with Brexit negotiations still unfinished
By Jorge Vilches for the Saker Blog
Brexitology focused keenly on UK fish but fully ignored the EU´s gigantic gold reserves supposedly still vaulted in custody at the Bank of England. Adding insult to injury, a UK-EU no-deal financial services crash-out divorce went by almost unnoticed… not only without the bang of the still postponed “financial equivalence” protocol… but also without a mere whimper from specialized media and Remainers. Now, the Ukraine crisis with its new payment requirements for the badly needed Russian oil & gas…overlapping with essential yet unfinished Brexit business…will necessarily evolve into a vicious NATO internal gold war. Paraphrasing James Carville spiced with some traditional British flavor, “It´s the bloody gold, stupid” [Refs.1+ 2]
As UK Prime Minister Boris Johnson would have it, the physical repatriation of the EU gold supposedly still vaulted in London would “mightily” affect the future of Europe with very deep, high-voltage political impact both sides of the English Channel. In this scenario No.10 Downing Street would easily negotiate the EU gold bullion availability only under specific Brexit conditions favorable to the UK. Actually, doing this could turn out to be absolutely necessary and should go far beyond the enormous intrinsic value of the EU gold supposedly still vaulted at the BoE. Let me explain.
[Ref. 3 thru 13]
NATO gold in London
Russia´s new rubles or gold payment requirements for any of its goods or services will necessarily prompt a major gold war between the UK and the EU probably resulting in NATO´s first-ever internal head-on gloves-off confrontation. After WW2 the idea was to keep Europe´s gold bullion safely away from the former Soviet Union and Josef Stalin, just in case. So decades ago current EU member states deposited most of their gold in custody at the Bank of England (BoE) in London. Now, the UK will dare to weaponize the approval of EU gold repatriation requests and other gold-related issues as a very convincing bargaining tool for lots of still unfinished yet most important Brexit business. So,
(a) Whitehall could indefinetly delay the EU gold delivery unless Brexit pending issues are agreed in favor of the UK.
(b) Or, quite simply, the BoE would not ever return such EU gold supposedly kept in custody for the past decades because it has been partially or totally sold off or loaned out or compromised as explained below with former UK Prime Minister James Gordon Brown knowing about it all too well.
The Mother of European conflicts
If history is any guide, hostilities will explode the instant the EU member states individually or collectively rightfully demand a yet-non-existant fully independent world-class functionally detailed audit of the EU gold supposedly still in ´custody´ at the BoE. This should take plenty of time and is the perfect excuse for delaying the whole process always under the exclusive perview of London, not Brussels. Or unmanageable problems would arise as soon as EU nations require immediate repatriation of at least some of such ´theoretical´ bullion, most probably all of them at the same time in view of circumstances. Then, either (1) some gold could possibly slowly be returned here and there (albeit with great delay ) but only under very vague London terms and changing the unfinished Brexit aftermath to levels yet unheard of, or (2) no gold would be returned as it has been sold off or compromised in different ways as explained hereinafter. And the UK better not decide to pay Russia even with a single gold coin as the EU would rightly wonder who owns it.
The London gold and silver markets have always been beyond “opaque” without any significant reporting of transactions or positions. No data has ever been offered either on commercial banks holding accounts at the BoE, or precise technical identification of gold custodies, let alone those belonging to EU members. As Venezuela knows all too well – and EU member states could be next — who may or may not be acknowledged as a valid claimee of anything vaulted in Threadneedle Street or whereabouts is an open subject left to the entire discretion of the Canary Wharf masters, not EU politicians. Same goes for the enormous unallocated gold and silver liabilities of the so-called ´bullion banks´… or any other pertinent data. [Refs. 14+15+16]
The (bad) German experience
Very recently Germany had to wait 5 long years to forcefully and painfully repatriate only a portion of its gold from the BoE and never got back any of the gold bars originally deposited, which clearly explains the delay. [Ref.17+18]
So while the EU freezes to death and its economy stops dead in its tracks, the many pending questions include
(a) does the BoE still have all of the EU´s gold bullion… or has it been sold off or loaned out as many experts insist ?
(b) is the BoE willing and able to immediately return the EU gold it may still have left to legitimate owners, if any ?
(c) who are the legitimate owners of BoE-vaulted gold after decades of European reshuffling of political borders ?
(d) would the ECJ decide gold ownership… or the British Judiciary… or the BoE ? On what basis, exactly ?
(e) has the BoE lent, swapped, re-hypothecated, leased, leveraged or encumbered such bullion now lien with other many alleged legitimate claimees also standing in line with ´fractional un-allocated synthetic´ bullion custodies unfit-for-purpose per “Digital Derivative Pricing Schemes“ thru which no one can know who owns what where (if anything) ?
