It isn't complicated at all. Gold or silver is accepted in lieu of fiat dollars at current spot prices to settle any bill. The metals are stored in a small area-safe at the state level temporarily, Brinks who has a Salt Lake location is sub-contracted to make some daily, bi-weeekly or weekly pick-up .....
Well, you are forgetting that there are lots of taxes in Utah and lots of places to pay those taxes. There are property taxes and motor vehicle taxes and many other taxes. So, every city and town is going to need a safe and an arrangement with Brinks? Totally stupid.
Incidentally, I looked at Utah's state tax instructions. They currently favor electronic transfer of funds, which are labor savings. I guess these crazy politicians want to make things a lot more expensive for the citizens of Utah.
<< <i>Other than the building of the storehouse I don't really see any additional costs since the "Utah Defense Force" will more than likely be made up of folks already on the States payroll
The legislation calls for an armed militia to guard the gold and silver. You can't just choose "folks" already on the state's payroll. Somebody needs to train these people to become part of a militia. It will need to operate 24 hours per day.
I don't think the program would be really that popular unless something disastrous would occur with the National Economy but if it did, then the State is legally positioned to react.
That's why this program is so stupid. The program won't be popular, but the state will still have to incur all of the expenses for the storehouse, the militia, and for setting up the processes to accept the metals. Even if only one person pays their income tax in gold, the state needs to have a process in place to calculate the value of gold, provide appropriate receipts, and securely transport the gold to the storehouse (probably using guards). Every taxing authority will need to be changed to accommodate this ridiculous option.
I guess the state legislature doesn't understand that America is becoming a cashless society. We like to pay our bills with checks, credit cards, and electronic transactions. Utah's concept is ridiculous. >>
Oh pooh! The Utah National Guard is already well trained and well armed. Exactly how many folks would it take anyway unless of course you're envisioning a Ft. Knox scenario which is totally off the mark? Any Militia formed to enact this legislation is already on the States payroll and simply amounts to a transfer of current duties.
As for the so called "stupidity" of the law, states cannot do ANYTHING without the backing of approved law and Utah is simply positioning themselves to address the possibility. There's nothing wrong with planning ahead.
I decided to change calling the bathroom the John and renamed it the Jim. I feel so much better saying I went to the Jim this morning.
<< <i>I guess the state legislature doesn't understand that America is becoming a cashless society. We like to pay our bills with checks, credit cards, and electronic transactions. Utah's concept is ridiculous. >>
Definitely. Young folks have no concept of precious metals coins in commerce. They'd be like: "wtf?" >>
Electronic transactions are only as good as the money backing them and there are many, many people that do not use electronic transactions.
I decided to change calling the bathroom the John and renamed it the Jim. I feel so much better saying I went to the Jim this morning.
I guess the state legislature doesn't understand that America is becoming a cashless society. We like to pay our bills with checks, credit cards, and electronic transactions. Utah's concept is ridiculous.
I guess cashless is good if you're the Fed, BoA, Citi, Wells, Merrill, Fannie, Freddie, GE Capital, JPMorgan, Goldman Sachs or Uncle Sam. For the rest - the little people - not so good.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>It isn't complicated at all. Gold or silver is accepted in lieu of fiat dollars at current spot prices to settle any bill. The metals are stored in a small area-safe at the state level temporarily, Brinks who has a Salt Lake location is sub-contracted to make some daily, bi-weeekly or weekly pick-up .....
Well, you are forgetting that there are lots of taxes in Utah and lots of places to pay those taxes. There are property taxes and motor vehicle taxes and many other taxes. So, every city and town is going to need a safe and an arrangement with Brinks? Totally stupid.
Incidentally, I looked at Utah's state tax instructions. They currently favor electronic transfer of funds, which are labor savings. I guess these crazy politicians want to make things a lot more expensive for the citizens of Utah. >>
The only thing stupid about this scenario are the lemmings who refuse to understand that if things happen, they are going to happen very quickly and something needs to be in place to address the outcome.
Just ask Husni Mubarak. Less than a week and he was gone.
I decided to change calling the bathroom the John and renamed it the Jim. I feel so much better saying I went to the Jim this morning.
<< <i>oooooh...another scary fear mongering chart! The evil fed...
Try this for a dose of reality
>>
I'm sorry but when I see a chart based on the "percentage of gross domestic product", my stomach gets queasy. Change the chart to reflect dollars up or down and you wouldn't recognize it as being pertinent to the point under discussion. For one thing, those black lines would mostly change to red and the red lines would run off the chart. This is simply due to inflationary factors skewing the figures. The period after WWII was dramatically inflationary causing Truman's trend to be steeply downward during his administration. That just wasn't true for the national debt based on dollars. Bill Clinton claimed budget surpluses during some years of his term in office. WRONG. I did a search of the internet to determine how he got away with making that claim and found that for every year he served, the national debt increased. This on a .GOV site. True, some years were respectable but nevertheless, billions of dollars had to be borrowed during each of those years to keep the government running.
Then Obamamama comes along with his terminology of "savings of XXX billion dollars" for this and that "every ten years". It sorta looks better that way since the amounts being discussed look much better when you multiply them by ten.
One last observation and I'll go to bed. The USA will never again be free of debt if it continues to require approximately half its income just to pay the interest on that debt.
And that's all I have to say about that. For now.
JT
It is health that is real wealth, not pieces of gold and silver. Gandhi.
I collect all 20th century series except gold including those series that ended there.
>> I'm sorry but when I see a chart based on the "percentage of gross domestic product", my stomach gets queasy
The "percentage of gross domestic product" is the correct way to view this issue. The graph tells you whether the economy (GDP) is growing faster than the nation's debt.
Also, barbershopper, sorry to learn of your stomach ailment.
<< <i> Now, if the lady were to take the same 20 Morgans to pay her State Income Taxes, she'd get silver bullion value for the coins according to the State Law. >>
On the other hand, when she files her Federal Income tax return she should be limited to a income tax deduction of $20 rather than the bullion value of her Morgans. But in reality, the income tax laws would require her to report 28% collectible rate maximum tax rate on long term Capital gains on her "sale" of her 20 Morgans as well as the income tax deduction based on the bullion value of her Morgans.
