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Title: Ron Paul: "Sell the Gold in Ft. Knox"
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URL Source: http://www.garynorth.com/public/8028.cfm
Published: May 19, 2011
Author: Gary North
Post Date: 2011-05-19 11:37:20 by Capitalist Eric
Keywords: None
Views: 8753
Comments: 16
Ask a gold bug if he thinks that Franklin Roosevelt did the right thing in 1933 when he unilaterally confiscated the gold coins of all Americans. He will tell you "no." Why not? "Because it was a violation of property rights. The Federal government had no legal authority to do this." But the Supreme Court authorized it, 5 to 4. The gold bug will tell you that the Supreme Court cannot be trusted. Fast forward almost 70 years. Ron Paul announces at the Heritage Foundation that the government should sell its gold to reduce the national debt. http://www.nysun.com/national/selling-gold-at-fort-knox-emerges-as-next-big/87350 No one comes to his defense. Understandably, the Treasury Department got one of its staffers to write a critique. The government should sell no assets, she insists. Congress must raise the debt ceiling. There are not enough assets to sell. She ridiculed the suggestion of a balanced budget through asset sales. With a deficit of $125 billion a month, she said, a fire sale would do no good. Then, amazingly, she admitted that gold is central to the perception if the U.S. government as solvent. Treasury Secretaries from both parties have made it clear that they would not sell gold in order to buy time in a debt limit impasse. As then-Treasury Secretary James A. Baker said: "President [Reagan] and I are not prepared to take that step because it would undercut confidence here and abroad based on the widespread belief that the gold reserve is the foundation of our financial system, and because the Congress clearly has the power to prevent a default by assuming its responsibility with respect to the debt limit." When President Reagan was asked whether he would consider selling gold, he told his Budget Director, James Miller, "absolutely not." Similarly, Treasury Secretary Robert E. Rubin said, "We will not sell the nation's gold supply." In short, gold is not a barbarous relic. Gold in the vault at Fort Knox and in the Federal Reserve Bank of New York (a private corporation) is basic to the world's confidence. But what about gold in the hands of Americans? She did not say. The Treasury has had contempt for that idea ever since 1933. That a salaried government bureaucrat would oppose the sale is understandable. But equally incensed are gold bugs. Only one came to his defense: the #1 scholar of the American gold standard, Dr. Edwin Vieira, author of Pieces of Eight, a 1600-page history of the gold standard in America. "Redeemable currency is an oxymoron." The government has no plans to restore a gold standard of any kind. "They don't need the gold. They've just been sitting on it since Roosevelt stole it." Everyone else was critical of Paul's suggestion to restore gold to the private sector. What's going on here? If it was immoral and illegal for the government to confiscate the gold at $20 an ounce in 1933, why is it a bad idea for the government to sell back the gold to the public at a market price today? We see once again that people who say they believe that gold is the basis of freedom do not believe it. They believe in the United States government. They believe that the government has the right to hang onto its stolen gold. Why? Because the government will someday establish a gold standard. The gold belongs to the government. But what is a gold standard? It is a system in which the government buys and sells gold at a foxed price. We have not had that system since 1933. The government did make the promise to foreign governments and central banks, but Nixon unilaterally broke the promise on August 15, 1971. The gold bugs have now converted to Franklin Roosevelt's idea of a gold standard: a system in which the government has the right to steal property at one price, hike the price later, and sit on the wealth. The gold bugs honestly trust the Federal government to restore a gold standard someday. There has not been one since since 1933 that any government on earth will do this, but somehow, the gold bugs believe, it will do it in the future. Fine. If the government sold all of its gold today, this would deplete the Federal Reserve of part of its monetary base. The public would have the gold. The FED could buy assets to replace the gold. That would restore the monetary base. The FED would have worthless IOUs, and the public would have the gold. My preference would be for the gold to be sold as tenth-ounce American eagles. Sell it to American citizens, not foreign central banks. Get Americans used to holding small gold coins. The government stole the gold from Americans. It should sell it back to Americans. But gold bugs see what is at stake. The price of gold would fall. They bought gold as an investment. They worry that they would lose money if the stolen gold were sold. Better to let the Federal government hang onto stolen goods than to let the public get its gold back. They do not believe in the free market. They believe in a rigged market, one in which the government gets the right to hold onto stolen gold forever, or what is the equivalent of forever: the restoration of a gold standard. But what kind of gold standard? The kind that existed under Bretton Woods system (1946-71)? One in which there is no legal right for common people to buy gold at a fixed price? That transferred power to Richard Nixon. How good a gold standard was that? What kind of gold standard is a government-guaranteed gold standard? "Turn over your gold to us. You can get it back at any time." That was what banks around the world promised until August 1914. Then the central banks confiscated the gold held on deposit at commercial banks. The gold was never returned. A