The fact that we may indeed be on the verge of another recession heading into 2020 means more and more investors will turn to gold as viable solutions for protecting their wealth. And the United State's steadily deteriorating fiscal condition certainly suggests it could be a possibility sometime before the end of the 2020s. People were given less than a month to comply with the order. This is fortuitous in a perverse way because the physical precious metal holdings stored in the commodity exchange warehouses represent a miniscule percentage of the outstanding paper contracts at any given point in time. After the Constitution called the federal government into existence, gold coins and silver coins were issued by the U.S. government. There is a lot of talk about student loan forgiveness. Why Now? Whereas gold was special in 1933, in 2020 it is pretty much like every other good in the economy. SchiffGold Friday Gold Wrap Dec. 11, 2020. Copyright © 2015-2020 AntiqueSage. So, if the extraordinary amounts of spending that have been promised by Sanders and Warren were to occur in practice, and high rates of inflation were indeed the eventual end result along with the promised much higher tax rates, then the end mathematical result could indeed be an effective government confiscation of 25% to 50% of the purchasing power of the gold currently held by investors. The order also allowed any person to own up to $100 in gold coins (a face value equivalent to 5 troy ounces (160 g) of gold. To appease the public, U.S. citizens were allowed to keep a small amount of gold for “customary use in industry, profession or art”. Although the Fed does not disclose exactly how much gold it holds in custody or who owns it, as of 2016 there was an estimated 6,000 metric tons of gold in the New York Fed's vaults. ETFs are stock-like vehicles held in brokerage accounts by speculators, traders and investors. The government would be outright robbing small investors who are trying to save for their retirement. Right now, not enough people own it, so gold confiscation doesn’t come into play until it’s a much higher price,” he said. These would be the holdings of retail-facing companies like KITCO (yes, I know they're Canadian, but some of their gold is stored in the U.S.), APMEX, Provident Metals and JM bullion. We could see those municipal debts double from today's $3 trillion to perhaps $6 by 2030. Even back in the 1930s, there were many, many people who simply did not turn in their gold coins. The AntiqueSage website does not provide investment advice. Historische Kurse, Charts und Einheitenumrechnungen von Gold in Unzen und Gramm. The government is creating an information base for later gold confiscation. The executive order was made under the authority of the Trading with the Enemy Act of 1917, as amended by the Emergency Banking Act in March 1933. The government doesn’t want its citizens to own gold because their financial/ personal information can’t be easily tracked. And there was only ever a single Federal prosecution under Executive Order #6102, which resulted in an acquittal (although the gentleman did lose his gold). Other minor holders are thought to be Sweden, Finland, Greece, Lebanon, Afghanistan, Ghana, the BIS (Bank for International Settlements) and the European Central Bank. And this fear is solidly based in historic fact. The idea is wildly popular and it would relieve a huge burden crushing millions of Americans. This questionable law required all U.S. citizens to surrender their gold coins, gold bullion and gold certificates to the Federal Government. The ostensible purpose of these commodities marketplaces is to allow miners, recyclers and industrial consumers to hedge their precious metal exposure in a convenient paper contract. The small amount of gold that was actually turned in to the government was voluntarily surrendered by people as an act of patriotism and the government gave fair market value in exchange. Read more thought-provoking Antique Sage editorial articles here. Failure to obey this draconian law carried the threat of a $10,000 fine (a massive amount of money back in the 1930s) along with 10 years imprisonment. And the political will to reform entitlement programs simply does not exist in Washington at the current time. But when the demand to hold gold increased… When the demand to hold copper increased, for instance, all that happened was that the price of copper rose. This is the type of confiscation that occurred during the 1930s. The feds never made any concerted effort to confiscate gold by force and nobody was ever prosecuted for holding onto their gold. Although the limitation on gold ownership has since been repealed, the risk still remains that governments could do this again today, albeit only if gold prices were much higher, said E.B. Crispin Odey, one of Europe’s highest-profile hedge fund managers, said that governments may ban private gold ownership if they lose control of inflation in the wake of the coronavirus