How do governments sell their physical gold

Gold ban: is it coming? What can I do?

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Some gold investors are concerned about the question: is a gold ban coming? If so, when? And what can I do about it? All the answers here.
  • Gold prohibition colloquially for: Access of the state to gold holdings
  • Excessive concern is unjustified because it is unpopular and difficult to implement
  • So far it only concerned investment gold. So jewelry was excluded
  • Of all asset classes, gold offers the best protection against access
  • If you still want to prevent: buy gold anonymously and then hide it

What is a gold ban?

As Gold ban Colloquially, a process is called where gold ownership is either regulated or the state levies compulsory taxes in some form on it. History shows that gold bans, especially in times of precarious public finances, were imposed as the "last resort", that is, as a last resort. And they were used in an era when the value of paper money was still linked to gold via the gold standard.

To what extent the possession of gold is generally a thorn in the side of the advocates of paper money, one can only speculate. Because anyone who owns gold is immune to negative interest rate policies and monetary devaluation.

What happens if there is a gold ban?

There is no such thing as THE gold ban. Gold bans can take different forms, with different consequences. Actions can relate to gold trading or gold ownership. They can range from selective restrictions, for example in the form of trade restrictions or quantity restrictions, to comprehensive prohibitions on ownership, where gold must be sold to the state at a fixed price. The sanctions can also vary, from simple fines to imprisonment.

Gold bans in history

There have been many gold bans throughout history, across all countries and epochs.

The historically best-known gold ban took place in the USA on May 1, 1933. By ordinance, all private gold had to be sold to state acceptance points within 14 days at a fixed gold price of $ 20.67 per ounce.

The only exceptions were gold jewelry and gold up to an exemption limit of 100 dollars.

Spicy: Nine months later, on January 31, 1934, the US government set a new gold price at $ 35 per troy ounce.

Photo: USA prohibition of gold - Order of the US President from 1933. Also known as "Executive Order 6102"

In order to properly classify the US gold ban, the value of this $ 100 exemption limit should be carried over to today. And then the extent of the measure is put into perspective. Because $ 100 was almost 5 ounces of gold at the time it went into effect. Or to put it clearly: That is 5 Krugerrand gold coins after all.

The gold bans from 1923 and from the time of National Socialism are known in Germany.

Before one asks this question, one should bear in mind that in principle any form of investment can be the target of government coercive measures. Each state will first examine the chances of success of alternative measures before issuing a gold ban. Because gold bans are unpopular, difficult to enforce, and relatively ineffective. In addition, gold is the smallest asset among all asset classes. There is little to worry about right now.

So instead of the question When will a gold ban come To speculate, it makes more sense to identify possible factors from which probabilities for an upcoming gold ban can be derived. Such factors would be for example:

  • How precarious is the state's position to take this unpopular measure?
  • What about the practical enforceability?
  • How bad or good are the chances of success of alternative coercive measures?
  • How big is the prospect that a gold ban will actually solve an existing problem?
  • How widespread is the (officially known) total gold possession among the population?

So it's important to understand that a gold ban is just one of many coercive measures a state can take to hold citizens' assets accountable during troubled times.

Other measures would be special taxes, general compulsory levies and tax increases, confiscation of foreign assets, currency restrictions, or compulsory mortgages for real estate. All examples that have already existed in history. Compulsory mortgages for real estate, for example, were levied in Germany after the end of World War II as part of the Burden Equalization Act.

Basically, if the state enforces coercive measures on assets, gold is the asset class that is by far the best suited to evade access.
You can buy gold anonymously and hide it well. This is not possible with real estate or other asset classes at banks and custody accounts. Incidentally, history shows that gold bans primarily applied to investment gold. Gold jewelery owners were generally not affected by gold bans. A gold ban is also very unlikely for collector coins.

How can you get around a gold ban?

If you seriously fear a gold ban and want to be on the safe side, you should be careful not to leave any traces when buying investment gold and hide the gold after buying it.

Anonymous gold purchase against cash payment is legally possible up to EUR 1,999.99. Anyone who then thinks about subsequent storage in a bank safe deposit box should know that safe deposit boxes can be opened by compulsory measures. So it is better to hide the gold.

As is well known, there is a serial number for larger bars. But anyone who buys such bars does not have to worry about whether they can be identified by this serial number. There is neither a note about the serial number on the invoice, nor do you have to worry about a data comparison of the serial number and personal data. Serial numbers are only memorized by manufacturers for internal purposes.

If such hidden gold is later to be turned into cash, that is also possible in principle. Although traders require proof of identity every time they buy gold, the reverse also applies: Gold can be sold to anyone at any time and anywhere using the price. Otherwise a bit of cleverness is required. Gold is small and mobile with a high density, and is accepted as a means of payment around the world.

of Concerned Freethinker | December 20, 2019, 11:55 am answers

Gold bans or access to private gold reserves only existed under totalitarian regimes. In a democracy, such a thing is hardly legally enforceable. However, since freedom of expression is already massively threatened at the moment, you never know how far we are from a totalitarian regime. THEY let us choose but do what YOU want and what is good for YOU.

Show 3 responses to Concerned Freethinker
of Martin (s) Horn | May 20, 2020, 5:47 pm Answers

Well done article that looks at the subject without ideological glasses.
However, I think it should be added that the "classic" gold bans were not only not general bans on ownership, but decidedly monetary policy measures! In a world in which all major currencies were somehow built on gold (partial coverage systems, currency coverage (if the foreign currency was gold-backed) up to Bretton Wood), gold is a motto. The private ownership of pecuniary gold (i.e. no jewelry or art in general or historical collector's items) means in gold standard systems an incalculable amount of "money" that is withdrawn from circulation (hoarded). This is completely different from nowadays, where hoarding gold has no influence on the respective currency system because there is no direct connection between the local currency and the amount of gold.
In a gold standard, however, the amount of gold deposited with the money-issuing institution (usually the central bank) is essential! Gold bans then prevent the necessary fundamentals of the entire monetary system from flowing away. That is why a "gold ban" is unlikely today.

Show 1 reply to Martin (s) Horn

written very easy to understand.
poured my gold into the foundation of my garden shed.
Nobody knows about it except my grandson.
greetings super Urmel from the egg

Show 1 reply to Urmel
of Erich Wiedner | 01/23/2020, 01:30 AM answers

perfect information .. took away my greatest fears ..
unfortunately it is always rumored in the greatest horror performances ..
..than to buy collector coins.

remember, remember the 5th of November ...