A Fundamental Postulate of the 100% Specie Doctrine Is That Paper Money Literally Is a Warehouse Receipt or Certificate for the Commodity Money It Represents

Paper money can play a definite, powerful role under the 100 percent specie standard.  Although some hard money advocates, such as Thomas Jefferson, at times favored the abolition of paper money entirely because of its “misuse,” others have pointed out that the economic advantages of paper money can be had without the disadvantages created through the fractional reserve system. Paper money turns out to be a very cheap and efficient way for the handling and transferring of metallic money. The actual transfer of gold or silver can be an expensive process, especially for large transactions, and consequently the transfer of claims for money proves to be much more convenient and efficient.

A fundamental postulate of the 100 percent specie doctrine is that paper money literally is a warehouse receipt or certificate for the commodity money it represents, just as it was under the scriveners and early goldsmith-bankers.

--Mark Skousen, Economics of a Pure Gold Standard, 4th ed. (Irvington-on-Hudson, NY: The Foundation for Economic Education, 2010), Kindle e-book.