Thinking this through, in my opinion, the only purpose of this possible new law is to permit an alternative back up method of payment to the State Treasury in case there is a short term failure in our Federal Reserve system and/or cashless society which would also affect the State operations.
It appears to just be an "emergency back up payment system" to me.
The period after WWII was dramatically inflationary causing Truman's trend to be steeply downward during his administration.
Ive been trying to find any fact that substantiates this claim, but under Truman there was not that much inflation. Please show me your data on this.
Bill Clinton claimed budget surpluses during some years of his term in office. WRONG. No, this is true.
Then Obamamama comes along with his terminology of "savings of XXX billion dollars" for this and that "every ten years". It sorta looks better that way since the amounts being discussed look much better when you multiply them by ten. That hasn'e even kicked in yet, so it isn't on the chart.
If you continue the chart from 2008 to today, you would see the costs of the two wars glaringly there for all to see, which under the previous administration it wasn't They kept it "off the books". Thisis the single most important thing to remember when talking about the debt - the accounting, or lack thereof.
The USA will never again be free of debt if it continues to require approximately half its income just to pay the interest on that debt.
Sadly, true, but the only thing that will ever keep us afloat is our GDP, that is why the chart is relevant.
GDP is another skewed government statistic based on how the government calculates it. When the government borrows money, it adds the debt to the GDP, same as when an individual borrows on his credit card not only is the individual going into debt which is only pulling consumption forward from the future. Going into debt for consumption is not a capital investment that will generate income in the future, it only means the debt must be repaid plus the interest at the expense of future consumption. This is the reason you can’t borrow your was to prosperity. Wealth comes from savings and production, yet all this consumption gets added to GDP and the banks lending the money can create 10x the amount borrowed out of thin air to compound the interest they collect on money that never existed in the first place.
In the period from 40’s through 50’s the currency still had a tie to gold and the government went into debt for capital investments in order to produce real products, for the war effort in the 1940’s and then after the war, America was the only country able to produce things. Europe’s productive capacity was decimated from the war, China had yet to go through their industrial revolution, the same for India. America was the leading producer of real goods in the world and prospered from the capital investments made during those years.
The current period ever since we went to a fiat currency after Nixon severed the dollars link to gold in 1972 is much different. The money supply has been expanded exponentially and has allowed the government to pay for its operation by going into debt and borrowing it from the future. This creates a situation where the dollar is continuously losing its purchasing power from being debased, and all the extra money in circulation has led to reckless speculation in seek of yields and thus creating ever growing bubbles that leads to massive busts for which the FED response is to continue inflating in order to continue supporting our economy that is almost 2/3 based on consumption and can no longer support itself from manufacturing since we are no longer the main producer of goods in the world and our manufacturing base has been exported overseas by companies seeking higher profits and thus taking those jobs with them.
This is the reason you can’t borrow your way to prosperity
A lot of what you said in the first paragraph is hogwash, but this looks like your main point. To which, I would strongly disagree, but you are certainly entitled to believe it. Just imagine if you had to save up for your house. If credit tightened to the point to which you are making, the economy would go back to the 1880's. They had a gold standard then. Maybe that's what you want - To lower the standard of living, etc. Not me.
Your third paragraph seems just like a rant against human nature and greed.
It'll be interesting to see what happens to the state economy of Utah when everyone tries to pay their state debts with gold once the price of gold starts to head downward (and yes, it will, eventually).
You'll see a state financial crisis thats going to make California's look like someone shorting you a quarter in change at the quiki-mart....
All of what was said by vann in the first paragraph about GDP was nonsense. I can suggest a good Principles of Macroeconomics book with a GREAT Study Guide (written by an economist with the first name of "Mark") for anyone who would like to actually learn some macroeconomics. And yes, I can guess that there will be a reply to my post with either another rant about how ignorant economists are or about how the government cooks its statistics.
Mark
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED.
<< <i>All of what was said by vann in the first paragraph about GDP was nonsense. I can suggest a good Principles of Macroeconomics book with a GREAT Study Guide (written by an economist with the first name of "Mark") for anyone who would like to actually learn some macroeconomics. And yes, I can guess that there will be a reply to my post with either another rant about how ignorant economists are or about how the government cooks its statistics.
Mark
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED. >>
Really? Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement? Part of the GDP is for government outlays. The part which the government has to borrow and spends on products is added to the GDP. So by the government going into debt, GDP grows even though the debt must be paid back plus interest (or defaulted) in the future, which is the point I was making.
The FED lowering fractional reserve requirements has dramatically increased the money supply and had a direct effect on consumers bidding up prices on items such as tuition, housing. The fact is people bought houses and went to school in the 1950’s and 1960’s shows that it is possible without having to go into perpetual debt.
P.S. As to the secrecy of the FED and its backers, I suggest you read ‘the creature from Jeckell Island’ and 'the road to serfdom’ which is where central planning is leading us.
Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement?
Okay. Here's your shortcoming. GDP is not "another skewed government statistic" as you said. Gross Domestic Product is calculated the same way for all countries. GDP was originally created in 1934, and the definition has not changed. The US government does not have any special way to calculate GDP, and there are multiple formulas that all give the same result. GDP refers to the market value of all goods and services produced in a country for a given time period (usually a year). GDP is a measurement of economic activity, and it's a good measurement. You should not dismiss data simply because the data are inconsistent with your viewpoints.
<< <i>Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement?
Okay. Here's your shortcoming. GDP is not "another skewed government statistic" as you said. Gross Domestic Product is calculated the same way for all countries. GDP was originally created in 1934, and the definition has not changed. The US government does not have any special way to calculate GDP, and there are multiple formulas that all give the same result. GDP refers to the market value of all goods and services produced in a country for a given time period (usually a year). GDP is a measurement of economic activity, and it's a good measurement. You should not dismiss data simply because the data are inconsistent with your viewpoints. >>
The GDP calculation only reflects the data that is used. As the US GDP chart shows below, Consumer and government consumption on goods is a factor in the calculation. Although dropping, consumer credit spending is a large part of that figure, the government through deficit spending has offset a large part of the consumer credit drop off. Spending on credit has an impact on future ability to spend because the debt must be repaid plus interest and therefore is not the same as paying for consumption without borrowing, yet the GDP calculation makes no distinction between the two types.
