Cross Post: John Adams When hoard work is not rewarded

Australians must be alert to the risk of the Turnbull, or a future Australian, Government engaging in mass gold confiscation.

Across the economy, many Australians have lost confidence in the international monetary system, including recent actions of the Reserve Bank of Australia, as well as in the ability of the Australian Parliament to manage the finances and creditworthiness of the Commonwealth.

Investors point internationally to large budget deficits and exploding government and private sector debt supported by runaway money printing, zero or negative interest rates, quantitative easing, bank bail-ins, interest rate and commodity market manipulation as well as the new international war on cash as signs that governments and global multilateral economic institutions have lost control in managing domestic and international economic affairs prudently.

Twelve years of scheduled continuous federal budget deficits (2008 – 2020) and a projected explosion of net Commonwealth government debt of $433 billion over the same period, the impending loss of our triple A credit rating, record low interest rates and the newly announced Black Economy Taskforce, which will consider abolishing the $100 note and placing a legal limit on the size of cash transactions, mean that Australia is not immune from these global trends.

As I have warned in a previous Daily Telegraph article, any restrictions on the availability or use of physical cash by the Turnbull Government is likely to undermine confidence in the banking system and lead to individuals hoarding precious metals such as gold to protect their wealth.

Australians need only look at tumultuous developments in India, where ordinary Indians are now paying significant premiums to purchase and hoard gold in response to the Modi Government’s decision to abolish almost 90 per cent of all physical cash in India.

For Australians’ currently accumulating gold, maintaining the physical security and ownership of their gold continues to be a concern given Part IV of the Banking Act 1959.

Part IV contains legislative provisions providing the Governor-General with the legal power to sign a proclamation requiring all gold in Australia, except for gold coins or ‘wrought’ gold, to be handed over to the Reserve Bank of Australia (RBA), within a month, in exchange for legal tender. This would be in the form of either physical cash or digital currency, with the amount exchanged based on an RBA-prescribed gold price.

These confiscation provisions can be triggered in order to ‘protect’ the value of the Australian dollar or the Commonwealth’s ‘public credit’.

While these provisions have never been exercised, 20th century history is littered with examples of governments, whether they be communist, fascist or democratic in nature, either limiting the ownership or confiscating mass quantities of gold when running out of money, or when confidence in their issued currency collapsed from massive inflation.

For example, during the 1930s and 1940s, Stalin tortured soviet citizens to obtain their gold, the Nazis stole large quantities of gold across Europe to fund their war machine and Mussolini raised 35 tonnes of gold by convincing Italian women through nationalistic propaganda to hand in their gold wedding rings in exchange for steel wedding rings provided by the government.

Moreover, President Roosevelt, in 1933, issued Executive Order 6102, making it illegal for Americans to own gold. The order confiscated approximately 22 per cent of all gold in circulation. Legal gold ownership in America was not formally restored until 1974.

In all of these examples, the respective government compensated owners with only a fraction of the real value of their gold.

Unfortunately, Australia is not immune from its own history of gold confiscation. After declaring war on Hitler and needing to fund the war effort, the Australian Parliament enacted the Gold Tax Act 1939 imposing a 50 per cent transactional tax on gold delivered to the Commonwealth Bank Government above 9 Australian pounds per ounce.

This tax, while not confiscating gold outright, confiscated a proportion of the gold used by Australians when redeemed for physical cash. The gold tax was not repealed until 1947.

In order to avoid a repeat of history, Australians who are hoarding gold and who are concerned of the future risk of confiscation are taking specific steps to avoid government detection.

Under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, bullion dealers are required to record the identities of individuals involving the purchase of gold, irrespective of payment, greater than $5,000. These records can be solicited by the government upon request.

Gold owners are therefore purchasing gold bullion in quantities of less than $5,000 in case relatively simple legislative amendments are enacted in the future that allow the government to solicit gold transaction records for purposes other than anti-money laundering or counter terrorism.

Such Australians point to the introduction of the 1928 national German gun register under the Weimar Republic which was later used by the Nazis to target political enemies or the 1938 Register of Jewish Property which was used to confiscate gold owned by German Jews.

Malcolm Turnbull can restore confidence in his government’s economic management by not only balancing the budget, raising interest rates and ending the war on cash but also by repealing Part IV of the Banking Act. This would quash current paranoia and conspiracy theories.

Further confidence can be generated by enacting legislation which would legally prohibit Commonwealth institutions from confiscating all forms of precious metals.

Tyranny and theft is only one signature away.

John Adams is a former Coalition Advisor. This op-ed first appeared in the Daily Telegraph.

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87 Responses to Cross Post: John Adams When hoard work is not rewarded

  1. Combine Dave

    Former Coalition advisors are about as credible as the Greens when it comes to economic matters.

    Sad.

  2. Infidel Tiger

    Anyone hoarding gold is a moron.

    When the shit hits the fan toilet paper and matches will be worth far more than an arbitrary and capricious store of value.

  3. .

    This is a great article. If Trump can change, so can John Adams.

  4. Squirrel

    A Prime Minister who, earlier this week, was boasting about an “immigration nation” – the ‘world’s most successful mutli-cultural nation” – would do well to remember that there are many Australians who will be less than pleased about being pushed further into the arms of a mightily leveraged banking system, propped up by the (qualified) guarantee of an increasingly indebted and money-hungry Government.

  5. Bruce of Newcastle

    Why stop with bullion? I’d love to carry around a pocket full of gold coins!

    Utah Bill Sets Stage For State Gold Depository, Further Encourages Use Of Metals As Money

    A bill introduced in the Utah legislature would build on the state’s Legal Tender Act, creating a foundation for further action to encourage the use of gold and silver as money, and take another step toward breaking the Federal Reserve’s monopoly on money.

