By Richard Schwary – California Numismatic Investments
With my many years of trying to keep the government out of private business I would never believe that I’m actually considering this government regulation on a limited basis. Why? Because there has been a significant and negative change in the way our government can regulate free enterprise and still present an advantage to American citizens within the physical precious metal market.
In the past if a telemarketer robbed a gold buyer by selling grossly overpriced merchandize the Federal Trade Commission (FTC) could step in and shut the offender down after investigating complaints from consumers. Now this was neither a quick fix nor one that would make everyone happy because the “room” could open up across the street using another name and the process of stealing from the uninformed began again. But at least the FTC could take decisive action which halted and warned.
So what has changed in the last 10 years that has changed my mind about limited government regulation as far as placing gold in your IRA? There is a new breed of telemarketer which has been bullet-proofed by expensive attorneys and now may be immune to federal prosecution because of prominent pre-sale disclosures given to new customers. In other words if you tell the mark he is being screwed up front the FTC may not be able to help him after the fact, never mind the new and uninformed investor who wants to buy “gold” is easily lead into overpriced “hyped” material with scare tactics and outright lies. And to add insult to injury we all get to hear our favorite conservative talk show hosts actually recommend this insanity.
So you free enterprise American thinkers out there might say “Well, you told the investor up front what he was being charged and the idiot still did business, so why get the government involved? The consumer had more than enough information to make an intelligent decision in the first place.” This is the same and very old wisdom used in the American car business since there was one color of Ford: “You bought the car, get off the lot” and if we were talking about cars there would be no need for significant change.
But we are now talking about the vast pool of money available because the government does allow the use of Individual Retirement Account money to purchase gold. And notice I said “vast amount of money” because this marketing windfall is being looked at greedily by some of the largest and hardest sell coin telemarketers in America. And believe me this “put gold into your IRA account” could end just as badly as the recent mortgage collapse if the professional coin trade does not step up to the plate and distinguish itself.
There is a very large wolf at the door wearing sheep’s clothing and finding Waldo is going to be easy because of the commission prize and legal shielding now in place. Expect trouble folks, right here in River City if the government does not regulate the selling of gold coins now being placed into retirement accounts. Why this type of needed legislation has to be trumpeted from someone who is actually in the bullion business, especially after congressional hearings in which the newbie trusted the “nice gold broker” is an amazement and embarrassment.