<< <i>All of what was said by vann in the first paragraph about GDP was nonsense. I can suggest a good Principles of Macroeconomics book with a GREAT Study Guide (written by an economist with the first name of "Mark") for anyone who would like to actually learn some macroeconomics. And yes, I can guess that there will be a reply to my post with either another rant about how ignorant economists are or about how the government cooks its statistics.
Mark
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED. >>
Yes, please recommend the book. I wouldn't mind looking into it, truth be told.
<< <i>Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement?
Okay. Here's your shortcoming. GDP is not "another skewed government statistic" as you said. Gross Domestic Product is calculated the same way for all countries. GDP was originally created in 1934, and the definition has not changed. The US government does not have any special way to calculate GDP, and there are multiple formulas that all give the same result. GDP refers to the market value of all goods and services produced in a country for a given time period (usually a year). GDP is a measurement of economic activity, and it's a good measurement. You should not dismiss data simply because the data are inconsistent with your viewpoints. >>
The GDP calculation only reflects the data that is used. As the US GDP chart shows below, Consumer and government consumption on goods is a factor in the calculation. Although dropping, consumer credit spending is a large part of that figure, the government through deficit spending has offset a large part of the consumer credit drop off. Spending on credit has an impact on future ability to spend because the debt must be repaid plus interest and therefore is not the same as paying for consumption without borrowing, yet the GDP calculation makes no distinction between the two types. >>
While it may be true that GDP measures some things and not others, do you reject that idea that the GNP is a good measure of economic activity?
Economic activity is economic activity, regardless of whether it is debt driven (from nasty people going into debt buying houses), from Government sources (those nasty government jobs), or from you and me.
<< <i>Economic activity is economic activity, regardless of whether it is debt driven (from nasty people going into debt buying houses), from Government sources (those nasty government jobs), or from you and me. >>
While it may be true that GDP measures some things and not others, do you reject that idea that the GNP is a good measure of economic activity? >>
IMO, consumer and government deficit (credit) spending skews the present outcome at the expense of future production and therefore is not as reliable as the GDP calculation in most other parts of the world where the amount of spending for consumption on credit is nowhere near as prevalent as it is here. In essence the US has a unique position in being able to use consumption pulled forward by credit as an indicator of current economic activity.
Whether that is the case or not for the majority of Americans is certainly debatable. Either way, it does nothing to address this chart.
The current debate in congress over 6 billion dollars in budget cuts for what is a $4,000 billion dollar budget problem shows the will is not there to address the issue either. Which is why I feel the states are looking to address the issue themselves.
It's amazing that people can't grasp that in a recession when people stop spending, companies stop spending, the very worst thing that could happen is for the government to stop spending. The Federal Reserve has done a reasonable job in smoothing out the booms and busts that plagued the 1800s
I was at the Fort Worth Coin Club show this weekend and a group of 4 or 5 MAJOR regional dealers were standing around the doughnuts and coffee SERIOUSLY discussing how Obama and the Fed and the Jews and the Rothchilds were all in a big conspiracy to purposely crash the economy.
A lot of coin dealers really need a couple of semesters of college level economics.
Frank Provasek - PCGS Authorized Dealer, Life Member ANA, Member TNA. www.frankcoins.com
<< <i>It's amazing that people can't grasp that in a recession when people stop spending, companies stop spending, the very worst thing that could happen is for the government to stop spending. The Federal Reserve has done a reasonable job in smoothing out the booms and busts that plagued the 1800s
I was at the Fort Worth Coin Club show this weekend and a group of 4 or 5 MAJOR regional dealers were standing around the doughnuts and coffee SERIOUSLY discussing how Obama and the Fed and the Jews and the Rothchilds were all in a big conspiracy to purposely crash the economy.
A lot of coin dealers really need a couple of semesters of college level economics. >>
This is chilling to read. Where are we, interwar Germany?
The current debate in congress over 6 billion dollars in budget cuts for what is a $4,000 billion dollar budget problem shows the will is not there to address the issue either. Which is why I feel the states are looking to address the issue themselves
Okay. This thread is about Utah's proposed law that will allow its citizens to pay their taxes in gold (and silver) bullion coins. Paying state taxes with gold and/or silver coins has absolutely no impact on the federal deficit. None.
<< <i> The current debate in congress over 6 billion dollars in budget cuts for what is a $4,000 billion dollar budget problem shows the will is not there to address the issue either. Which is why I feel the states are looking to address the issue themselves
Okay. This thread is about Utah's proposed law that will allow its citizens to pay their taxes in gold (and silver) bullion coins. Paying state taxes with gold and/or silver coins has absolutely no impact on the federal deficit. None. >>
The proposed Utah legislation is more than just being able to pay for your state taxes with bullion. In essence, it expands the federal governments definition of legal tender to recognize gold and silver and allows individuals to legally enter into a transaction or contractual obligation using gold and silver as payment if they choose. It also establishes a committee to evaluate alternative currencies for the state and exempts bullion from capital gains tax. The lack of addressing the deficit issue by the executive and legislative branches of the federal government is what I was suggesting is prompting states to take action against a further devaluation of the dollar.
The lack of addressing the deficit issue by the executive and legislative branches of the federal government is what I was suggesting is prompting states to take action against a further devaluation of the dollar.
I can't see any way that a few barter transactions with bullion coins in Utah will have any impact on the value of the dollar. Also, a few barter transactions in gold (or silver) bullion will have no impact on the amount of the federal deficit.
Are you suggesting that this bizarre legislation is somehow an act of defiance?
I can't see any way that a few barter transactions with bullion coins in Utah will have any impact on the value of the dollar. Also, a few barter transactions in gold (or silver) bullion will have no impact on the amount of the federal deficit.
