Turkey To "Confiscate" Gold "To Help Citizens Earn Money"

Tyler Durden's picture

Authored by Martin Armstrong via ArmstrongEconomics.com,

The dwindling credit of Turkey and significant decline in its currency, has led to the new clever idea of confiscating gold with a smile.

The Turkish Central Bank has come up with an idea of how to confiscate private gold while pretending they are helping you earn more money. Their objective is to make the private gold stocks of the citizens available to the financial system for themselves, but how to sell that to the people?

The Turkish central bank is launching two new investment opportunities for physical gold, according to reports in the Daily Sabah.

They are issuing a gold bond on one hand and on the other an instrument for the loan of gold and gold jewelry.

The scheme is that the Turkish government is really seeking to use the precious metal in the private sector making it available to the financial industry.

This is being marketed as broadening the financial system allowing citizens to earn additional income with their gold reserves under their mattresses by turning it over to the government.

They are pitching that this will stimulate the economy according to Deputy Prime Minister Mehmet Simsek .

What the government is really doing with issuing a gold bond that will pay you interest for using your gold. They are promising to pay a certain interest rate during the term of the bond in Turkish lira. This interest rate will be oriented towards the development of the gold price. The gold-covered loan certificate also entitles the holder to receive interest after physical gold or gold jewelry has been deposited with the intermediary bank.

This clever scheme means that the government cannot borrow internationally, so it now wants to confiscate people’s gold using a bond scheme that in the end they will be forced to default.

This will be a major test of the saying: You can fool all the people some of the time and some of the people all the time, but you cannot fool all the people all the time.

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WallHoo's picture

Im sorry but gold is not needed to facilitate industry and commerce...

giovanni_f's picture

correct. gold is an obstacle to the banking-"industry" and the commerce of rehypothecated assets of we, the cattle


Arturo's picture

Why don't they issue a new Turkish bitcoin. It is the future!!


eclectic syncretist's picture

Looks like everyone else is rushing into bonds this morning.

Davidduke2000's picture

because everybody wants to be the first to make money on paper until papers go to their intrinsic value and I am sure you know what a KG of paper is worth. 

fx's picture

Expect the US treasury to follow suit, with the Eu not far behind.

After all, try to hide your gold from the authorities when day X arrives after you had loaned it to them in the past...

Tired of Bending Over's picture

For the cattle it's single ply or newspaper, if there is still any around to be had.

HalinCA's picture

Depends whose crap is on it ...


Davidduke2000's picture

If real paintings that used to sell by the $$ millions are dropping like lead in water, do you really think Mario brother's coins would be worth much??? they are fictitious investments à la  madoff , comes a time when there won't be any takers and will drop to its intrinsic value which is zero.

HalinCA's picture

Silly boy ... a bitcoin of any variety is a medium of excahnge, not a store of value.  People that think storing wealth in bitcoins are going to get the same shock people that store wealth in computer entries will get.  

Perhaps some day a regulatory agency will 'insure' bit coins they way they do deposits ... then things will change ...

Davidduke2000's picture

the fdic insurance is a fraud, there is not enough money to pay everybody in case of banking collapse , it was made for only in a couple of banks default but not on a large scale, the governements are out of the business od supporting the citizens, even pensions will be left to the private sector that is why you have 401K and other instruments, nobody will collect anything from the government.

F22's picture

Davidduke 2000,

I agree that the FDIC is a fraud.....but I disagree that "nobody will collect anything from the government".....everyone will be paid in full....in dollars.

It's just that the dollars won't buy what your wealth says they should....


Mustafa Kemal's picture

Moreover, as far as I understand it, Dodd Frank lets fdic NOT apply to bailins

tuetenueggel's picture

Even Turks are not completely stupid.

Keyser's picture

You have proof of that because their actions to date contradict your assertion... 

UnschooledAustrianEconomist's picture

Visiting my home town Vienna once in a while I would disagree on your comment.