government-guaranteed gold standard is not a gold standard. It is a government promise standard. It will be broken whenever politicians deem it convenient. There are two kinds of gold standards. One is a government-guaranteed gold standard, which is preliminary to gold confiscation. The other is a gold coin standard. The difference is clear: the first is statist; the second is free market. As I wrote in 2003: This is why any call by conservatives for the State to adopt a gold standard is futile. No one will listen. Even if voters understood the case for a limited State, they would not be able to limit the State by a State-run gold standard. A State-run monetary system, with the exception only of Byzantium, becomes a debased standard. This is why the free market is the only reliable source for the re-establishment of a gold standard. Honest money begins with these steps: (1) the revocation of legal tender laws that require people to accept the State's money; (2) the enforcement of contracts; (3) laws against fraud, which fractional reserve banking is. The free market can do the rest. Ron Paul is correct. The government should sell the gold. I would add only this: the form of the gold should be in the form of American eagles, and sold only to Americans -- heirs of the victims of Roosevelt's confiscation. I want Americans to get used to seeing and owning gold coins again.
A "fire sale" of the Nation's gold to meet payment obligations would undercut confidence in the United States both here and abroad, and would be extremely destabilizing to the world financial system.
The State's gold standard is a preliminary to eventual confiscation or debasement. The State's promise of redemption on demand should not be trusted. A gold coin standard by profit-seeking storage organizations can be trusted with less risk, but not if the storage is offered for free. There are no free lunches. Someone will eventually pay for free services. When it comes to fractional reserve banking, that someone is always the late-coming depositors.
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#1. To: Capitalist Eric (#0)
Why don't you American gold bug retards buy gold coins from other sources? Gold is gold, so why would they suddenly pay for the American version when the public by and large can buy the Swiss or Canadian or South African coins just as easily? In other words, no restrictions on buying gold coins exists now so this argument that somehow gold is kept out of American hands is laughable.
"Keep Your Goddamn Government Hands Off My Medicare!" - Various Tea Party signs.
Typical ASSumption on your part. My reserves are in silver. You're a special kind of stupid, aren't you?
List of those unable to think: Bumper sticker on DwarF's car: Actually the turning in of gold coins was voluntary, which is why there are still a few of them around. It was the closing of the metal mines that was involuntary and led to higher unemployment.
Bullshit. Forbidding the Hoarding of Gold Coin, Gold Bullion and Gold Certificates By virtue of the authority vested in me by Section 5(b) of the Act of October 6, 1917, as amended by Section 2 of the Act of March 9, 1933, entitled An Act to provide relief in the existing national emergency in banking, and for other purposes~', in which amendatory Act Congress declared that a serious emergency exists, I, Franklin D. Roosevelt, President of the United States of America, do declare that said national emergency still continues to exist and pursuant to said section to do hereby prohibit the hoarding gold coin, gold bullion, and gold certificates within the continental United States by individuals, partnerships, associations and corporations and hereby prescribe the following regulations for carrying out the purposes of the order: Section 1. For the purpose of this regulation, the term 'hoarding" means the withdrawal and withholding of gold coin, gold bullion, and gold certificates from the recognized and customary channels of trade. The term "person" means any individual, partnership, association or corporation. Section 2. All persons are hereby required to deliver on or before May 1, 1933, to a Federal Reserve bank or a branch or agency thereof or to any member bank of the Federal Reserve System all gold coin, gold bullion, and gold certificates now owned by them or coming into their ownership on or before April 28, 1933, except the following: (b) Gold coin and gold certificates in an amount not exceeding in the aggregate $100.00 belonging to any one person; and gold coins having recognized special value to collectors of rare and unusual coins. (c) Gold coin and bullion earmarked or held in trust for a recognized foreign government or foreign central bank or the Bank for International Settlements. (d) Gold coin and bullion licensed for the other proper transactions (not involving hoarding) including gold coin and gold bullion imported for the re-export or held pending action on applications for export license. Section 3. Until otherwise ordered any person becoming the owner of any gold coin, gold bullion, and gold certificates after April 28, 1933, shall within three days after receipt thereof, deliver the same in the manner prescribed in Section 2; unless such gold coin, gold bullion, and gold certificates are held for any of the purposes specified in paragraphs (a),(b) or (c) of Section 2; or unless such gold coin, gold bullion is held for purposes specified in paragraph (d) of Section 2 and the person holding it is, with respect to such gold coin or bullion, a licensee or applicant for license pending action thereon. Section 4. Upon receipt of gold coin, gold bullion, or gold certificates delivered to it in accordance with Section 2 or 3, the Federal reserve bank or member bank will pay thereof an equivalent amount of any other form of coin or currency coined or issued under the laws of the Unites States. Section 5. Member banks shall deliver alt gold coin, gold bullion, and gold