Executive Order 6102 was enacted on April 5, 1933, when it was signed into law by President Franklin D. Roosevelt, and it remains a significant event in U.S. history. The order was intended to alleviate the economic hardships of the Great Depression, and it impacted the monetary system, individual liberties, and the role of gold in the United States.
One of the impacts of the order was making gold coins like the 1933 Saint-Gaudens Gold Double Eagle highly scarce. These gold coins still command an exceptional premium today.
Background of Executive Order 6102
The Great Depression began in 1929 with the crash of the stock market. It was marked by bank closures and the collapse of the money supply and lasted until 1939. Unemployment rates soared and the value of the dollar was under threat as the nation grappled with deflation. To cope with the uncertainty, many Americans hoarded gold coins, and the demand for gold grew as more people sought financial refuge in the warm glow of gold.
At the time, the dollar was still pegged to the value of gold, although the gold standard posed challenges to monetary policy. The 1913 Federal Reserve Act mandated that the U.S. Federal Reserve hold 40% of the value it issued in dollars in gold reserves. Yet by the 1920s, the Federal Reserve had exhausted its credit and was in dire need of additional gold for its reserves.
President Roosevelt’s logic was that gold hoarding prevented economic recovery from the Great Depression, as evidenced by the bank runs that transpired earlier that year. The order was issued under the provisions and authority of the 1917 Trading with the Enemy Act.
Exceptions to Gold Surrender
In the ‘b’ clause of the second section of Executive Order 6102, an exception was listed for “Gold coins and certificates in an amount not exceeding in the aggregate $100 belonging to any one person; and gold coins having a recognized special value to collectors of rare and unusual coins.”
Other exceptions for keeping gold included medical uses for dentists, industrial uses, and use by jewelers.
Penalties for Failing to Turn in Gold
The penalty for citizens who did not surrender their gold coins to the United States Federal government were a fine of up to $10,000 or a prison term of ten years. U.S. citizens were given until May 1, 1933, to comply with this order, which amounted to less than one month, a drastic measure. The purchasing power of $10,000 in 1933 is equivalent to $240,000 in 2024 dollars, which is a hefty fine. Gold was compensated for at $20.67 per ounce, just shy of $500 in 2024 dollars.
Individuals and companies were held accountable for failing to turn in their gold products, and some were prosecuted to the full extent of the law. Numerous court cases were heard, although the Supreme Court upheld the gold seizures as constitutional.
How Much Gold was Turned in?
More than 2,600 metric tons of gold were confiscated in 1933, with a value in the billions of dollars today. Based on the weight of gold melted and the number of gold coins issued by the U.S. Mint, it is estimated that a mere 25% of gold coins were turned in. This does not account for the gold coins that traveled outside the United States, although it would be difficult to imagine 75% of all gold leaving the country.
While the government compensated Americans for their gold, an act followed that impacted the value of the U.S. dollar. The 1934 Gold Reserve Act brought the gold content of the dollar from $20.67 per ounce to $35.
