The socialists will keep the people fed Chavez to Nationalize Venezuelan Gold Industry http://www.reuters.com/article/2011/08/17/us-venezuela-gold-idUSTRE77G53L20110817 The price consequences on your physical metal should not be underestimated. New production will slow or stop as operations will be taken over by the State. Share holders will rapidly try to get OUT of their mining shares and buy the REAL METAL driving prices further skyward. COMEX hedges will have to default as there is no metal production to cover forward sales. Paper market manipulation will have to kick into overdrive to try and stop the gold and silver moonshots. CONFISCATION of physical metal is a potential but I don't see it being too successful in today's day and age. The market for gold and silver is GLOBAL and the first sign of confiscation will drive global prices to infinity. Although Nationalization of mines is very possible in the US, it is clear that confiscation is NOT the plan as the US Government is already preparing the conversion to a Gold backed currency
Hey hiho, Not to threadjack but this goes one step further, in that Chavez has also requested 99 Tonnes of his country's gold to be transferred back to Venezuala from its current holding place, the BOE in London. Read this on zerohedge this morning. Very, very, very interesting article. THE MAD SCRAMBLE FOR PHYSICAL IS ON! http://www.zerohedge.com/news/chave...ld-jp-morgan-great-scramble-physical-starting "The Bank of England recently received a request from the Venezuelan government about transferring the 99 tons of gold Venezuela holds in the bank back to Venezuela, said a person familiar with the matter. A spokesman from the Bank of England declined to comment whether Venezuela had any gold on deposit at the bank." That's great, but not really a gamechanger. After all the BOE should have said gold. What could well be a gamechanger is that according to an update from Bloomberg, Venezuela has gold with, you guessed it, JP Morgan, Barclays, and Bank Of Nova Scotia. As most know, JPM is one of the 5 vault banks. The fun begins if Chavez demands physical delivery of more than 10.6 tons of physical because as today's CME update of metal depository statistics, JPM only has 338,303 ounces of registered gold in storage. Or roughly 10.6 tons. A modest deposit of this size would cause some serious white hair at JPM as the bank scrambles to find the replacement gold, which has already been pledged about 100 times across the various paper markets. Keep an eye on gold in the illiquid after hour market. The overdue scramble for delivery may be about to begin.
Would not be surprised to see this around the world eventually. Maybe even a world wide confiscation of physical gold and silver, as part of an internation reserve currency regime. NEVER trust the guvmint! OC
You know what those Venezuelan mining companies need? An advertising campaign! They could solve this problem so easily by just running some ads on TV and Chavez's popularity will sink so low that he'll be replaced as Venezuela's president.
Heh, well say what you like about Hugo Chavez (and who doesn't) but at least he doesn't take any shit from mining companies.
"10.6 tons of physical because as today's CME update of metal depository statistics, JPM only has 338,303 ounces of registered gold in storage" That is so silly, JPM's COMEX stock is not the only metal they have.
If gold is indeed money, shouldn't the right to produce and control its supply belong to the government? Whether the government actually acts in pursuit of the people's interest is another matter, and should be dealt with separately.
By the way, why would the government confiscate gold when it can simply impose capital gains tax (apart from other restrictions) on gold trading?
NO! Neither should it be the role of an organisation above national government. Gold is a limiting factor and a good one at that!
Surely the trading of existing bullion and stuff that has yet to be dug out of the ground are two separate issues though? In this case, the ground in question is Venezuelan ground and the Venezuelan government - as a representative of the Venezuelan people - should have a say in who gets to dig the gold up and under what circumstances. Is it in the national interests of Venezuela to have a completely unregulated gold mining industry? We're asking the same question now in Australia with the issue of coal seam gas extraction.
Well that's the theory, in practice though confiscation is much easier than collecting capital gains tax that's what I meant. The gov can't even collect proper capital gains tax or income tax from all the cash in hand jobs, how would they tax Gold that they may or may not know about which may or may not have changed hands?
Through the goodwill and honesty of all taxpayers to report their bartering transactions accurately and in-time?
It is a interesting turn of events, but i would only start panicking when a country with abit more credibility does this. I believe Chavez has already done this with there oil industry. If say Germany, France or Switzerland did this then that would surely be interesting.
Another article on this: http://www.news.com.au/business/ven...in-gold-reserves/story-e6frfm1i-1226117210508
