patrick.net

Wow, this is great!

https://www.coffeeandcovid.com/p/gifts-and-grifts-monday-june-30-2025

Yesterday, AInvest News ran a story headlined, “Texas Authorizes Gold, Silver as Legal Tender for Daily Transactions.” Texas’s comptroller announced that Governor Greg Abbott signed a new law making gold and silver legal tender in that state:

https://x.com/DonHuffines/status/1937130290029240630

@DonHuffines
Good morning, Patriots! Great news: Governor Abbott has signed
transactional gold and silver into law.

As Comptroller, I will lead the implementation of Texas' new gold- and
silver-backed transactional currency system through the Texas Bullion
Depository to offer secure, inflation-resistant alternatives to the U.S.
dollar.

I'll ensure this system is secure, transparent, and accessible, with real-
time pricing, fraud protection, and no government tracking or central
bank control. I will protect your right to financial sovereignty, making
Texas the national leader in sound money.

https://www.ainvest.com/news/texas-authorizes-gold-silver-legal-tender-daily-transactions-2506/

The Lone Star State joined Florida, Utah, and Arkansas in the move, which to be clear, is a frontal assault on traditional banking. Banks, after all, are just middlemen. They hold our money for us, and send it off to people we buy things from.

The new state laws like Texas’s are setting up systems where state depositories, not banks, will hold the gold, and citizens can still use debit cards to buy and sell stuff. But in this case, they’ll be using an asset-backed currency that isn’t subject to inflationary taxes like fiat currency (such as the dollar).

The ‘trick’ —the politically difficult part— is exempting precious metals from state sales taxes. When traded metals are taxed, they remain a product rather than a currency. Strip off the taxes, and folks can swap gold and silver (even digitally) for other products or services without paying for the privilege.

Lots of questions remain. For instance, can citizens use state-based, digital gold to buy things across state lines? The Constitution suggests yes, but it’s never been tested. States must recognize each others’ court judgments, but not, for example, driver’s licenses. That’s voluntary. The federal Congress holds the power of the purse.

The bottom line is, we don’t know yet.

The Tenth Amendment provides that powers not delegated to the federal government are reserved to the states or the people. The Constitution prohibits states from coining money, but explicitly allows them to use gold and silver coin as legal tender (Art. I, Sec. 10). Texas can also enter into mutual currency agreements with other states, just as they do with mutual driver’s license recognition.

This is a fascinating and slowly forming test case for constitutional federalism in finance. If Texas and the other states play it right—with enough gold, a functional app, and strategic alliances —and maybe a little help from Congress— it won’t topple the dollar, but it could give the banks their first competition since the Federal Reserve was founded.

So… keep on debanking people, dummies. The banks are making their own demise politically possible.

Patrick says

The ‘trick’ —the politically difficult part— is exempting precious metals from state sales taxes. When traded metals are taxed, they remain a product rather than a currency. Strip off the taxes, and folks can swap gold and silver (even digitally) for other products or services without paying for the privilege.

I don't think it does shit for the Feds taxing capital gains every time you sell gold in any transaction. Even if it is gold to gold.

Patrick says

“Texas Authorizes Gold, Silver as Legal Tender for Daily Transactions.”

Doesn't "legal tender" mean one MUST accept it as payment? So, if you price an old car at $1900, you must accept the 1 oz Saudi gold square I offer as payment. If you are selling a hamburger for $5.50, you must accept my 1962 quarter as payment.

HeadSet says

Doesn't "legal tender" mean one MUST accept it as payment?

For debts & taxes, yes.

HeadSet says

So, if you price an old car at $1900, you must accept the 1 oz Saudi gold square I offer as payment. If you are selling a hamburger for $5.50, you must accept my 1962 quarter as payment.

No.

Example, you go to a hot dog stand, buy a hot dog right then and there. That's a transaction. Technically, legal tender doesn't apply.

You go to a restaurant, sit down, order a meal (could be a hot dog, even)..wait for it, get it...then get the bill 'for goods and services rendered'. That's a debt, technically. Legal tender applies.

Interesting to note, checks and credit cards are not legal tender technically. Only Federal Reserve Notes and US minted coins are.

