Merit Financial - A History of Gold Confiscation?
Investors who invest in gold coins and other precious metals and even common citizens who possess gold and silver coins like Gold American Eagles and other U.S. minted bullion products often ask if the government can confiscate their precious metals/coins during dire financial conditions. Confiscation is allowed under the Constitution and the 1933 Executive Order 6102. Originally issued by then President Franklin D. Roosevelt is well known amongst gold coin buyers, but the question we will ask in this article is, can it happen again? If you do not know about it, then ask your Financial Investment advisor about the same.
The confiscation took place to stabilize the economy and revalue the dollar. With the help of other economic measures, the economy was back on track within few years and the loss suffered by the Asian and European nations during the World War II, gave the US a clear cut edge over them. There are economists who claim that the economy could survive because of the Gold Confiscation Act, while there are other economists who think that confiscation was not all that serious and there were people who were able to avoid it, legally or illegally.
Special Financial videos are available that explain about the gold confiscation and its history in a comprehensive way. Coming to the question as to whether gold confiscation by the government can take place in today's times or not. The letter of the law does not outright ban another confiscation from happening. The true answer behind this question is very political and we are not here to take politcals sides, but suffice it to say that leberals and conservatives have very distinct views on the possibility and or necessity of this happening. Simply stated, a standing president can not override the Executive order of a previous president however, he or she can pass a new order that begins after their predecessors order ends.
Back in 1933, $20 per Troy Ounce was paid in return for gold coins to those who surrendered their gold possession. Then the exchange rate was raised to $35 and those who did not submit their gold after the very first investment made windfall gains. This is not possible today because gold's prices have increased considerably and government may find it extremely difficult to compensate for the confiscated fold.
Moreover, back then also, people were allowed to keep $100 worth gold with them. If gold confiscation were to take place today, the $100 would become comparable to today's price index and shoot up dramatically. Ask about such a scenario to your Financial Investment advisor and he will tell you that there is no reason to worry because only a small section of the American population will actually have gold coins worth more than that, that today's equivalent of 1933's $100.
The chances of gold confiscation taking place are very slim, but they are nevertheless there and that is why investors are advised to create a portfolio that is diversified with not only stocks and gold but also other securities such as bonds, savings and untraditional commodities. Finally do not invest in any type of Gold or precious metals because you see it as a protection against the U.S. government, invest in Gold because you are seeking diversity in your portfolio, plan and simple.
The confiscation took place to stabilize the economy and revalue the dollar. With the help of other economic measures, the economy was back on track within few years and the loss suffered by the Asian and European nations during the World War II, gave the US a clear cut edge over them. There are economists who claim that the economy could survive because of the Gold Confiscation Act, while there are other economists who think that confiscation was not all that serious and there were people who were able to avoid it, legally or illegally.
Special Financial videos are available that explain about the gold confiscation and its history in a comprehensive way. Coming to the question as to whether gold confiscation by the government can take place in today's times or not. The letter of the law does not outright ban another confiscation from happening. The true answer behind this question is very political and we are not here to take politcals sides, but suffice it to say that leberals and conservatives have very distinct views on the possibility and or necessity of this happening. Simply stated, a standing president can not override the Executive order of a previous president however, he or she can pass a new order that begins after their predecessors order ends.
Back in 1933, $20 per Troy Ounce was paid in return for gold coins to those who surrendered their gold possession. Then the exchange rate was raised to $35 and those who did not submit their gold after the very first investment made windfall gains. This is not possible today because gold's prices have increased considerably and government may find it extremely difficult to compensate for the confiscated fold.
Moreover, back then also, people were allowed to keep $100 worth gold with them. If gold confiscation were to take place today, the $100 would become comparable to today's price index and shoot up dramatically. Ask about such a scenario to your Financial Investment advisor and he will tell you that there is no reason to worry because only a small section of the American population will actually have gold coins worth more than that, that today's equivalent of 1933's $100.
The chances of gold confiscation taking place are very slim, but they are nevertheless there and that is why investors are advised to create a portfolio that is diversified with not only stocks and gold but also other securities such as bonds, savings and untraditional commodities. Finally do not invest in any type of Gold or precious metals because you see it as a protection against the U.S. government, invest in Gold because you are seeking diversity in your portfolio, plan and simple.
Source...