This is a picture of a 1957 silver certificate and the reverse side of an 1879 Morgan silver dollar. Both are US legal tender with face values of 1 dollar. The silver certificate is supposed to be backed by silver in the US Treasury and convertible to silver on demand.
In 1965, the US Mint began debasing silver coinage and circulating coins contain no silver today. After 1968, the US Treasury reneged on its promise to honor conversion and the purchasing power of the silver certificate steadily declined while the purchasing power of the Morgan silver dollar increased. The Treasury has sold off all 16 million ounces of silver it once held as reserves. The Mint must purchase silver on the open market in order to create silver Eagle bullion and other collectible coins.
This scenario has played out time and again throughout the history of government issued money. Do not believe for a moment that the US government won't break its monetary promises. It has done so in the recent past.
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