crisis. Read in-depth Antique Sage investment guides here. Since 1933, there have been a few notable gold confiscations around the world. John Adams. As government coffers dwindled and reached emergency levels, politicians didn’t hesitate to grab the net worth of private citizens. They understand that some forms of precious metal seizure will play better in the public arena than other types. FDR’s Tyrannical Gold Confiscation. Once the government has raided precious metal ETFs, commodity exchange warehouses and mining companies, it becomes much harder to get more gold without looking like an insatiable, thieving monster. Governments have an incentive to eliminate currencies that can’t easily be tracked, and also exercise control on the population, Tucker noted. Heute gibt es viele Faktoren, die den Goldkurs in die Höhe puschen. Gold confiscation is an American fear we’ve imported. Keeping this in mind, I've constructed a list of gold confiscation targets in the probable order they would occur: Precious metals held by ETFs (Exchange Traded Funds) are the logical first step in any gold confiscation scenario. During the depths of the Great Depression, President FDR issued Executive Order #6102 on April 5, 1933. Under this scenario there would presumably be less of an international outcry as these institutions would have outlived their political usefulness. On the upside (from the government's perspective), there is actually real gold and silver held in these accounts, not paper contracts. Wegen der drohenden geopolitischen als auch wirtschaftlichen Fragen, inkl. It makes you a hard target. As such, the market for gold was different from every other market. Our current crop of sleazy politicians may be corrupt narcissists, but they aren't chumps. This makes our country a very important party in the global gold industry that could not be replaced elsewhere. And the United State's steadily deteriorating fiscal condition certainly suggests it could be a … Today's average citizen trusts the government far less than the everyman of the 1930s. In his April letter, which was reviewed by ValueWalk, Crispin Odey suggests there’s a small chance the government could confiscate gold again in an extreme situation. While most gold confiscation stories throughout history took place in the 1930s as a precursor to World War II and most of them ended by the 1970s, there is no a lot written in the world that cannot be changed. 6) Foreign Central Bank Reserves Held in Custody. This blatant gold confiscation was tantamount to outright theft. A gold confiscation applied to gold mining companies could take a number of varied forms, not all of which would be obvious theft. In his April letter, which was reviewed by ValueWalk, Crispin Odey suggests there’s a small chance the government could confiscate gold again in … A mere trickle of gold would make its way into government coffers if a modern-day, blanket gold confiscation law was promulgated. And so the grounds for a Roosevelt-style gold confiscation no longer exist. Analytical Charts - Jim Executive Order 6102 was signed by President Franklin D Roosevelt in April 1933, demanding citizens exchange their personal gold holdings for … Gold held outside the US was not confiscated. Yet even though gold confiscation never happened here — and it was over 90 years ago — Australians seem to have this fear that the government is going to come for your gold. Today, for instance, you could have a campaign against gold, but at a much higher price. For example, politicians could mandate that all domestically domiciled miners sell their production exclusively to the government for a predetermined (almost certainly below-market) price. https://www.fff.org/2020/03/12/fdrs-tyrannical-gold-confiscation But in practice, this did not lead to gold confiscation. Money they could use to retire debt and stabilize the economy. As long as any seized gold is immediately replaced with piles of freshly printed fiat money, everything will remain copacetic. More specifically, all U.S. citizens were required to sell their gold coins, gold bullion, and gold certificates to the Federal Reserve in exchange for $20.67 per ounce, which was below market value. This is just as well, because it is an open question as to just how much physical gold these ETFs actually hold. Eine australische Bank warnt: In den kommenden Jahren könnte Schmuck aus Gold sich im Preis mehr als verdoppeln. Federal entitlement spending (primarily Social Security and Medicare) is perhaps the worst debt bomb of all, with an estimated unfunded liability somewhere between $47 and $210 trillion, depending on who you want to believe. This silver bullion tax, which wasn't repealed until 1963, effectively blunted any speculative impulses towards the noble metal for several decades. Now things get downright ugly. Tucker, director of Metalla Royalty & Streaming and author of "Why Gold? Happily, circulating U.S. silver coins (dimes, quarters, half dollars and silver dollars) were specifically