certificates owned or received by them (other than as exempted under the provisions of Section 2) to the Federal reserve banks of there respective districts and receive credit or payment thereof. Section 6. The Secretary of the Treasury, out of the sum made available to the President by Section 501 of the Act of March 9, 1933, will in all proper cases pay the reasonable costs of transportation of gold coin, gold bullion, and gold certificates delivered to a member bank or Federal reserve bank in accordance with Sections 2, 3, or 5 hereof, including the cost of insurance, protection, and such other incidental costs as may be necessary, upon production of satisfactory evidence of such costs. Voucher forms for this purpose may be procured from Federal reserve banks. Section 7. In cases where the delivery of gold coin, gold bullion, or gold certificates by the owners thereof within the time set forth above will involve extraordinary hardship or difficulty, the Secretary of the Treasury may, in his discretion, extend the time within which such delivery must be made. Applications for such extensions must be made in writing under oath; addressed to the Secretary of the Treasury and filed with a Federal reserve bank. Each applications must state the date to which the extension is desired, the amount and location of the gold coin, gold bullion, and gold certificates in respect of which such application is made and the facts showing extension to be necessary to avoid extraordinary hardship or difficulty. Section 8. The Secretary of the Treasury is hereby authorized and empowered to issue such further regulations as he may deem necessary to carry the purposes of this order and to issue licenses there under, through such officers or agencies as he may designate, including licenses permitting the Federal reserve banks and member banks of the Federal Reserve System, in return for an equivalent amount of other coin, currency or credit, to deliver, earmark or hold in trust gold coin or bullion to or for persons showing the need for same for any of the purposes specified in paragraphs (a), (c), and (d) of Section 2 of these regulations. 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. This order and these regulations may be modified or revoked at any time. Care to try again? List of those unable to think: Bumper sticker on DwarF's car: Prove it was enforced. Did they go and break down doors ransacking homes for gold coins in 1933? If so there should be lots of old newspaper articles to back you up.
You've gotta' be fucking JOKING, right????????? You can't be THAT stupid...
List of those unable to think: Bumper sticker on DwarF's car: You can't be THAT stupid... War is right. You never have any facts to back up your blustering BS propaganda.
You post a bullshit comment, and I post the ENTIRE EXECUTIVE ORDER, which conclusively proves you lied. Some further quotes from you, that go into that period... The Gold Confiscation Act of 1933 Roosevelt's administration set gold prices and allowed them to fluctuate wildly, and as a result, credit markets froze up completely -- "only a lunatic would lend money in that environment" (per Sen. Glass). As soon as that happened, the administration demonized the banks (as though this were the banks' fault??) and stepped in to solve the problem. Their solution was inflation through printing of massive amounts of money. ............ Many Americans dutifully turned in their meager holdings. But not everyone. Many simply ignored the order, assumed the risks and stashed them away knowing that gold was more valuable than the paper given in exchange. Keeping it literally meant the difference between living ordying for some. There are not significant historical legal records of US citizens being fined or imprisoned for failing to comply. This was the bottom of the depression and average citizens did not have large quantities of gold. Many were jobless, bankrupt and barely surviving; selling pencils and apples on the street corners as so often depicted in the old black and white newsreels from that era. But wealthy businessmen, bankers and society elites did own considerable gold. They obviously did not turn in their gold. How do we know? Most of the US mint made gold coins that were in circulation at the time ($2.50, $5.00, $10.00 and $20.00 denominations, but mostly the 10 and 20 dollar coins) were simply shipped off in bags by the thousands to European banks (primarily in Switzerland and Great Britain) for anonymous safekeeping, far away from the reach of US authorities. They simply sat there in darkness and dust buried at the bottom of bank vaults. ........... The quote that best explains how it went down, is: Thus, when Roosevelt issued his decree, it was not met with massive protests and demonstrations but rather with the same degree of meekness and submission that many (but certainly not all) of the Cuban people would display when their homes and businesses were confiscated by Castro several decades later. The additional value of the public-school indoctrination was that it effectively immunized federal officials from having to bear responsibility for the consequences of their own wrongful conduct. For when U.S. officials announced that the 1929 stock-market crash and the resulting Great Depression were all the fault of “free enterprise” and that such things as the gold seizure and the New Deal were necessary “to save free enterprise,” entire generations of public-schooled Americans had no idea that they were being misled. If Americans had known the truth — that the stock-market crash and Great Depression, along with all the financial devastation and unemployment — had actually been the fault of the Federal Reserve, there would have been considerable anger, perhaps even violent revolts, against the federal government. In other words, American citizens still trusted the government, and did as they were told...... Oh, some DID fight back... and the result? Now, PISS OFF.