BobEore's picture

Whatever the future may be, Marty is about 5 years behind the present in his announcement here.This is old news and badly misinterpreted at that. The campaign to relieve Turkish citizens of their 'real wealth' in return for some(rapidly depreciating) script money began in 2011, as a jv between the Ankara regime, the complicit medias, and the banking sector - the ins and outs of which I covered in the 3 part "Devious Dervishes of Turkish Banking" series. Something in the neighborhood of 20 -40 tonnes of shiny was sequestered in the campaign. The model was later applied to the India arena... where it had much less success.

The scam to turn gold into paper was only partly exposed at the time... I later realized that had totally underestimated the duplicity of the actors - and their international partners in the original prognosis. I've therefore returned to the case in the newer GOLD FOR OIL series - which examines the parallel tracks of the scam in the gold savings department and the even more convoluted Reza Zarrab Iran gold trading trial which is the real political dynamite ready to blow behind the tsunami of fake news smokescreens in American domestic politics of the moment. You can catch up on that -real news- here.

The recent announcement out of Ankara about the gold bonds and the rest is just a last ditch attempt to scoop up any gold left in the hands of their citizen victims, and presages the complete collapse of the economy which will come after this Sunday's referendum results.

Twas a time when Marty was da Man. Sadly, he's reduced himself to the status of just another guy with a subscription list, hawking day old fish  like this one. In an era of ONEMEDIA fakenews complicity... only rogue journos cover the news. Marty came in from the cold... and now warms his feet with the rest of the gang.

Dame Ednas Possum's picture

Hmmm... let me think about it Erdog-poo...

How about you kiss my rusty sheriff badge.

tuetenueggel's picture

Ever heard about a ponzi scheme ?

No ? Thought so.

WallHoo's picture

Since when ponzis are not possible with gold??

Keyser's picture

You are either a troll or ignorant as hell... I vote for the first option... 

WallHoo's picture

Ponzis existed when gold was relevant(no sarc),i dont know why you get so angry,if you want to discus something im open to...

UnschooledAustrianEconomist's picture

Because gold cannot be conterfeited and its production consumes significant amounts of energy.

WallHoo's picture

True,but this aint gonna help much.I feel you but with gold you can always change the exchange rate between gold and paper like the US did in the past.

But even if people go around using actual gold coins for transactions,you cant stop credit,credit is something natural that everyone can create.

Then on top of that there is the interest(possitive) that causes the actual destruction of the system,by asking for more than there is available.

So first you have inflation(expectations) then deflation and you are also left wih the interest on top of that.So you either let youre economy go bust or you depreciate...Theres no way around that.


Even if we used tomatoes for money,there wouldnt be enough tomatoes in the end to satisfy usury...

I think this is the problem tha worries you.

HalinCA's picture

It is interesting to muse on your point.  The only reason what you say is true today is because people have been taught that paper money and coins are stores of value, not just transaction facilitators.

Gold and silver is what our society used for a very long time to teach people that concept.

Today most people around the world would still agree to take gold in exchange for their services.  The same can be said of most paper currency.  But how do you use a credit card without a communications network?

Banking and finance are incredibly delicate institutions, considering how easy it is to take down communication grids or the software that the system relies on to function.

WallHoo's picture

What makes something money is the sovereign of the country declaring something as money.So the first step is law,if the emperor says gold is money then gold is money.

The second is taxes,taxes create demand,taxes are used by the state to spend on the millitary that gives power to the sovereign that makes laws.

Thats the reason you pay taxes,it gives legitimacy to the currency,the gorvement obviously doesnt need gold or silver or any other metal to function,what the gorvement wants the gorvement gets...


Gold is generally used as money in troublesome situations,the roman empire started receiving taxes in gold after heraclious for example,up until then(around then) subjects could pay in other forms such us cattle.


In a perfect world trade would be facilitated through clearing houses,as international trade is barter.


