Seth Lipsky: Questions for Ben Bernanke


By Seth Lipsky
The Wall Street Journal
Tuesday, April 26, 2011

Federal Reserve Chairman Ben Bernanke, in a break with tradition, will now hold quarterly press conferences. The first begins today at 2:15 p.m. Here are four questions:

1) Mr. Chairman, I have here what my college poker buddies used to call a "Portrait of Grant" -- that is, a $50 Federal Reserve Note. It is my understanding that the United States code says that this is redeemable at the Federal Reserve in "lawful money." Does that mean that it is not in and of itself lawful money?

And might I impose on you here and now to redeem this bill for me in lawful money? The reason I ask is that my Portrait of Grant used to buy enough gas for me to fill the tank on my jalopy, but now I'm paying darned near $5 a gallon. I am hoping that "lawful money" might get me more gas.

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Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit,
Extending the Mineralization of the Southwest Vein on the Property

Company Press Release, October 27, 2010

VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:

-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.

-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.

-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.

Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.

"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."

For the company's full press release, please visit:

2) Mr. Chairman, when you appeared before the House Committee on Financial Services on March 2, Congressman Ron Paul, the new chairman of the subcommittee on monetary policy, which has direct oversight of the Fed, asked you what your definition of the dollar is. It took him a phenomenal gust of 670 words to ask the question, during which he talked about, among other things, the soaring price of gold.

You listened patiently and complimented him for raising some important points. Then you replied, "My definition of the dollar is what it can buy. Consumers don't want to buy gold. They want to buy food and gasoline and clothes and all the other things that are in the consumer basket."

Your definition made no reference to either the Constitution or to the laws passed by Congress. So where in the law do you get your definition of a dollar? You may not like the definition the Founders used, which was 371 and ¼ grains of silver, but isn't it important to have some definition in the law of what a dollar is?

3) Mr. Chairman, last month a federal jury in North Carolina convicted a man named Bernard von NotHaus of counterfeiting U.S. coins. His medallions, which he called "Liberty Dollars," were made of silver. When he sold them he was getting about $20 for a medallion containing an ounce of silver, and now the coin is worth nearly twice that amount in U.S. dollars.

Yet the dollars you issued back when Mr. von NotHaus was in business have plunged in value to but a fraction of the silver or gold they were worth when you issued them. Mr. von NotHaus may be going to jail for years, and yet here you are. I don't mean to suggest in any way that you broke any law, but how do you feel about this situation?

4) Mr. Chairman, one of the reasons our country broke from England is that the tyrant over there, George III, had "made judges dependent on his will alone for the tenure of their offices and the amount and payment of their salaries." That's the language in the Declaration of Independence. So the Founders wrote it right into the Constitution that a judge's salary may not be diminished while he continues in office.

Now some of our federal judges have been in office since the dollar had a value of a 35th of an ounce of gold. Since then, the value of the dollars in which they've been paid has collapsed by far more than any cost-of-living adjustment they've received. To add insult to injury, the automatic cost-of-living adjustment the Congress passed has been suspended. Some of our most distinguished federal judges are so upset they're appealing to the Supreme Court to get involved.

I'm wondering how you would testify in that case. Do you think that a judge who was paid a decade ago in a dollar that was worth a 265th of an ounce of gold and today is being paid with a dollar that is worth but a 1,500th of an ounce of gold has had his salary diminished? And what would the Founders say about that?


Mr. Lipsky is editor of the New York Sun.

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Prophecy Resource Spins Off Platinum/Palladium Venture:
World-Class PGM Deposit in Yukon

Company Press Release, January 18, 2011

VANCOUVER, British Columbia -- Prophecy Resource Corp. (TSX-V:PCY)and Pacific Coast Nickel Corp. announce that they have agreed that PCNC will acquire Prophecy's Nickel PGM projects by issuing common shares to Prophecy.

PCNC will acquire the Wellgreen PGM Ni-Cu and Lynn Lake nickel projects in the Yukon Territory and Manitoba respectively by issuing up to 550 million common shares of PCNC to Prophecy. PCNC has 55.7 million shares outstanding.

Following the transaction:

-- Prophecy will own approximately 90 percent of PCNC.

-- PCNC will consolidate its share capital on a 10 old for one new basis.

-- Prophecy will change its name to Prophecy Coal Corp. and PCNC will be renamed Prophecy Platinum Corp.

-- Prophecy intends to distribute half of its PCNC shares to shareholders pro-rata in accordance with their holdings.

Based on the closing price of the common shares of PCNC on January 17, $0.195 per share, the gross value of the transaction is $107,250,000.

For the complete announcement, please visit: