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Private gold ownership may become illegal

Updated: Aug 31, 2024
Published: May 22, 2020
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Given the current economic environment with the pandemic hitting most businesses and impending global recession, it is no wonder that people will likely flock to gold to protect the value of their holdings. Gold has been the undisputed hedge against inflation that stood the test of time.

Inflation

Global monetary inflation is no longer a question of “if” but “when”. Taking the example of the United States and the US Dollar, the Federal Reserve has been printing an obscene amount of fiat currency in order to flood the markets with cash and help artificially recover the economy.

This excessive influx of supply simply devalues the dollar and creates an increase in goods prices: inflation.

Private Ownership Illegal?

According to the high profile European hedge fund manager Crispin Odey, governments may choose to ban private gold ownership if they lose control of inflation.

In a letter to investors, Odey stated: “It is no surprise that people are buying gold. But the authorities may attempt at some point to de-monetise gold, making it illegal to own as a private individual. They will only do this if they feel the need to create a stable unit of account for world trade”.

Bitcoin Ownership

Bitcoin is seeing its first ever global recession, while there has been speculation about it being a great hedge against inflation, there isn’t as much data to back the claim as that of gold.

However, given the few instances of political instability such as the trade war and the Iran-US issues faced a few months back, Bitcoin is slowly rising to popularity as a hedge against inflation. Its digital availability and easy storage is becoming more lucrative for investors that even legendary Paul Tudor Jones has added it to his portfolio.

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