GOLD COIN TRADE

Hokitika Guardian, 17 November 1932, Page 7

GOLD COIN TRADE

PRACTICALLY AT A STANDSTILL,

REGULATIONS’ EFFECT.

AUCKLAND, Nov. 14

The recent regulations by Order-in-Oouncil, applying only to gold coin, have iseriously prejudiced the buying of gold) by legitimate traders, according to a number of jewellers and gold buyers in Auckland. “During the last month, the buying and selling of sovereigns had practically come to an end,” one jeweller said. “It is quite definite that there is still a large number of sovereigns, owned by people who hav© accumulated them ®s a nest-egg, and the result of the regulations will be that this gold will remain hoarded, privately, or else it will be smuggled illicitly out of the country. Either alternative means a loss to the country.” The new regulations provide that a buyer must obtain a permit from the police if he intends to deal in sovereigns and he must keep an exact entry of purchases and sales, with the names and addresses of people with whom i-3 dbes business. It has been found that the majority of prospective sellers refuse' to sell sovereigns under these conditions.

Before the introduction of the- regulations, there was a considerable trade in sovereigns for about a year. One city jeweller said he had frequently bought parcels of 600 sovereigns from individuals, paying about 25s tor every sovereign, In most oases, these stocks of sovereigns had been accumulated over about 15 and 20 years 'and had been lying idle at the homes of the owners, Other jewellers had had similar experiences, and v it was no exaggeration to say that before the appearance of the new regulations, thousands of sovereigns must have been bought and sold in Auckland every week. The use of which these sovereigns had been put was varied, but it was an open secret that many of them were melted down. This was strictly illegal, hut the authorities generally had tacitly connived at the practice and the gold so obtained had been exported, paying an export, duty of 'approximately 2s 6d- an ounce, and assisting in the liquidation of overseas debts when exported. In this manner the trade performed a highly useful service' to the community, a service which had now been mbda impossible by Government regulation. “It is quite- obvious that the new regulations will not force- hoarded sovereigns into the banks,” the jeweller said. “The' banks pay only £1 for a sovereign, and naturally the man. who ha's hoarded sovereigns for years, without the benefit of interest, wants some return on his money. The idle gold of the community -will remain hidden away in the- places that people have found for it. _ “Tlie only 'alternative is that sovereigns will be sold 1 to unauthorised dealers and illicitly smuggled out of j;he country to- Australia, where they wi'l be melted down and sold at a profit. There- is a considerable amount of this kind of trafficking going on at present,”