Are you suggesting that this bizarre legislation is somehow an act of defiance? >>
What I am suggesting is that states are looking for ways to protect themselves against a further devaluation in the dollar, of which the runaway deficit spending by the federal government through ever increasing budget deficits and 'QE' (i.e. create money out of thin air) by the FED are certainly a contributing factor. The Utah legislation by essentially monetizing gold and silver is one example of such action. Also, being approved by an overwhelming majority in the Utah state house suggests it's more than 'a few barter transactions', the other part being they are looking for alternative currencies for the state.
In other parts of the world, it is not uncommon for countries going through a devaluation of their currency to seek alternative methods of exchange for use in transactions and contractual obligations. In addition to their local currency, many countries in South America recognize contracts written is US dollars as a legal contractual obligation. Just like the dollar is recognized as a hedge against devaluation of the local currency in some countries, the legislation Utah is seeking to enact is seeking to establish gold and silver as a hedge against a devaluation of the dollar in the state of Utah.
...the legislation Utah is seeking to enact is seeking to establish gold and silver as a hedge against a devaluation of the dollar in the state of Utah.
Actually, no. This legislation does not create a hedge against the dollar. If the state simply allows a few citizens to pay their taxes with gold coins, it really isn't accomplishing anything except incurring transaction expenses. If the state of Utah really wanted to hedge the dollar, the citizens could authorize the state to purchase (and retain) a significant amount of gold or silver. Alternatively, the citizens of Utah could authorize the state to engage in signficant currency hedge transactions.
<< <i>...the legislation Utah is seeking to enact is seeking to establish gold and silver as a hedge against a devaluation of the dollar in the state of Utah.
Actually, no. This legislation does not create a hedge against the dollar. If the state simply allows a few citizens to pay their taxes with gold coins, it really isn't accomplishing anything except incurring transaction expenses. If the state of Utah really wanted to hedge the dollar, the citizens could authorize the state to purchase (and retain) a significant amount of gold or silver. Alternatively, the citizens of Utah could authorize the state to engage in signficant currency hedge transactions. >>
Recognizing US minted gold and silver coins as legal tender for debts, transactions and contracts in the state of Utah establishes a legally recognized alternative to the US dollar for individuals agreeing to use that option amongst themselves or with the state. In essence, gold and silver coins would be a competing currency with the US dollar that individuals in the state of Utah have the option of using as an alternative to transacting in US dollars if it suits their needs. Since the coins being recognized are US minted gold and silver coins, the production costs for the state are zero and once the exchange is established, the transaction costs for using gold and silver coins are really no different than using any other form of currency. The costs for the state would be similar to handling US dollars as well.
It might get tried in the courts again though when some fool tries to pay their workers in $50 AGE's and declare only $50 for payroll purposes like happened a few years ago in California.
Tir nam beann, nan gleann, s'nan gaisgeach ~ Saorstat Albanaich a nis!
<< <i>It might get tried in the courts again though when some fool tries to pay their workers in $50 AGE's and declare only $50 for payroll purposes like happened a few years ago in California. >>
That, IMO, should have been tried in court since it is an obvious attempt at defrauding the US Government by avoiding payroll, social security and income taxes.
Similar to the folks on eBay that sell a $200 coin for .01 cents and then charge $199.99 in shipping fees.
I decided to change calling the bathroom the John and renamed it the Jim. I feel so much better saying I went to the Jim this morning.
<< <i>Today, the Utah Senate passed HB317, a bill which will legalize gold and silver as tender within the state of Utah and exempt the exchange (purchase) of such specie from sales and capital gains taxes. Having already passed the House, the bill will now be sent to Governor Herbert to be signed into law, should he so decide. >>
The federal government is obviously out of control and something needs to be done. What the federal government is doing to us and our financial system is a travesty of monumental proportions and an absolute disgrace - they really should be ashamed of themselves.
What many in the public don't comprehend, is that the Feds rampant printing of money which of course devalues the currency, is actually a form of a tax increase. When currency is of lesser value, then people with their devalued currency, cannot buy as many goods and services as they could before because of inflation. Same thing as a tax increase takes away people's money and so they cannot buy as many goods and services as they could before.
It's a total sham that the current politicians in charge the past few years, usually say that they haven't raised taxes, when in fact they have passed on an enormous tax increase to us all.
What many in the public don't comprehend, is that the Feds rampant printing of money which of course devalues the currency, is actually a form of a tax increase. When currency is of lesser value, then people with their devalued currency, cannot buy as many goods and services as they could before because of inflation. Same thing as a tax increase takes away people's money and so they cannot buy as many goods and services as they could before
Actually there is a reason that the pubic doesn't "comprehend...that the Feds rampart printing of money...devalues the currency". Here's the reason. Your statement is not accurate.
First, "inflation" is a different than "devaluation". "Devaluation" involves the relationship between the value of the dollar with the value of other currencies. Devaluation does not necessarily cause inflation, and devaluation is not necessarily caused by expansion of the money supply.
Also, your view that inflation is taking people's money away is mis-informed. You are ignoring the deflation in housing values that has harmed millions of Americans. Right now, many American would be very happy to see re-inflation of housing values. It's important to remember that most Americans are debtors. If you have secured debts (like a mortgage), your wealth could increase with inflation.
<< <i>The US government currently issues it's own coins. Why not have the government directly issue enough of it's money interest free for it's operation? What is so good about a fiat currency system that deprives it's people of their purchasing power through it's continual debasement at the benefit of the bankers that create the money out of thin air through fractional reserve banking? The current FED run monetary system creates boom and bust cycles on the back of ever increasing debt which is impossible to pay back because the money to repay the debt plus the interest doesn't exist. >>
Vann, why do you keep typing "FED" like it's an acronym?
Frank Provasek - PCGS Authorized Dealer, Life Member ANA, Member TNA. www.frankcoins.com
Allow me to quote myself: PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED.
Other than this "reason," I have no idea why people refer to the Fed as the FED.
The Utah House was to vote as early as Thursday on legislation that would recognize gold and silver coins issued by the federal government as legal currency in the state. The coins would not replace the current paper currency but would be used and accepted voluntarily as an alternative.
You don't need a Utah law to do that now if you're stupid enough to do it.