exempted from this executive order to minimize its the disruptive effect on the public. In essence the government made $14.33 profit on every ounce of gold it seized. Before we get to the odds of it happening in Australia, a history lesson first. I do think it’s likely that gold runs into the same problem it did in the 1930s but it’s going to look different. Switzerland refines 70% of the gold bars in the world. Most people who own these ETFs won't complain, provided they realize a paper profit. In practice, very little silver bullion was seized under Executive Order #6814. By forsaking paper money and issuing sound, credible gold coins and silver coins, the U.S. government was precluded from plundering and looting people through inflation and monetary debasement for more than a century. Year-end countdown begins: Will gold price see a last-minute boost? A gold confiscation that seized these holdings would have major international repercussions, which is why I've placed it so low on my list. Gold confiscation has been a hot topic at various times, and amid the coronavirus crisis, some are worried that it could happen again. The Federal authorities even moved to confiscate silver in addition to gold. The only realistic exemptions were for gold coins with numismatic value or non-numismatic coins in amounts not exceeding $100 face value (about 4.8 troy ounces). However, mining companies would be the next rational target for a resource-starved government contemplating gold confiscation. Unlike with ETFs and commodity exchanges, we know for a fact that gold miners actually possess sizable quantities of physical gold, albeit locked in the ground. There would be very little blowback from a public relations perspective and only a relatively small number of real industrial participants would be impacted. Last Updated: August 18, 2020 / Anthony Anderson Until gold investors truly understand the historical and current laws concerning gold, the idea of “gold confiscation” will always remain an alarmist myth; a conspiracy theory. Sometimes people say, "I guess we'll just have to have a major economic or monetary crisis to wake people up and cause them to want a sound monetary system." Germans, like Indians and Chinese, love their gold - although their reasons for buying and keeping bullion are somewhat different. A gold confiscation applied to gold mining companies could take a number of varied forms, not all of which would be obvious theft. However, I don't think it is very realistic today. A large portion of their purported precious metal holdings may simply be paper futures contracts or other incorporeal gold derivatives. Apr 19, 2019; 5 min read; Will the Australian Gestapo Come For Your Gold? 2020.01.20. Wyckoff, The Metals, Money, and Markets Weekly by Mickey Fulp - December 11, 2020, Year-end surprise in store for gold? The outcome of a renewed nationalization of private gold holdings would be so bad that I don't think any government would be stupid enough to try it. If governments around the world are facing a depression and are casting around for a monetary response, a gold-specific policy simply is not on their radar screens. It's also possible that this form of gold confiscation could actually happen before gold IRAs were seized, depending on geopolitical circumstances. It would be utterly impossible to spin this public relations disaster in any kind of a positive way, so I think it would definitely be a last resort. This means that meaningful change will only realistically come via a financial crisis of some description. Having said that, if the U.S. government was desperate enough, they might consider seizing gold held in custody for one or more smaller countries. The largest holders are believed to be the IMF (International Monetary Fund) at around 2,000 tonnes, followed by Germany at 1,347 tonnes, Italy at 1,000 tonnes and the Netherlands at 190 tonnes. About | Privacy Policy | Terms & Conditions, Click to share on Pinterest (Opens in new window), Click to share on Twitter (Opens in new window), Click to share on Facebook (Opens in new window), Click to share on LinkedIn (Opens in new window), Click to share on Tumblr (Opens in new window), The Cultural Advantage Enjoyed by British Antique Investors, Blockchain 3.0 and the Problem with Bitcoin, The Best Places for Hiding Valuables? And as … Tucker said that it is “highly likely” that confiscation could happen today. So asking whether gold confiscation (or even silver confiscation) can happen again is something that understandably preoccupies many of today's precious metal investors. But today’s situation is quite different; back then gold was convertible into physical gold. But it is an open question just how much physical gold the government could derive from this move. Gold Confiscation: A Surprisingly Common Solution. And don't even get me started on the stock market, which is currently experiencing the largest bubble in all of human history. These are small-to-mid-sized, privately-held