More U.S. states looking to legalize gold and silver as currency while ditching dollars

As the U.S. government continues to crank out dollars like they were Monopoly money, more and more states – fearing an eventual collapse of the currency, most likely – are looking at ways to legalize and utilize gold and silver as currency.

Shunning trust in the Fed chairman Ben Bernanke, the Treasury and the economic policies of the Obama administration, more than a dozen states are considering adoption of the alternative currencies.

Utah lawmakers and Gov. Gary Herbert enacted legislation in 2011 that authorizes bullion for use as currency; now, similar bills are under consideration in Kansas, South Carolina and other states, according to Bloomberg News.

The measures are being supported by limited government advocates in these states yet for now passage of such laws are largely symbolic. You can’t, for instance, go grocery shopping in Utah and pay for your items with gold.

Concern about impending ‘collapse of the dollar’

These measures are important because they are reflective of growing concerns over the longevity and viability of the U.S. dollar – concerns that have been heightened by the Fed’s rather unconventional moves (like massive printing of trillions of excess dollars) in recent years, in some weird attempt to “stabilize” the economy, says Loren Gatch, a politics professor at theUniversity of Central Oklahoma.

“The legislation is about signaling discontent with monetary policy and about what Ben Bernanke is doing,” Gatch, who studies alternative currencies at the Edmond, Oklahoma-based school, told Bloomberg. “There is a fear that the government, or Bernanke in particular and the Federal Reserve, is pursuing a policy that will lead to the collapse of the dollar. That’s what is behind it.”

There is good reason for such concern.

For one, Bernanke and the other money masters have been manipulating currency and the markets for years, all in a way that benefits the Wall Street and banking elites. The Fed chairman has been keeping interest rates near zero since the beginning of the Great Recession in December 2007 primarily because elevated rates would devastate the federal government, which is paying hundreds of billions in interest payments on borrowed money as it is.

And this irresponsible fiscal manipulation is ongoing. Per Bloomberg News:

The Fed said in March it would continue buying $85 billion in securities each month in a program known as quantitative easing that has ballooned its assets beyond $3 trillion and is aimed at keeping long-term borrowing costs low to support economic growth.

Moreover, economic figures are being fabricated. According to an inflation measure “favored by the Fed,” Bloomberg notes, consumer prices rose just 1.3 percent in February over the previous year. Yet anyone who is trying to earn a living knows that two of the most purchased items – food and gas – are chiefly responsible for the dramatic cost of living rises in recent years. And yet, they aren’t even factored into the government’s inflation figures because they are considered too “volatile.”

Gold, silver making comebacks

Investors bet that inflationary pressures would increase because of the government’s phony “economic stimulus” measures that did nothing but pile on more debt. Still, that speculation led to a 78 percent rise in gold prices since December 2008. The historic precious metal hit a high of $1,923.70 an ounce in 2011; since then, prices have retreated and have remained flat. Now they are around $1,535 an ounce, which is still high.

But when inflation does kick in – and it will – the value of gold and the other historically valuable currency, silver – will increase as well. States considering using these precious metals as currency once more seek to use them as a fall-back when the dollar finally does collapse.

Texas gold is not just in the oil fields

One state, in fact, is so concerned about the dollar’s economic future it is considering legislation to regain physical possession over its gold.

Texas Gov. Rick Perry and a number of lawmakers want to establish the Texas Bullion Depository to store some 6,643 gold bars valued at about $1 billion that are currently being held in a New York bank warehouse. The gold, which is owned by the University of Texas Investment Management Co., or UTIMCO, took delivery of the bars in 2011 over concerns that rising demand would eventually outpace supply.

The facility would also accept deposits from the general public, and serve as a basis for a payments system in the state in case a “systemic dislocation in a national and international financial system” were to occur, the legislation says.

Jim Rickards, the senior managing director at the Tangent Capital Partners LLC in New York, and author of Currency Wars: The Making of the Next Global Crisis, said if Texas were to enact its legislation, it would mean sovereign backing of deposits, like when the dollar was based on the gold standard, and make the purchase and storage of gold easier.

“We are seeing a distinct movement back to a world where gold is considered money,” Rickards told Bloomberg News.

Source: http://www.naturalnews.com/039984_gold_currency_states.html

Texas wants its gold back from Federal Reserve

Call it the Rick Perry gold rush: The governor wants to bring the state’s gold reserves back from a New York vault to Texas.

And he may have legislative support to do it. Freshman Rep. Giovanni Capriglione, R-Southlake, is carrying a bill that would establish the Texas Bullion Depository, a secure state-based bank to house $1 billion worth of gold bars owned by the University of Texas Investment Management Company, or UTIMCO, and currently stored by the Federal Reserve.

The idea isn’t entirely new. Some Republican members worked on a gold bill last session that was never filed. And gold-standard-backing Ron Paul, the former Texas congressman, has raised repeated concerns about the safety of states’ gold supplies.

“If you think gold is a hedge, or a protection, you always want it as close to the individual and the entity as possible,” Paul told the Tribune on Thursday. “Texas is better served if it knows exactly where the gold is rather than depending on the security of the Federal Reserve.”

Bringing Texasgold home has gained more traction this legislative session because of Perry’s vocal support for it. On conservative radio host Glenn Beck’s show on Tuesday, the governor said Texas was “in the process” — the legislative process, he later clarified — of “bringing gold that belongs to the state of Texas back into the state.” He argued that the state was at least as capable as the Federal Reserve of safeguarding Texas’ “physical gold.”

“If we own it,” Perry said, “I will suggest to you that that’s not someone else’s determination whether we can take possession of it back or not.”

