Thursday, December 16, 2010

Bizarre: SEC to Require Retailers of Store-Brand Products to Report Source of Metal In Its Products

The SEC is about to require retailers carrying store-brand products to report whether the goods contain minerals from so-called conflict areas of Africa.

This madness will result in one of two things. Some retailers will stop carrying store-brand products, others will somehow be forced to track minerals back to the original source.

This tracking of minerals appears to be the true reason for this SEC regulation.

The requirement will affect around 6,000 U.S. and foreign companies that file reports to the SEC, an agency official said. 

Companies will have to report what steps they have taken to verify the minerals weren't taxed or controlled by rebel groups in the Democratic Republic of Congo and neighboring countries.

While companies will still be allowed to sell products without that a "DRC conflict-free" label,  the SEC's proposal would force companies to include in their annual reports and on their websites a list of their products that aren't "DRC-conflict free." Thus setting the stage for nut job protesters, who will be playing right into the hands of the government's desire to track minerals.

This, by the way, appears to be another Cass Sunstein designed "nudge" similar to the TSA cancer scan versus groping options. Regulators don't demand things anymore, they simply give you a "choice" between distasteful options. Here the real options are:1. Figure out away to track your minerals or 2. Deal with the clueless, usually unwashed, nut jobs that will be screaming outside your stores.

The proposal is now open for a 45-day comment period. Followed by a second vote by the SEC before the regulation is made official. On the first round the regulation was approved unanimously.

The four metals included as part of the proposal are: tin, tantalum, tungsten or gold.

Quite simply this is a backdoor attempt to force tracking of gold and other minerals, as gold whose pedigree can't be determined will face less demand from retailers than numbered gold.

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