Sunday, July 25, 2010

Dodd-Frank Bill Contains Provision that May Lead to Tracking of All Gold Coins

The Dodd-Frank Financial Reform Bill contains a provision that requires companies buying gold and other minerals to submit an annual report outlining what they are doing to ensure their minerals are "conflict-free."

Most of the focus on this provision, to date, has been on the ramifications for high tech companies such as Apple and Intel. But the provision goes beyond the minerals used in high tech equipment, such as cobalt, copper and tantalum. Gold is also on the list.

The Bill requires that manufacturers report where they purchased their minerals to ensure that they have not been purchased from "conflict zone" countries, which include Congo and neighboring countries.

The concept of conflict-free began with diamonds mined in a war zone and sold to finance an insurgency, invading army's war efforts, or a warlord's activity. The idea being that the purchase of diamonds from such war zones should be illegal, ostensibly to stop the financing of the wars. It is believed by observers of the diamond industry, such as Edward J. Epstein, that DeBeers was behind the idea of conflict-free diamonds as a way to limit the supply of diamonds that come on the market. Nevertheless the concept took hold.

According to Wikipeida:
On July 19, 2000, the World Diamond Congress adopted at Antwerp a resolution to strengthen the diamond industry's ability to block sales of conflict diamonds. The resolution called for an international certification system on the export and import of diamonds, legislation in all countries to accept only officially sealed packages of diamonds, for countries to impose criminal charges on anyone trafficking in conflict diamonds, and instituted a ban on any individual found trading in conflict diamonds from the diamond bourses of the World Federation of Diamond Bourses. The Kimberly Process was led by the diamond-producing African countries themselves.

On January 17 - 18 of 2001, diamond industry figures convened and formed the new organization, the World Diamond Council. This new body set out to draft a new process, whereby all diamond rough could be certified as coming from a non-conflict source.

The KPCS was given approval by the UN on March 13, 2002,[and in November, after two years of negotiation between governments, diamond producers, and Non-Government organizations, the Kimberley Process Certification Scheme (KPCS) was created.
Got that? All diamonds are now certified under the "Kimberley Process" to prove that they are not from "conflict zones".

The Dodd-Frank Bill appears to "nudge" the gold industry towards a certification process. Couple this nudge with the requirement in the Healthcare Bill that gold dealers will be required to fill out 1099 forms on all customers who buy or sell more than $601 worth of gold coins, and it is clear that the noose is tightening around the gold industry. It will take some time, but don't be surprised to find that down the road a "Kimberley Process" will be created for gold and that all newly manufactured gold coins and gold bars will be stamped with a unique serial number.

Then the serious tracking of who owns how many gold coins will begin.


  1. I don't see how "certification" can work with gold or any other metal. Diamonds cannot be melted and recast, metals can and are. Moreover, I don't see how a precious metal in form of ingots (bullion or anything) can be "certified". If bars must be stamped, how about offering the gold-hungry public a shot-like form of gold. PGMs, for example iridium, are regularly sold as a crushed sponge (a fine powder). Gold for jewellers is available in that form too. One way or another, for every measure there will be a lot of countermeasures and a market for exchange of that.

    One real life example. A certain country was going through a very rough time. Monetary rough, in particular. Circulation of precious metals had been and was tightly controlled, much more than in the West now. So did it stop people? Nope. Once in a while people got caught with BAGS of gold wedding rings, but mostly it worked for them. Everyone wanted it, except for the government. But even they didn't have it on top of their mind when the monetary problems got really serious. Foreign currencies were though - much wider and easier shelter for wealth in troubled times. But in general, as a government gets weaker, its harsh laws progressively become less of a problem for the people. In scope of the same example, the entire country was openly using a certain foreign currency as its own, although it was formally illegal. With loss of power came irrelevance of the government and all of its crazyass concoctions. Just facts.

  2. The "conflict-free" excuse is hilarious. Apparently it's okay for US submitizens to finance their own government's wars with taxes and bond purchases, but not other countries'.

  3. One way or another (or, as you suggest, using a combination of ways), the government will try to restrict private gold ownership. Uh, excuse, me, I meant to say "hoarding". I've read every article by Antal Fekete, and am quite convinced that as hoarding gold increases, it represents a greater threat to the regime, as it is a statement of preference for real money over fake money.

  4. @Anonymous #1 wrote:

    "With loss of power came irrelevance of the government and all of its crazyass concoctions. Just facts."

    Yes, I am excited and hopeful about this. As someone else once said, "the black market is the free market doing what the government disapproves of".

    I love the Agorist's approach ( which is to continue to engage in counter-economic (black market) activities - and avoid taxation - until the system finally collapses upon itself. It won't be a pain free process though...

  5. @Agorist:

    Yes, Ludwig von Mises demonstrated that socialism was "doomed to failure" due to the lack of economic calculation. The problem is that it can take many years and lots of pain before it collapses.

    Someone pointed out recently that the longest lasting, socialist regime lasted 70 years before collapsing.

