Am I on the right track??

In practice, in Utah, individuals will be able to use gold and silver bullion in the same way as they would cash for transactions but also for currency exchanges. Individuals with the metal will be able to get fair market value in a trade for cash, or may start depositing or paying with it.

How is this different from selling the bullion for fair market value ( fiat based) and then paying? The state is just acting as a bullion dealer and can determine their idea of fair market value.


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Sorry Peace, you are incorrect, but I understand you confusion. Even the press got that wrong. They said that Utah has now made official the use of gold and silver coins as legal tender, but it is not true. Below is a snip-it of what was really in the bill. Since retailers are not forced to accept gold and silver it connot be considered legal tender. Buyers are also not forced to use gold and silver.

Retailers still will not be forced to accept gold and silver, according to the bill. Instead, Utah made it acceptable to use it as an alternative currency for willing buyers and sellers. As a result, many gold bugs may find it hard to use gold and silver on a daily basis."This is just designed to be an alternative currency," said Utah Rep. Brad Galvez, who sponsored the bill, in March, according to the Salt Lake Tribune. "It is not designed to replace the Federal Reserve by any means."

Here is the definition of legal tender:
(Economics, Accounting & Finance / Currencies) currency in specified denominations that a creditor must by law accept in redemption of a debt

The bill did not really do much of anything. If you read up on it, the only thing it did was to eliminate the capital gains tax on gold and silver. Without the tax hit you can argue it makes it more efficient to use gold and silver in exchange for goods, but the fact is you could always use gold and silver in exchange for goods. It was bartering before and it is bartering now. Nothing really has changed. The bill was more symbolic and of a protest nature than anything else. If you don't believe me, fly to SLC, get that slurpee at the Quick Check and drop an ASE on the counter and see what happness. You might as well drop a few ears of corn on the counter, it is the same thing, they are both commodities and neither is legal tender.

Mike

 

If anyone is living in these states ( UTAH for instance), have you paid any bills or made any transactions? If your bill was $100 dollars and you paid with a 1 oz. AGE, was your change in gold or paper?

 

That is my point, See that '64 quarter. It is still legal tender, but take it to the quickie mart and you get 25 cents worth of goods. That quarter has 5 dollars of silver in it. If we were using commodity currency and silver was money you would be able to get 5 dollars worth of goods right there on the spot. Since silver is not money, you cannot. You need to sell the quarter as a commodity, get your 5 dollars in Fiat currency then go back to the quickie mart and spend your real money.

 

ASE's and 10 oz bars. Stack it high.

 

Let's be real here, nobody in their right mind would pay for $100 worth of goods with a AGE. Maybe a 1/10th and then accept the difference in paper, but a full oz AGE wouldn't happen.

 

Oh I just found this on Weathwire.com

However, there are a few legal dilemmas holding South Carolina (and other interested states) from setting this goal in motion. Because businesses have the right to deny gold and/or silver as legal tender, there is some discrepancy over how the logistics and legality would work out.

This is just like I said
So you tell me how this works. We are making a law that makes gold/silver legal tender, but you don't need to follow the law if you don't want to. I really wish they made speed limits like that.

A law that you do not have to follow is just not a law, more like a suggestion I would think. It is also not sounding like money to me.

 

Just as a note, there is no provision in the law as to what exchange rate someone would accept the AGE at. You are all assuming spot, but I really doubt that is the case. I would say sellers would want a premium over spot to protect themselves in case of a downturn from the time they accept the ASE to redemption. With no provisions for that, the seller could set premium at anything he likes. This is not sounding like money, there is no premium when purchasing with greenbacks. This is bartering.

 

You keep on citing those and I keep thinking there is no way on this earth I'm going to use my PMs to pay for something that I can pay for with dollars. I pay my bills with dollars, I save in precious metals.