I kid you not.
Today´s “paper gold” derivative transactions constitute a genuine pure-bred Ponzi scheme exceeding many-fold the real gold bullion theoretically behind them, probably with a 100 to 1 ratio or higher as London´s Square Mile knows all too well. Of course, the ECB, the IMF and the BIS would also claim it actually is “their” gold no ?
British economist Peter Warburton was 100% correct when he described that Westerncentral banks were using derivatives to control commodity prices and protect government currencies against the public’s recognition of currency devaluation. Warburton’s essay “The Debasement of World Currency: It Is Inflation But Not as We Know It” is posted at https://www.gata.org/node/8303
But however it unfolds, the “continental gold” now possibly still vaulted in London will necessarily trigger an internal NATO existential conflict in no uncertain terms (and desperation) in absence of the much-needed audit parameters and still missing gold bar serial numbers records affecting ownership and status claimed by more than one (supposedly legitimate) recipient, plus gold bullion quality and purity data, overdue custody costs, transportation & insurance, etc.
In passing, when push gets to shove (and it will, trust me) per their ´special relationship´ the US Federal Reserve would side with the BoE because it finds itself in exactly the same situation regarding the physical bullion they should still be theoretically vaulting for third parties, sovereigns included. In synchronized lockstep with Anglo-Saxon exceptionalism, the Fed´s gold custodies have never been audited either — as they should have – and the specialized commentariat worldwide is convinced that such bullion is not fully available either. Furthermore, the US would welcome any new additional problems for the EU as that was the whole idea behind provoking Russia into this unnecessary war.
Jorge Vilches – proud to have been introduced many times as “ the quintessence of the independent columnist ”.
Former op-ed contributor for The Wall Street Journal – New York and other financial media, has studied this topic in depth for the past 20 years. WSJ-NY “The Americas” column, editor David Asman today Fox Business News anchor.
(#1) http://www.gata.org/node/13310 (#2)https://www.counterpunch.org/2015/11/25/too-big-for-fed-have-central-banks-lost-control/ (#3) https://www.goldmoney.com/research/goldmoney-insights/the-destruction-of-the-euro?gmrefcode=gata
(#4) https://www.rt.com/business/507178-global-debt-record-high-pandemic/ (#5) http://www.gata.org/node/20642
(#6) http://plata.com.mx/enUS/More/403?idioma=2 (#7) http://www.gata.org/node/4279
(#18) https://www.bullionstar.com/blogs/koos-jansen/guest-post-47-years-after-1968-bundesbank-still-fails-to-deliver-a-gold-bar-number-list/ (#19) https://www.goldmoney.com/research/goldmoney-insights/the-looming-derivative-crisis?gmrefcode=gata
(#21) http://www.gata.org/node/19735 (#22) https://blogs.wsj.com/moneybeat/2014/09/18/if-scotland-splits-what-happens-to-the-gold/ (#22)https://www.goldmoney.com/research/goldmoney-insights/hyperinflation-is-here
A vault is empty, until proven full.
Which is why I thought this main stream media picture was so suspicious at the time (2012) – an obvious attempt to support the notion that ‘everything is fine’
There is a guy frowning in the back ground, are some bankers about to jump out the window or off the roof, the next week will be telling.
Wow, if Russia were to demand gold for gas, that would be like unleashing a Financial Kinzhal.
Great thought provoking article!
just do it…pay by Aurum….
Exactly what Russia should be doing! I hope someone with connections inside the Russian government is reading this . . .
I suspect they are way ahead of us.
Seems likely that they not only have the same information and assessment, but that the new financial terms for gas, etc. are taking advantage of the situation to aggravate the potential for conflict between USUK and EU countries.
They indirectly are actually demanding gold for gas now. It is a bit convoluted, however.
Up until now, the trade deficit between the EU and Russia has been “paid” for by Russia getting more euros. These euros that have been built up over the years are now frozen/stolen, and Russia does not accept them anymore.
Russia demands that only rubles will suffice for the EU to pay for gas. Other commodities are likely to follow.
The mechanism is that EU countries put euros into an account at the non-sanctioned Gazprombank, which then sells the euro for rubles, and the rubles are then credited to an account they can use to buy gas.
However, these euros need buyers, and what are buyers, especially russian buyers (who get rubles on the russian market), going to do with more euros than Russia needs for imports? The demand for rubles will be higher than the demand for euros in this trade relationship. Normally, this should lead to the ruble appreciating and the euro depreciating.