  6. --
    Radioisotopic trace compounds can be incorporated in any gold alloy formulation to facilitate identification. I would not hold it past civil government in these United States to require such tagging under the deceptive premise that it was being done as some sort of "anti-counterfeiting" measure, or supposedly to ensure that precious metal coins and ingots were not being derived from "conflict" sources.

    There is much reason for the Republican Party to publicly pledge that the will repeal specific acts of the 111th Congress immediately upon assuming the majority in January 2011. The elimination of the Form 1099 requirement incorporated in our Fraudulence-in-Chief's "health care" legislation is one such measure, and features of the Dodd-Frank "death to free markets" legislation should be specifically named and targeted as well.

    Nothing less will be necessary to bring into stark relief the deadly damage done by the National Socialists (we're not calling them "Democrats" any more, are we?) during their reign of malfeasance in public office.

  7. another chain placed on the back of a free people. freedom in this country is getting to be a heavy weight to carry.
    both of the political parties are bought and paid for. so whats another form to fill out to them, just more bs from corrupted scum officials. they all need to be VOTED OUT OF OFFICE. the good ones with the bad because they ALL condone the special interest form of gobernment and are not bothered by the CONSTITUTION.until we take the $$$ away from these bastards we will never be FREE. to hell with this CONgress. VOTE THE BASTARDS OUT or you are part of the problem and you will go down with the rest of us and them.

  8. I'm not really that worried by this. If the Establishment is trying to move to a Brave New Cashless World, they will want to focus their energies on hoards of paper dollars since these are the "gold" of today, that is, the only means of anonymous, secure, final payment. Controlling gold itself would only matter *after* a major monetary collapse.

  9. Let US face it...we're DQQMED!

    By the time 'they' try to institute more regs on people to rein in their remaining freedoms anarchy will prevail.

    Americans may be kept stupid by their educational system but they aren't dumbd!

    It has been said that when Americans have nothing left to lose they'll standup & fight back. Well Americans don't have anything left. Dignity, nat'l pride, ecomonic standing, the leaders of the world...all crap!

    America runs 'torture prisions' all over the world. They kill thousands upon thousands in illegal wars (prove legality, show US WMD in Irak!) & they continue to write Law to allow them & the other 1%'ers to loot what is left of the nation & the world.

    Let em stick & RFID chip in it. Who cares? The States will be operating their own gov't bodies independant from the Feds when it all comes apart.

    Thanx George...

  10. More drastic measures will be required to stop our federal government from totalitarian control of the populace. Voting them out of office will not be enough. A second American revolution will happen within 30 years. It will not be pretty.

  11. As long as Americans in general are obese and addicted to TV, they will put up with anything the government does to them. By the time they are hungry and aware, revolution will be impossible. They only want less government for themselves. They want more for their neighbor. They believe deeply in individual rights when they are about to be lynched and just as deeply in majority rule when they want to lynch someone. In general, they are fat, ignorant, parasitic hypocrits. They are thus doomed by their own hand. This november they will watch TV and vote for major party incumbents - as usual. They are powerless because they choose to be.

  12. The power that used to be cannot control all the population working independently. Just do your own thing and assist others to do their own thing. If you wish to learn something, find the person who knows and apprentice to them. Everybody needs a tangible skill that makes them individually valuable to the other members of the community.

    A monetary system can be created based on the elements of the periodic table. Gold and the PGMs form the high end, but complex hydrocarbons will be of great value - was more precious than to just burn. And each of us has a body full of them. just thinking howdt loud.

  13. Revolutions destroy Capital.

    The real revolution is the one that happens in peoples' minds.

    Want to end the Banksters' Regime?

    It is simple... Don't keep any money in Dollars.

    It works like this: Reserve Banks base the value of the currency they create on the Bank's assets. The assets consist of two general categories: real physical assets (largely commodities) and Instruments (Bonds, stocks, but generally promises...which may be void).

    If you have earned some wealth (money is just a marker representing a quantity of wealth) then do not hold it in currency.

    It is that simple.

    The wealth you need to spend for survival, spend immediately. Keep it as dollars only long enough to trade it for real objects that you need - food, rent, whatever.

    Use the wealth that you do not need to spend immediately to buy a physical asset. If you choose your purchase wisely, no matter what happens your wealth will not disappear... it will still be in the asset you bought. (HINT: Don't buy a car or depreciable asset unless you truly need it immediately. The wealth you put into depreciable assets reduces as the asset gets older.)

    Here's how it works as a better method than revolution. The Reserve Bank has physical assets and instruments (promises, IOU's). These assets & instruments are the value backing the currency. Each dollar of currency is a claim on a portion of those assets and instruments.

    When you refuse to hold currency you are refusing to support demand for currency - meaning that one less person wants the currency. This means that the dollars you would otherwise have kept in your account will remain out there circulating in the economy.

    That in itself is inflationary. Fewer (by one) people demand currency, and the supply (by equal amount) increases.

