July 6, 2022

Gold Confiscation, Missing Royal Canadian Mint Gold, Bernard von Nothaus Indictment

As gold contemplates the $1,000 barrier, here’s a roundup of gold, silver, and precious metals related stories that are interesting for one reason or another. Each headline comes with a snippet of commentary. Enjoy.

A Myth Concerning Gold Confiscation

Examination of a clause in Executive Order 6102, which receives little attention. In addition to the exemption from confiscation for numismatic gold, there was also an exemption for up to five ounces of gold per person.

U.S. Gold, Going or Completely Gone?

According to the United States Geological Survey, nearly 3,000 metric tonnes of gold were exported during 2008 in the form of “gold compounds.” Gold compounds consist of products containing gold content such as gold paint. The amount of gold claimed to have been exported in this format is more than 14 times the annual US gold mine production. What is going on here?

Mint can’t account for missing gold

In another story about missing gold, an audit of the Royal Canadian Mint turned up a discrepancy between the mint’s accounting records and physical precious metals holdings for gold, silver, and other precious metals. The article also describes the largest reported theft from the mint when a machinist pocketed 85 ounces of gold.

Liberty Dollar – Federal Indictment

Bernard von Nothaus, who created an “alternative currency” of gold and silver Liberty Dollars was formally charged “with uttering and passing, and attempting to utter and pass, a coin of silver in resemblance of genuine coins of the United States in the denominations of five dollars and greater, and intended for use as current money”. More than a year ago, the headquarters of his company was raided by the federal government and more than two tons of gold, silver, and copper coins were confiscated.

Buffet Gets ‘Comeuppance’ After Gold Outperforms

Every time someone writes a negative article about gold, they invariable measure the returns since January 1980 to support their preordained conclusion that gold is a bad investment.  Someone has finally turned the tables and compared an investment in gold to an investment in Berkshire Hathaway stock since May 2005, a much more favorable investment time frame for gold.

Gold: Headed For a Bubble?

A particularly vacuous article courtesy of the Wall Street Journal. From the title of the article I thought it would at least have some substance, but it turns into another run through of the “risks of buying bullion” and the lack of a measurable intrinsic value. The author winds up the article by suggesting that Treasuries are a preferable safe haven to gold.

Northwestern Mutual Makes First Gold Buy in 152 Years

For the first time in history, Northwestern Mutual, the third largest US life insurance company, has invested in gold. A great quote from CEO Edward Zore, “The downside risk is limited, but the upside is large. We have stocks in our portfolio that lost 95 percent. Gold is not going down to $90.” Indeed.

Gold Coin Shortage and Sales Trends, Dollar-Gold Relationship

With gold fluctuating around the $900 level, let’s take a look at some thought provoking gold and silver related stories from various blogs and news sites.

Jim Rogers Interview

Incredibly, he claims that there is no shortage of gold and silver coins.

What happened was all the dealers went and bought huge silver supplies back when silver was at $20 and now their stuck and they don’t want to take a loss and so they are telling people they don’t have coins. I promise you sir if you offer $25 for silver coins you’d get all you wanted. There is no shortage.”

He goes on to say the same thing about gold coins.

Gold Coin Shortage Likely To Become Chronic

And here’s the more popular conclusion- Yes, there is a gold coin shortage. This is supported by anecdotal evidence, gold coin rationing by world mints, and high prices paid for physical gold and silver in liquid markets.

APMEX Gold and Silver Sales Data

Some first hand sales data from precious metals dealer APMEX. From 2007 to 2008 the number of orders for gold increased 262% and the number of orders for silver increased 358%.

With economy tanking, ‘liberty’ coins made of silver are paying off

Remember the Liberty Dollar? It seems that in commerce, most vendors are more than happy to take them in lieu of paper money.

Where Do You Keep Your Gold?

If you are hoarding physical gold, where do you keep it? Here’s an examination of the pros and cons of various methods of gold storage.

Dollar Gold Correlation

Briefly the US Dollar and Gold had a price correlation of 100%, taking into consideration the prior 15 trading days. The odd correlation has recently reversed sharply.