If you don't already know this, prepare yourself for almost unbelievable government stupidity. By law, they can only redeem their gold certificates for $42/oz.
If they change that to market value, they immediately get an almost 20x on their gold holdings.
I didn't know this. Thank You.
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I had read it a long time ago and forgotten about it. Then the Mises guys were talking about it in a discussion about why the gold holdings are essentially useless for paying down the debt, because it can only be redeemed at that price.
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And what if they change the law? Law is just a funny paper nowadays
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I don't know how easy or difficult that would be. The issue is that they have gold-backed certificates that are redeemable for a specific dollar value, rather than a specific quantity of gold.
They might have to essentially seize the gold from whoever owns it, which they could obviously do.
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Ah, OK. So that's the way to do it. I don't see any problems.
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