Per John Brimelow:
At the GATA London conference Rickards brought up the US government's likely response to those of us who will profit from our gold investments. Here is an excerpt:
Brimelow: "The most dramatic presentation was made by James Rickards, who has surfaced as a very interesting and well-connected pontificator. Rickards was actually part of the negotiating team at LTCM, the hedge fund that sailed into the rocks in 1998. LTCM was always rumored to have a very substantial gold position, and its rescue seems quite clear to be an early forerunner of the enormous influence of Goldman Sachs, since the major beneficiary of the LTCM rescue was Goldman Sachs. Rickards really woke up the conference by saying that he thought the American government was very liable to impose an excess profits tax on gold miners and a windfall profits tax on holders of gold bullion. He also said that the Americans at some point would move to confiscate all the foreign-government-owned gold that’s actually stored in the United States. He said if he were the Germans, he’d be sending the ships over right away. Most people tend to assume they couldn’t possibly do a Roosevelt and confiscate the gold again. His point is that they can effectively confiscate it through taxes, which is unfortunately true. These ideas come out of the clear blue sky, so I wonder what he’s heard."
Really great how it is ok to profit off the internet bubble and the real estate bubble, but not off of the "dollar bubble, " eh? Though it is a possible future event, I am at least going to begin considering the various (legal) strategies available to keep Uncle's hands off as much as possible.
For one I can see taking capital gains on shares along the way while rates are lower, and continuing to re-buy and sell along the rest of the way. I didn't plan on selling peaks and buying dips during the manic phase, but it might be a better option than just holding.
Another strategy might be to avoid US-based producers. Canada might not seek to harm the producers as much due to Canada's more favorable position on mining (and their better fiscal situation). Or maybe just focus on the explorers; they aren't producing so they cannot be taxed on gold production.
As for the physical "windfall" taxes. I don't know if they would include silver (probably would), but I'm sure an underground economy in the metals will spring up if Uncle pushes taxation too far. Also, if silver, platinum, or palladium are not included in the windfall tax, I can certainly see people moving out of gold and into whichever one isn't part of their theft scheme.
Anyone have some thoughts?
Here is the link:
I hope GATA puts out a DVD of the conference like they did before. I would certainly buy one.