maester_millerRealMises,
My point was more that so long as QE3 fails to magically fix the economy (which will cause consumers and businesses to remain uncertain and desire to save) and as it starts to raise the expectations of inflation (whether it actually materializes or not) that will increase the appeal of gold, even to the common man. I agree that most people have no economic smarts, but basically everyone understands the argument that gold protects against inflation, many just disagree that inflation is a serious concern.
So once the fed successfully convinces them that inflation is a serious concern, perhaps these people will start buying gold. Confiscation would be impractical, true, but maybe something else like just making it illegal to own or purchase any gold. Many would do so anyway, but many would also be scared off by the threat of running afoul of the government.
If the fed wants us to spend more on consumption, it will have to do something to stop us from buying gold, right? So long as we desire to save (which we do because of a low time preference and uncertainty about the future) and we desire to avoid inflation (which QE3 is designed to make us believe will actually happen), we won’t simply cash out our 0.05% APY savings account and buy a house or a car or a vacation, we’ll simply convert our cash savings into gold savings. They’ll have to do something about that, won’t they?