Anteater's picture

It worked for Modi. He melted down the Jewery then traded it to London for pounds sterling, then used that to create junk bonds to privatize lands and factories for his chosen elite. Same way Israel took over Ukraine and turn their State bullion into privatized lands and factories. 'Bicycling! Bicycling, you boy! I'm so sorry. That lands been had!" (from There Will Be Jewery)

divingengineer's picture

So when do you get your gold back? When the bond matures?

BurningBetty's picture

Gold is a HEDGE!!! against government idiocy! It has nothing to do with commerce and industry. If you can't get that into your head you deserve to be wiped out financially like every other sheep on this planet that put all their trust into government and money printing.

WallHoo's picture

Gold is a hedge,i agree with you,no reason to get angry...

BurningBetty's picture

I am not angry but it seems this has to be repeated in every gold-article that is published. If gold was a pet rock, a barbarous relic, why do you think Central Banks store them in vaults deep underground? It's a BS narrative they are selling to the gullible public who seem to swallow everything that is spewed through the MSM. Paper currencies have collapsed 100% of the time through human history. EVERY SINGLE ONE due to greed of those in power to maintain their lavish lifestyles and wage wars. When you can't produce fast enough what do you do? You simply make more of it. Gold and silver are the reigns that hold governments in check. People who surrender their freedom to governments (those who think abolishing money is a good idea need a F wake up call or a bullet to their head!) are morons who can't think for themselves and are easily persuaded. Persuastion comes from the lack of the ability to have a critical mind.

WallHoo's picture

Im not negative to a gold backed currency,i welcome the idea,its just that gold is not going to solve the problem of usury and rent extraction.It wil actually make it worst.


Why is it in my interest to have a weak state but 50,100,1000 powerfull families that fuck me every day while they fuck prostitutes in theire jacuzis and consume cocane in theire own little castles?

divingengineer's picture

Dude, you're going to give yourself a hemorrhoid.

tuetenueggel's picture

Don´t wake them up.

GVMT need a sleepy crowd not to find us with PM hidden.

Davidduke2000's picture

Gold has more value than people think even in commerce and industry , that is why old motherboards and computer cards are in such demand , even old cellphones, even every satellite has over 100 kg of gold in it and yet it is so limited which will keep its value going up even when the con of the paper is raging hot. 

JohnnyBlaze's picture

Satellites?  Happen to have a picture of one of those?  A real one?

CHX13's picture

you're right, fiat currency will probably be with us as long as humanity persists, but the current exchange rates for gold will DRASTiCALLY change, how barbarous !!!

Davidduke2000's picture

and who are you to come up with this quote???

WallHoo's picture

Just an observer of the real world...

gmak's picture

You're right.  It's more like a battery that can store value so long as a civilization remains intact.

DisorderlyConduct's picture

Hmmm. Gold is not needed - and yet central banks hold it. China and Russia are hoarding it. Germany has repatriated theirs mostly. And Turkey is going to ludicrous lengths to obtain it. I'm not sure you're right.

I won't agree or disagree, I will just say watch the players and the answer becomes clear. My opinion doesn't matter nor does yours.

WallHoo's picture

The players emfasize on production,real wealth lies there.The trick is how to keep ure production.Even if you have infinite amount of gold and silver(like imperial Spain had) you will not achieve anything but inflation(as imperial Spain did).The ones that benefited where the industrious states and kingdoms of the Holy roman empire.


The common denominator between Russia germany and china are strong industrial bases or resources or both,but most of all sovereignty in there respected regions and economies.

mrblaf's picture
WallHoo Apr 13, 2017 5:03 AM

"Im sorry but gold is not needed to facilitate industry and commerce..."


Yeah, right, now do us a favor and put out your unneeded gold plated sim card from your mobile, and all those gold plated chip connectors from your PC, and you're good to go to facilitate industry and commerce...

WallHoo's picture

Well what about iron or copper or coal or wood or oil?Dont give me that pls...

Agstacker's picture

Then why do central banks hold it?