Texas Launches Gold-backed Bank, Challenging Federal Reserve

 

The State of Texas is setting up a gold-backed bank that will allow depositors to bypass the controversial Federal Reserve System and its fiat currency in banking and commerce, according to the state representative who authored the recently enacted law. Under the measure, passed overwhelmingly by lawmakers and signed in mid-June by Republican Governor Greg Abbott, Lone Star State officials will establish and operate the Texas Bullion Depository for anyone who would like to deposit and trade in precious metals. The implications are as big as Texas.

While some analysts have said the move may be another sign heralding Texas’ eventual secession from the union, or preparation for financial Armageddon, its advocates say the depository simply makes financial sense. Among other benefits, the institution will provide more options to consumers weary of the increasingly troubled traditional banking and monetary system, which is viewed by the public with growing suspicion. And experts say the effect of making it easier to use sound money in commerce could be far-reaching.

Merkel Advisor Feld: “Euro Crisis Will Return Shortly And With A Vengeance”

For all the groundless, starry-eyed optimism permeating Europe’s bureaucratic corridors of the fading oligarchy these days (because this time is not like every other time that, too, was different), there has always existed one sure, never-fail antidote: Germany, which without fail has managed to ground Europe any time its delusion of grandure hit escape velocity. Sure enough, while all the statist soothsayers who threatened with armageddon if the outcome of the Italian elections happened to be precisely the one that transpired, were stuck in backpedal mode, and scrambling to calm nerves that all shall be well after all, one person who refuses to play by the script is Lars Feld, member of panel of economic advisers to German Chancellor Angela Merkel, who in an interview with the Frankfurter Allgemeine Zeitung tomorrow says the euro crisis is to return shortly and “with a vengeance” as capital loss will lead to higher risk premiums for Italy’s interest rates.

More Americans Stashing Cash in Home Safes

Pessimists like precious metals collector Don Magnus, though, aren’t looking for toys; they want their safes to be simple, bulky and Armageddon-ready. “I’m worried about the banks crashing,” says Magnus, who’s keeping his stash of gold and silver bullion in a $200 home safe, bolted to the concrete floor of his basement. By his estimate, gold will climb to $5,000 an ounce, and in a financial panic, consumers won’t get access to their bank accounts for a “long period of time, if ever.” After a nasty one-two punch in recent years — a bad hurricane near his home, then the financial crisis — North Carolina contractor Pat Brabble spent $9,500 on two plain but very large safes, including one “you could fit five people in,” he says. The safes hold gold, silver and cash totaling about $7,000 in value, Brabble says. He’s also holding on to about 50 bottles of Jack Daniels. “I don’t drink,” he says, but “if things do fall apart, I’ve got something I can trade with.”

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That said, the pros in the field generally agree that you’re better off safe than sorry — and that many folks are more likely to use a safe if it’s attractive. Which is precisely the way Zani, the safe collector and dealer, feels about the vault in which he stores his “mad money” (about equal to a house payment or two). It’s a safe he considers a true work of art: an 1867 model with a hand-painted exterior covered in 22-karat gold leaf. Zani estimates the safe is worth $10,000. But it’s also a mini-fortress, protecting his stuff behind nine layers of steel plate. (The door alone weighs 500 pounds.) “It’s the difference,” he says, “between buying a Lexus and buying a Dodge Dart.”

Full article: More Americans Stashing Cash in Home Safes (Smart Money)