U.S. Will Default on Its Debt

The U.S. dollar will devalue; no one is disputing that. Yes, interest rates are low, but no one can predict how long they will remain so.

There is certainly no shortage of pundits (and other prophets of doom) who put a lot of spin on the U.S. debt problems. Yes, Social Security, Medicare and other government entitlement programs will need to be reigned in, and they shall.

On a side note, the American public held gold, silver and high yielding gold certificates (Liberty Bonds) during the thirties, but they were sliced, diced and quartered during Roosevelt's reign of terror (1933 Gold Confiscation Act).

Just as surely as the present administration will spare no expense in confiscating all of the nation's retirement plans, those who hold precious metals will not be spared a similar fate. Take heed, the Obama juggernaut is fast approaching.

It's not going to happen. Even if it did happen it would never be complied with. Even if it were complied with it would never make nearly enough difference to the US's shocking balance sheet.

The Fed have vigorously resisted an audit of US gold bullion holdings. Why? What harm could that possibly do? Obviously it can only be because some or all of the gold has, er, "vanished". If you think the American public are going to hand over *another* stack of gold to the Fed, when they can't even account for what became of the last lot, AND IN THE INTERNET AGE AND ALL, then good luck with that. You'll need it.

think those in power will certainly be talking and thinking and scheming about it but will they be able to pull it off a second time? And this time with the internet and availablility of information real time it's going to be a much tougher sell. It may spark a revolution this time especially as Paul_B pointed out, Fort Knox is probably empty or maybe it's just full of gold plated Tungsten bars.

And if Fort Knox is really full of gold then why would they have to confiscate more gold if they already have 8000 tons?

Ever since FDR's abrupt seizure of all private holdings of gold and silver in 1933, most Americans have shunned such commodities in their portfolio baskets. The confiscation that occured back then is not much different from plain homesteading in today's times. One does not 'own' the land per se, but rather just 'squats' on it. Similarly, one pays for the privelege of 'holding' gold, but not necessarily 'owning' the metal.

Make no mistake. If push comes to shove, nothing will be left off the table. The federal government has all the power that it needs to seize anything at will (whether it be land, stock purchases, commodities, personal property, savings and retirement accounts, etc.).

Do you think that FDR was fooling when he issued that confiscation order to the American public? Do you think that Barack Obama will be fooling when he issues a similar directive? I can assure you that FDR had absolutely no trouble at all in securing universal compliance with his order, and neither will Barack Obama. Do you know why? Please read Section 9 of the Gold Confiscation Act of 1933 below, and then you will have your answer.

Section 9. Whoever willfully violates any provision of this Executive Order or these regulation or of any rule, regulation or license issued there under may be fined not more than $10,000, or,if a natural person may be imprisoned for not more than ten years or both; and any officer, director, or agent of any corporation who knowingly participates in any such violation may be punished by a like fine, imprisonment, or both. in their portfolios.

Rick,

All people would have to do would be to stash their gold someplace safe. That's all. If the government can't find it, they can't seize it and they cannot punish you if you don't appear to possess any!

I wish the gold bugs well. They had more foresight than me, but I don't begrudge them the huge gains they've made. They took a risk and it paid off big time. Gotta salute that!

Hi,

Again these rumors about gold confiscation, you guys are heavily marked by the so called confiscation of 1933

but the historical facts of 1933 are other as you think:

Gold confiscation of 1933 is more a myth than a reality.

The White House has stated the 5 April 1933 that

".. over $600.000.000 in the form of gold and gold certificates" had been returned to the FED banks.

What does this mean ?

In 1933 there were gold certificates (legal banknotes with a promise of redeemption in gold coin with the text "IN GOLD COIN PAYABLE TO THE BEARER ON DEMAND') in circulation for the total amount of: $3.385.640.000 !!!

in $10, $20 and $50-Notes for $1.963.640.000

in $100-Notes for $324.000.000

in $500, $1.000, $5.000 and $10.000-notes for : $1.098.000.000 !!!!

The notes greater > $100 were automatically out of circulation by the confiscation act because 5 Oz of gold (to keep legally by any person) was only about $103,35 ($20 gold coin has .9707 Oz fine gold).

But there had been for $1.1 bn of these high value notes in circulation !!

BUT ONLY $0.6 bn IN ANY FORM (Gold Certificates, BULLION) WAS RETURNED !!!

The bulk of the returned $0.6 bn in gold had been high value gold certificates and NOT GOLD COINS OR BULLION!!

Because nobody would be able to use these notes after 1. of May 1933 these gold certificate notes were legally changed before the 1. of May into National Currency (FED notes).

People changed a bank note against another - loosing only the theoretical right of redeemption in gold !!

Another myth is that the (supposed) content of Fort Knox (some 8100 metric tons of gold - around 260.000.000 Oz) is coming from the confiscation of private gold holdings in 1933.

In reality only about 500 metric tons (16.000.000 Oz) where "confiscated" from the public in 1933 see http://en.wikipedia.org/wiki/Executive_Order_6102

We must see this in relation to the amount of gold in circulation. In the US up to 1930 gold coins for an amount of $4.800.000.000 have been minted (230.000.000 Oz) only 6% of them entered Fort Knox by being exchanged against FED-Notes in order to the Confiscation Act of 1933!

Where does the Fort Knox gold really come from ?