State Rep. Lon Burnam, D-Fort Worth, said he was familiar with Capriglione’s bill but was skeptical that it addresses a legitimate problem facing the state.

“We’ve got plenty of real problems that we’re not going to deal with this session,” Burnam said. “Let’s deal with them.”

Capriglione said he was at a Tea Party event in Tarrant County earlier this year where Perry spoke about the state’s gold investments as an economic development tool. Since then, he has been working with Perry’s office on the bill.

“Something on the scorecards of a lot of these businesses in deciding whether they want to come to Texas is stability and gold as being one of those items,” Capriglione said. “I think it’s been in his consciousness for a while in trying to get some sort of depository in the state of Texas.”

He has also spoken with UTIMCO, which owns the 6,643 gold bars currently housed underground in New York City.

“We’re trying to figure out the right amount of gold to have here in Texas,” Capriglione said. “’We don’t want just the certificates. We want our gold. And if you’re the state of Texas, you should be able to get your gold.”

The United States and many other countries stopped pegging their currencies to the gold standard decades ago. Capriglione said the bill is not about putting Texas on its own gold standard. Rather, a depository would give the state a reputation as being more financially secure in the event of a national or international financial crisis.

“For us to have our own gold, a lot of the runs on the bank and those types of things, they happen because people are worried that there’s nothing there to back it up,” Capriglione said. “So I think this cures a problem before it can happen.”

Physically transporting gold that various state entities own from New York City or other banks to Texas would be impractical from a security and logistics standpoint, Capriglione said. He believes it makes more sense to sell the gold Texas has elsewhere and repurchase it within state lines.

He said he doesn’t think the measure would be a significant expense, because the gold bars could be safeguarded in a small area, no bigger than 20 square feet.

Capriglione said he is working on revisions to the bill to address some concerns he has heard. He plans to make sure the bill would not cause the state to change its overall asset portfolio to be more heavily invested in gold. Also, to lower the bill’s costs, he expects to change the language to allow some of the administrative costs of building and running the depository to be handled by the private sector.

Source: http://www.texastribune.org/2013/03/21/perry-some-lawmakers-want-states-gold-back-texas/

Why Texas wants its gold back from the feds

gold_bar_inventory

“The eyes of Texas are upon you” goes the song, but right now those eyes seem to be squarely focused on the financial crisis in Cyprus.

Texas Gov. Rick Perry is supporting a bill that would return the state’s $1 billion in gold reserves currently stored by the Federal Reserve at a vault in New York to the state.

The sponsor of the bill, State Rep. Giovanni Capriglione, R-Southlake, told the Texas Tribune, “For us to have our own gold, a lot of the runs on the bank and those types of things, they happen because people are worried that there’s nothing there to back it up.”

Bank runs were the great fear in the Mediterranean-island country of Cyprus today, as banks reopened for the first time since March 16, while the European Union imposed unprecedented austerity measures on the nation, including confiscating money in bank accounts. WND reported on March 18 the concerns that the crisis could spread to the U.S. financial system.

Capriglione said his bill is, “not about putting Texas on its own gold standard, [but instead will] give the state a reputation as being more financially secure in the event of a national or international financial crisis.”

“If we own it,” Perry told Glenn Beck last week, “I will suggest to you that that’s not someone else’s determination whether we can take possession of it back or not.”

Capriglione’s bill would establish the Texas Bullion Depository to hold the gold.

“We don’t want just the certificates. We want our gold. And if you’re the state of Texas, you should be able to get your gold,” said Capriglione.

However, he concedes transporting $1 billion worth of gold bars would be impractical, so he suggests selling the gold and repurchasing it in Texas.

The bill might get bipartisan support. State Sen. Rodney Ellis, D-Houston, called the bill “an interesting concept” and wants to consult financial experts on its merits.

That bipartisan support may stem from the severity of the crisis in Europe and fears it could spread here.

Cyprus fell into turmoil while the government and European financial leaders hammered out a $13 billion emergency assistance package to keep the nation’s banks from collapsing.

Cypriots were outraged and took to the streets to protest an unprecedented plan to impose a confiscatory tax on all bank accounts.

Depositors with more than 100,000 euros, or about $130,000, would get 9.9 percent immediately deducted from their accounts. Smaller deposits would suffer a deduction of 6.75 percent.

Following the protests, the plan to confiscate money from the smaller accounts was rejected by Cyprus’ parliament.

Banks in Cyprus reopened today with a 300-euro ($383) daily limit on withdrawals and restrictions on transfers to accounts outside the country. Customers were orderly, though they faced lines of 15-20 people.

This is the first time since the introduction of the euro that a European country has prevented bank depositors from having full access to their own cash.

The European Union said in a statement today the restrictions on access to money will be lifted as soon as possible.

The heavily indebted government of Cyprus is still planning to raise as much as $8.3 billion with its “one-time” tax on bank accounts of more than 100,000 euros, to satisfy the bailout demands of the EU.

The Cyprus crisis has sparked a surge in an alternative currency that exists only in cyberspace.

The trading value of a digital cash called “bitcoins” has soared, increasing by 20 percent on one U.S. currency exchange in just the last week.

“Incremental demand for bitcoin is coming from the geographic areas most affected by the Cypriot financial crisis – individuals in countries like Greece or Spain, worried that they will be next to feel the threat of deposit taxes,” said Nicholas Colas, chief market strategist at ConvergEx.

“This is a clear sign that people are looking for alternative ways to get their money out of the country,” said Christopher Vecchio, currency analyst at DailyFX.

Source: http://www.wnd.com/2013/03/why-texas-wants-its-gold-back-from-the-feds/