Indiana proposal: use gold (credit, debt, buy, interest)
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The proposal includes provisions for conducting business entirely in gold and silver coin. The federal government has the exclusive power to coin money. If they went with gold certificates or electronic gold accounts, it wouldn't be a problem.
I would go with hard metal and no certificates of anything. If the country wants more currency it can dig up more gold and silver or buy it from others with wheat or manufactured goods. This would be an interesting experiment in inflation control.
Out of curiosity how will using a natural resource that one can essentially mint themselves (by digging it up) help the economy? And what would happen to the current crop of gold mines? Would they become nationalized?
Wouldn't it just be easier to stop spending and spend less than the governments' income is?
The Feds will shut this down quickly if it passes.
It is inevitable for gold to go black market, IMO. Establish your contacts now so you don't have to backdoor barter with strangers.
They'll try, but there's this pesky thing in the Constitution, states may not:
Quote:
make any Thing but gold and silver Coin a Tender in Payment of Debts
Article I Section 10. So quite arguably, by making FRN's and the current base metal coins legal tender within a state, a state is violating the Constitution.
The proposal includes provisions for conducting business entirely in gold and silver coin. The federal government has the exclusive power to coin money. If they went with gold certificates or electronic gold accounts, it wouldn't be a problem.
The state wouldn't coin its own money, so no problem there.
Out of curiosity how will using a natural resource that one can essentially mint themselves (by digging it up) help the economy? And what would happen to the current crop of gold mines? Would they become nationalized?
Wouldn't it just be easier to stop spending and spend less than the governments' income is?
Because currently our money is just toilet paper and it can be printed at the whim of the fed. The founding fathers originally intended for only gold and silver to be legal tender to act as a limit, because they had all experienced what happens with fiat, paper money: it loses its value and eventually becomes worthless. Hyperinflation like that seen in the Weimar Republic or modern day Zimbabwe is not possible with something like gold or silver because there's a limit to it.
accepting gold as a term for payment does not sound as a good idea for a state.
Its very risky.
Gold prices vary much. With a bad economy gold prices rise. Indiana is betting that the economy is going to stay bad.
If Indiana takes in payment in gold and is able to maintain a stock pile, what happens when the price of gold is deflated as the economy improves.
The state stands to lose much.
If it was for a private business, I would say go for it, but since they are dealing in public funds I would say that they should promote some fiscal responsibility and invest in a more "sure thing" with the public funds.
Bad Idea Indiana
I would think that switching to gold as a payment for debts would be more Constitutional than Federal Reserve bills of credit. As for gold prices, I think they have nowhere to go but up due to the constant flood of fed checkbook "money" that will soon flood the market.
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