List of those unable to think: Bumper sticker on DwarF's car: You piss off, since you proved my premise.
Did you expect otherwise. Your question had a simple answer...yes or no...
America...My Kind Of Place... "I truly am not that concerned about [bin Laden]..." You've gotta' be fucking JOKING, right????????? You can't be THAT stupid... Unable to think? And that's an awefully long list there, CE....8D And thanx for putting me at the top of it. The Ultimate Compliment. 8D
Your question had a simple answer...yes or no... Eric's another poster much like yukon, who recently admitted on LP that he thinks it's perfectly okay to lie to a poster if he doesn't like them or their politics. Even if their political leanings share some similiarities to his own. And Eric's quite intellectually lazy and covers it up with his juvenile cartoons and bluster. He is unable to even notice that his posts are totally unreadable with all the garbage BS he litters them with, a tendency he's probably been fired for in the past.
You're Number 1!
I revel in the Glory. ;} BTW, here's a riddle for CE. How can a privately owned prison be constitutional? How can a privately owned Post Office keep losing $2 billion a quarter and still be viable? How does Delta Airlines stay listed on the NYSE while AMTRAK is looking at Insolvency every quarter? "#2. To: go65 (#1) Nothing that Maggie Thatcher put into place has 'gone well'. but then it wasn't supposed to. The Top 50 000 got their's up front: The $$$ that was 'stripped out'. And the rest was left to rot in place. See AMTRAK for details.... The problem is that these entities left to die just won't...
Wow... A lot of ASSumptions on your part... based on.... nothing. But that's leftist mentality for you. When the facts don't fit your socialist agenda, you just fling shit out there, see what sticks.
List of those unable to think: Bumper sticker on DwarF's car: A lot of ASSumptions on your part... based on.... nothing. Your dysfunctional behaviors makes it safe to assume. They catch up with you every time don't they? Then you call the names in your typical lazy manner to distract and intimidate. You are soooo predictable. How many jobs have you been fired from?
Ron Paul is correct. The government should sell the gold. I would add only this: the form of the gold should be in the form of American eagles, and sold only to Americans -- heirs of the victims of Roosevelt's confiscation. I want Americans to get used to seeing and owning gold coins again.
#2. To: Godwinson (#1)
Why don't you American gold bug retards buy gold coins from other sources?
mcgowanjm, ferret mike, skippy, fartboy/yukko, white sands, bucky, lucys idiot mom, e_type_jackoff, go56, badlie, wreck, calCON, Kafir, war, Banjo Boris, Biff, Godwinson and meguro. If you're on the above list...? PISS OFF.
#3. To: Capitalist Eric (#0)
(Edited)
What's going on here? If it was immoral and illegal for the government to confiscate the gold at $20 an ounce in 1933, why is it a bad idea for the government to sell back the gold to the public at a market price today?
#4. To: mininggold (#3)
Actually the turning in of gold coins was voluntary, which is why there are still a few of them around. It was the closing of the metal mines that was involuntary and led to higher unemployment.
From: President of the United States Franklin Delano Roosevelt
To: The United States Congress
Dated: 5 April, 1933
Presidential Executive Order 6102
(a) Such amount of gold as may be required for legitimate and customary use in industry, profession or art within a reasonable time, including gold prior to refining and stocks of gold in reasonable amounts for the usual trade requirements of owners mining and refining such gold.
