Steve Gresh posted a link on facebook. The legislature in NH wants to permit the use of gold/silver coins.

Let’s see them permit the use without subjecting their constituents to usurious capital gains taxes!

Under the proposed legislation, those citizens of New Hampshire who prefer to use irredeemable Federal Reserve Notes and base-metallic coinage may continue to do so. But they will make this choice intelligently, knowing of their option to use silver and gold coin instead.

And they would be idiots to use Gold/Silver coins for any on-the-books transactions.

Due to Gresham’s Law (which only applies when one currency is artificially overvalued vs. another currency) most people acting intelligently would choose to hoard gold and spend FRNs. Given the choice, they’d all like to remit payments in FRNs, but would only accept gold/silver as payment, themselves.

The proposed legislation in NH (and elsewhere) stands in direct contravention to the privilege bestowed upon federal reserve notes. Because of Federal legal tender status granted to FRNs, except for rare instances nobody can refuse to accept FRNs as payment.

Holding commodity metal subjects you to the capital gains taxes should the value of the metal in terms of FRNs increase. As long as Uncle Sam is fighting Trillion Dollar Wars, that price is going to keep inching upwards.  If you go off the books, you can escape that slave-fee.  Even if the long-term return on commodity metal like gold or silver is zero, a zero return is <em>excellent</em> in this economy (my 401k is now a 201k, as the saying goes).  Even in better economic times, a zero return is great if you’re not paying taxes.

If you’re going to use gold/silver as payment for goods and services, you should do it off-the-books.

Issues like “Should New Hampshire allow people to use gold/silver coins?” are red herrings, that distract people from the real problem which is the state-enforced banking cartel and legal tender laws.