Will Gold Be Confiscated or Become Illegal, as It Was During the Great Depression?
Since the Great Depression, gold’s importance to our economy has fallen dramatically. During the Depression it was still very important—in the 1890s almost 90 percent of commercial transactions were consummated in gold. Hence, there was a greater need to confiscate gold. In the current economy, it simply isn’t that important. Even with high inflation, the dollar will still be the primary means of trade, even if it is worth much less. In a modern economy like ours, gold won’t be a viable means of transacting business. Hence, there is little need for the government to confiscate gold, unlike during the Great Depression.
It’s unlikely that making gold illegal in the United States would do any more than hurt smaller, middle class investors who can’t easily buy gold globally. Also, any talk of making gold illegal would dramatically increase its price, which would be very counterproductive. Further complicating the situation is the fact that a great deal of gold is already in circulation, making it difficult to outlaw. A large black market for gold among the middle-class could easily develop.
Also, people often forget that, unlike our stock market, the vast majority of the demand for gold is outside the United States. So, the price is very much determined by the international market. Whether the United States makes gold illegal or not is only one factor affecting the price of gold. Since most of the demand ...