7 LONG TITLE 8 General Description: 9 This bill recognizes gold and silver coins that are issued by the federal government as 10 legal tender in the state and exempts the exchange of the coins from certain types of 11 state tax liability. 12 Highlighted Provisions: 13 This bill: 14 . provides definitions; 15 . recognizes gold and silver coins issued by the federal government to be legal tender 16 in the state; 17 . does not compel a person to tender or accept gold and silver coin; 18 . provides that the exchange of gold and silver coins for another form of legal tender 19 does not create any individual income or sales tax liability; 20 . requires the Revenue and Taxation Interim Committee to: 21 . study the possibility of establishing an alternative form of legal tender; 22 . recommend whether an alternative form of legal tender should be established; 23 and 24 . prepare any recommended legislation for the 2012 General Session; and 25 . enacts an uncodified severability clause.
It says that US coins made of gold and silver are STILL legal tender.
it also says that you don't have to accept gold and silver coins for face value.
This type of bill is one that is becoming increasingly popular throughout the country, with multiple states introducing and considering such legislation. Though Utah is now the first state to have a legislature approve of the idea, the sustained momentum of getting other states to review the proposal demonstrates the resiliency of the campaign for sound money. With the U.S. Dollar plummeting in value, this is an issue that will become more popular as time goes on.
Demonstrates that a bill that does nothing will get resounding approval.
<< <i>The federal government is obviously out of control and something needs to be done. What the federal government is doing to us and our financial system is a travesty of monumental proportions and an absolute disgrace - they really should be ashamed of themselves. >>
This is just nonsense. There has been no out of control period in the past 20 years EXCEPT the ruinious DEFLATION SPIRAL of the first half of 2009. Reputable economists of either political party will confirm that the Bush TARP and Obama stimulus avoided a financial catastrophe.
Frank Provasek - PCGS Authorized Dealer, Life Member ANA, Member TNA. www.frankcoins.com
Comments
Well, you are forgetting that there are lots of taxes in Utah and lots of places to pay those taxes. There are property taxes and motor vehicle taxes and many other taxes. So, every city and town is going to need a safe and an arrangement with Brinks? Totally stupid.
Incidentally, I looked at Utah's state tax instructions. They currently favor electronic transfer of funds, which are labor savings. I guess these crazy politicians want to make things a lot more expensive for the citizens of Utah.
<< <i>Other than the building of the storehouse I don't really see any additional costs since the "Utah Defense Force" will more than likely be made up of folks already on the States payroll
The legislation calls for an armed militia to guard the gold and silver. You can't just choose "folks" already on the state's payroll. Somebody needs to train these people to become part of a militia. It will need to operate 24 hours per day.
I don't think the program would be really that popular unless something disastrous would occur with the National Economy but if it did, then the State is legally positioned to react.
That's why this program is so stupid. The program won't be popular, but the state will still have to incur all of the expenses for the storehouse, the militia, and for setting up the processes to accept the metals. Even if only one person pays their income tax in gold, the state needs to have a process in place to calculate the value of gold, provide appropriate receipts, and securely transport the gold to the storehouse (probably using guards). Every taxing authority will need to be changed to accommodate this ridiculous option.
I guess the state legislature doesn't understand that America is becoming a cashless society. We like to pay our bills with checks, credit cards, and electronic transactions. Utah's concept is ridiculous. >>
Oh pooh! The Utah National Guard is already well trained and well armed. Exactly how many folks would it take anyway unless of course you're envisioning a Ft. Knox scenario which is totally off the mark? Any Militia formed to enact this legislation is already on the States payroll and simply amounts to a transfer of current duties.
As for the so called "stupidity" of the law, states cannot do ANYTHING without the backing of approved law and Utah is simply positioning themselves to address the possibility. There's nothing wrong with planning ahead.
The name is LEE!
<< <i>
<< <i>I guess the state legislature doesn't understand that America is becoming a cashless society. We like to pay our bills with checks, credit cards, and electronic transactions. Utah's concept is ridiculous. >>
Definitely. Young folks have no concept of precious metals coins in commerce. They'd be like: "wtf?" >>
Electronic transactions are only as good as the money backing them and there are many, many people that do not use electronic transactions.
The name is LEE!
I guess cashless is good if you're the Fed, BoA, Citi, Wells, Merrill, Fannie, Freddie, GE Capital, JPMorgan, Goldman Sachs or Uncle Sam. For the rest - the little people - not so good.
I knew it would happen.
<< <i>It isn't complicated at all. Gold or silver is accepted in lieu of fiat dollars at current spot prices to settle any bill. The metals are stored in a small area-safe at the state level temporarily, Brinks who has a Salt Lake location is sub-contracted to make some daily, bi-weeekly or weekly pick-up .....
Well, you are forgetting that there are lots of taxes in Utah and lots of places to pay those taxes. There are property taxes and motor vehicle taxes and many other taxes. So, every city and town is going to need a safe and an arrangement with Brinks? Totally stupid.
Incidentally, I looked at Utah's state tax instructions. They currently favor electronic transfer of funds, which are labor savings. I guess these crazy politicians want to make things a lot more expensive for the citizens of Utah. >>
The only thing stupid about this scenario are the lemmings who refuse to understand that if things happen, they are going to happen very quickly and something needs to be in place to address the outcome.
Just ask Husni Mubarak. Less than a week and he was gone.
The name is LEE!
<< <i>oooooh...another scary fear mongering chart! The evil fed...
Try this for a dose of reality
I'm sorry but when I see a chart based on the "percentage of gross domestic product", my stomach gets queasy.
Change the chart to reflect dollars up or down and you wouldn't recognize it as being pertinent to the point under discussion.
For one thing, those black lines would mostly change to red and the red lines would run off the chart. This is simply due to inflationary factors skewing the figures.
The period after WWII was dramatically inflationary causing Truman's trend to be steeply downward during his administration. That just wasn't true for the national
debt based on dollars. Bill Clinton claimed budget surpluses during some years of his term in office. WRONG.
I did a search of the internet to determine how he got away with making that claim and found that for every year he served, the national debt increased. This on a .GOV site.
True, some years were respectable but nevertheless, billions of dollars had to be borrowed during each of those years to keep the government running.
