Meritt Financial - What is Executive Order 6102?
The Executive Order 6102 is also known as the Gold confiscation of 1933. The Order was issues on April 5, 1933 by the President Franklin D. Roosevelt, and prohibited personal ownership of the gold and physical bullion coins by the citizens of the country. The confiscation was legal under an Act of 1917, passed by the government in 1917 that prohibited hoarding of gold and other precious metals for illegal economic purposes. Those who failed to comply with the directions given in the order were liable for heavy fines and even imprisonment under the law.
The Executive Order 6102 made room for several exemptions that allowed people fulfilling certain conditions to continue holding their gold coins and bars. These exemptions allowed companies and organizations operating in mining industry, artists, collectors and jewelry manufactures to retain their gold coins and bars. Those owning gold worth $100 or less were also exempted from the confiscation.
In exchange for the gold coins and bars and gold certificates, the government of US gave $20.67 per Troy Ounce to the owner of the gold. After only two weeks, the compensation rate was increased to $35 and those who surrendered their gold at a later date made unexpected profits due to this hike in exchange rate.
In fact, the order had to be re-issued soon because the first order, that is the Executive Order 6102 was issued in the name of the President which is constitutionally not allowed. According to the constitution of the United States of American, only the head of Treasury can issue orders pertaining to confiscation of gold and other precious metals. Therefore, when challenged in the court of law, the government reissued the order as Executive Order 6112 and called for confiscation of all the gold under personal possession.
The ban on personal possession of gold and other silver coins was lifted in the year 1974 but along with that came the famous Nixon Shock which did away with the standard $35 per Troy Ounce. This made the prices of gold coins subject to market trends and conditions. Fortunately for all of us, the gold prices have always appreciated and rarely depreciated, making gold a brilliant way to hedge the anticipated losses in an investor's portfolio.
Many investors and gold coin owners worry about another gold confiscation and the fears about the same were at an all time during the 2008 global financial meltdown. Those who did not have sufficient gold holdings regretted it and those who had sufficient gold investments were worried over probable gold confiscation. Though their investments were hedged and losses were minimized, still one order from the government had the capacity to reduce their investments and savings to zero.
The Executive Order 6102 made room for several exemptions that allowed people fulfilling certain conditions to continue holding their gold coins and bars. These exemptions allowed companies and organizations operating in mining industry, artists, collectors and jewelry manufactures to retain their gold coins and bars. Those owning gold worth $100 or less were also exempted from the confiscation.
In exchange for the gold coins and bars and gold certificates, the government of US gave $20.67 per Troy Ounce to the owner of the gold. After only two weeks, the compensation rate was increased to $35 and those who surrendered their gold at a later date made unexpected profits due to this hike in exchange rate.
In fact, the order had to be re-issued soon because the first order, that is the Executive Order 6102 was issued in the name of the President which is constitutionally not allowed. According to the constitution of the United States of American, only the head of Treasury can issue orders pertaining to confiscation of gold and other precious metals. Therefore, when challenged in the court of law, the government reissued the order as Executive Order 6112 and called for confiscation of all the gold under personal possession.
The ban on personal possession of gold and other silver coins was lifted in the year 1974 but along with that came the famous Nixon Shock which did away with the standard $35 per Troy Ounce. This made the prices of gold coins subject to market trends and conditions. Fortunately for all of us, the gold prices have always appreciated and rarely depreciated, making gold a brilliant way to hedge the anticipated losses in an investor's portfolio.
Many investors and gold coin owners worry about another gold confiscation and the fears about the same were at an all time during the 2008 global financial meltdown. Those who did not have sufficient gold holdings regretted it and those who had sufficient gold investments were worried over probable gold confiscation. Though their investments were hedged and losses were minimized, still one order from the government had the capacity to reduce their investments and savings to zero.
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