    Rep. Ken Ivory (R-West Jordan) introduced House Bill 224 (HB224) on Jan. 27. The legislation would add several provisions to state law designed to encourage the use of gold and silver as legal tender. Passage would set the stage for expansion of gold repositories in the state and authorize further study on several sound money policies.

    Specifically, HB224 would authorize the investment of public funds in specie legal tender held in a commercial specie repository. Under existing code, “specie legal tender” means gold or silver coin and bullion. “Commercial specie repository” means an institution that holds or receives deposits of specie legal tender that is located within the state. Practically speaking, passage would give the state the option to hold funds in gold and silver instead of Federal Reserve notes.

    If you can make a currency like bitcoin work you can certainly do so for gold too: just stamp each coin with the weight and consult the gold price for what it’s worth. No need to try and fix the exchange rate with USD or whatever, just use the market value. Immune to inflation since you can’t inflate gold. It just is. I like silver too, silver coins would be very nice.

  6. Cannibal

    For a fuller treatment of the topic, I recommend the Gold Chat blog run by Bron Suchecki of the Perth Mint.

  7. Irreversible

    Outstanding! The apocalypse is imminent!

  8. RobK

    A decade or more ago when I last looked at buying refined gold; i think it was the Swiss mint being innovative in their marketing, was offering gold bar waffers which looked a bit like the thin lindt chocolate bars except each small piece that you could break off was stamped with the gram weight (i don’t recall the precise amount but say 10 or 15g). It occurred to me that would appeal to the “preper”market. A kind of break off coin. The Perth mint didn’t do the same.

  9. Jannie

    The barbarous relic continues to be valuable despite the best efforts of some influential economists to devalue it. Gold is pretty, gold is scarce. Middle class Indians and Chinese love it, so do Persians and Arabs. These people don’t believe anything Western talking heads say. The more it is talked down, the more valuable it becomes. When they try to abolish cash, the value of gold will go through the roof. After all the fighting abates, gold will still be valuable.

    I have read that over 95% of so called gold sales don’t involve physical bullion, just promissory paper. There is a suggestion that the Fed or its agents sell paper gold to keep the bullion price low, while acquiring real bullion wherever possible. I cant work this out, but it could be that gold is underpriced.

  10. King Koala

    When the economy crashes and Mr Adams is left with his hoarded gold I wonder how many people who hoarded food and guns will be interested in a piece of shiny metal with little intrinsic value?

    A serious thing for all you goldbugs to consider is that the same globalist banking arseholes who have fucked the economy in multiple ways have spent years hoarding gold. They could flood the market with gold at any time and crash the price. Banks could also take gold coins out of circulation whenever they are used in a banking transaction. An economy based on gold coins assumes they are not simply hoarded by all the banks and replaced by a series of numbers on the screen.

  11. J.H.

    Silver always ends up as the medium of exchange when coins become the currency of open markets.

  12. .

    When the economy crashes and Mr Adams is left with his hoarded gold I wonder how many people who hoarded food and guns

    In Australia?

    Hidden in their copies of Gears of War or in their sweat lubricated rolls of blubber.

  13. Speedbox

    ….barbarous relic…..

    I see what you did there Jannie. Barbarous relic is what Keynes called gold.

  14. .

    My horrible prediction for a truly apocalyptic societal collapse is the police will become a ruling gang of thugs who will create their own version of feudalism, big brother and martial law.

  15. JC

    Australians must be alert to the risk of the Turnbull, or a future Australian, Government engaging in mass gold confiscation.

    Across the economy, many Australians have lost confidence in the international monetary system, including recent actions of the Reserve Bank of Australia,

    John, how many universes up for mine are you living in? Which Australians have lost confidence in the monetary system and what clues are you getting about this gold confiscation thing?

  16. Dr Fred Lenin

    When I was young it was well known in Normandy that farmers turned cash savings into gold coins , Louis d’or I think , my canny relatives amongst them . Suppose that proves bankers and politicians have not been trusted for years by hard working thrifty people . They were bad enough then to make people do that ,God knows. now they are much worse ,so buy coins comrades and bury them in the yard ,deprive the u.n.communists of wealth socialism dies without other peopkes money.

  17. Howard Hill

    They might try to confiscate it, but they’ll soon find most of it was lost in boating accidents. I mean, zerohedgers have all had several already!

  18. DavidH

    @RobK I think this is what you referred to: PAMP 25 x 1g minted bars …
    https://www.abcbullion.com.au/store/gold/gpampm251g-x-25-pamp-multi-gram-minted-bar

    I’ve thought about buying some but so far have gone with 1oz PAMP bars and the ABC 1oz cast gold.

  19. Jannie

    Koala, gold has some intrinsic value in that is pretty, and easy to make into adornments. It many cultures it is desired as a way of displaying and storing wealth, because buyers and sellers understand it is a very scarce element. A lot of jewelry is manufactured to be exchangeable, Indian bangles for example. Warlords who adorn their women and temples with gold understand that its beauty can be exchanged for tradesmen and weapons.

    When the putative apocalypse happens, it wont happen everywhere at the same time. There will be pockets of production and social control, and they will exchange goods and services.

  20. Jannie

    My comment is in moderation, but I cant work out which word triggered it.

  21. Speedbox

    I am not sure whether gold is the answer, but, right or wrong, I am certain that we approach a financial meltdown of substantial proportions. My only problem is “when?”

