CHEYENNE, Wyo. (Jan. 10, 2025) – A bill introduced in the Wyoming Senate would require the state to maintain precious metal reserves, potentially strengthening its financial stability, insulating against inflation, and reducing reliance on the Federal Reserve’s fiat currency system.
Rep. Bill Allemand filed Senate Bill 96 (SF96) with 10 cosponsors. Under the proposed law, the state treasurer would be required to hold not less than $10 million in specie and specie legal tender “between and across all state-managed accounts.” Specie is defined as a “coin having gold or silver content.”
SF96 states that gold and silver reserves would be held “for the purpose of diversifying the state’s investment portfolio, preserving capital and insuring against inflation, debt defaults and other risks.”
The proposed law would also give the state treasurer the authority to invest state funds in “precious metals leases or bonds payable in precious metals,” if warranted by market conditions.
SF96 also includes provisions that would require the treasurer to conduct a study “analyzing the role of precious metals in augmenting, stabilizing and ensuring the economic security and prosperity of the state and the families, residents and businesses of the state.” The study would have to include a review of “methods for the state to begin accepting gold and silver as a payment medium.”
Wyoming is among five states that have legally recognized gold and silver as legal tender, as they always should have been doing. Utah led the way, reestablishing constitutional money in 2011. Oklahoma, Arkansas, and Louisiana have since joined.
Utah took a step-by-step approach, similar to the strategy being followed in Wyoming. A combination of at least four state laws, plus plenty of steps forward by businesses and individuals has built what is likely the most robust foundation for the advancement of gold and silver as money in the United States.
IMPACT
Holding funds in gold and silver would protect the state’s cash reserves from the ravages of inflation caused by the rapidly depreciating value of Federal Reserve notes. Since 2020, the purchasing power of the dollar has dropped by nearly 20 percent. In that same period, the price of both gold and silver skyrocketed, reflecting the devaluation of the dollar.
Adding gold and silver in reserve could also create a pathway for Wyoming to maintain financial independence should the U.S. dollar collapse, a very real possibility as the world moves away from the greenback as its reserve currency.
In fact, central banks around the world have been buying gold to limit their dependence on the U.S. dollar. According to the World Gold Council (WGC), central banks’ net gold purchases totaled 1,037 tons in 2023. It was the second straight year central banks around the world added more than 1,000 tons to their total reserves. According to the WGC, there are two main drivers behind central bank gold buying — its performance during times of crisis and its role as a long-term store of value.
It’s hardly surprising then that in a year scarred by geopolitical uncertainty and rampant inflation, central banks opted to continue adding gold to their coffers and at an accelerated pace.”
These factors are as relevant to Wyoming as they are to any country.
Tennessee authorized gold and silver reserves in 2023 and Utah did the same during the last legislative session.
BACKGROUND
The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” Currently, all debts and taxes in most states are either paid with Federal Reserve Notes (dollars) which were authorized as legal tender by Congress, or with coins issued by the U.S. Treasury – very few of which have gold or silver in them.
The Federal Reserve destroys this constitutional monetary system by creating a monopoly based on its fiat paper currency. Without the backing of gold or silver, the central bank can easily create money out of thin air.
This not only devalues your purchasing power over time; it also allows the federal government to borrow and spend far beyond what would be possible in a sound money system. Without the Fed, the U.S. government wouldn’t be able to maintain all of its unconstitutional wars and programs. The Federal Reserve is the engine that drives the most powerful government in the history of the world.
State bills that facilitate and encourage the use of sound money create a playing field where people can push back against the Fed’s monetary malfeasance. Ultimately, it could create a scenario where people can drive out the “bad” fiat money with “good” sound money.
Once things get to that point, Federal Reserve notes would become largely unwanted and irrelevant for ordinary people. Nullifying the Fed on a state-by-state level is what will get us there.
WHAT’S NEXT
SF96 will be assigned to a committee where it will need to get a hearing and pass by a majority vote before moving forward in the legislative session.
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