Then Obamamama comes along with his terminology of "savings of XXX billion dollars" for this and that "every ten years". It sorta looks better that way since the amounts
being discussed look much better when you multiply them by ten.
One last observation and I'll go to bed.
The USA will never again be free of debt if it continues to require approximately half its income just to pay the interest on that debt.
And that's all I have to say about that. For now.
JT
I collect all 20th century series except gold including those series that ended there.
The "percentage of gross domestic product" is the correct way to view this issue. The graph tells you whether the economy (GDP) is growing faster than the nation's debt.
Also, barbershopper, sorry to learn of your stomach ailment.
<< <i> Now, if the lady were to take the same 20 Morgans to pay her State Income Taxes, she'd get silver bullion value for the coins according to the State Law. >>
On the other hand, when she files her Federal Income tax return she should be limited to a income tax deduction of $20 rather than the bullion value of her Morgans. But in reality, the income tax laws would require her to report 28% collectible rate maximum tax rate on long term Capital gains on her "sale" of her 20 Morgans as well as the income tax deduction based on the bullion value of her Morgans.
Thinking this through, in my opinion, the only purpose of this possible new law is to permit an alternative back up method of payment to the State Treasury in case there is a short term failure in our Federal Reserve system and/or cashless society which would also affect the State operations.
It appears to just be an "emergency back up payment system" to me.
Ive been trying to find any fact that substantiates this claim, but under Truman there was not that much inflation. Please show me your data on this.
Bill Clinton claimed budget surpluses during some years of his term in office. WRONG. No, this is true.
Then Obamamama comes along with his terminology of "savings of XXX billion dollars" for this and that "every ten years". It sorta looks better that way since the amounts
being discussed look much better when you multiply them by ten. That hasn'e even kicked in yet, so it isn't on the chart.
If you continue the chart from 2008 to today, you would see the costs of the two wars glaringly there for all to see, which under the previous administration it wasn't They kept it "off the books". Thisis the single most important thing to remember when talking about the debt - the accounting, or lack thereof.
The USA will never again be free of debt if it continues to require approximately half its income just to pay the interest on that debt.
Sadly, true, but the only thing that will ever keep us afloat is our GDP, that is why the chart is relevant.
In the period from 40’s through 50’s the currency still had a tie to gold and the government went into debt for capital investments in order to produce real products, for the war effort in the 1940’s and then after the war, America was the only country able to produce things. Europe’s productive capacity was decimated from the war, China had yet to go through their industrial revolution, the same for India. America was the leading producer of real goods in the world and prospered from the capital investments made during those years.
The current period ever since we went to a fiat currency after Nixon severed the dollars link to gold in 1972 is much different. The money supply has been expanded exponentially and has allowed the government to pay for its operation by going into debt and borrowing it from the future. This creates a situation where the dollar is continuously losing its purchasing power from being debased, and all the extra money in circulation has led to reckless speculation in seek of yields and thus creating ever growing bubbles that leads to massive busts for which the FED response is to continue inflating in order to continue supporting our economy that is almost 2/3 based on consumption and can no longer support itself from manufacturing since we are no longer the main producer of goods in the world and our manufacturing base has been exported overseas by companies seeking higher profits and thus taking those jobs with them.
A lot of what you said in the first paragraph is hogwash, but this looks like your main point. To which, I would strongly disagree, but you are certainly entitled to believe it. Just imagine if you had to save up for your house. If credit tightened to the point to which you are making, the economy would go back to the 1880's. They had a gold standard then. Maybe that's what you want - To lower the standard of living, etc. Not me.
Your third paragraph seems just like a rant against human nature and greed.
You'll see a state financial crisis thats going to make California's look like someone shorting you a quarter in change at the quiki-mart....
Mark
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED.
<< <i>All of what was said by vann in the first paragraph about GDP was nonsense. I can suggest a good Principles of Macroeconomics book with a GREAT Study Guide (written by an economist with the first name of "Mark") for anyone who would like to actually learn some macroeconomics. And yes, I can guess that there will be a reply to my post with either another rant about how ignorant economists are or about how the government cooks its statistics.
Mark
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED. >>
Really? Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement? Part of the GDP is for government outlays. The part which the government has to borrow and spends on products is added to the GDP. So by the government going into debt, GDP grows even though the debt must be paid back plus interest (or defaulted) in the future, which is the point I was making.
The FED lowering fractional reserve requirements has dramatically increased the money supply and had a direct effect on consumers bidding up prices on items such as tuition, housing. The fact is people bought houses and went to school in the 1950’s and 1960’s shows that it is possible without having to go into perpetual debt.
P.S. As to the secrecy of the FED and its backers, I suggest you read ‘the creature from Jeckell Island’ and 'the road to serfdom’ which is where central planning is leading us.
Okay. Here's your shortcoming. GDP is not "another skewed government statistic" as you said. Gross Domestic Product is calculated the same way for all countries. GDP was originally created in 1934, and the definition has not changed. The US government does not have any special way to calculate GDP, and there are multiple formulas that all give the same result. GDP refers to the market value of all goods and services produced in a country for a given time period (usually a year). GDP is a measurement of economic activity, and it's a good measurement. You should not dismiss data simply because the data are inconsistent with your viewpoints.
<< <i>Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement?
Okay. Here's your shortcoming. GDP is not "another skewed government statistic" as you said. Gross Domestic Product is calculated the same way for all countries. GDP was originally created in 1934, and the definition has not changed. The US government does not have any special way to calculate GDP, and there are multiple formulas that all give the same result. GDP refers to the market value of all goods and services produced in a country for a given time period (usually a year). GDP is a measurement of economic activity, and it's a good measurement. You should not dismiss data simply because the data are inconsistent with your viewpoints. >>
The GDP calculation only reflects the data that is used. As the US GDP chart shows below, Consumer and government consumption on goods is a factor in the calculation. Although dropping, consumer credit spending is a large part of that figure, the government through deficit spending has offset a large part of the consumer credit drop off. Spending on credit has an impact on future ability to spend because the debt must be repaid plus interest and therefore is not the same as paying for consumption without borrowing, yet the GDP calculation makes no distinction between the two types.
