Posted on 03/23/2013 11:40:57 PM PDT by 2ndDivisionVet
Call it the Rick Perry gold rush: The governor wants to bring the state's gold reserves back from a New York vault to Texas.
And he may have legislative support to do it. Freshman Rep. Giovanni Capriglione, R-Southlake, is carrying a bill that would establish the Texas Bullion Depository, a secure state-based bank to house $1 billion worth of gold bars owned by the University of Texas Investment Management Co., or UTIMCO, and stored by the Federal Reserve.
The idea isn't entirely new. Some Republicans worked on a gold bill last session that was never filed. And gold-standard-backing Ron Paul, the former Lake Jackson congressman, has raised repeated concerns about the safety of states' gold supplies.
"If you think gold is a hedge, or a protection, you always want it as close to the individual and the entity as possible," Paul told The Texas Tribune on Thursday. "Texas is better served if it knows exactly where the gold is rather than depending on the security of the Federal Reserve."
Bringing Texas' gold home has gained traction this session because of Perry's vocal support. On conservative radio host Glenn Beck's show Tuesday, the governor said Texas is "in the process" -- the legislative process, he later clarified -- of "bringing gold that belongs to the state of Texas back into the state."(continued)
(Excerpt) Read more at star-telegram.com ...
Distrust, and rightfully so.
If I had a billion in gold to protect I think I’d rather have Texans doing it than New Yorkers. Maybe that’s just me.
> Distrust, and rightfully so.
On the head. I remember a day when a man would look you in the eye, shake your hand, and do what he said he would and meant what he said. Those days are gone in the political and liberal arenas.
A preventative measure to keep the feds from pulling a 'Cyprus' on the gold it holds in trust for the States, perhaps?
Huh?
If I did the math correctly, that should be about 19.5 tons of gold. Not even a tractor trailer load. Certainly 8 or 10 armored cars could handle it.
Wonder if the Federal Reserve had a "chat" with this guy?
I haven’t done any calculations but I agree that it doesn’t seem like an impossible transport job.
From the article it indicates the following:
....He has also spoken with UTIMCO, which owns the 6,643 gold bars housed underground in New York City.
He said the measure wouldn’t pose a significant expense, because the gold bars could be safeguarded in a small area, no bigger than 20 square feet.......
http://www.star-telegram.com/2013/03/21/4721036/tarrant-lawmaker-seeks-to-create.html#storylink=cpy
I’d be willing to bet they don’t get it back. It has likely been sold and resold many times. Rehypothication is the term, I believe. Same reason Germany hasn’t gotten theirs back.
Yup.
Think about it.
Since I’m such a nice guy, and trustworthy, I convince you to pay me to store your physical gold.
You think (for whatever reason) “That’s a great idea!” And you send it to me.
I turn around and like the dirty rotten scoundrel I actually am, I sell your gold to somebody else and convince them to let me store it for them.
Then I do it again.
And again.
And again.
Now, after I have sold THE SAME PHYSICAL GOLD to say like 8 other people, do you finally understand why I’m not at all excited about the price of gold going up? Do you understand why I oppose, for any reason, actually delivering the SAME PHYSICAL GOLD to five or six or twenty or fifty other folks who all think they “own” the same bars?
“If you think gold is a hedge, or a protection, you always want it as close to the individual and the entity as possible,” Paul told The Texas Tribune on Thursday. “Texas is better served if it knows exactly where the gold is rather than depending on the security of the Federal Reserve.”
If you can touch and control it, then it’s yours. If you can’t then it isn’t yours. Simple as that and paper “certificates” are worth exactly nothing when it comes time to collect your bullion and they don’t have any for you to collect.
Something doesn't add up here.
From the U.S. Mint website, the standard gold bar weighs about 27.5 lbs.
6,643 of them would weigh 182,682 lbs. or 2,922,920 oz.
At ~$1600 an ounce, that amount of gold would be worth over $4.6 billion.
They’re going to have to melt and re-assay every bit of that gold, after assuring the New Yorkers that they *will* make good on any “contaminants”, like tungsten, that show up instead of gold.
If they do, I would heartily recommend that they mint that gold into state of Texas, non-circulating coinage. To go to a logical extreme, they should do like Canada, and first purify it to .9999 millesimal fineness (24 carat), with some special issues .99999 fine. Coin sizes from 1/10th of an ounce to 1 ounce.
Importantly, they should also follow in Canada’s footsteps by laser writing hologram designs on the front, but they should also write an encrypted hologram matrix bar code on the back, to authenticate that particular coin, before sealing each one in a protective case.
This was a brilliant idea on the part of Canada, to attest to the purity of the coin, because impurities would stick out like a sore thumb in a hologram, and it is not easy to put a hologram on gold. But as you well imagine, a hologram on pure gold is very fragile.
The reason that it is non-circulating is if Texas ever needs to issue currency backed by gold, its value is instantly known. As well as its purity, if Texas ever wants to sell any.
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