Tag: gold

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free trade & free markets national politics & policies too much government

Banker Away

Republican candidate for the U.S. Presidency Mitt Romney has received some flak for keeping some of his vast hoard of wealth in foreign accounts. Though I have a few problems with Mr. Romney, this isn’t one of them. Folks with savings and investments should diversify. Anyone with large amounts of money should consider diversifying beyond our borderlines.

And not just for “tax avoidance” reasons, either.

For one thing, as nice and generous as our politicians are, the U.S. isn’t exactly stable and business-​friendly. That used to be the U.S. It may not be, any longer.

Take Peter Schiff’s new endeavor. The redoubtable Schiff, an investment expert perhaps best known for having predicted the 2008 mortgage crisis and the severity of the current recession, has started a gold bank, Euro Pacific Bank Ltd., which will back deposits with gold. The actual yellow stuff.

Its most interesting innovation will be its offer of a “gold debit card,” for use worldwide. Peter Wenzel calls this idea “awesome,” but then notes the downside:

U.S. security laws have become so intrusive, burdensome, and expensive to comply with, that it made it difficult for Schiff to offer the services in the U.S. So, Schiff opened his bank offshore, in St. Vincent and the Grenadines. It operates outside the jurisdiction of U.S. security regulations, and does not accept accounts from American citizens or residents. 

America’s place in the world is changing. And not for the better.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets national politics & policies too much government

Going After the Gold

What does gold have to do with medical care? Ingested, it’s a poison. It’s not often used in treatment.

So why did the Obama administration place a provision further regulating the buying and selling of gold into the Democrats’ medical reform legislation? 

Economist Thomas Sowell explains, in a recent column, why politicians are obsessed with the yellow metal. Before FDR, gold provided a check against politicians’ desire to spend the money government could “just print.” Because, in those long-​ago days, paper dollars were backed by gold, Americans would cash the paper in for gold when it looked like the Treasury had gone on a printing spree. So inflation (the increase of the supply of money, and the consequent diminishing of its value, leading to increasing prices) was checked.

In 1933, FDR confiscated most of America’s circulating (and hoarded) gold, and Nixon took us off the gold standard completely in the ’70s, morphing our monetary system into a pure fiat (inflationary) standard. 

Also in Nixon’s time, it became legal, again, for Americans to own gold.

So why make it harder, now, to trade in gold — when gold is not money?

Because investors, in times of inflation and crisis, turn to gold as a hedge. Against politicians, basically. And, says Sowell, “the Obama administration sees people’s freedom to buy and sell gold as something that can limit what the government can do.” 

Gold, like freedom, “cramps the government’s style.”

That speaks volumes about gold … and “Obamacare.”

This is Common Sense. I’m Paul Jacob.