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According to current Florida law, precious metals such as gold and silver are not considered legal currency. But that might change if the state’s chief financial officer has his way.
In an effort to determine how gold and silver may be utilized to purchase goods and services in the state, Florida CFO Jimmy Patronis, who is also a candidate for a congressional seat, is starting a research.
The Florida Department of Financial Services will carry out the investigation, which will concentrate on actual gold and silver in the form of coins and bars.
Why are valuable metals used?
Proponents of legalizing gold and silver as forms of money contend that these precious metals are a good substitute for the US dollar and other “fiat currencies,” or money whose value is not based on a tangible good.
“Our state might see tremendous growth as a result of this innovative project. “It makes perfect sense to use gold and silver as legal tender, as they have been trusted assets for thousands of years,” Patronis said in a statement issued on Wednesday.
Additionally, the proposal includes a number of tax exemptions, such as ensuring that gold and silver are not subject to personal property taxes.
There are advantages and disadvantages to gold-backed currency, according to Shawn Clark, a financial advisor with Mosaic Financial Group.
“I think a lot of Americans have been looking for some more independence,” Clark stated.
According to Clark, gold and silver money might reduce inflation.
“There’s only a certain amount of gold, and so, they typically work well in inflationary times just because, as the price of things goes up, so does the price of gold,” Clark explained. Thus, if milk’s price increases by one dollar, your gold price will also increase. It increases by one dollar.
But according to Clark, there are certain particular difficulties with the concept of gold and silver money.
“You’re going to have to get businesses to buy in on this as well,” Clark stated. “And, they’re going to have to accept this type of gold or silver-backed currency.”
According to Tampa Bay Coin & Precious Metals owner Marc Bonnett, incorporating gold and silver coins into everyday life is far more difficult than it might seem.
“To me, it would be very difficult to make this happen on a day-to-day basis,” Bonnett stated.
According to Bonnett, who deals with gold and silver on a daily basis, there is a method for determining the value of any coin or piece of gold or silver.
“I would think you’d have to have a specialist at every store and every register, and you’d have to test this stuff because obviously, anything that has value, they’ll fake everything,” Bonnett stated. “They impersonate Rolex timepieces. They are counterfeiting gold coins. They falsify everything valuable.
He claims that while gold currency makes sense in theory, monetizing it for everyday use would be challenging.
“You have to know how much gold is in the bar, and then you have to have the gold spot, and then you have to know the percentage of gold you can pay them out at,” Bonnett stated.
According to Clark, gold and silver have become legal tender in a number of other states around the nation. However, he predicts that Florida will probably not use gold or silver money very soon.
“Having a diversified way to pay for things is going to be a nothing but a good thing,” Clark stated. However, should we anticipate that dollar bills and credit cards will disappear anytime soon? No, I would expect. Not for quite some time.
According to Clark, customers may gain from the CFO’s proposed tax exemptions for gold and silver coins.
“It looks like there would not be sales tax, which would be game-changing for consumers,” Clark stated. However, what effect would that have on local government? That would have a significant effect on municipal government, you know.
For the complete announcement from Patronis, see this link.
The increasing demand for silver and gold
When the U.S. dollar was under the “gold standard,” the government money was backed by gold. The Federal Reserve claims that gold hasn’t been traded for US currency since 1971.
Since 2011, numerous states have implemented legislation permitting gold and silver to be spent as legal money. Since Utah was the first state to take this action, other states such as South Carolina, Louisiana, and Oklahoma were able to follow suit.
How much do gold and silver cost?
Gold futures were trading close to the record high of $2,757 per ounce as of Wednesday noon, which was set in late October.
On Wednesday, silver was little under $33 an ounce. In January 1980, silver hit its highest price ever, $49.95 per ounce, according to Nasdaq, but it quickly plummeted on what became known as “Silver Thursday.”
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Born and raised in South Florida, Krystal is a recent graduate from the University of Miami with professional writing experience at the collegiate and national news outlet levels. She’s a foodie who loves all things travel, the beach, & visiting new places throughout Florida.