/s/
Franklin D. Roosevelt
President of the United States of America
April 5, 1933
mcgowanjm, ferret mike, skippy, fartboy/yukko, white sands, bucky, lucys idiot mom, e_type_jackoff, go56, badlie, wreck, calCON, Kafir, war, Banjo Boris, Biff, Godwinson and meguro. If you're on the above list...? PISS OFF.
#5. To: Capitalist Eric (#4)
Care to try again?
#6. To: mininggold (#5)
Prove it was enforced.
mcgowanjm, ferret mike, skippy, fartboy/yukko, white sands, bucky, lucys idiot mom, e_type_jackoff, go56, badlie, wreck, calCON, Kafir, war, Banjo Boris, Biff, Godwinson and meguro. If you're on the above list...? PISS OFF.
#7. To: Capitalist Eric, war (#6)
You've gotta' be fucking JOKING, right?????????
#8. To: mininggold (#7)
War is right. You never have any facts to back up your blustering BS propaganda.
----------------------------------
Roosevelt demanded that all americans turn over their bullion and coins (except those having significant numismatic value at least 15% above bullion price), and after having acquired a significant reserve at reasonable prices, he immediately devalued the US dollar, which meant a person who sold their gold for $10K would have had to pay $17K for the same gold the next day (if they could have legally bought it). Congress passed Roosevelt's act on March 9, 1933 without anyone in congress having read the act. Following the act's passage, Roosevelt enforced it by using the Trading With The Enemy Act of 1917 (without consulting congress) against Americans to prevent gold hoarding, speculation, or shipment (TWEA was intended for use against other countries' merchants, not against Americans). On challenge from at least 3 significant cases involving citizens and corporate entities, the SCOTUS upheld the law's use, since Congress had not expressly forbid its usage in the US, and one result was that americans were thenceforth permitted to open their safe deposit boxes only in the presence of a Treasury agent. After the deadline for selling gold had passed, americans could be imprisoned and fined if they were caught hoarding gold, in addition to which their gold was summarily confiscated. Here's the good part: What was the reaction of the American people to Roosevelt’s gold seizure? By the 1930s, most of the United States had been under systems of public (i.e., government) schooling for at least three decades. After years of such indoctrination, even though Americans had not yet become dependent on the federal government’s welfare dole that Roosevelt was initiating, most of them nevertheless now deferred to the wisdom of federal officials to deal with such complicated subjects as economics, depressions, and monetary policy.
The gold-clause cases did reach the Supreme Court. Unfortunately, a majority of the Court declared the nullification of the gold clauses in private contracts to be a constitutional exercise of the president’s power. While it declared the nullification of gold clauses in government notes to be unconstitutional, the Court also held, in a twisted form of logic, that the holders of government debt had suffered no damage because gold was then illegal to own anyway.
mcgowanjm, ferret mike, skippy, fartboy/yukko, white sands, bucky, lucys idiot mom, e_type_jackoff, go56, badlie, wreck, calCON, Kafir, war, Banjo Boris, Biff, Godwinson and meguro. If you're on the above list...? PISS OFF.
#9. To: Capitalist Eric (#8)
There are not significant historical legal records of US citizens being fined or imprisoned for failing to comply. This was the bottom of the depression and average citizens did not have large quantities of gold.
#10. To: mininggold (#9)
--GW Bush
#11. To: Capitalist Eric (#6)
(Edited)
Prove it was enforced.
#12. To: war, Capitalist_Eric (#10)
Did you expect otherwise.
#13. To: mcgowanjm (#11)
And thanx for putting me at the top of it. The Ultimate Compliment. 8D
#14. To: Fred Mertz, Capitalist Eric, All (#13)
#15. To: mininggold (#12)
Eric's another poster much like yukon, who recently admitted on LP that he thinks it's perfectly okay to lie to a poster if he doesn't like them or their politics. Even if their political leanings share some similiarities to his own. And Eric's quite intellectually lazy and covers it up with his juvenile cartoons and bluster. He is unable to even notice that his posts are totally unreadable with all the garbage BS he litters them with, a tendency he's probably been fired for in the past.
mcgowanjm, ferret mike, skippy, fartboy/yukko, white sands, bucky, lucys idiot mom, e_type_jackoff, go56, badlie, wreck, calCON, mininggold, war, Banjo Boris, Biff, Godwinson and meguro. If you're on the above list, you're too fucking stupid to hold a real conversation.
#16. To: Capitalist Eric (#15)
Wow...
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