[MedicalConspiracies] The Confiscation Con - Gold

-------- Original Message --------

Subject:	[Paranormal_Research] The Confiscation Con - Gold
Date:	Sat, 4 Dec 2010 19:16:49 -0500
From:	Lucky <luckypig@infionline.net>
Reply-To:	Paranormal_Research@yahoogroups.com

PEOPLE BUYING GOLD ........... YOU NEED TO READ THIS

      The Confiscation Con


      -- Posted Friday, 3 December 2010 | Digg This Article | Share this
article| Source: GoldSeek.com

      By Peter Schiff

      If you've spent enough time in the gold community, you might be under
the impression that the most imminent threat to the average American isn't
terrorism or unemployment, but rather gold confiscation. Starting with the
fact that FDR confiscated gold during the last Great Depression, and
continuing to the quite accurate forecast that we are headed into an even
Greater Depression, unscrupulous coin dealers have been pushing investors to
buy expensive "numismatic" or "collectible" coins that they claim would be
protected from government seizure. The only problems are that the original
motive for confiscation no longer applies and the "protection" offered by
major coin dealers wouldn't actually help you keep your gold.


      THE TYRANT'S ORDER
      In 1933, President Roosevelt issued Executive Order 6102, prohibiting
the private holding of gold and requiring US citizens to turn over their
gold bullion or face a $10,000 fine ($167,700 in today's dollars) or 10
years imprisonment.


      For private citizens, the order listed the following exemption:
        Gold coin and gold certificates in an amount not exceeding in the
aggregate $100 [about 5 troy ounces at that time] belonging to any one
person; and gold coins having a recognized special value to collectors of
rare and unusual coins.
      Seizing on this "rare and unusual" language, many coin dealers try to
convince unsuspecting customers that regular bullion coins are not safe, and
that it is worthwhile to pay extra for "numismatic" or "collectible" coins
that would be exempt from a Roosevelt-style confiscation.


      CALL THE MYTHBUSTERS

      The reality is that almost all coins sold as "numismatic" or
"collectible" by our competitors are really quite ordinary coins sold at
high mark-ups to make these dealers extra profits. If we were in 1933, these
coins would absolutely not fall under the definition of "rare and unusual."

      True numismatics are extremely rare or one-of-a-kind coins that
collectors purchase for their historical and aesthetic qualities. These
coins might retail for $100,000, while only containing $1,400 worth of gold.
Most dealers charge a huge premium, so the coin may have to appreciate
30-50% before the buyer can even hope to make a profit. It is a speculative
endeavor, and one that is likely to get even riskier as the US descends
further into economic depression.



      True numismatic coins, like pieces of high art, do well in good times,
when people are getting richer and adding to their collections. In bad
times, collectors are forced to sell because they need cash. With many
collectors in the same boat, prices plunge. Even if the value of the gold in
the coin rises, the gold content is only a small fraction of the coin's
value. Since premiums are contracting, the value of the coin falls. So, if
you are buying gold due to fear of an economic collapse, you should buy
bullion, not numismatics.

      WHY WAS GOLD CONFISCATED?

      In 1933, when Roosevelt issued his infamous order, the United States
was still on a gold standard, meaning every 20.67 paper dollars could have
been "redeemed by the bearer on demand" for a troy ounce of gold. Since
Roosevelt had many public works projects to finance and also may have wanted
to quietly lower real wages to drive employment, he confiscated gold and
then devalued the exchange rate to $35/oz (at this point, the only people
who could "exchange" were foreign governments). Thus, Americans instantly
saw a 40% drop in value for the dollars they held, and the government's
profit was sequestered in something called the Exchange Stabilization Fund,
which could be used by the President at whim without Congressional approval.
Pretty nifty trick, huh?


      It's important to note that confiscation was necessary to Roosevelt's
plan because we were under a gold standard. Gold at that time was widely
held throughout the population. If Roosevelt had devalued the dollar without
confiscation, then whatever savings Americans held in gold would have been
immune from this hidden tax. Furthermore, many Americans likely would have
redeemed whatever paper dollars they held in fear of another devaluation.
This could have wrecked the dollar's viability as a currency.




      These rationales no longer apply. In the aftermath of Roosevelt and
Nixon's dismantling of the gold standard, gold is no longer currency. Most
Americans hold their savings in dollars and it is the only legal tender
(which means it must be accepted in payment of all debts). Thus, President
Obama and his buddy Bernanke don't need to confiscate gold to devalue the
dollar and finance excessive spending. In fact, the Fed has more than
doubled the monetary base since the financial crisis started.




      WHAT, ME WORRY?

      The only reason to fear confiscation is in the case that the federal
government is in default and needs the gold in order to pay off its
creditors. But if it comes to Washington simply stealing our assets at whim,
then why would gold be the only target? At that point, real estate, stock
and bond certificates, and vehicles would be much easier to seize. Gold has
been prized throughout history for its high value-to-weight, making it easy
to conceal and trade under tough political conditions. Consider: you could
store enough gold to care for a small family for six months (approx. 9
ounces) on the inside of a belt buckle.


      Remember, if Washington chooses the confiscation route, we're talking
about a situation of pure pandemonium. When governments begin abrogating
property rights in that fashion, the entire market mechanism ceases to
function. We saw this in the Great Depression as Hoover and then Roosevelt
relentlessly attacked private property and contracts.




      If the situation really gets this bad, you aren't going to trust some
government agent with the intelligence of your average TSA officer to judge
whether your coins are "numismatic" enough to be exempt from confiscation.
The best protection in this case would be to have your gold stored safely at
home or off-shore (not in a safety deposit box at a bank, where it is more
likely to be seized).



      Even in the heat of Roosevelt's confiscation scheme, government troops
did not break into people's homes. The singular (failed) prosecution under
the order took place when a New York lawyer tried to withdraw 5,000 troy
ounces from Chase Bank. Ironically, all the gold actually collected by the
Treasury was willfully surrendered in a wave of misguided patriotism, while
many "law-breakers" simply kept their gold - which is why some old coins
escaped the Treasury's furnaces and are still around today.

      SHOP SMART


      The bottom line is that unscrupulous dealers use the threat of
confiscation as a scare tactic to get you to buy gold coins at mark-ups well
above the spot value of the metal they contain. While investors buy physical
gold for many reasons - lack of counter-party risk, financial privacy,
portability, et cetera - it is principally a store of value, a way to
protect your wealth from the relentless devaluation of fiat currencies. Your
goal as a buyer is to get the most gold possible for your money, from a
dealer you trust. The dealer should make the process transparent and easy to
understand, and deliver a genuine product at the agreed-upon price.

      As a matter of business ethics and fair dealing to our customers, I
decided early on that Euro Pacific Precious Metals would not offer
numismatic coins. To put it simply, I think they are a poor investment
option.

      Peter Schiff is CEO of Euro Pacific Precious Metals. Having spent
years encouraging his brokerage clients to buy physical gold, he grew
concerned about the growing number of unscrupulous dealers that tried to
"up-sell" customers to rare or collectible coins with high markups. Peter
Schiff's gold coin buying philosophy is to buy for the coin's metal value,
not its claimed "numismatic" value. He decided to open his own firm to sell
investment-grade bullion products at competitive prices. Euro Pacific only
sells reputable, well-known coins that trade on the open market, such as
American Gold Eagles, Canadian Maple Leafs, and Australian Kangaroos. To
find out more, please visit www.europacmetals.com or call us at (888)
GOLD-160
      -- Posted Friday, 3 December 2010 | Digg This Article | Source:
GoldSeek.com


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