Gold, silver coins to be legal currency in Utah
SALT LAKE CITY (AP) -- Utah legislators want to see the dollar regain its former glory, back to the days when one could literally bank on it being "as good as gold."
To make that point, they've turned it around, and made gold as good as cash. Utah became the first state in the country this month to legalize gold and silver coins as currency. The law also will exempt the sale of the coins from state capital gains taxes.
Craig Franco hopes to cash in on it with his Utah Gold and Silver Depository, and he thinks others will soon follow.
The idea is simple: Store your gold and silver coins in a vault, and Franco issues a debit-like card to make purchases backed by your holdings.
He plans to open for business June 1, likely the first of its kind in the country.
"Because we're dealing with something so forward thinking, I expect a wait-and-see attitude," Franco said. "Once the depository is executed and transactions can occur, then I think people will move into the marketplace."
The idea was spawned by Republican state Rep. Brad Galvez, who sponsored the bill largely to serve as a protest against Federal Reserve monetary policy. Galvez says Americans are losing faith in the dollar. If you're mad about government debt, ditch the cash. Spend your gold and silver, he says.
His idea isn't to return to the gold standard, when the dollar was backed by gold instead of government goodwill. Instead, he just wanted to create options for consumers.
"We're too far down the road to go back to the gold standard," Galvez said. "This will move us toward an alternative currency."
Earlier this month, Minnesota took a step closer to joining Utah in making gold and silver legal tender. A Republican lawmaker there introduced a bill that sets up a special committee to explore the option. North Carolina, Idaho and at least nine other states also have similar bills drafted.
At the moment, Franco's idea would generally be the only practical use of the law in Utah, given the legislation doesn't require merchants to accept the coins, either at face value - $50 for a 1-ounce gold coin - or market value, currently almost $1,500 per ounce. And no one expects people will be walking around town with pockets full of gold and silver.
Matt Zeman, market strategist for Kingsview Financial in Chicago, expects more people will start investing in gold as America's growing debt and bankruptcies in other countries continue to decrease the value of government-backed money.
"You've seen gold replacing these currencies as safety instruments," Zeman said. "If I don't feel good about the dollar or other currencies, I'm putting my money in precious metals."
Some supporters, including the law's sponsor, seek to push Congress toward removing the tax burdens that discourage use of the coins, such as a federal capital gains tax.
"Making gold and silver coins legal tender sends a strong signal to Congress and the Federal Reserve that their monetary policy is failing," said Ralph Danker, project director for economics at the Washington, D.C.-based American Principles in Action, which helped shape Utah's law. "The dollar should be backed by gold and silver, so we have hard money."
The U.S. and many other countries largely abandoned gold-backed money during World War II because they needed to print more cash to pay for the war. Later, during the Great Depression, President Franklin D. Roosevelt took steps that essentially prohibited gold and silver as legal currency to prevent hoarding.
In 1971, President Nixon formally abandoned the gold standard.
Fifteen years later, the U.S. Mint began producing the gold and silver American Eagle coins, primarily aimed at investment portfolios and allowing people to trade them at market value but with capital gains taxes on profits.
Utah is now allowing the coins to be used as legal tender while levying no taxes.
Opponents of the law warn such a policy shift nationwide could increase the prospect of inflation and could destabilize international markets by removing the government's flexibility to quickly adjust currency prices.
"We'd be going backward in financial development," said Carlos Sanchez, director of Commodities Management for The CPM Group in New York. "What backs currency is confidence in a government's ability to pay debt, its government system and its economy."
Larry Hilton, a Utah attorney who helped draft the law, disagrees and says the gold standard would restore faith in American money at a time when spiraling debt is weakening confidence.
"We view this as a dollar-friendly measure," Hilton said. "It will strengthen the dollar by refocusing policy matters in Washington on what led to the phrase, `the dollar is as good as gold.'"
http://hosted.ap.org/dynamic/stories/U/US_BACK_TO_GOLD?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-05-22-15-23-20
Barack Obama To Explore His Irish Roots
The Queen has just left but now President Barack Obama is visiting Ireland, ahead of his state visit to the UK.
To view this content you need Flash and Javascript enabled in your browser.
Please download Flash from the Adobe download website.
His trip to the Emerald Isle on Monday is being seen as a boost to the country amid all its economic woes, but it is also a chance for the US President to look up some family.
As well as undertaking diplomatic engagements in Dublin he is expected to travel to Moneygall in County Offaly, which prides itself as being an ancestral home of the 49-year-old.
The President's great-great-great-grandfather Falmouth Kearney was a shoemaker and lived in the rural village.
On the day he walks down the pavements of this village hopefully I will get to shake his hand and it will definitely be very real that day.
Henry Healy, an eighth cousin to Barack Obama
There's no doubt Americans love to have an Irish connection, and the Irish are loving this particular link-up too.
Local church records detail President Obama's family ties to Moneygall.
Records show that Mr Obama's great-great-great grandfather was born in Ireland in 1831 and left for America in 1850.
When the ancestral link was first revealed four years ago, the news was met with initial scepticism.
A T-shirt for sale in Moneygall ahead of President Obama's visit
But the villagers shrugged off the jokes and are now about to reap the rewards of a presidential visit.
Moneygall resident Henry Healy has traced a family connection and is an eighth cousin to Mr Obama.
Mr Healy said: "It's always been surreal but now again it is becoming more and more of a reality.
"On the day he walks down the pavements of this village hopefully I will get to shake his hand and it will definitely be very real that day."
Barack Obama posters adorn the walls of this Moneygall pub
The entire village has received a fresh coat of paint, with one resident going as far as to paint the American flag on the front of his home.
The pavements have also been replaced and fresh flowers are being planted in doorways.
Moneygall school principal Eugene Ryan said: "This connection was found out in 2007 and it has been brilliant for the whole community.
"I think it has resurrected the kind of parish and community spirit that may be was always there but maybe was dormant for a while."
We just never imagined this would happen in anyone's lifetime ... We are living history at the moment and it's brilliant!
Moneygall pub owner Majella Hayes
A bust of Mr Obama already sits proudly on the bar of the village pub and pictures have adorned their walls since he was elected into office.
Pub owner Majella Hayes said he can be sure of a warm welcome when he stops off for a tour during his short stay in Ireland.
She said: "There's absolutely great excitement, it's a kind of a feeling of something unreal happening because we just never imagined this would happen in anyone's lifetime and it's a huge thing.
Mr Obama's great-great-great grandfather was born in Moneygall
"And as we say here we are living history at the moment and it's brilliant."
President Obama has put Moneygall on the map and the villagers are putting him on t-shirts, which are for sale on the main street.
Some have a picture of the president holding a pint of Guinness, one simply says: "What's the craic Barack?"
This visit is not only about celebrating a seemingly unlikely family history, but it's also about giving a rural village and a country a much needed boost.
http://news.sky.com/skynews/Home/World-News/Barack-Obama-Moneygall-Visit-US-President-To-Visit-Ireland-Ahead-Of-State-Visit-To-UK/Article/201105315996322?lpos=World_News_Right_Promo_Region_1&lid=ARTICLE_15996322_Barack_Obama_Moneygall_Visit%3A_US_President_To_Visit_Ireland_Ahead_Of_State_Visit_To_UK
No comments:
Post a Comment