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Monday, April 8, 2013

Trust in Gold Not Bernanke as U.S. States Promote Bullion

Mistrust in the Federal Reserve and concern that U.S. dollars may become worthless are fueling a push in more than a dozen states to recognize gold and silver coins as legal tender.

Lawmakers in Arizona are poised to follow Utah, which authorized bullion for currency in 2011. Similar bills are advancing in Kansas, South Carolina and other states.

In Utah, officials haven’t yet figured out how to accept gold and silver for tax payments -- though some residents have asked to pay that way. Photographer: Simon Dawson/Bloomberg
U.S. Federal Reserve Chairman Ben Bernanke has pushed interest rates to near zero since the 18-month recession that began December 2007. Photographer: Andrew Harrer/Bloomberg

The Utah Precious Metals Association, established after passage of the 2011 law to advocate for the use of gold and silver coins, has established a pilot program in which members can make deposits that are held in gold and access money using a bill pay service. Photographer: Victor J. Blue/Bloomberg

The Tea Party-backed measures are mostly symbolic -- you still can’t pay for groceries with gold in Utah. They reflect lingering dollar concerns, amplified by the Fed’s unconventional moves in recent years to stabilize the economy, said Loren Gatch, who teaches politics at the University of Central Oklahoma.

“The legislation is about signaling discontent with monetary policy and about what Ben Bernanke is doing,” said Gatch, who studies alternative currencies at the Edmond, Oklahoma-based school. “There is a fear that the government, or Bernanke in particular and the Federal Reserve, is pursuing a policy that will lead to the collapse of the dollar. That’s what is behind it.”

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