    But for the reserve bank it is worse. It is fractional reserve banking in reverse. That wealth you have refused to put into the system was already loaned out at a multiple. When you refuse to keep your wealth in-system it has an inflationary effect on the instruments the bank holds.

    Second, the reserve bank also swaps (sells) its physical assets using a fractional reserve methodology. That means that it sells the same physical asset - not the same kind, but the same physical one - to multiple people. Each of those people think they own the asset exclusively.

    As long as only a small percentage of people try to physically collect their assets at the same time everything is fine for the bank. When enough people physically collect their assets that the vault is getting bare, then the bank will try to sell some instruments (promises) to get JUST ENOUGH more assets to satisfy those taking possession of the assets.

    When you buy physical assets you raise demand for physical assets, making their prices (in currency) rise. In turn this makes it difficult for the bank to deliver on assets it sold, but never actually owned. It is hard because it must sell instruments (promises) that are declining in value to get assets that are rising in value.

    This really only works if the bank has been fractional reserving its assets. But the reserve banks have been doing that...

    When the instruments are getting worth less and less, at the same time the assets (which the bank has in fact long ago sold to many different buyers who each think they exclusively own the assets) are rising in value, the bank cannot deliver, and then must admit that they don't really have any assets, but some depreciated promises.

    Each unit of currency is a claim on those depreciated promises. Each currency unit's value will fall in tandem with the depreciation on the value of the promise.

    Ergo: Everyone who dumps the bank early keeps their wealth. Everyone who supports it gets wiped out by the fraudulent nature of the beast they supported.


  14. Clayton said: "Controlling gold itself would only matter *after* a major monetary collapse."

    Clayton, I am afraid you may be on to something here. Maybe the government isn't completely ignorant of the consequences of their actions?

    Just a possibility one should not quickly dismiss.

  15. Read "Does Obama Want Your Bling?" at:

    A suggestion: Use American Eagle $1 silver coins for transactions that involve tax reporting. Each coin is legal tender of $1, yet because of the silver content they are worth perhaps $18 per coin.

    If you own a business and would normally sell a particular item for $180, sell it instead for $18! The buyer pays you with 18 American Eagle coins. You (legally) record the sale price as $18, and that amount is therefore recorded in your financial records as the gross income for the sale.

    Do that often enough and you will be able to report substantially lower income and profit, resulting in lower taxes. Then hold on to the American Eagles, because they will surely be worth more than $18 if Obama and Bernanke keep printing money.

  16. Oops! Typo. It should read:

    If you own a business and would normally sell a particular item for $180, sell it instead for $18! The buyer pays you with 10 (not 18) American Eagle coins. You (legally) record the sale price as $10 (not $18) and that amount is therefore recorded in your financial records as the gross income for the sale.

  17. The gold coin business in Mexico and Canada will be booming.

  18. I like your proposal regarding Silver Eagles at

    Little Things You Can Do...

    but you really should correct the math in that article.

  19. Regarding trading in American Eagles:

    This is illegal. Yes, you read it right, it is now illegal to use our constitutionally required and issued money at it's face value. You can't report $1 and $50 (for gold eagle), you must report their "market value" as in $1200 for one gold eagle coin.

    For proof, search for "Robert Kahre" or read here:

    This great American did exactly what has been suggested here. He paid his employees in constitutional coin, and reported face value, so that his labor expenses were too low, but his employees weren't losing that much on taxes.

    He got slaughtered, and the LV public whore reporter has said that 'This is a case about money, greed and fraud'. OK? "Fraud and greed" - this is what he calls our constitution.

    So, no, you can't do that, legally. What is "legal"? Legal means allowed or required by king, because it does him good. Not the people.

    Why is it still that old low face value on coin? Two reasons:

    1. USG is not willing to openly admit the extent to which it had stole from the people. The gold coin should be well above $1200 now, and it is only $50, so there it is at least 24 times. This means that by revaluing the coin to it's market value, the USG would be admitting that it had stole at least 23 cents of every 24 cents you held.

    2. Most of foreign owned gold was stolen in 1971 and is held in NYFED cellars (if not spent yet). If we are ever forced to pay it back, then we would be better off by paying back in USD "technical default" at a rate of $50 per ounce than at a rate of $1200 or more per ounce stolen.

    There is nothing but death ahead. In real life, there is no magic. Sow in flames and reap in ashes.

  20. Regarding trading in American Eagles:

    @Anonymous said: "This is illegal. Yes, you read it right, it is now illegal to use our constitutionally required and issued money at it's face value. You can't report $1 and $50 (for gold eagle), you must report their "market value" as in $1200 for one gold eagle coin."

    [And THAT is why—if you report it at all--you don’t report the transaction as involving metal coins!!! Record it as a damaged item or fire sale item or short-hours, part-time work-week or whatever….duh…Recall what barter means--and “black” markets? And the Fifth Amendment? Always remember who the enemy is and how THEY operate.]

  21. "conflict free minerals" yet you can invade bomb the shit out of countries for oil : )

  22. Senators don't have nothing on their hands so their trying their best to keep themselves busy.