That Texas gold-backed digital currency bill is a step backwards

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Just a word about the blog schedule for this week; as it is the Orthodox Holy Week blogs will appear on Mon, Tues, and Wed for that reason.

(Article by Joseph F. Farrell republished from GizaDeathStar.com)

With that said, down to business:

This very important story was spotted by one of our regular readers and article contributors, S.D., and you are going to want to read and take note of it, perhaps even, if you live in Texas or those states approving bullion-as-legal-tender bills, to write your state representatives and senators, for one of my predictions appears to be coming true: the state bullion-legal-currency trend may be the way Mr. Globalooney has decided to "sneak through" a digital cashless society:

Texas Bill Would Create State-Issued Gold-Backed Digital Currency

Note what the article states:

Sen. Bryan Hughes (R) introduced Senate Bill 2334 (SB2334) on March 10. Rep. Mark Dorazio (R) introduced a companion, House Bill 4903 (HB4903) on the same day. The legislation would require the state comptroller to establish a digital currency that is fully backed by gold and fully redeemable in cash or gold as well. The comptroller would also be required to create a mechanism to use this gold-backed digital currency in everyday transactions.
“In establishing the digital currency the comptroller shall establish a means to ensure that a person who holds the digital currency may readily transfer or assign the digital currency to any other person by electronic means.”

The state of Texas would hold gold backing the currency in trust on behalf of the digital currency holders.
“The trustee shall maintain enough gold to provide for the redemption in gold of all units of the digital currency that have been issued and are not yet redeemed for money or gold.”

In practice, individuals would be able to purchase digital currency from the state. The state would then use the money to purchase gold that would be held in the Texas Bullion Depository or another secure vault. Individuals would be able to redeem their digital currency for dollars or gold.

CENTRAL BANK DIGITAL CURRENCIES (CBDC)

A gold-backed digital currency would create an alternative and allow individuals and businesses to avoid a CBDC.

Now, much of this sounds very good, of course. Of crucial importance is that the digital currency is "fully convertible" to dollars or actual physical bullion, so the argument that the gold-backed currency will replace federal reserve notes or a Central Bank Digital "Currency" seems sound.

I said, seems sound, because I'm just not buying the scheme. Rather than take the step of establishing means of using such a currency in "everyday transactions," why not just simply issue certificates of deposit - actual physical bearer certificates - for any gold or silver in the state depository, and allow those to be used for transactions by passing a law to that effect, rather than the expensive and power-consuming - and I would aver, environmentally unfriendly - route of a digital currency? In other words, if you're going to take the step of establishing a mechanism to allow such a currency to be used in transactions, why not take the step of allowing physical certificates to be used in that manner as well?

In other words, it's the omission of that step that now functions, in my opinion, as a significant indicator that the state-bullion-depository and bullion-as-legal-tender movement may have been yet another central bankster's conjuring trick, not only to suck privately held gold and silver back into government vaults, but eventually, having once done so, to get rid of the convertibility factor once and for all. After all, governments have done it before, and can do it again. Without that all important physical medium of exchange with a stated convertibility stamped on its face, all the talk about it being sound money in a digital form does not make it so, any more than all the talk about someone with X and Y chromosomes being a woman makes them a woman.

See you on the flip side...