The Numismatic Bibliomania Society



The E-Sylum: Volume 15, Number 17, April 22, 2012, Article 18


On Friday I heard a short interview on National Public Radio mentioning Utah's recent law making gold and silver coin legal tender in the state. Kai Ryssdal of Marketplace talked with Craig Franco of the Utah Gold and Silver Depository. -Editor

Online, Marketplace cited this article as background for their story:

In practice, in Utah, individuals will be able to use gold and silver bullion in the same way as they would cash for transactions but also for currency exchanges. Individuals with the metal will be able to get fair market value in a trade for cash, or may start depositing or paying with it. The state will also be offering a one-time tax credit to offset any capital gains taxes accrued for individuals who choose to trade metal for paper.

The tax credit essentially ensures that the exchange works like any other currency exchange, say if someone went to Europe and needed to get Euros around that trip. It will also eliminate a shadow market for the metal as those with metal to exchange would normally call around for transaction prices in order to offset fees and taxes.

To read the complete article, see: Utah to accept gold & silver bullion as currency, move highlights broader financial realities in US ( highlights-broader-financial-realities-in-us/)

Here's the interview. -Editor

gold bullion coins This final note on the way out. The governor of Utah signed a bill this week making gold and silver legal tender.

We were curious about exactly how that might work. So we called Craig Franco, he runs the Utah Gold and Silver Depository. It's a bank -- kinda.

Craig Franco: Nice to be with you.

Ryssdal: Just to be clear, this law does not let me take a nugget of gold and plop it down on the counter and buy a pair of jeans and a candy bar?

Franco: That is correct. The law is very specific on the type of gold product that's been monetized. And what has been monetized is American gold and silver coinage.

Ryssdal: Printed by or minted by who? The United States Mint?

Franco: The United States federal government.

Ryssdal: So I can have some 1792 gold, double-eagle, walking liberty coin, whatever they call 'em -- because you guys do special stuff, right? -- and plop it down on the counter?

Franco: Theoretically, yes. Now practically, that's impossible to do. So what we've done at the Utah Gold and Silver Depository is we have developed a debit card that allows for people to deposit their gold and silver like you would deposit cash in a bank. And we can issue a debit card against the value of your gold or silver holdings.

Ryssdal: I have to tell you, this takes literally all the charm out of it, man.

To read the transcript online, see: (

To read the complete article, see: U.S. Currency Backed by Gold and Silver? Yes, But the 'U' Stands for Utah (
-gold-and-silver-yes-but-the-u- stands/)

The brief interview didn't mention that Franco's "depository" isn't open for business yet - it's set to open June 1, and it has competitors. An online search found bullionvault as one example. The company is based in London and has been operating since 2005. Back to Utah, here's an excerpt from a more in-depth article. -Editor

Earlier this year, the Utah state legislature passed a law making gold and silver coins legal tender. Now, a Salt Lake City-area numismatist hopes to set up a system that will allow Utahans to use those precious metals to pay for anything they want.

Franco says he has encountered "a profound amount of interest" in his new service, "coming nationally, not just locally. We have received, in the last 48 hours since the AP article broke, inquiries from the East Coast to the West Coast, from private investors to asset managers."

Some details remain to be decided, including the exact fee schedule the depository will charge. Franco says clients will have 30 days to clear their accounts following transactions. When debiting, he'll use the spot price of the metal in question on the day a transaction is settled. "But the value of the account fluctuates on an hourly basis," Franco explained, "based upon the global market."

When it was passed in March, the Utah law was derided as an example of right-wing fringe thinking run amok. Political columnist Dana Milbank denounced it as one of several "curious formulas" mixed by "tea party chemists," akin to a Montana bill celebrating global warming, or an attempt to mandate gun ownership for all adults in South Dakota. Even its backers seemed to admit that its significance was largely symbolic.

And yet a dozen other states, from Virginia to Idaho, are said to be considering similar legislation, though the practical effects are limited.

To read the complete article, see: U.S. Currency Backed by Gold and Silver? Yes, But the 'U' Stands for Utah (

Wayne Homren, Editor

NBS ( Web

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