The Real Reason Purchasing Power Is Collapsing
When most people discuss the loss of purchasing power, they focus on inflation, interest rates, and Federal Reserve policy. According to Kenneth Mraz, Strategy Specialist at Zang International, those explanations only scratch the surface.
The deeper issue, he argues, is not mathematical. It is structural.
Rather than viewing the decline in purchasing power as simply the result of economic forces, Kenneth points to what he describes as a fundamental change in the legal architecture of the monetary system. To understand the challenges facing savers and workers today, he says we must examine a pivotal moment in American financial history: House Joint Resolution 192.
House Joint Resolution 192 Changed the Monetary System
In June 1933, House Joint Resolution 192 fundamentally altered the legal framework surrounding money in the United States.
Before this change, transactions involving physical gold were considered payment. According to Kenneth, exchanging an ounce of physical gold for property represented a transfer of intrinsic value for intrinsic value. Once completed, the debt was settled and ceased to exist.
House Joint Resolution 192, however, suspended the gold standard and introduced a different legal mechanism that Kenneth refers to as "discharge."
Under this framework, transactions no longer functioned as a final settlement of debt through real money. Instead, Kenneth argues that the system shifted toward the use of fiat currency as a tool for discharging obligations rather than paying them with intrinsic value.
The Endless Debt Loop
Kenneth describes modern fiat currency as part of what he calls an "IOU illusion."
In his view, every fiat dollar represents government debt moving through the system. Rather than eliminating obligations, each transaction simply transfers liability from one party to another.
This creates what he characterizes as an endless debt loop:
- Debt is created.
- Currency enters circulation.
- Obligations are discharged rather than permanently settled.
- Purchasing power continues to decline over time.
According to Kenneth, this structure helps explain why many people feel they are working harder while their money buys less each year.
Who Receives New Money First?
One of the key concepts Kenneth highlights is the unequal distribution of newly created currency.
He argues that when new fiat debt enters the system, it does not arrive equally across society. Instead, it enters from the top.
According to Kenneth, governments, central banks, and large financial institutions gain access to newly created money before it filters through the broader economy. Because they receive it first, they can deploy it while its purchasing power is strongest.
He contends that these entities often use that purchasing power to acquire:
- Tangible assets
- Financial assets
- Investment portfolios
- Productive resources
By the time that currency reaches workers through wages and salaries, Kenneth argues much of its purchasing power has already been diminished.
Why Workers Bear the Burden
Kenneth describes the modern financial system as a pyramid in which consumers occupy the lowest level of the monetary flow.
In his analysis, workers exchange their:
- Time
- Labor
- Productivity
- Life energy
For dollars that have already experienced purchasing power erosion.
This dynamic, he says, effectively turns consumers into what he calls a "financial sponge," absorbing the consequences of ongoing currency devaluation while those higher in the monetary structure benefit from early access to newly created money.
The Savings Account Problem
Kenneth also challenges conventional thinking about savings.
He argues that money deposited into savings accounts remains part of the same debt-based system. Rather than representing preserved wealth, he believes savers are effectively holding and lending back currency that continues to lose purchasing power over time.
This perspective leads him to question whether traditional savings methods can adequately support long-term wealth preservation during periods of ongoing currency debasement.
Gold Confiscation Came Before the Rules Changed
A central part of Kenneth's argument focuses on the timing of two major events in 1933.
In April 1933, Executive Order 6102 required Americans to surrender much of their physical gold holdings under threat of fines and imprisonment.
Just two months later, House Joint Resolution 192 altered the monetary framework.
Kenneth raises an important question:
Why require the public to surrender physical gold before changing the monetary rules?
His conclusion is that the government first removed access to what he considers real money before transitioning society into a debt-based fiat system.
He refers to this process as "financial disarmament."
According to Kenneth, removing physical wealth from public ownership made it easier to establish a monetary structure that relied entirely on fiat currency.
Stablecoins, the GENIUS Act, and the Future Monetary System
Kenneth also draws parallels between historical monetary changes and current developments involving stablecoins.
He points to provisions within the GENIUS Act, signed into law in July 2025, which require permitted payment stablecoin issuers to maintain identifiable reserves backing outstanding stablecoins on at least a one-to-one basis.
In practical terms, Kenneth explains that if a company wishes to issue $10 million in stablecoins, it must maintain at least $10 million in qualifying reserves.
He believes this requirement could remove liquidity from the broader economy because large amounts of capital would need to remain reserved to support stablecoin issuance.
Deflation, Inflation, and Reset Risks
According to Kenneth, reserve requirements for stablecoins could contribute to deflationary pressures by pulling liquidity out of circulation.
He argues that policymakers typically combat deflation through inflationary measures, including the creation of additional currency.
As a result, Kenneth believes the system may face a cycle where:
- Liquidity is absorbed.
- Additional money creation becomes necessary.
- Purchasing power continues to erode.
- Pressure builds toward a larger monetary reset.
In his view, this process could contribute to the conditions that eventually lead to a hyperinflationary environment before a currency transition occurs.
The Choice Facing Investors
Kenneth concludes by presenting what he sees as a critical decision.
Individuals can continue operating entirely within a debt-based system, or they can begin evaluating alternatives designed to preserve purchasing power.
His focus remains on tangible assets and sound money strategies that emphasize ownership rather than dependence on financial promises.
As uncertainty surrounding monetary policy, digital currencies, and financial system restructuring continues to grow, Kenneth encourages investors to evaluate how exposed their wealth may be to ongoing currency devaluation and consider whether physical gold and silver may play a role in their long-term wealth preservation plans.
Final Thoughts
Kenneth Mraz's analysis centers on a simple but powerful idea: purchasing power is not only influenced by economics, but also by the legal and structural framework that governs money itself.
Whether one agrees with every aspect of his interpretation, the questions he raises about debt-based currency systems, purchasing power erosion, and the role of tangible assets are increasingly relevant in today's financial environment.
Understanding how monetary systems evolve can help investors make more informed decisions about financial freedom, economic collapse preparation, and wealth preservation in an era of accelerating change.
Learn More About Sound Money Strategies
If you're concerned about declining purchasing power and want to understand how physical gold and silver may fit into a comprehensive wealth preservation strategy, speak with the team at Zang International.
Discover how sound money strategies built around tangible assets can help you prepare for financial uncertainty, protect your purchasing power, and build a stronger foundation for long-term financial freedom.