If you offer legal tender currency to pay a debt even if the creditor wants some other form of payment, the mere offering of said legal tender currency discharges that debt, anyway. Contracts are exempted from this (see below).

Formal contracts can specify other forms of payment. Legal tender then does not apply. Of course, contract law can restrict certain forms of payment...such as the FDR law abolishing gold clauses in contracts.

Congress has granted the States the right to expand upon what is legal tender or not in their jurisdiction, as well.

MolotovCocktail says

Example, you go to a hot dog stand, buy a hot dog right then and there. That's a transaction. Technically, legal tender doesn't apply.

You go to a restaurant, sit down, order a meal (could be a hot dog, even)..wait for it, get it...then get the bill 'for goods and services rendered'. That's a debt, technically. Legal tender applies.

Right, a merchant can refuse cash in advance of the purchase, but once you have a debt, the merchant must accept Federal Reserve Notes as payment. FRNs are utterly worthless in themselves, but have worth because others must accept them for debts and because the government requires them to pay taxes.

Patrick says

Well, let's see. Siver is about $80/oz and there are about 14 dimes to make an ounce of silver so that dime is worth $80/14 or about $5.71 today. California min wage is about $17 in most areas so silver would have to be $196/oz for a dime to equal minimum wage. Even in states like Montana, with about $11 min wage, silver would have to be $154/oz for a dime to be minimum wage. For the states that use the Fed min wage of $7.25, silver would have to be about $102/oz. I suspect the silver price will correct somewhat well before it hits $100.

Mainly about silver and gold, but truth in the examples of food and government are just as good:

WHAT DRIVES SILVER AND GOLD PRICES?

Until the late 1990s I used to pore laboriously over the Silver Survey published by the Silver Institute with a fine-toothed comb every year That was the annual silver supply and demand report, and I did the same for gold. Sometime about then it dawned on me I was wasting my time. Why?

Simply that industrial supply and demand change only slowly over time. What really drives gold and silver prices is monetary demand, demand for silver and gold as money, because it arises quickly and hits prices at the margin where it has the greatest effect. It’s not that industrial demand makes no difference at all, just that by its nature it won’t power large, fast price changes. As long as industrial demand is steady and climbing, that’s sufficient to undergird the market, but its monetary demand that really drives metals — a structural change in demand.

That’s exactly what we are witnessing right now, only the monetary demand is the strongest I’ve ever seen because it is a product of worldwide US dollar repudiation. What y’all are watching is a rare structural shift away from fiat money and the debt-based economy and a light to real value.

In other words, finance and money are shifting from abstracts to realities. Y’all know that humanity runs to excess always. Thinking since the Enlightenment has tended to the abstract and away from realities. Think of industrial agriculture, for instance. They think in NPK terms (nitrogen, phosphorous, and potassium) largely ignoring trace minerals and microscopic soil life. The result is food that doesn’t nourish.

In the financial world everything is abstracted and financialized, removing products further and further from the actual thing, the reality, that gives them value. A share of stock is a derivative of a company that produces something, for example. That derivative is then bundled and financialized and traded through an Exchange Traded Fund (ETF) that becomes a financial entity in itself — a derivative of a derivative of a derivative. Likewise debt is a derivative of some underlying collateral, real or otherwise, and not itself real.

Maybe I’m not explaining this very well, but the structural shift I mean is a return from the abstract to the real, where real assets like gold and silver will replace abstract and virtual assets (like debt and financial derivatives) and form a new financial foundation. That’s one reason I am so ardent about selling y’all gold and silver, because I know they are the best if not the only way to carry value across the abyss of monetary, financial, and economic collapse. They will give you capital indoor hands to rebuild on the other side.

Maybe another example will help. Communists love all mankind [the abstract] but no man [the reality]. That's why they can execute millions of humans to create their utopia for mankind. It’s all an abstraction, so never mind the sticky, troublesome particularities of real live men and women. Their reality must make way for the abstraction.

- Franklin Sanders

Patrick says

Yet they re-elected FDR twice....

HeadSet says

Yet they re-elected FDR twice....

Right, I think he was the last (only?) 3 term president and they put the 2 term limit on it during his last term?

Except for Trump that is!