Gold confiscations and current gold

In 1933 President Roosevelt seized privatly owned gold coins, using authority found in legislation dating from 1917 designed to keep folk from hording gold in time of war.

http://www.lewrockwell.com/anderson/anderson154.html

Putting aside the politics and legality of the move, the reason I post is because the government grab in 1933 paid $20.67 an oz at a time when the stamped value on a gold Eagle was about the same.

I have been collecting US gold in a very minor way since 2004. Recently I have become concerned about the drop of the dollar and the rise of the EURO and the growing reluctance of foreign businesses to take payment in dollars. If this continues or extends to governments, our fine government might be tempted to repeat the 1930's.

If they did this and again repeated the practice of paying the face value for their confiscation, owners of US gold coins would receive 1/18 the bullion value of the coins, not to mention any numismatic value.

Is this paranoia or should I be buying foreign gold???

 

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i would never even think about telling the Govt. i even own a gold coin, if something liek this were to happen again. IMO i really dont think it could. People today are smarter, or rather more informed, then back in the 30's. If the govt tried a repeat, i dont think it would have much affect.

 

i can see how this would look to an outsiider, but not really apply to a collector. when this happened in 33, they let gold with numismatic value stay with collectors.

i wouldnt put it past the gov. to try to do this. You think it wouldnt be easy to find out who owns what? internt, world wide web! maybe afew go under the radar but enough of us would eat it on that one.

very interesting topic though. mines buried anyway. not to mention i would spend it first.

 

The government redeemed gold coins to get us off the gold standard and could care less about people owning gold. However, I am sure there there are people convinced the government is out to get them and would argue with me. Your gold is safe.

 

Let's not forget, many of us bought most of our gold from the US Mint which is the Federal Government. I'm not really concerned that they'll try to confiscate the gold, however.

 

This must be how conspiracy theories and urban legends get started.

 

i think so... crap i hear static, they are watching us right now...

 

Thank goodness for the ACLU.

 

do you really think the people would let the government, any administration for that matter, take their nest eggs. Not likely

 

It's paranoia. Gold was confiscated back then because it was money and the government desired to switch to a purely fiat currency system. Now, gold is a commodity. The government could just as easily go around ripping the copper pipe out of people's homes, or collecting wedding bands, or confiscating agricultural commodities -- all seem to be low probability events. I'm pretty sure federal agents aren't going to perform a house-to-house search of everyone in the country looking for coin collections. If they do, foreign gold won't protect you. In the very unlikely event that the government decides they need gold [for what purpose nobody knows because they don't use it for anything anymore], they'll probably just take it out of the gold ETFs and Comex warehouses.

 

When I looked at the mints prices, I found they were charging more than coin services. What is with that?

 

I hope you are right, but we are speaking of the government. These are the same folk who will steal a house for $10K in back taxes, sell it for $150K and keep the entire windfall (Most state and local governments). This is the government that promised 'free health care for life' to career veterans yet who now charge fees and copays for the free care.

They did steal gold in 1933. If foreign governments begin demanding real value and not simply paper for their goods, like oil, what does the government do, protect the wealth of a few hundred thousand collectors or grab that gold to keep the oil flowing?

That was not my question though...My real question had more to do with putting a value on the coins, a value 1/18 its real value. Krugerands don't do that. I would feel more secure if our coins did not list a bogus face value.

 

Your gold could be confiscated, but as Amendment V of the United States Constitution states:

No person shall...be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

They would have to give you a fair price for your gold.

 

A 'just compensation' is often in the eyes of the beholder. In eminent domain cases the government always low balls and often revises zoning to insure a lower 'just price' on the property they desire.

That is politics, not coin collecting. I am just curious about the decision to put a bogus face value on the coin...why?

 

The only interpretable definition of "just compensation" in my mind when it comes to bullion would be spot price. I doubt it would be upheld in court if the government took bullion and only gave face value for it, as it is well known that the face value of bullion is well below its actual worth.

Regardless, I don't see the government doing this; it would be too difficult to seize gold from every single private home that has gold.

 

Then why put a bogus face value on the coin? What purpose is served? Would not '1 OZ Gold' serve as well? Paper currency is worth what it says, modern pot metal coins are again only worth what they say on the coin but gold and silver coins have two values, a real one and a face value.

 

If I understand your question, the reason is that coins sold by the US Mint are numismatic coins, either some kind of special issue or proof finishes and they have special packaging (like fancy boxes) so they carry a premium. Commemoratives usually add an additional surcharge that doesn't go to the mint, but goes to a sponsor of the commemorative. For example, the Bald Eagle commemoratives that just came out carry a surcharge to support the American Eagle Foundation of Tennessee.

Bullion gold (uncirculated silver and gold eagles) are sold only by authorized dealers and the price is based more on the precious metals markets.
Their packaging is very basic (usually just a mylar film blister).

 

It was my understanding that a face value was stamped on bullion so that it could be considered a legal tender coin for coin collectors. I thought it was purely a symbolic measure.

Similarly, if the government ever had to take a 1909-S VDB Lincoln Cent for public use (not that they would, this is just speaking hypothetically), "just compensation" would surely not be the one-cent face value.

Of course, the government has never confiscated gold since the 1930s, so we have no idea just what "just compensation" would mean. However, if gold were to be confiscated, it would be done so by an Act of Congress (Legislative Branch) or by an Executive Order (Executive Branch), while the "just compensation" clause would be interpreted by the Judicial Branch. Therefore, the same branch of the government that would be confiscating the gold would not be the same branch that would have the final say on what "just compensation" means.

 

Joan Langbord may differ with you regarding her 10 1933 Double Eagles the Feds confiscated from her. But they confiscated them because they claim they are illegal to own, not for the reasons stated by the OP.

 

Thank you...that makes perfect sense and answers that question:smile