Yep...you go right ahead and eat them gold coins of yers, Harley, once the the banks and the crops fail.
Utah Law Makes Coins Worth Their Weight in Gold
FARR WEST, Utah -- Most people who amass the pure gold and silver coins produced by the United States Mint do so for collections or investments, not to buy Slurpees at 7-Eleven.
"You'd be a fool," Tom Jurkowsky, a spokesman for the Mint, said of the Slurpee idea, "but you could do it."
After all, while the one-ounce American Eagle coin produced by the Mint says "One Dollar," it is actually worth more like $38 based on the current price of silver. (An ounce of gold is worth more than $1,500.)
Now, however, Utah has passed a law intended to encourage residents to use gold or silver coins made by the Mint as cash, but with their value based on the weight of the precious metals in them, not the face value -- if, that is, they can find a merchant willing to accept the coins on that basis.
The legislation, called the Legal Tender Act of 2011, was inspired in part by Tea Party supporters, some of whom believe that the dollar should be backed by gold or silver and that Obama administration policies could cause a currency collapse. The law is the first of its kind in the United States. Several other states, including Minnesota, Idaho and Georgia, have considered similar laws.
Mr. Jurkowsky said the new law "is of no real consequence," and is purely symbolic, but supporters say it is more than political pocket change. They say that it is just a beginning, that one day soon Utah might mint its own coins, that retailers could have scales for weighing precious metals and that a state defense force could be formed to guard warehouses where the new money would be made and stored.
"This is an incremental step in the right direction," said Lowell Nelson, the interim coordinator for the Campaign for Liberty in Utah, a libertarian group rooted in Ron Paul's presidential campaign. "If the federal government isn't going to do it, then we here in Utah ought to be able to establish a monetary system that would survive a crash if and when that happens."
Utah has a strong conservative streak, but there are other reasons why it was first to pass such a law.
For many of its supporters, the new law represents an extension of the notion of preparedness that is nurtured by Utah's powerful founding institution, the Church of Jesus Christ of Latter-day Saints. Many of the law's supporters believe policies like stimulus spending, the bank bailout and national health care will soon bankrupt the government, sending inflation soaring. Owning gold and silver, they say, will help protect people.
"It's kind of written into our theology that we're supposed to be prepared for any eventuality," said Mr. Nelson, who was involved in early meetings with state lawmakers about the law.
Wayne Scholle, the marketing director for Old Glory Mint, in Spanish Fork, Utah, showed off a commemorative silver coin the company made honoring the new law, one he said he hoped could be a model for a future state-minted coin. The front -- or obverse -- includes an image representing "the miracle of the gulls," an important story in Mormon folklore in which seagulls are said to have suddenly appeared and eaten insects that were destroying the first crops Mormon settlers raised, a year after arriving in Utah in 1847.
"Their messaging is spot on with this," Mr. Scholle said. "It's preparedness. It's protecting yourself."
Old Glory is not the only company that hopes to benefit. Craig Franco, a coin dealer south of Salt Lake City, said he was finishing an arrangement with a bank to create a depository through which people will be able to spend their gold and silver indirectly, by using a Visa credit card that makes charges against the value of their holdings. Mr. Franco noted that state law, for now, left it to the private sector to figure out how conducting business with gold and silver should work.
"The regulation of the system?" Mr. Franco said. "There is no regulation of the system. We are working out the nuances of it."
Mr. Franco is among several supporters who say the law's most important feature may be that it eliminates state capital gains taxes on the sale of gold and silver, a move he thinks will prompt individuals and large scale investors outside the state to move their gold and silver to Utah. But federal capital gains taxes would still apply.
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