Reply To: QE3 and gold confiscation


The US government is very active in discouraging escape from their inflation scheme. They did seize all of Bernard von NotHaus gold and silver. Much of the metal was not owned by NotHaus but was being held for third parties that were using paper money he minted. Mr. NotHaus was motivated by the idea that the USA was on a course that would ultimately destroy the dollar. If you open a foreign bank account their are special forms and reporting required, especially if your balance reaches $10,000. Police, TSA, etc. have seize coins with a metal content worth more than $3,000. Foreign securities are monitored and regulated to prevent US citizens from moving assets out of the country. The US and other governments make tax haven countries provide information about their (US, etc.) citizens accounts in violation of the tax haven countries laws. Some countries therefor will not open accounts for US citizens.

Would the US outlaw gold ownership by private citizens and require that they surrender their gold for less than it is worth? That was done in 1933. At the time US money was gold and silver. It was assumed any one could go to their bank and withdraw their money in gold or silver coins. In actual practice most US citizens in the country operated with paper money and bank accounts. The silver coins were not seized or outlawed. The silver was removed from US coins in the 1960s. The silver coins were not outlawed and still exist, but disappeared from circulation, since the silver is worth more than the face value of the coin. It is a crime to melt down these coins, but the are traded as “junk silver” in bags by weight. The dimes, quarters and half dollars contain 90% silver and 10% copper. in the 1970s the laws against personal gold ownership was repealed. The US Mint now mints silver, gold and platinum coins (100%). A very short list of dealers are allowed buy from the mint and sell for profit. In all cases the face value is a small fraction of going price of the metal. A person pays about 3% over the metal value of the coin.

When the US government seized the gold coins in 1933, I think a very high percentage of the coins were held by the banks. So their was no effort to search homes and people for contraband coins. People have been in legal difficulty over gold coins that were not surrendered.

Buying gold coins or investing in other gold investing avenues (mining stocks, ETF stocks which buy and store gold) is definitely a good way to hedge against inflation but all may come under attack buy future politicians.