There have been some issues with US based members, who participated in the recent PP, getting their US broker to accept their certificates. This seems to be isolated to US based members, as those outside USA have been able to find a broker that will readily accept a certificated holding.
So what is going on here. There is more to it, than meets the eye. “The most important aspect of any painting is what is not on the canvas!”
Here are my own views:
The US brokers, who are generally owned by banks, are over regulated. But its not to protect the investor. Its more about herding folks into industry “products” (such as ETFs, mutual funds, electronic day trading, etc.) where the money gets farmed by the brokers (banks).
FATCA is now in place, using laws where the IRS wants their cut and are enforcing tracking of every dollar electronically. That is why hard copy share certificates, are not generally accepted
by US brokers, as the IRS is on their backs. When the certificate is accepted by a US broker, one has to “prove” how they got it. Its a bit like going to the bank to deposit or withdraw “your” cash. The questions asked include where did the cash come from, and why are your dealing in cash. “It must be an illegal activity”.
They are de-facto banning certificated holdings and eventually …cash. Its coming folks. Where cash is banned and everything is transacted electronically, for tracking purposes. Not as “they” say to stop “criminal” activities. And that begs the question, “Who indeed are the criminals?”. I leave that to the reader to answer.
Post 2008 GFC the head bankers should have been prosecuted. That is what should happen to criminals. Instead, the tax payer ended up bailing them out of their ill gotten positions, and the regulators, in their infinite wisdom, brought in more and more regulations, under the argument that this would prevent investors losing funds in a crash. In reality, the bankers are the issue, and rather than over regulate the industry, they should have been prosecuted and banned from the markets. Then bring back Glass Steagall, to prevent the bankers from trading in the markets altogether.
Take the bankers out of markets, then many problems are resolved, including using hard copy certificates for investing and using cash for buying goods and services. Taking the bankers out, includes dismantling the Fed. A capitalist system thrives on free markets, without bankers participating in trading public markets. Free markets includes the use of share certificates, which can be held outside the system, and therefore have no counter party risk or visibility by the authorities. Much like gold and silver bullion. Or cash.
In a certificated system, short selling is difficult, as the broker does not have the scrip. You do! The banks thrive on short selling. Its money for jam for them. Using your money on deposit. Using your shares.
Bottom line: The system is rigged against us. That’s why I invest in this micro cap precious metals and mining sector outside USA, as the bankers cannot get a leg in the door, in order to farm the crowd. Its off piste for them as the mcaps are way outside their mandate. And “they” hate PPs, as folks get to make a profit!
Feel free to chip into this debate. Its important as it defines the right sandpit to be playing in, and how to go about it.