Indiana Jones and the Temple of Gold . . . Hoarding in India
Are you a hoarder?
Do you keep stacks of bundled old newspapers? Maybe you’ve got a huge pile of single socks (when the mates have disappeared years ago) you can’t part with? Maybe you can’t part with anything, period?
Even if, like the Collier brothers, you have filled a house with everything, with all the stuff you wouldn’t let go of . . . what about hoarding gold?
We’re not talking about stuffing mattresses with money.
The World Gold Council estimates roughly 2,000 tons of gold is locked away in Hindu temples in India. That’s nearly half of what’s in Fort Knox, here in the U.S. And the present estimated value of all that gold? Conservatively, this hoard could be worth about $84 billion at current exchange prices.
Perhaps an equal amount has also been secreted away by the general population.
The central bank of India – the Reserve Bank of India, or RBI – wants to inventory this temple gold. RBI claims it is simply good bookkeeping procedure – data collection, as it were – but Hindus are up in arms. Like much of India’s diverse population, they mistrust the motives of authorities desperately trying to cut a hefty import bill which is hurting the nation’s economy. For Hindus, and others, this attempt cuts deep into their cultural and religious association with gold, a tradition going back many centuries.
Unlike here in the U.S. – where “gold fever” propelled prospectors and speculators to “get rich quick” schemes in the Old West and Alaska – in India it is handed down, such as in heirloom jewelry or coins, from generation to generation. Gold is seen as a means to make offerings to a god, as well as a way to hedge against national inflation and emergencies. In India, the general population actively buys as much as 2.3 tons of gold every day.
What is the big-picture problem? This gold hoarding – ingrained into a vast populace – means the Indian government must import gold ($54 billion/year) just to stabilize its economy. To most international economists this is a “useless import” – a non-essential item brought in from overseas – which is swelling India’s already-staggering national deficit.
As can be imagined, curbing gold imports and getting the gold squirreled away back into circulation has become a priority for the Indian government and the RBI. According to a report, “Temples in India hold large quantities of gold jewelry offered by devotees to the deities.”
But the problem is that religion and a black-and-white economic crisis are at odds. As one Hindu emphatically said, “We have given [the gold] to the gods with a purpose. Nobody can take these offerings away.”
What’s the future of this dilemma? Will it be religious belief vs. the state? Unlike in the U.S., where religion is held to be separate from government, in India religion and government are often closely twined. Can India survive its teetering economy without tapping into these temple treasures? What of the potential religious and cultural upheaval if this hoarded gold is circulated?
Or will it become something of legend – Hindu temples, like the Knights Templar, hiding their treasures or taking their wealth overseas?
Ironically, India also ranks as one of the prime locations for international gold smuggling – a criminal activity watchdogged by many countries. Recently, arrests were made at one of its major airports as two women were detained for allegedly attempting to smuggle twenty gold bars out of India to Dubai.
In the U.S., Executive Order 6102, signed on April 5, 1933 by President Franklin Roosevelt, makes hoarding gold illegal. It covers gold coins, bullion, and certificates, criminalizing the hidden possession of all monetary gold by any individual, partnership, association, or corporation.
However, such possession in the U.S. is often the result of ignorance. The U.S. – the “melting pot” of the world – embraces many cultures, and what’s common practice overseas is sometimes practiced here without knowledge of U.S. law. The Blanch Law Firm has handled many cases regarding infractions of Executive Order 6102 by foreign visitors, immigrants, and new citizens.