Can Government Refiss Gold?
There are various methods by which individuals can protect their gold and silver from confiscation by governments. Unfortunately, in the past governments have confiscated this kind of property at any given moment without compensation being made available; so it’s essential that people understand their risks of confiscation as well as have an effective plan in place to counter them.
History of gold confiscation
Governments often confiscate gold during times of extreme economic crises. This typically happens when currency values decline or deflation threatens an economy; by seizing gold, governments aim to prevent people from withdrawing their savings and creating bank runs or panic.
Roosevelt’s Executive Order required Americans to turn in gold coins and bars, but did not require them to give up items with sentimental value such as wedding rings or other emotionally significant objects. Furthermore, his order avoided costly legal battles over items with high premiums such as rare numismatic gold coins.
Numerous telemarketers promote the idea that rare numismatic gold coins provide effective confiscation hedges, but this claim is incorrect. Roosevelt’s Executive Order only exempted coins with special collector’s value from confiscation, while later Treasury Department regulations defined “numismatic coins” as having premiums exceeding 15% of their gold content.
Modern monetary system
Modern Monetary Theory (MMT) is an heterodox macroeconomic supposition which holds that monetarily sovereign countries that use fiat currency they control to spend, tax and borrow can print (or create through digital means in today’s digital era) as much money needed to fulfill obligations denominated in their domestic unit of account without ever running out and becoming insolvent.
MMT has both supporters and detractors. Critics hold that MMT fails to account for private credit demand in driving economic expansion; and that it overemphasizes government.
MMT proponents argue that governments should avoid taxing to take resources out of the economy as this will eat away at its monetary base, or all cash and reserves deposited with the central bank. Furthermore, they believe bond sales serve more as a tool to drain excess reserves than an integral part of budget planning.
Political landscape
Gold confiscation during a financial crisis is a very real possibility, which has given rise to many myths and speculation from telemarketers offering solutions designed to protect physical metals against this event. Unfortunately, most of these solutions cannot withstand close examination.
Though governments have confiscated gold in the past, this practice was typically implemented as a measure to combat capital flight and bank runs during periods of economic stress. Furthermore, such seizures targeted coins or bars rather than jewelry items.
Today’s public is disillusioned with global finance and political leaders and therefore unlikely to support confiscating precious metals; also wealthy citizens with gold or silver tend to play an active part in politics and would likely fight any laws restricting their rights to purchase, sell or trade these commodities.
Risks of gold confiscation
Gold investment has long been considered a reliable strategy to protect wealth during economic crises. Investors must remain cognizant of its risks, taking precautionary steps against private ownership as was seen with 1933 gold confiscation; many people remain concerned by this potential scenario in today’s unstable economic environment.
Although confiscation is unlikely to reoccur, it’s still essential to understand its history and potential for government intervention in times of crisis. This article will examine the legal basis of confiscation as well as provide some tips on minimizing your risk of loss.
Telemarketers often advertise “non-confiscateable” gold as a benefit of trading it, yet this claim is false. Most coins promoted as non-confiscateable are European. Only rare numismatic coins exempted by President Roosevelt from seizure can truly qualify. Investors should opt for bullion coins such as American Gold Eagles and Krugerrands which track with global prices more closely.
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