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Discussion Starter · #1 ·
(AP, Matt Rourke)

A South Carolina state politician wants the state to develop its own gold and silver-based currency in case the Federal Reserve collapses and hyper-inflation ensues.

"If folks lose faith in the dollar, we need to have some kind of backup," State Sen. Lee Bright told the Spartanburg Herald Journal's Stephen Largen. His bill asks a committee to look into the development of a state currency, citing the Constitution and Supreme Court precedents to prove the bill's legality.

Slate's Annie Lowrey tracks down similar bills in Georgia and Virginia, and points out that the legislation reflects a larger trend of state politicians wading into monetary policy. A bill in Georgia would require all debts to the state be paid in pre-1965 gold and silver coins. The Virginia proposal would let the state print its own money. Meanwhile, one politician in Utah wants to cut out the middleman entirely and allow the state's residents to run their very own mints.

Advocates of currency alternatives to the dollar argue that the Federal Reserve's quantitative easing techniques will lead to inflation. Texas GOP Rep. Ron Paul, who won the Conservative Political Action Committee's presidential candidate straw poll last week, has been Congress' most visible anti-Fed leader. Paul argues the Fed devalues the dollar, and proposes that the United States should gradually return to gold-backed currency.

In addition to the nightmarish logistical challenges involved with a state adopting a new currency, Lowrey points out that commodity-backed currencies can also experience volatility. For example, if a state collects income taxes in gold and then a big new gold mine is discovered, the metal's value would decline--together with the state's revenue holdings.

So for now, it's probably bests for individual consumers to refrain from shifting over to sovereign state currencies--especially since none of the recently introduced currency bills stands a strong chance of passing. However, for numismatists looking to make a political statement, the Ron Paul silver dollar will likely appreciate--especially since federal authorities raided the libertarian minting operation that marketed it back in 2007.



The mere fact that there are people in office asking permission for their states to have the courts allow them to have their own currency really concerns me. .....
 

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I am totally in favor of any gold or silver backed currency.

:2thumb:
I agree, it would be good to get back to the "good old days":D
 

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Discussion Starter · #4 ·
This is why I'm hoarding silver and gold :D
 

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(AP, Matt Rourke)
A bill in Georgia would require all debts to the state be paid in pre-1965 gold and silver coins.
U.S. Constitution
Article VI.
"…This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding. The Senators and Representatives before mentioned, and the Members of the several State Legislatures, and all executive and judicial Officers, both of the United States and of the several States, shall be bound by Oath or Affirmation, to support this Constitution…"

I fear inflation more than I fear anything else. William Jennings Bryan was a bigger threat to this country than either Adolf Hitler or Robert E. Lee was.

But this country is tens of trillions of dollars in debt both public and private. I don't see how we will ever reduce our debt load if we don't inflate the currency.
 

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I am totally in favor of any gold or silver backed currency.

:2thumb:
It wouldn't protect you from inflation. If additional gold/silver mines were discovered their output would reduce the value of gold/silver that is already in circulation and you'd have inflation. And if the government decides how much gold/silver you can get by redeeming paper money, then the government can reduce how much you'd get, your paper money would lose value and you'd still have inflation.
 
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