Well it just so happens that Russia has declared it will buy 1 gram of gold (currently 61.88USD) for 5000 rubles (currently 58.31USD).
As the demand/supply difference between rubles and euro pressures the ruble to rise, the value of 5000 rubles will exceed that of 1 gram of gold. An opportunity for arbitrage then presents itself. Players in the market can then profit from selling the much needed rubles to the europeans for euros, then they take those euros and with them, buy gold on the world market, and this gold they can again sell at home for 5000 rubles to the government at a profit in ruble terms.
Then end result is that the trade deficit/profit between Russia and EU ends up as gold for the Russian government, and they don’t have to buy it directly on the world market.
If the sanctions become severe enough that this cannot be done by players in the forex market with access to rubles, the europeans themselves will have to sell gold to get rubles, because there will be a lack of demand for their euros that they are trading for rubles if they insist on making those euros completely useless through sanctions.
Something to note is that the Russia increased their central bank loan interest to banks from ~10% to ~20% when the ruble fell low. This measure has not been removed. When the interest is very high, the cost of loans to banks, and the cost they pass along to consumers, become very expensive, and this pressures the money(ruble) supply to drop. Especially in finance. Normally one might think this would just lead to runaway deflation for the ruble, causing economic problems, perpetual ruble hoarding as the rate of deflation outpaces rate of return for investment… however, the 5000 ruble per 1 gram of gold offer effectively provides a price roof for the ruble, and thus deflation. When the gold price rises, Russia can adjust the roof of the value of the ruble through adjust the offer. For example, if 1 gram of gold goes from the current $62 to $93, they can adjust the ruble per gold gram offer by 50% as well and offer 7500 rubles per gold gram, if they want to have it be priced at the same dollar amount it was before.
Using this mechanism, Russia can use its trade surplus to get other entities to hoard gold to sell to Russia, and also put a dampener on the rise of the ruble as they see fit.
The financial Avangard is already here.
A very good explanation of the complexity involved in converting non-tangibles ( debt based currencies ) to tangibles ( gold ) to pay for tangibles ( gas ) and increasing the use of gold in settlement to the detriment of debt based currencies.
Russia has turned back the clock and the ‘value for value’ monetary system is being reborn.
China is obviously following suit with the futures/gold/contracts exchange in Shanghai.
Both Russia and China could explode the world’s monetary system tomorrow but are integrating (monetary) gold into an existing financial architecture to allow the rest of the world to adjust without blowback on themselves.
The underpinning of what the markets call “commodities” with gold in a trade using a gold derivative as the settlement vehicle is a tried and true system.
Provided the fixed rate of exchange of a gold derivative ( which is a monetary unit and gold substitute that represents a fixed amount of gold, and facilitates the settlement transformation between parties without using the underlying physical gold ) for a fixed amount of gold is not increased, thereby diluting or debasing the purchasing power of the derivative.
This has been the system previous to Bretton Woods, and following the complete abandonment of a fixed amount of gold to a gold substitute/derivative ( USD ) in 1971, the de facto gold replacement became oil.
Saudi Arabia was chosen by Kissinger and Nixon who convinced the King to agree to sell their oil ( and OPEC ) only for USD, in return for ‘protection.’ And the ‘petrodollar’ was born. Without the backing of the USD with all oil sales there would be insufficient USD to run a permanent trade deficit. The US has had a free ride at the expense of the rest of the world for 50 years. A gigantic credit card.
The hoarding of gold for collateral purposes is only just beginning and those countries without gold in reserves above ground or reserves below ground and operational mine supply will be the losers. Unless of course those with little or no gold have something of value to trade with those who have gold. And gold doesn’t need to be “shipped” in settlement. Just a balance sheet entry on an account at the Shanghai Gold Exchange ( SGE ) would suffice.
We are entering a new monetary world order and Russia is showing the way as many have already commented publicly.
A final point. The trading of futures contracts
( another form of derivatives ) has kept all commodities and precious metals, most importantly the “monetary metals,” gold and silver, suppressed in price, as price is subjective. So to give the perception of value
( purchasing power ) to the currency that was the benchmark for all currencies, the USD, prices of all commodities had to be kept relatively low, so that the world would still have faith and trust in using the USD. A rising price of any commodity, and especially the “monetary metal” gold, would sound the alarm that the USD was losing value. It’s not the price of gold going up, it’s the value of the USD plummeting.
