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As rational commentary about such a possibility is rarely found,
we were delighted when one of our friends directed us to Jesse’s
Café Americain, a blogspot we had never encountered before.
There we found this October 9th 2009 post, and it pretty much
sums up our skepticism about the gold confiscation scare:
The question of confiscation reappears every time gold rallies,
from those with enough history to be able to throw out a few
facts and sound plausible, but not enough grounding in history
and the law to actually place them in any sort of reasonable
context. Below is a 'reprise' of a blog entry we posted early
this year on the topic.
The Feds acted on gold because at the time it WAS the currency
of the country, and the government had some proper claims on it.
When the US left the gold standard it relinquished all such
claims, as gold became purely private property. Except perhaps
if you are holding gold American eagles, which bear the patina
of 'currency.'
It should also be noted that the sole action of the government
was to ask for the gold, to withdraw convertibility of gold
notes from the domestic public, and to monitor the activity of
safe deposit boxes taking certain categories of gold, and
essentially nothing else. There were no investigations,
searches, or even active prosecutions for non-compliance.
The purpose of the confiscation was to prepare the way for a
formal devaluation of the dollar while it was still on the gold
standard.
Could the government try to confiscate the gold from private
citizens again? Certainly. Although unless it is part of a
return to the gold standard with adequate recompense, it would
be little more than the theft of private property.
The government can also ask you to place an RFID chip in your
head before you can buy anything or drive a car, ask for your
children and place them in youth camps, bind you over to your
creditors in indentured servitude, ask you to house homeland
security troops in your home with no payment, and request your
presence on a freight train for relocation to New Mexico.
There is a wide difference between what *could* be done, what is
likely to be done, and what people might consider to be
unreasonable enough to resist.
Talk of confiscation invariably occurs when gold rallies because
it is a way for those who rode the rally to climb the wall of
worry and those who missed the rally to feel better about their
lost opportunity.
- Most common fears about confiscation would not take root if
not for paranoia and historical ignorance, as cited by Jesse
above. But you have to wonder exactly how these rumors get
started. After all, the monetary recall of gold was 76 years
ago, and not very relevant today. So why do people investigating
gold today hear so much about it?
“Follow the Money” is usually a good approach. To trace these
confiscation rumors, the first question is, Who exactly would
profit if potential gold investors avoided the purchase of gold
bullion?
If some people can be scared out of buying gold bullion, what
else could they buy that would be round, made out of gold, and
not bullion?
Could it be something like the old numismatic gold coins, the
very ones that were recalled in 1933? Perish the thought, but
would numismatic salespeople exploit the ‘confiscation’ issue in
order to sell collector coins to people who are not coin
collectors?
Can it be true that some potential bullion investors are being
encouraged to take up an expensive hobby, out of the greed of
the seller, and the fear and ignorance of the buyer?
Rather than end another sentence with a question mark, let me
just say – yes it is.
The confiscation bogeyman is a great part of the sale tool-kit
employed by those smooth-talking sharpies that you reach when,
curious about gold, you dial an 800 number that you saw in a
newspaper or magazine.
They will poo-poo the idea of buying gold bullion as if it were
the worst thing you could do. Not only will they allege that
gold bullion will probably be confiscated someday, but they will
also tell you that its purchase is ‘reported’ to some state
agency, that it is ‘registered’ in a big book somewhere, and
that it would put your 'financial privacy,' (whatever that is),
at risk.
All sales-talk malarkey, of course, and the shame of it is that
these lies have scared thousands of investors out of a timeless
monetary asset which has more than quadrupled in value since
2001.
So the next time you hear about gold ‘confiscation,’ remember
that you are either hearing it from someone who is either just a
little confused, or just about to pick your pocket.
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