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Let’s talk about gold confiscation (again)

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  • Wed, Nov 04, 2009 - 07:58pm

    #1
    switters

    switters

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    Let’s talk about gold confiscation (again)

I have great respect for Stoneleigh at The Automatic Earth (TAE) and value her opinion.  She strongly believes that it will again become illegal to own gold in the U.S. in the future.  I’d like to hear your arguments for or against this as a possibility.  

If there’s any significant possibility of this happening, it seems like a good idea would be to own physical gold and store it outside of the U.S.

  • Wed, Nov 04, 2009 - 08:57pm

    #2
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

Switters

I think gold confiscation is a distinct possibility.  It makes perfect sense once it becomes obvious to the US and the world that gold is real money and fiat currency is worthless…but other possibilities exist  including confiscation of 401Ks, roth accounts, confiscation of land by taxation, heavy taxation or confiscation of overseas investments, and the list goes on.   

Will the population comply if ownership is made illegal?  will this include gold and silver?  who knows…

Trying to keep a close eye on the chatter, of which Dr. Martenson does a great job, is probably a good idea.  Any signals that ownership would be made illegal would be an impetus to move into another asset.  Fortunately PMs are very liquid and can be unloaded rather quickly, unlike trying to sell a piece of land.

 

 

  • Wed, Nov 04, 2009 - 09:01pm

    #3
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

Well the first thing that would have to happen would be a change to existing law about private ownership of gold. It is certainly possible but I can’t see that happening anytime soon.

Then again the government may find some “creative” way to say that they already have that power. Then all they need is 5 of the supremes to agree and then the game is over. I also think that is a long shot but FDR was able to be creative in some of the things that he did so you never really know. In perceived emergency situations the government and judicial system can do some very strange things.

Still I think gold confiscation is improbable.

 

Ken

 

 

  • Wed, Nov 04, 2009 - 09:04pm

    #4
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

I don’t believe it will be confiscated, unless the price were to hit the moon. Look at yesterday when India bought 200 tons of gold for $6.8 billion. That’s chump change in today’s world of paper stocks, trillion dollar deficits and bailouts. Now, if gold was priced 5 or even 10 times that amount, then we’d be talking some serious coinage and maybe then I’d change my mind.

Chris wrote a piece about gold confiscation last November that you may want to read again.

https://www.peakprosperity.com/blog/gold-confiscation/9436

  • Wed, Nov 04, 2009 - 09:09pm

    #5
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

I’ve given some thought to this recently.

I just recently encouraged my father to keep all future gold purchase to physical gold held outside of the U.S.

The problem is this, if gold is confiscated it will be so because it prevents TPTB from meeting some goal.  The next round of currency emergencies or market/bond dislocation will have global impact.

If you’ve kept up with recent events, you are aware that there is a movement afoot for the IMF to gain global regulatory authority.

The bottom line is this IMHO, if gold is declared contraband it will be a global prohibition.

  • Wed, Nov 04, 2009 - 09:22pm

    #6
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

I think that it would be unecessary for a government to make physical possession of gold illegal unless the US were to attempt to return to a gold-backed currency.  Otherwise the government would have no reason to want the gold – they would only want the value, and the American public does not hold enough to make it worthwhile to specifically target gold (you might as well target real estate holdings, other commodities, &c).

Value confiscation can more easily be achieved through taxes and restrictions.  Even today the inflation-blind capital gains tax accomplishes this purpose.  Suppose you own $1,000 worth of gold.  The dollar thereafter declines by 50%.  The true value of the gold has remained steady, but the nominal price is now $2,000.   You sell your gold for $2,000.  Even though $2,000 post-inflation will buy no more than $1,000 did pre-inflation, you must pay capital gains tax on $1,000 in fictitious profits.  The capital gains tax on fictitious profits efficiently confiscates a portion of the original value.  If the government wished to confiscate the value of precious metals holdings, why not merely increase the capital gains tax on precious metals to 40%?  60%?  The only reason why Washington needed the physical metal in the 1930’s was because they were attempting to sustain a gold-backed currency system.

 

  • Wed, Nov 04, 2009 - 09:55pm

    #7
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

Read this:

http://emsnews2.wordpress.com/2009/02/04/1933-terrorizing-people-into-handing-over-gold/

 

I think there is little doubt that the idea now is to devalue the dollar to pay off our nations debt. When that happens the only real wealth will be in precious metals. Do you think the government will want your worthless dollars? No way. They will want your gold and they will just take it.

  • Wed, Nov 04, 2009 - 10:13pm

    #8
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

Hi Bluestone,  I’m new to this, today in fact is my first day.   Can you tell me what PM’s are?  thank you

  • Wed, Nov 04, 2009 - 10:13pm

    #9
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

Hi Bluestone,  I’m new to this, today in fact is my first day.   Can you tell me what PM’s are?  thank you

  • Wed, Nov 04, 2009 - 10:24pm

    #10
    Peak Prosperity Admin

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    Re: Let’s talk about gold confiscation (again)

Cynthia,

Welcome to the site.

PM means precious metals, mostly gold and silver but also other costly metals that have commercial value.

 

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