companies that operate on paper-thin margins to provide everyday people reasonably-priced access to gold and silver bullion. And things would turn ugly in a hurry if the government pressed the issue. Forgive Me Uncle Sam! In addition, gold is 29% of Swiss exports which is very significant. I would like to preface this by saying that I believe the seizure of gold mining companies to be rather unlikely. It was the soundest monetary system in history. Subjecting them to a gold confiscation edict would be like sending up a signal flare letting the public know that the government is (eventually) coming for their personal precious metals stash. That's one reason why some precious metal investors still buy pre-1933 semi-numismatic U.S. gold coins. That doesn’t happen at $2,000,” he said. In other words, there are far more gold future contracts than there are gold bars to delivery into them - yet another prime example of modern day institutionalized financial fraud. The government could even outright nationalize gold miners, buying out former shareholders with rapidly depreciating fiat currency. FOCUS-MONEY: Ende vergangenen Jahres gaben Sie die Prognose aus, dass der Preis für die Unze Gold bis 2020 bei 5000 US-Dollar beziehungsweise 4000 Euro stehen wird. Many gold owners fear that their governments could seize their gold, pointing to the U.S. confiscating people’s gold during the Great Depression in 1933. Gold in bank safe deposit boxes was taken but many Americans hid their gold at home. SchiffGold Friday Gold Wrap Dec. 11, 2020. But FDR decided that the US holders of gold should not get the benefit of a revaluation. Or the government could demand that miners issue them a "golden share", which would entitle the holder to a significant ownership interest in the underlying company (perhaps 10% to 25%) along with a veto on any undesirable corporate activity (like fleeing offshore). Another possibility is the confiscation of IMF and BIS gold holdings if the international trade/monetary system were to utterly implode during a future financial crisis. Gold return vs S&P 500 (Jan-May 2020) Thomson Reuters/Datastream. Gold confiscation is an American fear we’ve imported. For one thing, I don't think it would be remotely enforceable. Instead, the government passed the Silver Purchase Act of 1934, which included a 50% windfall profit tax on the sale of silver bullion payable via revenue stamps. The U.S. dollar was basically a receipt that could be exchanged for physical gold, the real money.Today, central bankers can devalue their own currency by a simple press on a bu… All rights reserved. At home, Mr. Lares told his father-in-law, also a fisherman. But most importantly, the optics of a precious metal nationalization involving gold IRAs would be abysmal. Right now U.S. Federal debt is a mind-blowing $23 trillion, well on its way to $40-something trillion by 2030. If governments around the world are facing a depression and are casting around for a monetary response, a gold-specific policy simply is not on their radar screens. Whereas gold was special in 1933, in 2020 it is pretty much like every other good in the economy. The possibility of gold confiscation is every precious metal investor's worst nightmare. Regardless, when the time comes it will be easy for politicians to mandate the seizure of any ETF-linked physical precious metal holdings. “The methods and the means change over time but the general principal does not change. May 2020 in Precious Metals, by Steven Cochran.Citibank expects gold to average $1715 in 2020, $1,925 in 2021, and later go higher than $2,000 an ounce. He thought that devaluing the dollar would solve the problem. Economics 2020; Economics 2018-2019; Politics; Education; Public Policy; Cultural; All News; Search. Right now, not enough people own it, so gold confiscation doesn’t come into play until it’s a much higher price,” he said. But almost everyone buying gold ETFs is interested in paper profits, not actual physical ownership of gold. Wyckoff, Where Are the Stops - Jim SchiffGold Friday Gold Wrap Dec. 11, 2020 December 11, 2020 by SchiffGold 0 0 There is a lot of talk about student loan forgiveness. Log in / Sign up. Updated: Apr 20. Every currency in the world was either defined as a certain amount of physical gold or pegged to another currency that had a gold definition, usually the U.S. dollar or the British pound. Being priced to perfection, the equities markets are incredibly vulnerable to a synchronized crash that would devastate Federal tax revenue. Gold Confiscation Con | Peter’s Blog; NAVIGATION MENU. So seizing precious metals would have the political advantage of filling government coffers while only directly impacting a minority of the populace. A systematic search of safe deposit boxes for gold would turn the public virulently against the entire banking system, undermining the government's already precarious financial situation even further.
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