A new piece of legislation is being proposed in Texas that could be a game changer for how gold is owned in the United States. The bill, if passed, would allow large pension funds in the state to invest in physical gold, instead of paper gold contracts that it is currently limited to. An even more interesting part of the bill would be the creation of a Texas bullion repository, Texas’ very own Fort Knox if you will, that would not only keep Texas’ own gold there (currently its stored with the Federal Reserve) but also capable of holding private investor gold there if demanded. This would be one of the first sovereign depository of private gold, and essentially move the counterparty risk of storing one’s gold with third parties from a corporation to the state.
The potentially attractive side of this would be a provision that would prevent the Federal government from confiscating this gold, as it did in 1933. The 10th Amendment of the United States constitution would give the state the right to take this stance.
If this bill passes, it would highlight the growing sense of doubt on the health of the US dollar and the general economy. Pensions preferring physical gold, the state wanting to keep its own gold, and a general cause for worry of gold confiscation to happen on such a scale would be a clear signal that gold manipulation is coming to an end. When it comes to gold, Texas wants to hold ‘em.