March 12, 2012
Dude, Where’s My Gold?
by Jan Skoyles
The Real Asset Company
Amid reports of Germany and Switzerland requesting their gold from the United States, Jan Skoyles asks why do they want it back considering their monetary policies? The repatriation of gold is a growing topic of interest since Venezuela demonstrated how much value they place on their gold reserves. With escalating gold prices, growing gold investment demand and faltering Western economies is it any wonder German and Swiss politicians are asking where their gold is?
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In Switzerland, as in Germany, it is the citizens who seem to be most concerned as to the location of their gold. It is, after all, theirs as the four parliamentarians presenting the ‘Gold Initiative’ point out. The Initiative stated the Swiss people should vote on the following:
i) The gold of the Swiss National Bank must be stored physically in Switzerland;
ii) The SNB does not have the right to sell any more of its gold reserves;
iii) The SNB must hold at least 20% of its assets in gold.
In Germany a Parliamentary Budget Committee is set to investigate how the country’s gold reserves are managed. At present the gold reserves represent 42% of money held in reserves. The investigation has come about as a result of the German Federal Audit Office’s criticism of Bundesbank’s management of the country’s 3,396.3 tonnes of the yellow metal. The Audit Office is said to have buckled to the pressure of German citizens and politicians interested to know where their gold is.
It is believed 60% – 70% of the country’s gold reserves are kept at 33 Liberty Street, the Federal Reserve Bank of New York. The official line is; it is kept here to facilitate trade and payments. German newspaper, Bild, report that Germany’s gold reserves in the US have not been audited by the Bundesbank since 2007 – a clear breach of the law. Bundesbank President Jens Weidmann, is reported to have said that the gold bar list is kept secret and any demands on the New York Federal Reserve bank would ‘endanger the trust between alliance bank and the Fed.’
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Throughout years of economic lessons I was taught that gold no longer circulates as money due to the restrictions it places on the central banks when it would like to inflate the money supply. We were basically taught that the Central bank would be a much more successful steward of our monetary system than something which has successfully been in the job for two thousand years. So why do governments even keep gold?
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[T]hey seem to have purposefully forgotten that a gold backed monetary system is a barbarous relic. Economists from the Austrian school are having a good laugh…
Full article: http://therealasset.co.uk/my-gold/
Gold is $1,581/oz today. When it hits $2,000, it will be up 26.5%. Let's see how long that takes. - De 3/11/2013 - ANSWER: 7 Years, 5 Months
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