The expansion of the money supply to create an illusion of wealth when in reality it is a mirage is the greatest trick ever to be played on humanity. Made possible by computational power, mass media deception, governments held hostage by central banks, no accountabily, impunity from repercussions, and military coercion. In this corrupt system greed is always a given “because we can.” A debt based monetary system was always doomed to fail because there is no such thing as something for nothing. The notion of gold as a relic is the attitude of those who have never know any other monetary system, and have benefited from participating in a system without lifting a finger, and yet live a life fit for a king.
Soon they will know what it feels like to live as a pauper.
Russia is the world’s second largest miner and refiner of pure gold at 331 tons per year, after China. Therefore it does not really need to import gold. However, I think that something was written into the Russian Constitution under Yeltsin and the influence of the IMF, concerning the central bank, that new rubles could only be created by converting US dollars from export earnings to seriously adversely affect the rate of growth of Russia’s economy, which was the whole idea of the western banks of course.
Buyers of Russia’s exports now have the opportunity to pay in rubles and/or gold bullion, so that Russia would then accumulate more gold reserves, thus enabling its central bank to have more rubles available to spend domestically and expand its industrial productivity, the limiting factor of which might be its relatively low population of 144 million people.
Just to remined all that the wests gold was tested for tungstun in 2012 or there abouts, and it came up positive in the center with a shell of pretty gold rapping.
The tester was then arrested for raping a maid at the hotel he staying at, he was let go to go back to Italy, but the issue was swept under the rug of diplomacy and another African country was destabilized while no one was watching.
That clearly means the banking elites have ripped off the real gold and substituted for fake.
Per Ian Fleming – 007 Goldfinger 1964.
Interestingly he died in 1964 just a month before the film was released.
He died and then hillary was born.
I seem to recall stories from back around 2012 or so, that Swiss refiners were at maximum capacity. They were electro-refining gold bullion to .9999 purity, casting 1kg bars, and stamping Chinese characters on them for their customers. A whole lot of kilograms went off to east Asia, never to be seen (in the west) again.
Come to think of it, that’s where some of the tungsten stories originated. Tungsten doesn’t melt and can’t be refined (into gold). It weighs almost exactly the same as gold, making it popular with fakers.
The tungsten was discovered by China years earlier than the Dominique Strauss-Kahn takedown in 2011. The fake bars were a Clinton era fraud in the 1990s. Not saying that DSK didn’t get drawn into it later, but he wasn’t the start of it.
Putin should have turned off the gas back in February.
I agree wholeheartedly.
The German experience bringing (part of) their gold from England and The USA is illuminating. Add in the illegal freezing of assets; who in their right mind would keep any assets in the West ?
Of course the gold is not in Fort Knox or the BoE. It’s been long since stolen.
Firstly much of the BoE gold will be that secretly looted from the US from Fort Knox since 1934 – hence the refusal to audit. The rest will be in Switzerland under the control of the thieves there.
Secondly an internal war within NATO has long been overdue.
Does anyone really expect historical enemies – UK, Germany & France to be buddies (if they ever were) for more than a few years ? They all hate each other to some extent. And long term economic and social cycles always come into play causing conflicts.
A proper audit of the US gold will reveal the theft and set the path that should take place where the US & UK are at arms length, as the UK (rulers) have never been its friend since 1776.
Thirdly, even if the EU gold gets out of BoE hands then there will be squabbles / fights within the EU as to who gets what and where it is put. Is it to be controlled by Brussels / ECB and the elite pigs that control the EU or will it be apportioned to each EU country to be held in their own national bank as it should be ? = A recipe for internal strife within the EU.
If Brussels / ECB got control of it there would manipulation of it. Including a shell game and fake gold bars being made to substitute the real gold bars which will have been smuggled into private hands elsewhere for fake ones. Or factoring it with derivatives.
You can guarantee the pigs in Brussels / ECB will not apportion the gold to EU member countries on their territory under their control. And they would cite ECB loans or member debts as the excuse. But many countries who were never fully compensated for WW2 damage from Germany (aka Poland, Greece, etc…) would rightfully argue they should get it and a good slice of it.
All this presents great opportunities for Russia, a free US, and the Eastern Europe.
Somewhere I read that the Roman Empire got its toehold on regional power by being the entity who kept smaller entities *away from* each other’s throats, kind of like parents separating fighting children.
Was that a fable for grade-schoolers?
My thought being that in the end, it might be Russia that everyone hates but, conversely, trusts enough to store their gold . . .
Back around that time frame I hauled a few shipments of steel plates to Germany, I don`t recall from where. Italy mabbe. They were THICK, nothing I`ve ever seen before, so I asked the fab-foreman what were they for. He said they were building safes for the repatriation of some of their gold.
