Is there a Currency Devaluation on the
Horizon?
Silver Eagles are the only US silver
coins specifically approved for IRAs,
After repeated warnings from
currency analysts and market advisors that the U.S. currency system is on the verge of
becoming a blocked, two-tier system we now have confirmation that the country is one step
closer to realizing this. When fully implemented, the new U.S. dollar will mean a
"banana republic" type currency and across-the-board devaluation.
According to a CNN/Money news wire report - the new U.S. $20 bills were released at banks
across the country. Meanwhile, the Fed and its Bureau of Engraving and Printing (BEP) will
hold a nationwide series of publicity events as part of a $33 million campaign to let the
world know of the new bills and to acclimate the public to their strange new appearance.
The new $20s are peach-toned with the presence of blue ink, making it the first time in
almost 100 years that a mass-circulation U.S. note has prominently contained a color
besides green and black. They also contain an embedded vertical plastic strip and
color-shifting ink, whose appearance changes from copper to green as the bill is tilted
against the light.
So what is the significance of this change of color in the U.S. $20 note? Well according
to the Feds it is designed as a deterrent to stop counterfeiters. But
accordingly to currency analyst Lawrence Patterson, who authored the 1994 monograph titled
"Currency Recall", which accurately forecast the new multi-colored notes, the new colored money is part of a two-tiered currency system that will have drastic
implications for investors and non-investors alike here in the U.S.
Patterson calls the new notes "crayola currency" and claims they will circulate
domestically while the normal green currency that we've grown accustomed to will circulate
offshore all over the globe. According to commentator Terry Savage, "Two-thirds of
the U.S. paper currency is circulating in foreign countries." With the coming
two-tiered currency system, foreigners will continue to be allowed to use the greenback
while U.S. citizens will be stuck with the "crayola currency" which cannot be
exchanged.
Patterson forecasts the coming use of foreign exchange controls for the U.S. dollar
domestically, which would prohibit Americans from transferring capital to any other world
currency. Again, this is discussed in Patterson's now-classic monograph "Currency
Recall" (which I've read and highly recommend to students of currency policy and
investors seeking to retain the value of their investments).
Patterson states, "I want every one...to think carefully about this...because we are
coming very, very close to the end of the freely convertible domestic dollar. The cut in
value could be as much as 50%...I believe those holding gold bullion bars offshore and
bullion coins domestically will be very surprised to find that special regulations will
prohibit them from profiting."
He further maintains that coin dealers are under a strict Treasury regulation and must
report your sales of some coins but not others. The rule is as follows: Coins with a
premium above 15% do not have to be reported. In addition to the 1099 report, filed by the
coin dealer, you have to declare any capital gains as well."
He continues, "The existence of this rule, I believe, indicates an intent to outlaw
the ownership of bullion coins altogether! However, the rule will not remain at 15%
necessarily and could be changed to a higher percentage, which is unknown at this time.
Obviously, you do not want to own any investment coins with a premium of 15% or less and
better stay at the 25% or 30% level to be safe." Patterson points out that
complications for the government would clearly arise should numismatic collectibles be
forcibly confiscated since the bullion coins' value can be determined by the London gold
fix, but not so for collectibles. "The price of the collectible coin may or may not
be easily determined as numismatic valuables are routinely auctioned off at prices of not
only tens of thousands of dollars, but hundreds of thousands of dollars per item," he
observes. "It is difficult to imagine just how this would all be sorted out by the
bureaucracy to come up with a calculation of compensation that would relate to the market
value." He advises staying in the "safe zone" and exchanging bullion coins
not needed for emergencies (such as food or gasoline shortages, et al) for numismatic
coins with higher premiums.
Obviously, the introduction of the new peach-colored $20 bill is a test on the American
public to see how they respond to the drastic new changes. The CNN/Money article states
that the BEP has launched a multi-million dollar promotional campaign aimed at gaining
public acceptance of the new currency. For example, the twenties are being featured on
game shows, including "Wheel of Fortune" and "Jeopardy," sporting
events, like ESPN's college football telecasts. The bills are also part of some consumer
product tie-ins, according to CNN/Money, and pictures of the bills will be on the side of
bags of Pepperidge Farm Goldfish. If the government succeeds in getting the American
public to accept the bills, the other remaining denominations will obviously follow and
plans will proceed for the blocked domestic dollar. article By Cliff Droke
Silver Eagles are the only US silver coins specifically approved for IRAs,
though the .999 fine clause makes Silver Maple Leafs also eligible. However, pre-1965 US
90% silver coins are not eligible for IRAs. For IRA investors who prefer silver, bullion
bars are recommended |
