The New Gold Standard?

Utah recently became the first state in the union to legalize the use of gold and silver coins as currency. The same law also helpfully exempts the sale of such coins from taxability, meaning that consumers will not have to fear paying for capital gains if the gold they hold for transactions appreciates. Though the law does not require merchants to accept the coins, at least one entrepreneur is looking to cash in on the law with a debit-card-linked depository. Such a debit card system is critically important at the point of sale; it would be difficult to imagine the clerk at a CVS weighing out and making change off of gold coins in the absence of such an innovation.

Perhaps sensing that the public is yearning for the good old days when the dollar was the dollar (and was also back by something other than a promise), at least ten other state legislatures are looking at schemes similar to the one Utah put into place. However, even proponents of the plan, including its author Rep. Brad Galvez, recognize that the dollar isn't returning to the old standard any time soon after the system was abandoned in the early seventies. The AP has more on the plan as well as a brief history of the gold standard in the US here.

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