| Our new customers
usually ask, "Will the government seize gold again like it did
in 1933? Shouldn't I buy numismatic coins to protect myself
from seizure? Aren't numismatic coins exempt from reporting to
the government?" The correct answers are (1) No, (2) No,
and (3) No. But numismatic coins do cost a lot more per
ounce than bullion coins, and they carry a much higher
commission.
SHOULDN'T I BUY
NUMISMATIC COINS TO AVOID A GOVERNMENT GOLD SEIZURE?
The sales pitches for
their alleged safety rest on shakey assumptions about human nature
and ignorance of the law. "Numismatic" coins were not exempted
from the 1933 gold seizure, only "gold coins having a recognised
special value to collectors of rare and unusual coins." [Exec. Ord.
of 4/5/1933, ß 2(b)]. Any tyrant worth his whip could drive an
18-wheeler through a definition that vague.
NO
CONSISTENCY
Numismatic dealers argue
that because government exempted "numismatics" then, they must
exempt them now. But what obliges a tyrant to be
consistent? No, if they played by the rules they wouldn't be
stealing your gold. If the government chose to seize gold and silver
again, nothing obliges it to follow 1933's path. Why would the
lawless respect this particular law?
NO LAW OR
REGULATION
Numismatic dealers may
tell you that "the law defines a `numismatic' coin as one with a
premium of 15% or more over its gold value." That's also not
true. No such law or regulation exists. A reg was
proposed in the Federal Register, Vol 49, No. 3, 1/5/1984, but never
adopted.
By statute, the only
coins defined as "numismatic" are American Eagle gold and silver
coins minted since 1985 and other currently minted commemorative
coins. No statute or regulation defines U.S. $20 gold pieces
(or any other U.S. gold or silver coin) minted before 1935 as
"numismatic."
Dealers may tell you
that "U.S. $20 gold pieces are exempt from reporting when you buy or
sell them," but this means nothing - everything is exempt from
reporting when you buy it, unless you pay more than $10,000 in
cash. Even then it's not your gold or silver purchase that
must be reported, only the cash transaction.
NO
EXEMPTION
Contrary to the scare
stories, very few things are reportable when you sell.
Under 26 CFR 1.6045-1 and Rev.Proc. 92-103, dealers need only report
customer sales of 25 or more (but not fewer) Krugerrands, Maple
Leaves, or Mexican Onzas, five bag lots ($5,000 face value} of US
90% silver coin, kilo gold bars, 100 oz. gold bars, 1,000 oz. silver
bars, or 50 oz. or 100 oz. of platinum. If you sell lots
smaller than these, the dealer reports nothing.
NO SENSE
Millions of people
refused to hand over their gold in 1933. How many would comply
today? If your family's survival depends on owning a little
gold and silver what will you tell the government agent? Will you
fork over your gold and watch your family starve? Or
will you reply, "Gold? What gold? Oh, yeah, I was
talking to a fellow in the Burger King a few years ago when my wife
was sick and I needed money. I sold him the gold, and even
remember his name. Sold it at a loss, by the way."
Finally, gold and silver
today don't represent the huge pool of wealth they represented in
1933. Why risk wide-spread disobedience to steal such a tiny
plum? If the government wants to steal a big pool of wealth,
they'll snatch your pension funds and IRAs, not your gold.
Further reading on
Numismatics:
Franklin
Sanders
Franklin Sanders / THE
MONEYCHANGER
P.O.
Box 178 Westpoint, Tennessee 38486-0178
(888)218-9226; Fax: (931)766-1128
Franklin@The-Moneychanger.com
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