    We all know that after WW2 the western world hit a sweet spot. The “swiss cheese” principle configured circumstances that created a clear economic division between the West and the rest of the world. We had access to cheap oil, industrialisation was at full speed, rampant population growth (the ‘baby boom’), security under the auspices of the USA, and a massive rebuilding opportunity from at least two decades of financial and social upheaval.

    After five or six decades of prosperity and growth, that growth has come to be expected. We are indoctrinated to believe growth is perpetual and each generation seems to believe it’s entitled (earned or unearned) to a better standard of living than the one that preceded it. Sure, hiccups may occur but these are generally forgotten quickly as the financial machine cranks up again and “everyone” can get their piece of the cake.

    Well sorry girls and boys, but I don’t believe it and in fact, I think that the sheer level of debt and unfunded promises in the system means that the next economic failure will be bigger than anything seen before. Irresponsible Government spending, no significant action to rein in deficits and very low growth coupled with low interest rates that continue to fuel debt-funded consumer spending, are creating the perfect “swiss cheese” moment of their own. The levels of personal indebtedness by Australians has reached unprecedented levels.

    I don’t like being a pessimist and it runs contrary to my natural state – and I hope I am wrong about all this – but it seems to me that personal debt minimisation is the best defense against the storm. Whether a store of gold bars is worthwhile remains to be seen. Perhaps toilet paper, batteries, milk powder and tinned food will be at least as valuable as gold.

  22. Jannie

    Perhaps toilet paper, batteries, milk powder and tinned food will be at least as valuable as gold.

    Exactly Speedbox. Some smart people are going to make wealth by exchanging said items for gold, before supply resumes anyway. Whichever, you wont exchange said items for paper money.

  23. Motelier

    Perhaps toilet paper, batteries, milk powder and tinned food will be at least as valuable as gold.

    Sorry that is wrong on so many levels. See Venuzuala et al.

    What you need are hard skills.

    A horticulturalist would be far better value than a person that has built a hoard of gold.

  24. Bruce of Newcastle

    To be fair I’ll point out that I’ve help produce more than a few tonnes of gold and silver in my time.
    Biggest hoard I got to handle was about 40 odd kg of doré at around 75% Au content, just to be able to say I physically lifted that much. We then sent it away in the helicopter to be refined.

    Also I’ll point out a major disadvantage…

    Corporal Christopher Lunt loses life savings after thieves steal gold bullion from safe (2014)

    A DIGGER who lost his life savings when $200,000 in gold and silver was stolen from his safe says two other houses have been robbed of precious metals in Brisbane in the last six months.

    Portable wealth is sadly very…portable.
    Which is a plus for electronic currency so long as you can trust the government and the people holding it for you.

  25. Chris M

    Which is why we see the rise of non-nationalised online currencies like Bitcoin and Onecoin.

    bullion dealers are required to record the identities of individuals involving the purchase of gold, irrespective of payment, greater than $5,000.

    Interesting, in this state it seems to be set at $2,000 above which all transactions are recorded not $5,000

  26. rickw

    Perhaps toilet paper, batteries, milk powder and tinned food will be at least as valuable as gold.

    You need a balanced portfolio:

    Guns
    Food
    Shelter
    Fuel
    Tools
    Gold

  27. Speedbox

    What you need are hard skills.

    A person that can build a cabinet or rewire an old generator or cobble together from spare parts a workable machine to dig a well is going to be very popular and compensated for those abilities. But, I am not seriously suggesting we will revert back to 1800’s subsistence farming or bartering.

    I do think however that the financial shock will (potentially) cripple millions insomuch as ultra low interest rates have lured them into highly geared scenarios that they will be unable to maintain. We have all heard the old saying that most Australian’s are “two pay cycles from bankruptcy” and that appears to be more true today than at any time previously.

    In a financial crisis, I expect the Government will lurch even more to a Keyne’s style doctrine of “pumping” the economy just as they have in the past – except this time, there is bugger all capacity to do so and Government will be “forced” to confiscate the necessary resources “for the greater good”. Whether those funds come from existing bank accounts, Superannuation funds or wherever makes no particular difference.

    Cry havoc and let slip the financial dogs of war. (with apologies to Shakespheare)

    Sorry Cats for the pessimism. Perhaps I should go a mix a nice cooling beverage and watch the sun go down.

  28. Roger

    The future value of gold depends upon civilisation as we know it continuing.

    At this point in time that is not a given.

    Guns, ammo, tinned food, diesel and portable generators may be sounder investments.

    Tongue only partly in cheek.

  29. Thanks for the link to my article, Cannibal. I think the only reason Part IV was merely suspended and not repealed at the time was because it was not clear whether the US was permanently off the gold standard, as Nixon did say at the time it was “temporary”.

    For those who’ve taken this post as an opportunity to make fun of gold, I guess you wouldn’t have any issue with this section being repealed, as what use in you opinion would the RBA have for gold. Hopefully someone will put a bill forward to repeal it as I would be interested to see if the RBA objects.

  30. Rabz

    Gold is pretty, gold is scarce. Middle class Indians and Chinese love it, so do Persians and Arabs.

    Gold is monstrously ugly. Unsurprisingly, the wallies identified above are some of the most crass, tasteless imbeciles in human history. The only suspects missing are “african-americans”, who equally unsurprisingly, also “love it”.

    Give me silver anyday. I judge people instantly and ruthlessly by whether or not they’re into gold.

    If you are, I’ll never trust you and will regard you as a crass, tasteless imbecile, akin to the z-graders above. I wouldn’t even bother with gold as a nominal store of value.

  31. .

    I actually like silver more, but unfortunately, it isn’t as noble as gold and tarnishes.

