Return to Gold

[jon]

It was brought to my attention on another chat board that Utah is trying to legalize the use of Gold and Silver coinage. At first hearing this it sounded ludicrous to me. Then someone posted a story of a contractor in Las Vegas that got his subcontractors to accept gold coins at face value for payment. So this guy only has to pay out $50 for $1200 worth of work. The sub contractors then re-sell the coins for melt and get the full wages. In my opinion the contractor was brilliant in showing very low wages paid out on his books and reducing his tax burdon. Apperently the goverment wasn't as impressed and they found him guilty of tax evasion. The government hates it when you beat them at your own game.
Anyway, simular laws are now pending in about a dozen states to bring back the "Gold Standard". Could get interesting?

[Dick]

Yes, it could! It would mean the end of the roll of toilet paper that we are using for money, at present.
The only 'real money" was done away with when the silver certificates,and gold certificates were withdrawn from circulation. It has been 'funny money, ever since. Same story with the coinage.

[eagames]

There's about half a trillion dollars worth of gold in Ft Knox.
The debt is about 30 times that amount so the first or second interest payment on the debt would use all the gold.

The days of backing money with silver/gold are long gone.

[coppercoins]

Paying out $50 for $1200 worth of work is illegal because in dollars and cents that's well below the Federal minimum wage.

I'd be very happy to work for ANYONE at minimum wage in silver, though!

$7.50 X 16 = $120/hour

That's considering $7.50 minimum wage and 16X face for silver.

[jon]

If the guys he hires agree to work as contractors, the minimum wage doesn't apply. They are working for a fixed face value per job. They essentually sub contract the jobs.

[coppercoins]

So then if that's the case how did they get the guy on taxes?

[Dick]

Only a guess, but it depends on the "proper" reporting of income, as such. Similar to the "Capitol Gains Tax".
No matter how you do it, the IRS is going to screw you.
They keep saying that there should be a re-contruction of the Tax system. IMHO, it would be very simple:
All income, regardles from who, or where, to be taxed at the source, @3%. No deductions, no withholding, no write-off's. No Nothing! Everyone pays 3%, and no exceptions. Win the lottery, it is 3%, not the 75% of the gross! That way everyone, Bill Gates, or Me, with my SS, and Navy pension, would pay the same 3%.
In less time than it takes to put it into place, the budget would be balanced, and China would have NOT one red cent of paper!

[jon]

See if I can link to a news article here

http://www.lvrj.com/news/46074037.html

[smed]

They're trying to send that guy to prison for the rest of his life and drug dealers are walking.

What the FIRETRUCK??????

[mojaveblue]

Ed, I wouldn't be surprised that an audit of Ft Knox would show a deficiency in the inventory, much like some stories about the ETF's currently trading. Congressman Ron Paul was pushing for an audit of the Fed also.
I have been checking into the silver/gold swapping idea, where you hold one until the ratio tops and then trade and then trade back when the ratio flips. Franklin Sanders heads one such process, he describes his history in part, to have been in jail because his business did not charge sales tax for certain transactions, fiat money for hard assets, because he considers gold/silver to be real money (always have been), so its like going to the bank and exchanging pennys for dollars. You don't get charged sales tax for that transaction.
We should never be charged sales tax when exchanging fiat money for gold or silver. I understand the owner of the asset to charge a premium, overhead and such, but not tax.
Hopefully the 1099 rule doesn't pass.

[Dick]

Don't hold your breath!
With that bunch of shysters, obama appointed to his cabinet, it's pure luck, that they haven't figured out how to make it illegal to hold gold, OR silver!

[justafarmer]

Keep in mind - Sales Tax are based in state laws - not federal

[mojaveblue]

State or Federal, the laws can be changed.
One thing to be charged sales tax and another to be charged capitol gains with 1099's.
But I am interested to find out the details about stuff like the point you bring up, Farmer.
And alternative ways to look at things.
I guess though Ill always be a conspiracy theorist.

[mikediamond]

The value we place on gold or silver is just a much of a cultural construct as the value we place on slips of paper. It's just a much older cultural construct. Of course, in times of economic turmoil, these precious metal commodities do rise in value. But when stability returns, their value drops.

There really isn't enough gold in the world for it to replace the dollar, the Euro, or the Yuan. We're stuck with the present system for the forseeable future.

Our current budgetary problems are entirely self-inflicted. For the past 30 years there has been a steady chipping-away of the principle of progressive taxation that underlay American prosperity through much of the 20th century. The wealthy and multi-national corporations get enormous tax breaks unavailable to the average citizen and small business. At the same time, government expenditures have increased. Our current average tax burden is about the same as it was during the Eisenhower administration. This "average" hides great inequities, however.

[mikediamond]

Continuing, the Federal Government's revenue as a percentage of GDP is lower now than at any time since the 1950's. There's no reason for this except that the American public has been fed the fiction that taxes are bad, that the Government is wasteful and inefficient, and that private industry is efficient. The picture is much more complicated. There are some things government does better while there are other things the private sector does better.

There's no reason why the wealthy should be free of FICA taxes above $109,000. There's no reason why the Estate Tax should be gutted. There's no reason why agricultural subsidies should be directed to ADM and Monsanto and why oil companies should be subsidized to the tune of $35 billion a year. There's no reason why capital gains should be taxed at only 15%. All giveaways to the rich and powerful.