Many Americans have gotten fed up with the federal government’s inability to take action on certain issues, and so they’re fighting to enact change at the state level instead. We’re seeing that in both red and blue states, especially on controversial issues like abortion and guns. But less controversial issues are seeing movement, too, inducing the movement to return to sound money.
What most sound money advocates want is a return to the gold standard, or to some form of gold-backed currency. And with the federal government seemingly in no rush to get back to sound money or responsible spending, efforts at the state level now seem to be gaining traction. Could they lead to a monetary renaissance for gold?
Efforts Starting to Bear Fruit
Texas has been the frontrunner in the push for gold, with the establishment of a state-run bullion depository through the passage of legislation in 2015. The Texas legislature has also seen the introduction of legislation to provide for a gold-backed digital currency backed by some of that gold. But Texas isn’t the only state pushing for gold.
Legislators in North Carolina are now looking at placing some of their state’s funds into gold, gold that would be stored in the Texas depository. And the bill would also study the feasibility of North Carolina starting its own bullion depository.
Moves like these are a way of returning to sound money at the grassroots level. It’s important to remember that the U.S. Constitution states in Article I, Section 10 that “No State shall… make any Thing but gold and silver Coin a Tender in Payment of Debts…”. So these efforts at pushing state-level sound money initiatives are trying to harness the states’ existing powers in an effort at bringing sound money back.
With the federal government approaching $32 trillion in debt, its willingness and ability to return to sound money is understandably limited. So any efforts at sound money will almost by necessity have to start at the state level.
We’re still in the early stages of seeing what states are doing, as the Texas Bullion Depository only started its operations in 2018. But the depository has already seen tremendous interest from people and businesses looking to protect their gold holdings, and at one point was even attempting to become a non-bank custodian so that it could offer depository services for gold IRA accounts.
Texas is demonstrating what can be done at the state level if lawmakers are willing to think outside the box and come up with real and practical solutions. And it could be just the first state to take a step toward greater acceptance of gold.
What Could Spur Advances
If the U.S. economy falls into recession within the next year or two, as many expect, it could potentially experience a crisis as severe as 2008. Many people remember what happened to their investments during that period, as markets lost more than 50% of their value. And many too remember what gold did during that period.
From October 2007 to March 2009, when markets lost more than 50% of their value, gold gained 25%. And gold went on to hit record highs in the coming years, as markets struggled to regain their footing.
Many Americans are expecting gold to take off if the U.S. falls into recession soon, and they’re buying gold to take advantage of that. Consumer demand for gold has been booming for years and shows no signs of slowing. But individual investors trying to protect their wealth against recession won’t necessarily be the only ones to benefit from gold during a recession.
The Texas Bullion Depository could also benefit from a flight to gold in the event of a recession, as investors and gold buyers look to keep their gold holdings safe and secure. And if gold prices shoot up during the next recession the way they did in the aftermath of the 2008 crisis, it could give greater impetus to state-level efforts to store gold, use gold as a means of payment, or even develop gold-backed digital currencies.
Gold and Recession
No one wants to see the U.S. economy fall into recession, but there’s nothing really we can do about that. If the economy falls into recession, we can only hope that we have prepared ourselves well enough to minimize our losses. And owning gold can be one way of doing that.
Gold has helped protect wealth for centuries, serving as a store of value and as a safe haven asset. Gold remains one of the most trusted safe havens, even as numerous paper currencies have failed over the centuries. While paper currencies can be printed ad infinitum, gold is incredibly difficult to mine, ensuring a relatively stable supply of above-ground gold.
Whereas the U.S. dollar has lost 87% of its purchasing power since President Nixon closed the gold window in 1971, gold has gained over 5,000% in value. And with high inflation today and a national debt that continues to grow, that gap between the performance of gold and the dollar is likely to continue to grow.
Buying gold to protect against recession is relatively easy to do, and you don’t have to wait for state bullion depositories to be created in order to buy gold and store it safely and securely. With a gold IRA you can protect your existing retirement savings with a tax-free 401(k) rollover or IRA transfer, choose the exact gold coins you want, and store those coins in a secure bullion depository.
If gold is in high demand now, just imagine how large demand could grow in the event of a recession. Gold prices today aren’t too far from their all-time highs, and they could easily set new highs during the next recession.
In order to benefit from gold, however, you have to own it. And right now is the time to start thinking about owning gold.
With over $2 billion in precious metals placements and thousands of satisfied customers, Goldco has worked hard to ensure that our customers benefit from owning gold. With numerous 5-star reviews and a Goldco BuyBack Guarantee, shouldn’t you start thinking about buying gold from Goldco? Call Goldco today to learn more about how easy it is to start protecting your wealth with gold.
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Trevor Gerszt is the founder and CEO of Goldco, a precious metals dealer in Los Angeles. For more than 20 years, Trevor has sought out ways to help people build long-term wealth through the security and stability of precious metals and other alternative assets. Goldco is A+ Rated by the Better Business Bureau, a 5-Time INC 500 Winner and has countless 5-Star Reviews for its quality customer service, dependability and strong reputation.