1. 1933 most of the gold certificates (legal bank notes) where exchanged into Fed-Notes - 1934 private possession of gold certificates was forbidden and those in possession of the banks where changed into not redeemable gold certifcate notes (issue of 1934).

The old gold certificate notes were backed at 100% by the local FED's with gold which was stored in their vaults.

This gold now obsolete for backing gold certificates went to Fort Knox.

We don't know how much gold certificates were in circulation but it must have been at least the sum of the so-called "small-size" notes of 1928.

The former "large-size" notes (issues 1882-1922) were also in circulation but in parts replaced by the 1928 issue.

The 1928 issue was about $3.385.640.000 alone - this means for backing this amount at least some 168.000.000 Oz of gold had been stored in the local FEDs.

After the Gold Reserve Act of 1934 all gold of the FED's was transferred to the Department of Treasury.

2. After the Gold Reserve Act of 1934 all gold mine companies had to sell their mined gold to the gouvernment - that the second big source of the Fort Knox gold.

As we see the 1933 confiscation was in reality a "confiscation" of the right of redeemption of bank notes and only in a very little part a "confiscation" (by exchange into Fed-Notes) of real physical bullion!

More than 90% of the physical Bullion was not "confiscated"!

There was only 1 prosecution under the Confiscation Act and this one was declared technically invalid by the judge.

Safe deposit boxes held by individuals were not forcibly searched or seized under the order, and the few prosecutions that occurred in the 1930s for gold hoarding were executed under different statutes. see

http://en.wikipedia.org/wiki/Executive_Order_6102

Cheers

Gold confiscation is not a myth. It did happen and since there is a precident for it, it could happen again. Anyone with more than 5oz of gold needs to think about that. Will it happen? If the entire fiat currency system collapses, which is a possiblity, then gold will be in high demand and governments will do what they need to do to get hold of it. It still doesn't mean there will be another round of gold confiscation but I think the prudent investor will at least plan for the possibility. Tread carefully, these are dark times and the storm is approaching.

Hi,

Peter, I never said that there had been no gold confiscation in 1933 and I never said that there won't be any in the future.

What I say is that the way todays people talk about it is not the historical truth.

Mythical horror stories about 1933 is the problem I try fight.

Again the thruth is:

- about 168.000.000 Oz PAPER GOLD was confiscated in 1933 and redeemed in fiat (FED notes)

- only some 16.000.000 Oz of real physical gold bullion was changed against fiat and the owners of this bullion had been in great majority institutional - there was very little privatly owned gold bullion given away.

- nobody was fined or jailed in this story

- deposit boxes have not been blocked for the owner

- FBI never investigated in homes and deposit boxes in order to find some double eagles

- more than 214.000.000 Oz of physical gold (minted coins and ingots) has been hidden by your grandfathers until 1971

- nearly everybody having more then 5 Oz of physical bullion did not respect the law

What this story is telling us in case of a new confiscation:

- not to have "paper gold" in the borders

- gouvernement will probably not investigate in your home

- gouvernement will not jail millions of people in order to have a revolution

- do what your grandfathers did

Cheers

Given the mass awareness now (thanks to the internet) of how savers and investors have been screwed by governments the world over for decade after decade, I believe we would see, on the path to any "confiscation" and well before it ever came to pass, politicians and bankers hanging by piano wire in their thousands from telegraph poles in all western countries. One more major black swann event and it's game over for the enslavers.

It's not just gold but silver to watch out for. As said above, do what your grandfathers did and don't let go of your gold and silver no matter what the government tells you to do.

On a side note, if confiscation were ever to happen again you would probably (but not necessarily) see the mint stop producting gold,silver eagles in the months before such an event would happen. That would be a possible sign that they were preparing for confiscation again. In the 30's there was basically no gold coinage minted after 1929 although there was some in very very limited quantities with 1933 being the very last year of which only a handful of coins were produced.

Peter: In fact, not only were all of the nation's safety deposit boxes locked down (before the ink could even begin to dry on FDR's gold confiscation directive), our grandfathers did do exactly like FDR commanded. One has to look no further than through the records at that time to discover that most of the gold (and silver) which was confiscated originated from the general public.

As history reveals, it was hardly necessary for FDR to ever raise a finger to meet his objective, and I would have to doubt that this president wasn't prepared to use all means at his disposal to achieve that end. Moreover, one would have to believe that the penalty for non compliance with that order was simply something no one dared risk at that time. Tell me. What would all of you learned gentlemen have really done in 1933? Would all of you been willing to forfeit the family jewels, and share a cell in Atlanta (next door to Capone's) for daring to violate FDR's order? I think not.

Now as for the remainder of the nation's gold (which was held primarily by the nation's major banks), this was quietly routed to select Swiss vaults and other clandestine offshore depositories (and presumably out of the U.S. government's reach).

The big players (Rothchilds, Morgans, Rockefellers et al) in this game write the rules Peter, but they don't necessarily have to abide by them. They will if it is convenient for them to do so. A pleasant journey!

Rick,

Onc' Scrooge has gone to extensive lengths to try to inform you of the facts. He has provided facts and figures and sources and attributions for every claim he has made.

You are coming across like a classic anti gold bug. You're bitter about missing out on gold's meteoric rise and you just want to spoil the party for those that were smarter than you and bought gold years ago. .

If any FED agents were unwise enough to seek to seize gold in the internet age, they will encounter only lead for their trouble. No one would comply, especially given that US gold reserves have been blocked from an independent audit. It simply ain't gonna happen, pal.