I'm just not too excited about Utah's law as some people are. For one thing, it depends on the government valuing the gold and silver fairly. Basing the exchange rate on the London market may seem like a good idea, But both U.S. and British government have become adept at short-term currency manipulation. And both governments have regulations in place which ostensibly "protect" the markets from wide swings in price, but which actually close down the market if prices change too much too quickly. What this means is, if the dollar should collapse - or decline more than a few percentage points overnight - depositors may either find it impossible to access their funds, or will only be able to access them at a severely discounted rate.
Secondly, depositors are not paid any interest on their deposits. What is the point of depositing your gold and silver in the depository?
And finally, every time you access any of your funds, you are in effect selling a part of your gold and silver to the state. Over the long term, this is a pretty poor deal.
Remember
Gresham\'s Law :
When a government compulsorily overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.
The hoarder, in this case, will become the State. And the losers will become the people who sell their precious metals for a declining fiat currency.
If it is a good idea to have competing currencies - and it is -
why not take the State out of the equation completely? Let banks or other private enterprises issue their own currencies, based on ounces of gold, bushels of wheat, barrels of oil, or whatever both parties agree to base it on.
Let the free market decide what currency to use for individual contracts.Trusting a government to uphold their side of a contract is one huge, colossal mistake. If you doubt this, just look at how well they've
managed their own employees\' pension funds .
Onward and upward,
airforce
