With American news and economists still spelling out doom and gloom regarding the economic outlook for the near and possibly long-term economic future, some US states have begun to look towards hard assets as a potential barrier against the fragility of fiat currencies.
Utah in particular made the headlines this week, due to a law just passed by Utah’s House and Senate and signed by the governor to make gold and silver coins legally recognized tender that are exempt from state taxes. The status of legal tender basically grants Congress the ability to set the price of the coins, regardless of the price of the metal inside or the weight of the coin. This will mean that the coins will only be worth their face value when legally exchanged as tender.
The passage of this law will provide the state legislature time to research and decidedly answer the question of whether an alternative currency is really needed by the state, or even possible.
In the United States, people have traditionally used gold and silver coins as an investment, not as grocery money.
Times may be changing, though, as the shrinking of the US dollar’s purchasing might continues and more states begin to consider the idea of re-instating a gold standard as a safety net if the Federal Reserve system fails.
The USA might have something to learn from Thailand in this regard.
Gold is part and parcel of Thai culture, and has served an important monetary and aesthetic role in Thailand for centuries.
Not only is gold the most important metal used to convey status and respect in religious, royal, social and ceremonial settings, buildings and places of worship; it has also been used by Thais throughout the ages as a dependable form of monetary exchange.
Although gold is not an official currency in Thailand, Thais have been using gold as an alternative investment for some time. Buy-sell rates for gold are standardized as gold purity standards and gold bullion sizes and weights. The Thailand Law Forum recently produced the following video on buying gold in Thailand that provides additional details on the treatment, price and history of gold in Thailand.
Gold prices have also risen in Thailand and the world over the last several years, as the demand continues to rise likely due to economic concerns.
The main practical problem with using gold as an alternative currency is due to its high value in relation to its weights. Coins would be too valuable for most basic purchases. One ounce of gold is currently valued at 1,400 USD. Gold coins of smaller values would be so tiny in size that they would be impractical.
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Buying Gold in Thailand video
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