I broke out laughing, told him to take his time, nowhere to rush…he had a sense of humor on him…
I would also add to my other comment that the BoE gold will probably be real gold.
No honor amongst thieves, no country or state should ever trust their gold outside their own borders.
Sooo . . .
All US and UK gold, along with gold held in the US and UK but belonging to other nations, is, at this moment at least, now Schrodinger’s gold.
But don’t forget, if it’s Schrodinger’s Gold, it both exists and doesn’t exist – until someone looks…
hahahh re the perfect parallel analogy… “until someone looks”
But that´s precisely the problem, you can´t look !
Reuters – Russia wants a new financial architecture for the whole world
* Kremlin warns West: rouble-for-gas scheme is only the ‘prototype’
* Russia to price more exports in Roubles
* Russia sees end to West’s currency dominance
If you have your gold at home, there’s a chance that the thieves will get it. If you have it in a vault somewhere, the thieves already got it. :)
Wow. “When thieves fall out…” Bilking Venezuela is one thing: the EU, rather another.
Do you think the Russians saw this coming? It’s like one of those magnificent domino-tipping demonstrations.
My personal opinion is that the Russians know who they’re dealing with, they knew the gold was gone and just needed to wait for the right moment. Everything comes to he who waits.
England still has Venezuela’s gold locked up in London and refuses to repatriate it.
The is an article by Veterans Today that claims gold looted from various countries, including the World Trade Center on nein eleven, has been laundered back into circulation by Barrick Gold Corporation of Canada.
nein eleven – klever! very very klever!
I am stealing it ye? 🤞
Your gold held in The City’s vaults is not your gold.
Rehypothecation: a fancy word for a shell game.
During the London Blitz, the German planes never bombed The City nor Buckingham Palace, concentrating the destruction in low rent areas, that were converted postwar to high rent districts.
Joseph Heller – Catch 22
Documentary I would argue…😉
Dont watch the movie – read it.
I did, when I was 12 or 13. I think that was when the cynacism virus was contracted.
German planes never bombed Buck House.
Of course not, why would they bomb their own kith and kin?….
Speaking of gold, when is the United Kingdom going to return the 1.3 billion pounds in gold that it stole from Venezuela and wants to give to Juan Guido, the favored regime change stooge of the United Snakes and its allies?
Guaidó closer to £1.3bn in Venezuelan gold after UK court ruling
This so-called “war” amongst NATO nations about gold is merely bickering among thieves, as they have all politically supported the theft of Venezuela’s gold.
You say: “This so-called “war” amongst NATO nations about gold is merely bickering among thieves…etc ”
That´s simply not so.
Whatever their current view or position regarding Ukraine or Venezuela or Russia… or Greta Thunberg for that matter or … XXXYYYZZZ… the fact of the matter is that at the end of WW2 most current NATO members with their best & honest good faith deposited an enormous portion of their gold bullion firmly believing that it would be and remain “in custody”… at the Bank of England… and a small part in Paris and also in the US. But mostly in the UK, okay ?
As the author of this article clearly explains ” the idea was to keep Europe´s gold bullion safely away from the former Soviet Union and Josef Stalin, just in case “. After decades elapsed, now the situation is completely different and whatever any criticism we may have for current NATO members regarding other topics none of them ever thought THEIR gold would not be readily available for immediate repatriation whenever needed, such as today, having left it in “custody” with supposedly fully trustworthy WW2 winners.
No xvfsb, regarding this specific topic, most — just about all — current NATO members are not thieves.
Rather they are patsies… been had… understand ?
History and historians will not be kind with this far-worse-than-FDR poetic “infamy” still to unfold, trust me.
This is deceit amongst allies and friends, not the enemy.
And all of these now-cheated NATO members didn´t have neither voice no vote regarding Venezuela´s gold.
Again, the supposed “custodian” of Venezuela´s gold ALSO was and still is the UK thru the Bank of England which has failed miserably as the Authorized Custodian it was assigned to be.
So shame on the Brits… and them better find the gold they are supposed to still be vaulting on behalf of their NATO partners, or else…
I think we’ve already entered the or else phase, all I see are future consequences being dished out.
Or else it would be on the part of the European population, not its leaders, who actually are sold to the Abglo-Saxon powers, hence they remain shooting themselves ( really their populations…) in the foot any time it is ordered from the Atlantic decision making rooms.
An example is the last play by “Antonio” ( as he was called by Dragui in a recent visit Spanish PM paid to Italy…) whom after recognizing the Moroccan position on Wester Sahara, pissing on Spanish colonial obligations, achieved that Algeria keeps the price of gas frozen for everybody in the EU except for Spain, achieving in passing that for a conutry not dependent on Russian gas, and thus not dependent on US super expensive fracking LNG, the Algerina gas becomes less competitive i nfornt of the expensive US one, that way offering Spanish popualtion as hostage of the US interests this time even for gas.