    Guns, ammo, tinned food, diesel and portable generators may be sounder investments.

    They’re not currency and only ammo would come close and it has an expiry date as well.

  32. Rabz

    A cautionary tale:

    In 1998, Mazda released its second series of the iconic MX5. The flagship colour, featuring in all the advertising material, was metallic gold. There were about seven colours available, including a metallic silver.

    The silver sold more than all the other colours combined and the gold sold the least. The next series of the MX5 unsurprisingly, featured silver as the flagship colour. That series was also unavailable in factory gold.

  33. Splatacrobat

    Turnbull’s second letter to the Australians 5:3
    “Your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. Ye have heaped treasure together for the last days and now I’m going to confiscate it.”

  34. Tel

    Sorry that is wrong on so many levels. See Venuzuala et al.

    What you need are hard skills.

    A horticulturalist would be far better value than a person that has built a hoard of gold.

    No, that’s wrong and you clearly have not been looking at the situation in Venuzuala.

    Actually, they have plenty of viable farms AND they have people who know how to grow crops, yet they import almost all of their food, even while people are desperately short of food. How can this happen?

    What happens is that growing a crop requires time and effort, you put the effort in for three to six months (depending on what you are growing) and the value only pops out right at the end. But that crop is now equivalent to gold in as much as it is a tangible item of value. The crop can be confiscated. Even if not confiscated, government will fix the price you can sell at, thus making the crop worthless to the farmer, because the sell price doesn’t cover the costs. You can’t even keep the crop and eat it yourself because hoarding food is illegal and subject to harsh penalty.

    So even the people with perfectly good horticultural “hard skills” choose not to grow food. Their skills are wasted.

  35. Tel

    The future value of gold depends upon civilisation as we know it continuing.

    Not if you have any sense of history.

    Gold held its value just fine during both the heights of civilization, and the depths of barbarity. The problem was not the value of gold, it was figuring out how to keep both the barbarians and the civilized folk from getting their hands on your gold.

  36. Splatacrobat

    Gold and silver may be of temporary use if a crisis ever comes but bartering goods or services will see you through…….. only if you have something worth bartering though.

    Somehow I don’t see there being a future for a vagina knitted baby layettes in exchange for firewood when the temperature drops below zero in Melbourne during the Apocalypse or women’s interpretive dance lessons in exchange for food.

  37. John Adams

    From what I can tell no political party in Australia has a policy to repeal Part IV of the Banking Act 1959, including the Liberal Democrats. Interestingly, I discovered that Senator Leyonhjelm was not aware of this sleeper legislative provision when I spoke to him recently about this.

    Repealing gold confiscation laws should be near the top of any Australian pro-liberty agenda.

  38. DM of WA

    Please tell me: has April Fools’ Day has come early this year?

  39. .

    Well, maybe we should, John Adams.

    My god, read the whole thing:

    PART IV–GOLD

    40. Operation of Part
    41. Transfer of gold out of Australia
    42. Delivery of gold
    43. Vesting of gold delivered
    44. Payment for gold
    45. Limitation of sale and purchase of gold
    46. Limitation on working of gold
    47. Application of Part
    48. Exemptions

    BANKING ACT 1959 – SECT 40

    Operation of Part
    (1) This Part shall not be in operation except as provided by this section.

    (2) Where the Governor-General is satisfied that it is expedient so to do, for the protection of the currency or of the public credit of the Commonwealth, the Governor-General may, by Proclamation, declare that this Part, or such of the provisions of this Part as are specified in the Proclamation, shall come into operation, and this Part, or the provisions so specified, shall thereupon come into operation.

    (3) Where the Governor-General is satisfied that it is no longer expedient, for the protection of the currency or of the public credit of the Commonwealth, that this Part, or any of the provisions of this Part, should remain in operation, the Governor-General may, by Proclamation, declare that this Part, or such of the provisions of this Part as are specified in the Proclamation, shall cease to be in operation, and thereupon this Part, or the provisions so specified, shall cease to be in operation.

    BANKING ACT 1959 – SECT 41

    Transfer of gold out of Australia
    (1) A person shall not, except with the consent in writing of the Reserve Bank, take or send any gold out of Australia.

    (2) A person commits an offence if:

    (a) the person contravenes subsection (1); and

    (c) there is no instrument in force under section 48 exempting the person from the application of this subsection.

    Penalty: 200 penalty units.

    Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

    Note 2: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

    (3) An offence against subsection (2) is an indictable offence.

    BANKING ACT 1959 – SECT 42

    Delivery of gold
    (1) Subject to this Part, a person who has any gold in the person’s possession or under the person’s control, not being:

    (a) gold coins the total value of the gold content of which does not exceed the prescribed amount; or

    (b) gold lawfully in the possession of that person for the purpose of being worked or used by that person in connexion with the person’s profession or trade;

    shall deliver the gold to the Reserve Bank, or as prescribed, within one month after the gold comes into the person’s possession or under the person’s control or, if the gold is in the person’s possession or under the person’s control on any date on which this Part comes into operation, within one month after that date.

    (1A) A person commits an offence if:

    (a) the person fails to comply with subsection (1); and

    (c) there is no instrument in force under section 48 exempting the person from the application of this subsection.

    Penalty: 50 penalty units.

    Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

    Note 2: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

    (2) Where a person who has gold lawfully in the person’s possession for the purpose of being worked or used by the person in connexion with the person’s profession or trade ceases to have that purpose in respect of that gold, the person shall deliver the gold to the Reserve Bank, or as prescribed, within one month after the person has ceased to have that purpose in respect of that gold.

