Liberty Economics

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Is selling silver bullion terrorism?

I was never a fan of Bernard von NotHaus’s “liberty dollar”. The same reason I wasn’t a fan and never bought any is why the government had no business prosecuting him. The free market would have been entirely capable of putting him out of business. If he should have been prosecuted, then makers of faux novelty money, which is backed by no silver at all, should definitely be prosecuted.

All Bernard von NotHaus did was sell silver bullion. Nothing more and nothing less. Objectively, selling anything has the same economic impact as does selling silver bullion. Historically, all sorts of commodities have been used as money. Tobacco has been used as money. Does this mean cigarette sellers are creating a counterfeit currency by selling cigarettes?

When selling silver bullion, NotHaus was buying dollars, consequently helping to prop up the value of the dollar. He wasn’t trying to pass “liberty dollars” off as government issued dollars. He was exchanging “liberty dollars” for government issued dollars. Contrast that with people who engage in direct barter, in which case no dollars are purchased. The entire “liberty dollar” ploy was merely a marketing gimmick for selling silver bullion with a high markup over spot price.

I have always told people that if their desire is to hedge against inflation, stick with bullion. Unless you are a coin collector, avoid numismatics. To get a price as close to spot as possible, go with rounds (i.e. privately minted coins) rather than government minted coins with face value. I never would have advised anybody to buy “liberty dollars”, which is why I never advised anybody to buy “liberty dollars”. Bernard von NotHaus’s weakness was selling silver rounds at prices too high over spot, which he was successful at doing because of his “liberty dollar” marketing gimmick. By using his “liberty dollar” marketing gimmick, he confused the prosecutor and judge into believing he was doing something other than selling silver rounds.

NotHaus complicated the process of selling silver and did things in terms of marketing that I wouldn’t have felt comfortable doing, but nothing that should have been considered a crime. Things that could have been easily corrected by removing the “liberty dollar” value from the round, or adding a disclaimer saying that it’s not referring to U.S. dollars on the round. Objectively, it was printing a price in terms of “liberty dollars” onto the object. Certainly not a criminal act.

The real crime was in prosecuting NotHaus. If the prosecutor’s purpose was to defend the value of the dollar, as alleged by the prosecutor, then it’s politicians in Washington who should have been prosecuted.

In no way did NotHaus counterfeit anything. Using the word dollar in no way infringes upon official currency. Other countries issue currencies called dollars. The government doesn’t have a copyright on the word dollar. The word dollar descends from the Thaler, which is short for Joachimsthaler. Thalers were coins that originated in Joachimsthal, Bohemia, minted by Count Hieronymus Schlick in 1518. Unlike official currency, NotHaus was selling real silver. The only thing that would have made his operation a criminal enterprise is if he were issuing ownership certificates (i.e. “liberty dollars”) that he promised to redeem for silver but had no intention of doing so.

If NotHaus had no intention of fulfilling his obligation to deliver silver, that would have been a crime. But it appears that the government’s prosecution is the only thing that jeopardized NotHaus’s ability to fulfill his obligations.[1] He had no obligations to me, because I recognized you could have done better by shopping with another bullion dealer. But it does make me wonder what kind of country we live in when selling silver bullion becomes tantamount to a criminal act, and that the federal government would use the force of law to compel people to use a currency that it’s debasing as a matter of policy.

[1] –┬áConfiscating NotHaus’s silver and gold bullion would have actually had a deleterious effect on the value of the dollar in relationship to silver and gold by pushing up the price of silver and gold.

Updated: December 13, 2018 — 4:55 pm

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