For what me is concerned, and I fear also for those widely damnified by the unending meddling by British Integrity Initiative into Spanish internal and external affairs, my country people, and all European people, will know of all these shenanigans with nazis and plain robbery of the sweat of European peoples as long as I am alive…
I will not discard an incursion onto Britain and may be even onto the US….For once it would be a game changer…
I fear not being the only European who are quite long ago fed up of the Britons and US meddling and continuous robbery and uining of our countries.
I will fight as I can for the end of the NATO lacra which remains draining our economies and foreign policy dry on behalf of the Uk and UK MICIMATT
It would seem reasonable to observe, on the basis of this and other similar evidence over a long period of time, that the label ‘Perfidious Albion’ was not bestowed for nothing.
It’s not “perfidious Albion” for nothing.
“Speaking of gold, when is the United Kingdom going to return the 1.3 billion pounds in gold that it stole from Venezuela…?”
When they return the Spanish Empire gold stolen from its galeons, at its time stolen from the indigenous American people?
That is, NEVER!!!
Only a fool would keep its gold in the hands of the Britons, famous through the ages for their robbery vice and for living always on the back of other peoples…
When was the last time Boris de Pfeffer Johnson sweated at work?
The same could be said of that nazi family at Buckingam….https://www.strategic-culture.org/news/2022/04/02/new-revelations-shed-light-on-nazi-roots-of-house-of-saxe-coburg-gotha/
One would say they orchestrated WWII, as they did with WWI, to this outcome, drain the whole Europe from its riches….
Remember 911. Just so bappened, before the World Trade Centers turned to dust, reports came out that the gold vaults, beneath the towers, were open and empty. Trucks with armed guards dissuaded curious 1st responders. Now what was that Bruce Willis movie? You know. The one about a terrorist distraction in NYC,? To provide cover for dump trucks loaded with gold bullion to caravan their way to … some where.
Too bad Bruce can’t talk anymore. It seems he was hit with 1 of the 1900 vaccine side effects. What’s the odds?
From memory that was all Kuwait’s gold.
Just a thought.
With the west having confiscated roughly 300billion. The fact that Russia has done gas for rubles. That perhaps Russia will offer discount pegged to those european counrties that are holding this money that it be returned as gold bullion back to Russia. The discounted rate apply only so long as that held by them is repatriated in this manner.
I am sure that the London gold exchange would go balistic as if this happens the paper ponzie gold will be crusified.
Pat, just another thought…
What if just about none of the gold is there ?
Many genuine experts on this topic — even cited as References by the author — are fully convinced of that, did you know ?
What would NATO members do when realizing they´ve “been had” by treacherous ´perfide Albion´ while simultaneously were made to believe and act as if THEIR gold bullion had been kept clean & shiny all these years comfortably vaulted at the Bank of England instantly available for immediate repatriation ?
And all of this while Brexit isn´t even close to be finished, with no “financial protocol” even in draft version form. All the while with BoJo constantly teasing and provoking EU leaders with his half-broken French statements. Would UK fish matter any ? Methinks the Ukraine war would dwarf in importance…
Then the penny drops and the west will collectively implode. Its entire ponzie money, imf, central bank structue will fold.
Russia at this point has already changed direction. The collective west is now in chaos.
Pat, we agree.
And maybe “some” NATO members know all about this dirty little secret, no ?
Events pick up fantastic speed as we speak.
Pat, let´s fasten our seat belts, right NOW.
Please check 2 key spanking-new pieces of news.
Orban declares victory despite opposition uniting against him.
So Russia keeps its European ally.
Food retail prices UP by 20-50% on Monday.
Could that possibly be a typo ?
I mean, 20 to 50% food prices increase TOMORROW morning would mean 1930s Weimar hyperinflation…
This is famine, period.
My seat belt is fastened, chips and popcorn, plus a vintage whiskey are ready.
Davos is quaking, so it begins.
A coruscating article is not necessarily an aureate metal.
Like a rotating igneous fragment accrues no lichen.
No one has seen the US gold either, and such audits as have been conducted are pretty unsatisfactory.