    (3) A person commits an offence if:

    (a) the person fails to comply with subsection (2); and

    (c) there is no instrument in force under section 48 exempting the person from the application of this subsection.

    Penalty: 50 penalty units.

    Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

    Note 2: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

    BANKING ACT 1959 – SECT 43

    Vesting of gold delivered
    All gold delivered in pursuance of section 42 shall thereupon vest in the Reserve Bank absolutely, free from any mortgage, charge, lien, trust or other interest in or affecting the gold, and the Reserve Bank shall pay for the gold, to the person delivering the gold, on behalf of all persons having any interest in the gold, an amount determined in accordance with section 44 and the Reserve Bank shall not be under any liability to any other person claiming any interest in the gold.

    BANKING ACT 1959 – SECT 44

    Payment for gold
    The amount to be paid for any gold delivered in pursuance of section 42 shall be an amount determined in accordance with such price as is fixed and published by the Reserve Bank or, at the option of the person delivering the gold, such amount as is determined in an action for compensation against the Reserve Bank.

    BANKING ACT 1959 – SECT 45

    Limitation of sale and purchase of gold
    (1) Subject to this Part:

    (a) a person shall not sell or otherwise dispose of gold to a person other than the Reserve Bank or a person authorized in writing by the Reserve Bank to purchase gold; and

    (b) a person, other than the Reserve Bank or a person so authorized, shall not buy or otherwise obtain gold from any person.

    (1A) A person commits an offence if:

    (a) the person fails to comply with subsection (1); and

    (c) there is no instrument in force under section 48 exempting the person from the application of this subsection.

    Penalty: 200 penalty units.

    Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

    Note 2: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

    (1B) An offence against subsection (1A) is an indictable offence.

    (2) A person may buy gold from the Reserve Bank or from a person authorized in writing by the Reserve Bank to sell gold, and the Reserve Bank or a person so authorized may sell gold to a person, for the purpose of its being worked or used by the purchaser in connexion with the person’s profession or trade.

    (3) A person authorized by the Reserve Bank under this section shall comply with such directions relating to gold as are given to the person by the Reserve Bank.

    (4) A person commits an offence if:

    (a) the person fails to comply with subsection (3); and

    (c) there is no instrument in force under section 48 exempting the person from the application of this subsection.

    Penalty: 200 penalty units.

    Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

    Note 2: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

    (5) An offence against subsection (4) is an indictable offence.

    BANKING ACT 1959 – SECT 46

    Limitation on working of gold
    (1) A person shall not work or use in manufacture any gold, not being gold lawfully in the person’s possession for the purpose of being worked or used by the person in connexion with the person’s profession or trade.

    (2) A person commits an offence if:

    (a) the person fails to comply with subsection (1); and

    (c) there is no instrument in force under section 48 exempting the person from the application of subsection (1).

    Penalty: 200 penalty units.

    Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

    Note 2: If a body corporate is convicted of an offence against this subsection, subsection 4B(3) of the Crimes Act 1914 allows a court to impose a fine of up to 5 times the penalty stated above.

    (3) An offence against subsection (2) is an indictable offence.

    BANKING ACT 1959 – SECT 47

    Application of Part
    (1) This Part does not apply to wrought gold, not being wrought gold worked or manufactured in contravention of this Part.

    (2) In this section, wrought gold means gold and gold alloys which on view have apparently been worked or manufactured for professional or trade purposes and includes the waste products arising from the working or manufacturing of gold and gold alloys for professional or trade purposes.

    BANKING ACT 1959 – SECT 48

    Exemptions
    The Reserve Bank may, by instrument in writing, and either wholly or to the extent specified in the instrument, exempt a person from the application of the whole or any of the provisions of this Part and, so long as the exemption continues, that person is exempt accordingly.

  40. John Adams

    Dot, think about who was roaming around in 1959 pushing monetary and banking policy in Australia?

    Nugget Coombs – the arch leftist who studied Keynesian economics in London and came back to Australia to infect us with this crap. He served at both the Treasury and the RBA (when the RBA was established in 1959).

    I suspect Coombs had a big hand in this.

  41. Docket62 (deplorable)

    “Hidden in their copies of Gears of War or in their sweat lubricated rolls of blubber.”

    Dot, don’t assume that just because gun laws exist that we aren’t armed to the teeth. And the people we play with have no blubber, or read said magazines.

  42. .

    Nugget Coombs indeed.

    We just need to repeal this and change superannuation so it cannot be legally interpreted as a tax.

    The combined all government debt is nearing 700 bn AUD. No one is trying to pay this off. It is simply growing without care or contemplation.

    Like I said elsewhere – super, the family home, gold – nothing is sacred to government.

  43. .

    Um docket, Gears of War is a PS4/XBox game.

  44. Goldbuggery, yeesh. What next on the Cat, chemtrails or infrasound?

  45. .

    Laugh it up monty. There is no defending the government taking stuff at will.

    This isn’t Henry VIII’s England.

  46. Rabz

    Goldbuggery, yeesh. What next on the Cat, chemtrails or infrasound?

    Says the individual who’s hoarding most of the planet’s rakes.

    I bet you wear gold joowellery, monts. You strike me as an absolutely crass, tasteless individual.

  47. John Adams

    Dot.. you are right.. Australians are sleep walking into financial ruin. For most people, superannuation should be written off now. They won’t see it as it is tied up in financial/digital assets. I have no doubt that the Commonwealth (especially when Labor is in power) will push for a raid on superannuation when the market crunch comes.

    If the asset is not real which you can’t physically touch, then the so-called “asset” will likely be destroyed when the global correction/re-set comes.