<< <i>All of what was said by vann in the first paragraph about GDP was nonsense. I can suggest a good Principles of Macroeconomics book with a GREAT Study Guide (written by an economist with the first name of "Mark") for anyone who would like to actually learn some macroeconomics. And yes, I can guess that there will be a reply to my post with either another rant about how ignorant economists are or about how the government cooks its statistics.
Mark
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED. >>
Yes, please recommend the book. I wouldn't mind looking into it, truth be told.
<< <i>
<< <i>Rather than simply dismissing my arguments, how about pointing out the shortcomings of the statement?
Okay. Here's your shortcoming. GDP is not "another skewed government statistic" as you said. Gross Domestic Product is calculated the same way for all countries. GDP was originally created in 1934, and the definition has not changed. The US government does not have any special way to calculate GDP, and there are multiple formulas that all give the same result. GDP refers to the market value of all goods and services produced in a country for a given time period (usually a year). GDP is a measurement of economic activity, and it's a good measurement. You should not dismiss data simply because the data are inconsistent with your viewpoints. >>
The GDP calculation only reflects the data that is used. As the US GDP chart shows below, Consumer and government consumption on goods is a factor in the calculation. Although dropping, consumer credit spending is a large part of that figure, the government through deficit spending has offset a large part of the consumer credit drop off. Spending on credit has an impact on future ability to spend because the debt must be repaid plus interest and therefore is not the same as paying for consumption without borrowing, yet the GDP calculation makes no distinction between the two types. >>
While it may be true that GDP measures some things and not others, do you reject that idea that the GNP is a good measure of economic activity?
<< <i>Economic activity is economic activity, regardless of whether it is debt driven (from nasty people going into debt buying houses), from Government sources (those nasty government jobs), or from you and me. >>
Exactly.
<< <i>
While it may be true that GDP measures some things and not others, do you reject that idea that the GNP is a good measure of economic activity? >>
IMO, consumer and government deficit (credit) spending skews the present outcome at the expense of future production and therefore is not as reliable as the GDP calculation in most other parts of the world where the amount of spending for consumption on credit is nowhere near as prevalent as it is here. In essence the US has a unique position in being able to use consumption pulled forward by credit as an indicator of current economic activity.
100% Positive BST transactions
The recession is over
<< <i>Yes, thanks for the chart. Look at the change in Private Inventories. This is a good indicator that the economy is rebounding nicely.
The recession is over >>
Whether that is the case or not for the majority of Americans is certainly debatable. Either way, it does nothing to address this chart.
The current debate in congress over 6 billion dollars in budget cuts for what is a $4,000 billion dollar budget problem shows the will is not there to address the issue either. Which is why I feel the states are looking to address the issue themselves.
Financial Panics of the 19th Century
I was at the Fort Worth Coin Club show this weekend and a group of 4 or 5 MAJOR regional dealers were standing around
the doughnuts and coffee SERIOUSLY discussing how Obama and the Fed and the Jews and the Rothchilds were all in a big conspiracy
to purposely crash the economy.
A lot of coin dealers really need a couple of semesters of college level economics.
<< <i>It's amazing that people can't grasp that in a recession when people stop spending, companies stop spending, the very worst thing that could happen is for the government to stop spending. The Federal Reserve has done a reasonable job in smoothing out the booms and busts that plagued the 1800s
Financial Panics of the 19th Century
I was at the Fort Worth Coin Club show this weekend and a group of 4 or 5 MAJOR regional dealers were standing around
the doughnuts and coffee SERIOUSLY discussing how Obama and the Fed and the Jews and the Rothchilds were all in a big conspiracy
to purposely crash the economy.
A lot of coin dealers really need a couple of semesters of college level economics. >>
This is chilling to read. Where are we, interwar Germany?
Okay. This thread is about Utah's proposed law that will allow its citizens to pay their taxes in gold (and silver) bullion coins. Paying state taxes with gold and/or silver coins has absolutely no impact on the federal deficit. None.
<< <i> The current debate in congress over 6 billion dollars in budget cuts for what is a $4,000 billion dollar budget problem shows the will is not there to address the issue either. Which is why I feel the states are looking to address the issue themselves
Okay. This thread is about Utah's proposed law that will allow its citizens to pay their taxes in gold (and silver) bullion coins. Paying state taxes with gold and/or silver coins has absolutely no impact on the federal deficit. None. >>
The proposed Utah legislation is more than just being able to pay for your state taxes with bullion. In essence, it expands the federal governments definition of legal tender to recognize gold and silver and allows individuals to legally enter into a transaction or contractual obligation using gold and silver as payment if they choose. It also establishes a committee to evaluate alternative currencies for the state and exempts bullion from capital gains tax. The lack of addressing the deficit issue by the executive and legislative branches of the federal government is what I was suggesting is prompting states to take action against a further devaluation of the dollar.
I can't see any way that a few barter transactions with bullion coins in Utah will have any impact on the value of the dollar. Also, a few barter transactions in gold (or silver) bullion will have no impact on the amount of the federal deficit.
Are you suggesting that this bizarre legislation is somehow an act of defiance?
<< <i>
I can't see any way that a few barter transactions with bullion coins in Utah will have any impact on the value of the dollar. Also, a few barter transactions in gold (or silver) bullion will have no impact on the amount of the federal deficit.
Are you suggesting that this bizarre legislation is somehow an act of defiance? >>
What I am suggesting is that states are looking for ways to protect themselves against a further devaluation in the dollar, of which the runaway deficit spending by the federal government through ever increasing budget deficits and 'QE' (i.e. create money out of thin air) by the FED are certainly a contributing factor. The Utah legislation by essentially monetizing gold and silver is one example of such action. Also, being approved by an overwhelming majority in the Utah state house suggests it's more than 'a few barter transactions', the other part being they are looking for alternative currencies for the state.
In other parts of the world, it is not uncommon for countries going through a devaluation of their currency to seek alternative methods of exchange for use in transactions and contractual obligations. In addition to their local currency, many countries in South America recognize contracts written is US dollars as a legal contractual obligation. Just like the dollar is recognized as a hedge against devaluation of the local currency in some countries, the legislation Utah is seeking to enact is seeking to establish gold and silver as a hedge against a devaluation of the dollar in the state of Utah.