 

As I have stated twice before paper currency does not constitute a unit of account. If you cut a dollar in half it loses it's value. If you put a dollar in your compost it won't be there a century later. It fails both the divisibility and the durability test. It also fails as a store of value because that value is dependent upon enforcement by the current establishment and will eventually not have that value. We can split hairs and I will concede that yes, you are correct by the modern definition of money that FRN's are acceptible, but they do not fill all the roles needed by money that caused it to come into existence in the first place which is why gold and silver are sound money and will have to supplant a non-metal backed fiat currency out of necessity regardless of semantics. If you are familiar with Joseph Goebells' line about convincing people that a square is a circle because they are just words, that applies perfectly here. The labels don't change anything fundamentally. Gold and silver are money, and will always be money due to their inherent characteristics. The rest is only temporary.

 

Again, only using your logic here, but by your definition of money, Anthracite Coal is also money. Do you consider anthracite money. if not, why not.

Mike

 

If these are money, then how come everyone that sells them wants our fiat currency instead of say, more silver, gold or copper for trade instead?

 

Exaclty right, if they were money, there would be no need to sell them at all

 

You'd be wrong, as I trade more of my PMs for other PMs than I do for dollars. Everyone is a bad choice of words.

 

The need to "sell" them for cash is because of the current medium of exchange only, or the need of the currently accepted medium of exchange.

Just out of curiosity, do you stack or collect PMs, and if so why?

I'll answer first, to me it is not going to be inflated or printed to less value.

 

Lots of good reading material in here! Well I just edited, forum rules~ please read them made my first purchase of a number of coins yesterday. Like some one posted that I should take it slow at first made sense because I was a bit to eager with the "add to cart button". I can see how this can become addicting. I wonder how I'll feel once I have the coins in my hand...:smile

 

First of all I am currently not stacking PM's I have in the past and I may in the future, but not now. Also that decsion not to stack now has nothing to do with PM's being money or not. It is just my assessment of the current value and current price on the commodity. It is my Opinion, (this is the first Opinion I have stated so far in this thread, everything was fact) that the currect price of Silver exceeds the current value. If that changes, my position will be of a more bullish nature.

Now for your post. I could not agree more, I could have written it myself



The need to "sell" them for cash is because of the current medium of exchange only, or the need of the currently accepted medium of exchange.





You see, there is a NEED to sell because of the CURRENT medium of exchange. When PM's were money there was no need to sell, because they WERE the CURRENT medium of exchange. Used to be money, now they are not. So lets go 360 here and look at the very first line in the proof that Inflexion posted as the definition of money that he believes from the WIKI.



Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given socio-economic context or country.[SUP][1][/SUP][SUP][2][/SUP][SUP][3][/SUP] The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past, a standard of deferred payment.[SUP][4][/SUP][SUP][5][/SUP] Any kind of object or secure verifiable record that fulfills these functions can serve as money.
It is very clear. See, it has to be generally accepted, which Silver is not or you would not need to sell it for money. It also needs to serve as a medium of exchange, but you clearly state, the reason to sell it, is the NEED of the CURRENTLY ACCEPTABLE medium of exchange. If it were money it WOULD be the CURRECTLY ACCETABLE MEDIUM of Exchange and there would be absolutely no need to sell it.

Again, used to be money, now it is not.


Also please notice, how I am only using your words and arguments. I am sure by now you feel I am twisting your words, but if you read it cafefully you will see I am not. Also, notice when these super pro buillion folks are spewing their words, try to pick up on the inacuracy's half truths and lies. If you pick up on an untruth, think to your self, Ok what other things is he saying that are untrue.

My absolute favorite is, there is no Physical Silver backing up the ETF SLV. The stackers just love that one, but it is not true, just look it up.

Mike

 

There is no NEED for me to sell, only wants. I make cash on a regular basis, and I sell when I want to, not when I need to. There may come a time when I NEED to, but that's why I stack PMs in the first place.

I'm still of the belief that you're wrong, and the only thing on your side is the current medium of exchange. PMs are money, even if only in a commodity sense. That current medium of exchange is robbing people of savings and will continue to do so as long as it's in place. So I'll stack what I consider real money, and you can carry on with the paper. One of us is going to pay a very dear price for our decision.

 

Coal does not pass the fungibility test. Only metals pass all requirements of sound money.