    I have nothing tied up in the stock market or in digitally dominated assets (except for superannuation unfortunately – but this is financial entrapment by the Government).

    This is why Minister O’Dwyer is the most dangerous and reckless Minister in the Government. If she is successful in banning the $100 note or placing a legal limit on cash transactions, then we are all stuffed. She is covertly trying (with the support of international financial institutions) to trap Australians in digital assets which won’t be convertible when the system freezes up from all of the financial derivatives blow-up (i.e. Warren Buffet – weapons of mass financial destruction) which are now in the trillions of dollars.

    I have been looking at precious metals as a form of diversification, but with secret sleeper provisions such as Part IV of the Banking Act, there isn’t much legal flexible if you are trying to escape from the global financial system.

  48. Incogneto

    When the $hit hits the fan, Elites and Doomsday Preppers will be somewhat prepared the rest of us are fked!

  49. .

    Do as I intend to do.

    I’ll always be Aussie but I plan to live an international lifestyle once I gain liquidity and sufficient capital.

    It is another form of diversification. Real assets held in different places.

  50. Pedro the Ignorant

    I reckon there is an astonishing amount of gold bullion being held by individuals in Australia in the form of natural nuggets, gold coins and bullion bars of various sizes. Many people have little faith in the ongoing health of our financial system and the security of the superannuation funds that look like big fat chooks just waiting for the government fox to attack. Gold has always been the “safe haven” option, particularly in troublesome times.

    Like the great gun theft of 1996, any government decree to “hand in your gold” will be met with widespread civil disobedience and a flourishing black market will immediately spring into being.

  51. John Adams

    The important thing to note is that O’Dwyer’s Black Economy Taskforce is currently taking submissions up to 17 Feb 2017. The media is largely ignoring this Taskforce and as a result, the number of submissions & interest which this taskforce will receive will be much smaller than what they should receive.

    I was talking to some people in my local community the other week about the fact that the Turnbull Government is considering abolishing the $100 note. These people were largely dismissive of the Taskforce as they believed it was near politically impossible for the Government to abolish the $100 note.

    I suspect that these people are in for a large shock when the May budget comes around!

  52. John Adams

    Pedro the Ignorant…

    For those of us living in NSW, think of this… the NSW police force from what I understand is the 4th largest police force in the world! They are armed to the teeth, have military style weapons and have been trained in military style operational tactics.

    Also note that the NSW government is tracking people who use the train/light rail/ferry system who use the Opal system and that both levels of government can track people down through arrangements with smart phone manufactures and software/website companies (including social media platforms).

    With Howard’s 1996 gun laws still in force, most of us are sitting ducks.

    I have no doubt that Part IV would have been triggered by the Scullion Government had they been on the books in 1929. Without any hesitation, Scullion’s cabinet took Australia off the gold standard and started up the print press.

    Shorten/Bowen pose the most risk to gold ownership in Australia, but Turnbull/Morrison/O’Dwyer isn’t that far behind.

  53. the NSW police force from what I understand is the 4th largest police force in the world! They are armed to the teeth, have military style weapons and have been trained in military style operational tactics.

    Size ain’t everything. We saw how good they are, at the Lindt Café.

  54. john constantine

    Land and houses are just rented from the state, miss a rate payment or two and the crushing power of the state swings to bear on those revolting against paying tax on capital.

  55. Ripper

    Dot, think about who was roaming around in 1959 pushing monetary and banking policy in Australia?

    Nugget Coombs – the arch leftist who studied Keynesian economics in London and came back to Australia to infect us with this crap. He served at both the Treasury and the RBA (when the RBA was established in 1959).

    I suspect Coombs had a big hand in this.

    It wasn’t long after that in 1966 that the silver 3d 6d shilling and florin were replaced by cheap junk.

  56. max

    Also note that the NSW government is tracking people who use the train/light rail/ferry system who use the Opal system and that both levels of government can track people down through arrangements with smart phone manufactures and software/website companies (including social media platforms).

    Hunted the second series started on ABC2 last Thursday night. Well worth a look if you’re interested in all the ways our movements can be tracked in this digital world.

  57. Zulu Kilo Die Onuitspeeklike

    the NSW police force from what I understand is the 4th largest police force in the world! They are armed to the teeth, have military style weapons and have been trained in military style operational tactics.

    Superbly trained, and equipped to fulfill any role but one – investigate and prosecute those who have actually broken the law.

  58. Jimf

    Dot ,seriously . “Sweat lubricated rolls of blubber ” … ? Are you actually a romance writer for the Chub-Love sub-genre? A sort of Barbara Cartland with double cheese and a side of mayo?

  59. As a matter of fact, Rabz, the wife mandates white gold. Not sure where that sits in your gold vs silver rankings.

  60. Cannibal

    If gold is of so little consequence, and of little intrinsic value, why would government have such draconian legislation on the books ready to be activated at a moment’s notice?
    Just another way to stop people finding alternative transactional arrangements, and another asset class prohibited because it can’t be controlled easily by bureaucrats.

    By the way, has there been any discussion here about Australian implementation of the bail-in rules said to have been promulgated from the BIS? It seems this has been adopted unremarked, or do we wait for our own Cypress event and see what happens?

  61. rickw

    Size ain’t everything. We saw how good they are, at the Lindt Café.

    That’s when they’re protecting us. When they’re effectively protecting themselves it could be very different.

  62. Anonandon

    All these people talking down gold have no idea what they are talking about.

  63. Rabz

    Good work m0nts (and the wife), white gold is tolerable.

  64. john constantine

    The future fund is already spent, whenever they quote ‘net government debt’ this is an open admission that the future fund is zeroed out against the great squandering.