Actually, no. This legislation does not create a hedge against the dollar. If the state simply allows a few citizens to pay their taxes with gold coins, it really isn't accomplishing anything except incurring transaction expenses. If the state of Utah really wanted to hedge the dollar, the citizens could authorize the state to purchase (and retain) a significant amount of gold or silver. Alternatively, the citizens of Utah could authorize the state to engage in signficant currency hedge transactions.
<< <i>...the legislation Utah is seeking to enact is seeking to establish gold and silver as a hedge against a devaluation of the dollar in the state of Utah.
Actually, no. This legislation does not create a hedge against the dollar. If the state simply allows a few citizens to pay their taxes with gold coins, it really isn't accomplishing anything except incurring transaction expenses. If the state of Utah really wanted to hedge the dollar, the citizens could authorize the state to purchase (and retain) a significant amount of gold or silver. Alternatively, the citizens of Utah could authorize the state to engage in signficant currency hedge transactions. >>
Recognizing US minted gold and silver coins as legal tender for debts, transactions and contracts in the state of Utah establishes a legally recognized alternative to the US dollar for individuals agreeing to use that option amongst themselves or with the state. In essence, gold and silver coins would be a competing currency with the US dollar that individuals in the state of Utah have the option of using as an alternative to transacting in US dollars if it suits their needs. Since the coins being recognized are US minted gold and silver coins, the production costs for the state are zero and once the exchange is established, the transaction costs for using gold and silver coins are really no different than using any other form of currency. The costs for the state would be similar to handling US dollars as well.
<< <i>It might get tried in the courts again though when some fool tries to pay their workers in $50 AGE's and declare only $50 for payroll purposes like happened a few years ago in California. >>
That, IMO, should have been tried in court since it is an obvious attempt at defrauding the US Government by avoiding payroll, social security and income taxes.
Similar to the folks on eBay that sell a $200 coin for .01 cents and then charge $199.99 in shipping fees.
The name is LEE!
<< <i>Today, the Utah Senate passed HB317, a bill which will legalize gold and silver as tender within the state of Utah and exempt the exchange (purchase) of such specie from sales and capital gains taxes. Having already passed the House, the bill will now be sent to Governor Herbert to be signed into law, should he so decide. >>
More info on the Sound Money Movement:
http://utahsoundmoney.org/
What many in the public don't comprehend, is that the Feds rampant printing of money which of course devalues the currency, is actually a form of a tax increase. When currency is of lesser value, then people with their devalued currency, cannot buy as many goods and services as they could before because of inflation. Same thing as a tax increase takes away people's money and so they cannot buy as many goods and services as they could before.
It's a total sham that the current politicians in charge the past few years, usually say that they haven't raised taxes, when in fact they have passed on an enormous tax increase to us all.
Actually there is a reason that the pubic doesn't "comprehend...that the Feds rampart printing of money...devalues the currency". Here's the reason. Your statement is not accurate.
First, "inflation" is a different than "devaluation". "Devaluation" involves the relationship between the value of the dollar with the value of other currencies. Devaluation does not necessarily cause inflation, and devaluation is not necessarily caused by expansion of the money supply.
Also, your view that inflation is taking people's money away is mis-informed. You are ignoring the deflation in housing values that has harmed millions of Americans. Right now, many American would be very happy to see re-inflation of housing values. It's important to remember that most Americans are debtors. If you have secured debts (like a mortgage), your wealth could increase with inflation.
<< <i>The US government currently issues it's own coins. Why not have the government directly issue enough of it's money interest free for it's operation? What is so good about a fiat currency system that deprives it's people of their purchasing power through it's continual debasement at the benefit of the bankers that create the money out of thin air through fractional reserve banking? The current FED run monetary system creates boom and bust cycles on the back of ever increasing debt which is impossible to pay back because the money to repay the debt plus the interest doesn't exist.
>>
Vann, why do you keep typing "FED" like it's an acronym?
Allow me to quote myself:
PS: It always seems as if people who view the Federal Reserve as some sort of deep, dark privately run conspiracy refer to it in all capitals, as the FED.
Other than this "reason," I have no idea why people refer to the Fed as the FED.
You don't need a Utah law to do that now if you're stupid enough to do it.
Read the bill
7 LONG TITLE
8 General Description:
9 This bill recognizes gold and silver coins that are issued by the federal government as
10 legal tender in the state and exempts the exchange of the coins from certain types of
11 state tax liability.
12 Highlighted Provisions:
13 This bill:
14 . provides definitions;
15 . recognizes gold and silver coins issued by the federal government to be legal tender
16 in the state;
17 . does not compel a person to tender or accept gold and silver coin;
18 . provides that the exchange of gold and silver coins for another form of legal tender
19 does not create any individual income or sales tax liability;
20 . requires the Revenue and Taxation Interim Committee to:
21 . study the possibility of establishing an alternative form of legal tender;
22 . recommend whether an alternative form of legal tender should be established;
23 and
24 . prepare any recommended legislation for the 2012 General Session; and
25 . enacts an uncodified severability clause.
It says that US coins made of gold and silver are STILL legal tender.
it also says that you don't have to accept gold and silver coins for face value.
Wow! this is big news.
Vann's link to the "sound money" fringe media
This type of bill is one that is becoming increasingly popular throughout the country, with multiple states introducing and considering such legislation. Though Utah is now the first state to have a legislature approve of the idea, the sustained momentum of getting other states to review the proposal demonstrates the resiliency of the campaign for sound money. With the U.S. Dollar plummeting in value, this is an issue that will become more popular as time goes on.
Demonstrates that a bill that does nothing will get resounding approval.
<< <i>The federal government is obviously out of control and something needs to be done. What the federal government is doing to us and our financial system is a travesty of monumental proportions and an absolute disgrace - they really should be ashamed of themselves. >>
This is just nonsense. There has been no out of control period in the past 20 years
EXCEPT the ruinious DEFLATION SPIRAL of the first half of 2009. Reputable economists of
either political party will confirm that the Bush TARP and Obama stimulus avoided a financial
catastrophe.
Spend your gold and silver in Utah