS released an hour-long video promoting the new currency a few days ago.
ISIS didn’t explain where the coins were being minted or how they will be distributed in order to replace currencies currently circulating in parts of Iraq and Syria which it now occupies. But it emphasized its focus on “the return of the gold dinar” and each new dinar, dirham and fulus bears an inscription that reads, “The Islamic State, a caliphate based on the doctrine of prophecy.”
In its declaration, ISIS states that it is producing its own currency in order to “prevent blind and tyrannical monetary system that was imposed on the Muslims and was a reason for their enslavement, impoverishment and the wasting of national wealth.”
Paper Money in Islamic Civilizations
ISIS like to point out that in the time of the Prophet, only precious metals were used as currency. This is true, but forms of paper money were in use by merchants by the time of the Mamelukes, and paper currencies were formally introduced by the governments of several Islamic countries in the 19th century. Therefore ISIS seem to be suggesting that at least the last 200 years at least has seen a great ethical error.
It would be incorrect to say that ISIS has derived its doctrine of precious metal from western thought, but there certainly seems to have been a seepage in rhetoric.
Debt and the U.S. Dollar
Although the debt levels in the United States have exploded to unprecedented levels in recent years and seven out of ten Americans are in constant debt, the dollar has come roaring back to life from just one year ago and has returned to its position as the strongest currency in the world. 
The United States dollar averaged 97.30 from 1967 until 2015, reaching an all-time high of 164.72 in February of 1985 and a record low of 71.32 in April of 2008. According to the New York Board of Trade, the US Dollar Index, which tracks a basket of currencies, was valued at 95.55 points on Tuesday.
The dollar continues to dominate global economies. And despite ISIS’s stated efforts to withdraw from ‘enslavement’ and material waste, only time will tell if the new ISIS currency will ever hold a place among other world currencies.