    When shorten was in power last time, he oversaw the evaporation of the future fund, the defunding of the military and the creation of unfunded military liabilities going forward, shorten created shortencare, also known as their NDIS, he was there for the establishment of the NBN, the human rights commission, the climate council, the fair work commission, the creation of vast unfunded infrastructure liabilities in the pursuit of Big Australia at any cost, with the crippling unfunded medical liabilities looking forward.

    If shorten gets back in, he will go hellbent for Big Australia, as this will give him client vote herds with no historic accumulated capital invested in the country. These client herds will vote for and demand that legacy assets be massively taxed to fund current welfare benefits.

    Their idiot savant shorten can already see that medical spending is his path to eternal power.

    “why should obsolete and deplorable racists live untaxed in houses worth a million, when this little wheelchair bound waif is sobbing in need of her operation?”.

    The money is already spent, the unfunded liabilities are set rock solid and the cumulative interest is already compounding.

  65. john constantine

    Medical investment in yourself is better than gold.

    Make sure all the dental work is up to date, even pull out any dodgy wisdom teeth.

    Consider laser eye treatment to replace eyeglasses.

    Even cosmetic vanity ‘work done’ could be more valuable than gold once shortencare rations medical treatments.

  66. Lem

    If the asset is not real which you can’t physically touch, then the so-called “asset” will likely be destroyed when the global correction/re-set comes.

    I have nothing tied up in the stock market or in digitally dominated assets (except for superannuation unfortunately – but this is financial entrapment by the Government).

    Wise at this point. However, after fiat has completely blown up, governments, which produce nothing but have rapacious appetites will confiscate assets. Nothing to stop them confiscating property, whether by forcing property sales on individuals through one off (sarc) “levies” , or new property or wealth taxes, thus crippling those with hard assets. It was done in the US in the 30’s, which is a very interesting story (particularly with regards to how people circumvented the government. Mises Institute has an interesting book on it available to read for free).

    The only good thing standing between government and people in Australia is that just about everyone is invested heavily in real estate, unlike perhaps the 30’s in the states, so an outright asset seizure policy would result in widespread insurrection (even police own homes, and investment properties). So it’s probably the safest asset class to hold at this time in these very troubling times.

    Nevertheless, it will be fascinating to watch what happens worldwide with government treatment of private physical gold holdings as we sleep walk into the inevitable financial abyss.

    China and Russia (and a number of US states) are not rapidly accumulating bullion for nothing. They probably know which way fiat is going.

  67. john constantine

    Got a mate that has done some ‘castle work’, the argument against is that all he is doing is creating a honeypot for the Apex Predators to be drawn to and take over if things get that bad.

    His argument is that he enjoys doing it, that the preparation for off grid living covers him against the inevitable rolling blackouts coming for rural vicco after andrews dynamites the coal power and that his front yard will resemble the First Day of the Somme before they dig him out his homestead.

    Digging an old style cellar, comfortable, waterproof, damp-proof and deep enough to store vegetables and wine in a stable cool enviroment, no power required.

    Well equipped home butchers shed.

    Greenhouse for all season horticulture.

    Dig big deep dams, for multiyear water storage.

    Sink a bore if suitable geology.

  68. Lem

    Sink a bore if suitable geology.

    Don’t forget a windmill for the bore. Do southern cross still make them?

    Actually, what you are describing is how many of us grew up on farms decades ago anyway. Nowadays, the inner city types sniff at this as “prepping”, when we just called in self sufficiency, because we had no money and grew as much food for ourselves as we could. Of course the inner city types are trying do it as well, but they have the high moral ground: they’re being “environmentally sustainable”.

    They may find the starving hoards are a little close for comfort though.

  69. .

    Cannibal
    #2285453, posted on February 5, 2017 at 4:35 am
    If gold is of so little consequence, and of little intrinsic value, why would government have such draconian legislation on the books ready to be activated at a moment’s notice?
    Just another way to stop people finding alternative transactional arrangements, and another asset class prohibited because it can’t be controlled easily by bureaucrats.

    Boom. Thank you.

  70. .

    I’m not averse to self sufficiency.

    The sad fact is nuclear war is still a distinct possibility. You just don’t know what Iran or what Islamists in Pakistan might do.

    You’re not crazy if you have a basement and prep.

    We are sleepwalking into financial ruin. Do you want to live in a place like Venezuela without preparation?

  71. Lem

    I think the main value of gold bullion in reality is a store of a lot of value, to be used at a later date once the dust settles. Silver is more of interest as an alternative transactional medium, but as others have said, if things get bad quickly people would find other money systems or revert to barter of goods and services, and anyway I don’t think many Australians are holding silver bullion or coins.

    You don’t need much food everyday to survive, it is more water and a heat source in the short term (days) that matters. And personal protection.

    It is an interesting thought experiment (let’s hope it stays that way).

  72. john constantine

    Trouble is that old mate would be required to pay the state in its various forms at least two thousand dollars a month simply to be permitted to continue live on his own homestead.

    Miss a rate payment if the financial system has a hiccup and he is out on the road with the swaggies, while the government moves their Apex Predators into the off grid castle he built with his own sweat and treasure.

    Given that the state can even now simply enter your home and search it without a cause or warrant as long as you are on the firearms registry, that the Nazgul of yarragrad are funding a unit to forensically examine social media and the internet for thought crimes, Big Australia gives their social justice aristocracy the power base and sanctification to make preppers ‘share’ with the unprepped, because of social justice.

    The rule is not to look like anybody could be covetous in any way of anything they could take off you.

