Utah Legislature goes for gold, silver as currency options

Readopting a fixed gold standard won't do much to prevent future debt and financial crisis. The 1930's depression was a classic example of how a fixed gold standard could not prevent a financial crisis. When the debt bubble burst in 1929, currency devaluation was the only viable political solution. Currency devaluation, however, was impossible as long as gold remained in circulation. Executive order 6102, signed on 1933, forbid ownership of gold by US citizens. It forced citizens to turn in their gold for $20.67/oz. Once the gold has been confiscated by the Treasury, its official price was raised to $35/oz. This legislative move effectively devalued the U.S. dollar overnight.

The Utah Legislature on Thursday passed a bill allowing gold and silver coins to be used as legal tender in the state — and for the value of their precious metal, not just the face value of the coins.

State backers said they hope the move will help insulate Utah from a potential monetary slide as countries question the value of the dollar. Others, casting their eye nationwide, said it could spur a broader move by Congress or states to readopt a gold standard.

“Utah, if the governor signs this particularly, they’re going to change the national debate on monetary policy and get us back to basics,” said Jeffrey Bell, policy director for Washington-based American Principles in Action. Mr. Bell has been in Utah to help shepherd the legislation through.

Source: washingtontimes.com