Ronan Manly has a great overview of the exact nature and specifications of the (theoretically 8,000 tonnes of) gold reserves held in the US, and the geopolitical implications:
US Gold Reserves, Of Immense Interest to Russia and China [January, 2018]
From Manly, gold must be of a certain purity to be a “Good Delivery” bar, but much of the US holding is coin melt gold, which falls below the requirement. Apparently, in 1968 when the London Gold Pool collapsed, and physical gold was required, the US was found to be incapable of supplying Good Delivery gold – the author estimate less than 20% of the 8K tonnes is of such a purity.
That’s if it’s even there, of course.
Completely on a wild tangent – as I’ve watched the gold of the world shift East over the years, in tandem with the power of the world, I keep remembering the person called “Another” who said in the late nineties in the Kitco forums that at the very top level of the World Game, countries moved large gold stocks around to denote the relative power of the various nations. Kind of like paying tribute to, or memorializing, or perhaps solemnizing, the power.
It’s an unverifiable concept – but gold keeps being important, and despite the western propaganda seems very important to countries and their central banks – and it all seems to track with geopolitical power, even to the extent of nations having placed their gold in the US and the UK back in times when those nations had power.
So I don’t know. Just a wild thought.
Grieved, I believe you have good wild thoughts.
Your very precise opinions and the authors you followed also impress me quite favorably.
“Another” was the first to reveal the genuine guidelines.and was certainly tops, but not here with us any more.
,,, “If you don´t like the current financial system just wait till you get to see the new one when it comes”,,,
,,, “Follow the steps of the giants”,,,
Etc etc etc
Bullion Star in general and Ronan Manly (´alive and kicking´) in particular are indeed top dogs regarding many/most important aspects of this topic.
FOFOA — Friend of a Friend of “Another” — is certainly worth the while despite the fact that he does get carried away in verbiage. Alasdair Macleod is also excellent, knowledgeable, precise and very thorough albeit sometimes a bit “longish”.
Readers ought to go to their local pawn shops and buy what physical gold is available.
I have to wonder what is being done with the gold if it is not in bank / investors hands somewhere.
Could it have gone into computer chips ?
Just as silver is the backing material for recordable CDs and DVDs ?
We all remember the gold backed CD-Rs from 20 years ago before it was altered to silver.
May I ask three silly questions of you?
1. What do you bait a mousetrap with?
2. Do you remember the saying last century about America needing a New Pearl Harbour?
3. Do you remember the Tungsten gold bars found by the Chinese?
Of course back in those days, Paul Rand was doing his level best to get an audit on the Federal Reserve and Fort Knox, which of course never happened. Perhaps because Fort Knox was pretty much empty.
How do we know that? Well simply because when the Chinese requested the return of some of their gold thye received thew ‘tungsten bars instead. Further investigations into those tungsten bars gave the actual number of those tungsten bars manufactured which was a few more than delivered to the Chinese.
So if perchance somebody wanted to set a mouse-trap for the US government, what would they use? Gold of course, similar to what the US have been stealing off lesser nations.
And thus I would believe that Putin and the Russian Federation set a trap for the US and they fell for it ; in fact this trap could be considered as big as the trap FDR set for the Japanese, back in 1941.
The last thought I have is this; Is the Bank of England in the same quandary?
Thank you for this important report.
I vaguely remember the quickly quashed rumblings a few years back about Germany complaining that it did not receive the original gold bullions the US was “safekeeping” for it and the absurd explanation that they had been melted and reformatted in the interest of saving space (???!!!). Germany was (as ti still is) too cowardly to raise a stink about it. Another story circulating at the time was that Germany had some gold bars tested and they were only gilded but not gold and that when they raised the issue and apology was given with the excuse that it was a mixup and by mistake they were give bars that were merely for display. Display where???
Arent we missing an important point here?
The countries Venezuela and Co deposited their gold in City of London yes. But it was as guarantee for loans of hard currency of fiat money to be used on the international market.
A problem only occur when people loose faith in their fiat money loan, and that is exactly what happens now, why we have the concern about our real gold value deposited elsewhere, as we cannot run away from our international debt and participation in the casino game.
But if City of London have issued hard currency loans on the basis of gold deposit, they have a legal and morally right to the gold until the loans are paid back, and we can only blame an irresponsible European population living a luxury life on debt and loans.
Remember, politicians are only doing the dirty job for their whining greedy irresponsible voters.
Tommy, the problem is different.
The UK — on its own — decided that Maduro´s government is not legit and should not get anything back.
Then the UK decided that Guaidó is the legitimate leader of Venezuela.
@Brexitologist. Thanks :-). I know this side of the story.
But there must be a logical explanation on why Central Banks are so stupid to store their gold in London.