  73. john constantine

    Silage pits filled in good seasons with fodder that will sit for decades are a form of prepping, but it costs upfront money and without certainty of title, third world peasants don’t do it.

    As Australia accelerates towards a ‘social justice licence to farm’ future, preparing for hard times seems less worth the effort.

    The individual electronic registration of each sheep now demanded by their yarragrad Nazgul isn’t a step towards freedom.

    The underground storage of a truckload or two of coal in a waterproof pit was considered as insurance against the day that private firewood harvesting is totally banned. Don’t laugh, rural victorian pensioners that used to heat their houses with wood stoves as their families have done for generations are now faced with a world where they go to bed fully clothed at sunset in winter, because the Nazgul of inner city yarragrad have saved the scrub.

  74. john constantine

    Coal stored could be more valuable than gold stored, as you are less likely to have your throat cut for a lump of coal.

    Wheat and grain burning stoves are interesting, but they require some electricity and the government control of grain and foodstuffs is a typical zimbabwe/venezuela thought process.

    The best prepping is to be a shorten orc, with a government job and payments for life, conscripts to serve as military meatshields for your protection and unending food, warmth and shelter for you and your social justice elite regardless of what happens to the proles. [North Korea is very reassuring to shorten, as it demonstrates exactly how much a regime can get away with.]

  75. Tel

    Don’t laugh, rural victorian pensioners that used to heat their houses with wood stoves as their families have done for generations are now faced with a world where they go to bed fully clothed at sunset in winter, because the Nazgul of inner city yarragrad have saved the scrub.

    That’s incredibly Far Cupped.

    The dry wood left on the ground will only add intensity when the next bushfire goes through. Picking up the wood is a favour to everyone.

    The determination to rule over the lives of others is like a horrible sickness that runs through humanity, but lately we have incredibly stupid people managing to take charge somehow.

  76. old bloke

    john constantine

    #2285551, posted on February 5, 2017 at 9:53 am

    Got a mate that has done some ‘castle work’, the argument against is that all he is doing is creating a honeypot for the Apex Predators to be drawn to and take over if things get that bad.

    The first rule to protect your family and assets is the “tank and a half” rule. Make sure that your property is more than one tank of fuel away from any major population centre, and make sure you have sufficient fuel on hand to get there when you need to.

  77. Lem

    The dry wood left on the ground will only add intensity when the next bushfire goes through. Picking up the wood is a favour to everyone.

    On the farm of my childhood we had a wood stove that also heated the water for washing and bathing (and of course we had rainwater tanks). Woe betide anyone who let the fire go out, especially in winter. Any wood lying around was stored, and all farm houses had fruit trees around them as well as a decent amount of fallow untreed ground for a decent circumference to protect the house from bush/grass fires. Honestly, I can’t believe people are rediscovering all this, it wasn’t that long ago, indeed people still live like this all over Australia.

  78. DI

    During the coming currency crisis, gold will go into hiding. During this time, cash and food will be important. However, if you wish to transfer your wealth from here to there, gold will out-perform all other assets.

    And no. Gold will not be confiscated by governments – that only happened when gold was central to the international monetary system. However, the trend is the opposite. Gold has nearly completed its exit from the international monetary system, with only the failure of the fractionally reserved and for-historical-purposes-only Bullion Banking system required to complete it’s exit. At this point, all IOUs for gold will default, leading to an enormousness upward re-pricing of physical gold.

    http://fofoa.blogspot.com.au/2009/08/confiscation-anatomy-different-view.html

    As wise men have said: Gold, get you some.

  79. AC

    Transfer of gold out of Australia
    (1) A person shall not, except with the consent in writing of the Reserve Bank, take or send any gold out of Australia.

    What about all the tourists who buy gold at Perth Mint then go home overseas? I didn’t realise that was illegal.

  80. Portable wealth is sadly very…portable.
    Which is a plus for electronic currency so long as you can trust the government and the people holding it for you.”

    And therein lies the problem outlined in this article.
    Do you trust that the “electronic” funds you have recorded with your financial institution remain inviolable?
    Do you trust your government to manage the fiscal affairs of your country so as to maintain the value of that currency and those funds you have entrusted to your financial institution?
    Do you trust your government not to ban actual cash money so as to make you totally reliant on the electronic funds held by your financial institution, which are subject to the whims, fiscal management and control of your government and financial institution?

  81. Diogenes

    What about all the tourists who buy gold at Perth Mint then go home overseas? I didn’t realise that was illegal.

    AC , that provision only kicks in upon the GG issuing the proclamation to surrender all gold, for obvious reasons, ie move it OS so it cannot be seized.

  82. Tim Neilson

    The dry wood left on the ground will only add intensity when the next bushfire goes through. Picking up the wood is a favour to everyone.
    True, but try telling that to the “sea change” majority on the Council of the Surf Coast Shire (CFMEUistan), who all live in the pretty and increasingly crowded beach resort towns. They say that fallen wood is “habitat”. I don’t know whether any of the farming families in the hinterland actually pay any attention to the bullshit, but, yes, it is technically illegal in Surf Coast Shire for a farmer to pick up a fallen branch and throw in onto the fireplace.

  83. Tel

    Honestly, I can’t believe people are rediscovering all this, it wasn’t that long ago, indeed people still live like this all over Australia.

    It’s about power, not about any rediscovery.

    The purpose is to undermine people’s established lifestyle and make them look to the state.

  84. Pedro the Ignorant

    Based on the figures I saw when I worked at the Perth Mint for 20 years, I don’t think there is “astonishing amount of gold bullion being held” by Aussies – at least 90% of what the Perth Mint sells is exported. The golden goose for a cash strapped government would be to nationlise gold mines.

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