Jim Sinclair: Gold confiscation rumor control
Jim Sinclair tonight dismisses concerns about gold confiscation and makes an important point about the confiscation undertaken by the U.S. government in 1933. Sinclair writes:
"In the 1930s gold was to the monetary system what 'quantitative easing' is today -- a means of increasing the supply of money for Federal Reserve and Treasury Department discretionary use. The secretary of the treasury and President Roosevelt set the gold price higher arbitrarily at their daily breakfast -- higher because, to create money then, the system required a higher value of gold to have more money outstanding. This is why Roosevelt ordered the confiscation of gold -- to unfold his type of monetary stimulation, his QE. This is what confiscationphiles simply do not know."
Indeed, some market analysts, like Stewart Thompson of the Graceland Updates letter --
-- and the economists and fund managers Paul Brodsky and Lee Quaintance of QB Asset Management in New York --
-- long have argued that central banks now are arranging a controlled ascent for gold to devalue their currencies for monetary stimulation, what GATA has called a controlled retreat with the longstanding gold price suppression scheme.
Like Sinclair, GATA also has been skeptical about any new confiscation of gold insofar as the justification offered for it in 1933 simply doesn't apply today. That is, gold no longer constitutes a significant part of the money stock of the United States and the government already owns (or claims to own) the better part of the gold within the country's borders.
But there is no absolute assurance about what the U.S. government will do as it grows more power-mad every day. As it confirmed officially to GATA in 2005, the Treasury Department claims the power, upon proclamation of an emergency by the president, to seize or freeze not only any gold or silver or gold- or silver-related asset but also to seize or freeze any financial asset. GATA's correspondence with the Treasury Department is posted in the "Confiscation" section of our Internet site here:
Seize or free anything -- that's the land of the free and the home of the brave for you these days.
Sinclair's commentary, "Gold Confiscation Rumor Control," is posted at JSMineSet here:
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.