June 6, 2018, is a historic day as the 74th anniversary of the allied forces D-Day invasion of France and the opening day for the Texas Bullion Depository (TxBD). 2023 is the five-year anniversary of its operation. Texas Comptroller of Public Accounts Glen Hegar states, “We’re proud that the nation’s first state-administered bullion depository is now a reality — this is a big day for Texans who want to secure their precious metal assets,”
The depository accepts deposits of physical gold, silver, platinum, palladium, and rhodium from U.S citizens and residents. Bullion by definition is not limited solely to gold. Bullion defined as a noun from dictionary.com is, “gold or silver considered in mass rather than in value and gold or silver in the form of bars or ingots.” The permanent home was completed in 2019. The third party bullion administrator Lone Star Tangible Assets (LSTA) was authorized to, “. . . to build its own on-site firearms range and tactical training area.”
As of December 2023, the state of Texas is the only state to authorize, operate and maintain a bullion depository with gold as one of the metals stored. The gold price from its June 2018 opening was approximately $1300 per ounce and as of December 2023, its closing price is above $2000 per ounce. The gold price per ounce continues to climb as sovereign governments around the world proliferate their printing and spending of fiat money since early 2020 (remember coronavirus).
As of September 2017, Tennessee is the only other state to have passed legislation calling for a depository similar to Texas’, and this was only a joint resolution expressing support for the idea. Idaho, Arizona and Louisiana have passed or considered legislation to end state-level taxation on gold and silver coins and bars, and in some cases to treat them as another form of legal tender. These states primarily base their legislation on an interpretation of the U.S. Constitution’s Article I, Section 10, which states that “No State shall… make any Thing but gold and silver Coin a Tender in Payment of Debts.”
The TxBD depository is comparable to federal gold reserves stored at Fort Knox, Kentucky, as well as U.S. Mint facilities in Denver and West Point, N.Y. and the Federal Reserve Bank in New York City. The gold, silver and other metals stored in Texas is growing and efforts to expand its presence beyond Texas are shown. “As of June 2021, nearly 1,000 account holders had deposits at TxBD, with the average account valued at approximately $140,000, . . .”
“The coronavirus pandemic prompted a surge in deposits at TxBD: From September 2019 to February 2020, total deposits increased by $12 million (42 percent). In the following six months, however, from March 2020 to August 2020, total deposits increased by $52 million (129 percent). As of June 2021, the total value of all deposits at TxBD was about $129 million.” Exhibit 1 shows the trend. This is encouraging to see precious metal ownership and storage growing in spite of federal government fiat money printing and out of control spending.
EXHIBIT 1: TOTAL DEPOSITS AT TXBD, SEPTEMBER 2019-JUNE 2021
Source: State of Texas Comptroller
The state of Texas does not own any physical gold and silver bullion as of December 2023. Will other states follow Texas’ lead on state authorized bullion storage is hard to say as part of the long term trend of decentralization or federalism. The Texas effort begun in 2015 was a clear statement to our bureaucrats and legislators in Washington, D.C to cut spending, get back to sound money with full or partial gold backing and wean themselves from overdosing on debt.
