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Why States Are Turning to Gold and Silver: What It Means for Your Financial Future

by Kathrynn WardDecember 19, 2024

In a year marked by financial turbulence, gold and silver have not only seen substantial value increases but have also emerged as key components in state-level financial strategies and central bank reserves globally.

As inflation persists and global conflicts rise, several U.S. states are taking steps to recognize gold and silver as legal tender, signaling their importance in preserving wealth and hedging against the risks of fiat currency.

Here's what's happening and why it matters for you.

A Shift Toward Precious Metals

Historically, gold and silver have been viewed as timeless stores of value, offering stability in uncertain times. Over the past decade, 12 states have embraced this principle by passing laws to recognize gold and silver as legal tender. Most recently, Florida's Chief Financial Officer, Jimmy Patronis, announced a study exploring how the state can incorporate gold and silver into its economic framework. Also in the news, Texas is proposing gold-backed debit cards for use in daily transactions.

These states could be driven by concerns over the Federal Reserve's monetary policies and the weakening value of the U.S. dollar. Former Congressman Ron Paul, representing Texas and an advocate for precious metals, argues that the Fed’s monetary policies lead to inflation and devalue the dollar. In his book End the Fed, Paul states that the government and its banking cartel have “pursued a relentlessly inflationary policy,” resulting in the devaluation of the dollar.

Why Are States Embracing Gold and Silver?

  1. Hedge Against Inflation: Gold has retained its value over time, protecting wealth as the dollar loses purchasing power.
  2. Economic Stability: Many investors use precious metals as a safe haven during geopolitical and financial crises.
  3. Intrinsic Value: Unlike fiat money, gold and silver cannot be devalued by overproduction or mismanagement.
  4. Decentralization: Gives citizens more control over their financial decisions, reducing dependence on the Federal Reserve.
  5. Financial Independence: Utilizing gold and silver can offer an alternative in times of economic uncertainty or potential central bank digital currency implementations.
  6. Tax Advantages: Although we are not tax advisors and always suggest you consult your financial team, classifying gold and silver as legal tender can exempt transactions involving these metals from certain state taxes, such as capital gains taxes, making their use more attractive.

2024: A Year of Growth for Gold and Silver

This year alone, gold has surged by an impressive 29%, reaching over $2,644 per ounce. Silver has performed even better, climbing 35% to levels not seen in over a decade. These increases reflect a perfect storm of factors: central banks buying gold at record levels, persistent inflation, geopolitical tensions, and industrial demand for silver in sectors like renewable energy and technology.

What This Means for You

If states and central banks are turning to gold and silver to protect against inflation and economic uncertainty, It could be a strong signal for individual investors to follow suit. The U.S. national debt recently surpassed $36 trillion, adding fiscal pressure. Inflation, while slightly easing, continues to erode purchasing power, with everyday essentials still costing more than ever.

On December 18, 2024, Florida Chief Financial Officer Jimmy Patronis, stated, “This is an exciting initiative that has the potential for enormous growth in our state… Gold and silver have been trusted assets for thousands of years, and it makes perfect sense to use them as legal tender". By investing in these metals, not only could you help safeguard your wealth but also position yourself to benefit from their upward momentum.

How to Act Now

Gold and silver are at a pivotal moment. They could represent a "sweet spot" for investors looking to help protect and grow their wealth. At Lear Capital, we make it easy to invest in physical gold and silver. Whether you're interested in diversifying your investments or simply owning a tangible asset, our team is here to help guide you every step of the way.

Don't wait, Join the growing number of Americans-and states-turning to gold and silver as the ultimate safeguard for their financial future. Call 1-800-576-9355 today to learn more.

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