Why Texas wants its gold back from the Federal Reserve

by day dreamer Wed 08 May 2013, 11:39 am

day dreamer: Interacting Investor; Posts : 3197
Join date : 2012-12-19

Post n°1

Why Texas wants its gold back from the Federal Reserve

by day dreamer Wed 08 May 2013, 11:39 am

Why Texas wants its gold back from the Federal Reserve

By Keith Wagstaff | The Week – Tue, Mar 26, 2013

Gov.
Rick Perry tells Glenn
Beck he wants the state's $1 billion in gold bars on Texas soil
Texas wants its gold back —
all $1 billion of it. That's what Gov. Rick Perry told Glenn Beck on his radio
show last week, according to the Texas Tribune.
The
Federal Reserve holds the gold bars, which are owned by the University of
Texas Investment Management Company. Perry wants to bring them all back to Texas
to store the gold in what would be called the Texas Bullion Depository.
Former Rep. Ron Paul (R-Texas), a
stalwart gold
standard proponent, supports Perry's proposal. But Texas state representative Giovanni Capriglione,
who wrote legislation to fulfill Perry's wishes, wants to distance the move from
that kind of rhetoric, telling the Texas
Tribune that the measure is "not about putting Texas on its own gold
standard." He says, instead, that it looks to "give the state a reputation as
being more financially secure in the event of a national or international
financial crisis."
But what's so bad about keeping the gold in the Federal Reserve's vault in
New York City? If there were a serious spike in inflation (a big worry of gold
standard supporters), there would be nothing to stop Texas from accessing its
store of gold in Manhattan. And taking the gold to Texas would likely be more
problematic than helpful. As Neil Irwin of the The Washington Post notes, building, staffing, and securing
the proposed Texas Bullion Depository would be incredibly expensive.

In fact, it would take a Mad Max-style breakdown to justify bringing all of
that booty back to Texas, says Irwin:
For it to make sense to go to all that hassle of storing your own gold, you
have to be insuring against some much darker possibilities, like a collapse of
the U.S. government and monetary system...
In some episode of hyperinflation and U.S. government collapse, as the nation
falls into a Hobbesian state of nature, paper dollars will be no good, but gold
would likely be the medium of exchange for buying food and guns and whatever
else is needed for Texas to prosper amid the post-apocalyptic hellscape. [Washington Post]
Another reason — other than the one put
forth by Capriglione — that a state might want to keep $1 billion of gold
handy is if it were planning to secede. Texas, after revolting from Mexico in
1835, existed as an independent republic until it was forced to rejoin the U.S.
following the Civil War. And the desire to regain its independence hasn't
dwindled much in the ensuing time — more than 100,000 Texans signed an
online petition earlier this year asking the White House to allow the state to secede.

http://news.yahoo.com/why-texas-wants-gold-back-federal-141500293.html

by day dreamer Wed 08 May 2013, 11:42 am

day dreamer

day dreamer: Interacting Investor; Posts : 3197
Join date : 2012-12-19

Post n°2

Texas lawmakers propose creation of Texas Bullion Depository to guard against the federal government

by day dreamer Wed 08 May 2013, 11:42 am

Texas lawmakers propose creation of Texas Bullion Depository to guard against
the federal government

Gold News

Why Texas wants its gold back from the Federal Reserve Usgb_gold_bars_2

March 31, 2013 –- For years the term "Texas gold" has typically referred to
oil, and the black sludge that originally brought fortune to the state and many
of its residents. But if Texas lawmakers have their way, it may soon come to
mean precious bullion itself in the modern age.

Based on a bill introduced by in the Texas legislator, the Lone Star State is
seeking the authority to create its own public and private gold depository,
reported The
Daily Ticker on
Yahoo Finance.

Known as the Texas Bullion Depository, the proposed facility would change
current laws and allow the state and its citizens to store gold bullion in a
private facility, with the full protection of the state.

Jim Rickards of Tangent Capital Partners and author of the bestseller
Currency Wars said, “Personally I think this is a game-changer in the way the
world and institutional investors are going to look at gold.”

The legislation is not law yet and needs to be voted upon before it can
pass.

“It allows large Texas pension funds to invest in physical bullion, which
they are not allowed to do right now,” Rickards told The Daily
Ticker. For example, the Texas Teachers Retirement System, one of the
largest pension funds in the world, they’re interested in gold but they can only
do paper gold, Comex futures, things like that. They’re not permitted by law to
own the physical gold. They would like to own the physical gold, because it’s a
better way to own it. You don’t have the exchange risks, and you don’t have
various other regulatory risks.”

The proposed legislation would change the law, to allow large pension funds
in Texas to buy physical gold. It would also create a central Texas storage
facility to hold this gold. If passed, the proposal states that over time the
Texas Bullion Depository would accept private deposits as well.

“Think of it as the Fort Knox of Texas,” said Rickards. “This will be one of
the first sovereign depositories of private gold. Private citizens will be able
to put their gold in a sovereign depository that is guaranteed by the State of
Texas.”

If passed, the Texas bill would buoy the state’s 10^th amendment
power. If the current administration or any future presidential administration
tried to mandate that citizens turn over their gold, as President Franklin D.
Roosevelt did in 1933, the new legislation would allow Texas to refuse.

“You’ve got the state of Texas standing up for you if the federal government
tries to do what they tried to do in 1933,” said Rickards, “ which is take the
people’s gold."

The move has caused some to raise their eyebrows and ask once again if Texas
is eyeing secession from the union down the line.

However, it’s not the only state looking to shore up its resources based on
precious metals.

Recently, lawmakers in Arizona moved to declare privately minted gold and
silver coins legal tender.

Gold is considered a hedge against inflation. And while inflation is
currently low in the U.S. right now by official figures, Rickards doesn’t expect
that to remain the case, projecting an uptick to come later this year or early
next year.

If people were to lose faith in the dollar, Rickards concedes Texas could
have the foundation for its own currency, of sorts.

<p>Click
here to see the full The
Daily Ticker video
of Rickards on Yahoo Finance.
http://www.usgoldbureau.com/news/gold-news/texas-lawmakers-propose-creation-texas-bullion-depository-guard-against-federal-gover