It’s Time to Stop Taxing Gold & Silver

Grinding inflation is causing once-affluent people to become merely middle class, former middle-class people to become working class, while working class people are being forced into the ranks of the working poor and even the destitute. According to the most recent Gallup Poll, inflation was America’s number one worry with of people polled saying that they worried about inflation “a great deal,” while the latest Fed survey showed that of Americans believe that inflation has made their financial situation worse.

The sad truth is that inflation is not an inevitable fact of life or an inherent flaw of capitalism; it is a direct byproduct of unbacked paper money and central banking. The United States experienced virtually no inflation for over a century until the Federal Reserve was founded in 1913 and the U.S. dollar was progressively downgraded from a gold-backed currency to a paper currency that could be — and has been — printed to oblivion.
Though the U.S. is no longer on the gold standard, savers and investors have been able to effectively protect their wealth from the ravages of inflation by creating their own personal “gold standard,” so to speak, by investing in gold and silver bullion. Unfortunately, the U.S. government taxes capital gains on gold and silver bullion at an unfairly high rate, which is particularly infuriating because those so-called “gains” are not actually gains at all as they are simply compensation for the plunging purchasing power of the dollar, which is the U.S. government’s fault in the first place! Thankfully, as I will discuss later in this piece, there is a glimmer of hope in the form of a new bill that intends to eliminate U.S. federal capital gains taxes on physical gold and silver.

What is Inflation & What Causes It?

In order to truly understand the virtues of gold and silver, it’s important to understand inflation, what causes it, and how destructive it is to society. Simply stated, inflation is an increase in the money supply that manifests in the form of pricier goods and services as well as a loss of purchasing power of the currency that is being inflated. The money supply is the number of units of currency in existence; the more units in existence, the less each unit is worth.