Post #217 Buy gold and silver to protect your wealth | Keep it out of USA jurisdiction | Confidence in fiat money is eroding
Hong Kong is 8,000 miles from the U.S., but that did not stop the U.S. government from disallowing U.S. banks from transacting with eleven Hong Kong officials it sanctioned. Hong Kong Chief Executive Carrie Lam acknowledged in August that the sanctions had caused her some inconvenience with using her credit cards.
Her remarks in bold underscored how businesses with U.S. exposure are more likely to comply with U.S. government sanctions. These businesses may be non-U.S. companies, but if they have business operations in the U.S or transactions with U.S. banks, there will be substantial leverage for the U.S. government to pressure.
We have always warned against storing gold and silver with banks and vault operators with exposure to the U.S. or within jurisdictions with unsustainable debt growth. Whatever advantages a jurisdiction may have become ineffective if your vault operator indemnifies itself against foreign governments nationalizing the stored gold and silver.
Most dealers who offer storage programs are clueless about such risks or do not believe gold confiscation by governments will happen again. We disagree, and we believe the chances for bankrupt governments to grab citizens’ gold are much higher today. The motivation for every confiscation case by fiscally-poor governments can be traced to their desperate need to shore up confidence in fiat currencies.
From April 5, 1933, President Roosevelt made it illegal for anyone in the U.S. to own or hold any form of monetary gold, be it coins, bullion, or certificates. They coerced citizens into turning their gold to local Federal Reserve bank branches. A month later, the government escalated its underhandedness by abolishing the gold clause in all past debt obligations, thereby breaking its promise to redeem its paper money for gold.
More than three decades later, the British government in its bid to stem the Pound’s slide on the currency markets also enacted laws to forbid the purchase and hoarding of gold. Despite having left the Gold Standard 35 years ago, the British government chose to block imports of gold coins and banned private citizens from owning more than four gold coins.
It is time we awake to the real reason why highly indebted governments are likely to confiscate gold – they want the confidence that gold gives! Germany’s hyperinflation in the 1920s destroyed its currency, the Papermark. Trust was only restored with the introduction of a gold-backed currency – the Goldmark.
Many economists do not see a suitable currency that can effectively replace the dollar as a reserve currency. In other words, confidence is sorely lacking in currencies. It is a matter of time before the world realizes that gold is the best neutral solution to restore confidence in the global monetary system, and he who has the most gold will have the biggest say at the table.
Refer to post #200 #201