“..gold as a reserve asset and stability anchor have been gaining acceptance since the financial and sovereign debt crisis.” https://www.sprott.com/media/2690/wgc-a-central-bankers-guide-to-gold-as-a-reserve-asset-2019.pdf
So its a financial and stability tool called “reserve asset” for Central Banks.
The Venezuela case is thus more complicated than just pure robbery, its robbery yes but BOL referred at that time to some coverage for lacking payment on international loans.
Remember Venezuela were broke on hard currency to International transactions, had stopped payment on Russia loans and credit among others.
This is once again why I keep coming back here.
Bravo team Saker
I have to also wonder why we are still using gold as the unit of wealth.
Sure, it has jewelry and industrial purposes and is scarce and will last intact forever but it has no other uses.
Anything scarce is a currency. Diamonds, emeralds etc… platinum, palladium, chromium.
In the Bronze Age tin was worth as much as gold.
Saffron today often sells for more than gold in per gram.
Perhaps the reason is gold and silver are heavy and thieves can’t carry much away easily ?
That would have been valid in the old days. And it could be cast into coins.
But copper also has value be it less.
What would be an alternative I wonder ?
This gold subject certainly suggests that Brexit was deliberately organised as an attempt to shield England from its gold obligations to Europe, and the world.
What would you do if you were an international Perfidious Albion crime game, and the torches of the investigators could already be seen, in the gardens surrounding the gold vaults, containing only poorly written IOU’s..
‘Sorry chaps, EU legal obligations died during Brexit. Any complaints can be sent to the legal department at the Battersea dog home. Cheerio’!
And how long would the EU and NATO last, once the internal dogfights start?
Congrats, you may have struck a couple of major chords here.
I´ll take a shot at your last question first if I may… as for one it is far shorter !
From my perspective Ric, if a serious “internal dogfight” starts within NATO/EU members — for whatever reasons related to this topic and there are several possibilities not just one — such violent conflict would have unfathomable consequences not only for NATO and the EU, but also for the world as we know it.
How so ?
We can´t know exactly, but it´d be vicious and game-changing because the Rubles-or-Gold game means that many in Europe could-would plain undergo famine and/or freeze to death, that bad.
Was this everybody´s Brexit´s “dirty little secret” ?
Yeeeaah… sorta… politics, you know…hmmm, how to say this…
This situation is well known since decades ago by a very wide range of UK politicians and economists from Labour and/or the Liberal Democrats and/or the Conservatives of course. During this period the UK has had plenty Chancellors of Exchequers with very large technical teams and just to underscore the widespread shared responsibility from the whole British side — not just the Tories — no more and no less than Gordon Brown and Tony Blair were Labor Prime Ministers who knew every nitty gritty detail of this messy mess. But, as everybody else also had a share of blame, they all swept it under the rug, whistled the mess away, and “one hand washes the other” sort to speak… while the Ponzi scheme kept working wonders making gold not interesting to anyone, except till now.
Meanwhile, the EU had been taken for a ride and didn´t want to accept it as bringing this matter up during Brexit negotations would have meant triggering off the confrontation right there and then, to no avail. So the EU leadership ALSO played games betting that time and Brexit negotiations would be in their favor. Of course no one saw the Ukraine crisis coming thus bringing the matter quite suddenly to a head with very specific consequences. After the terrible Western mis-management though, Russian exports are now Rubles or Gold guys. The rest is confiscatable wall-paper with pretty pictures of royalty or musicians or musical instruments or even gracefull animals painted on them…
So… to make a long story short… I guess the title of this article comes quite close to reality.
Still, this internal gold war could be avoided at a terrible geopolitical price to be paid by the West to Russia as “winner-take-all” checkmate bye bye adios amigos game over… But I don´t see it happening though as the EU and specially the Brits — let alone Boris Johnson — would rather die in a ditch before accepting defeat to the Russians
One final point Ric.. whatever was said, acted and done — kabuki theatre or otherwise, Brexit or no Brexit – the UK as Authorized Custodian was and still is responsible for the EU gold and nothing in this world will politically shield it from complying with such obligation.They´ll even have to buy it back from the world market at exhorbitant prices however painfull that might be.
Gold standard and fixed exchange rates – myths that still prevail
Unfortunately, this article is full of them.
The two monetary systems are very different. You cannot apply the economics of the gold standard (or USD convertibility) to the modern monetary system.
Unfortunately, most commentators and professors and politicians continue to use the old logic when discussing the current policy options. It is a basic fallacy and prevents us from having a sensible discussion about what the government should be doing.
All the fear mongering about the size of the deficit and the size of the borrowings (and the logic of borrowing in the first place) are all based on the old paradigm.
They are totally inapplicable to the fiat monetary system people use today.
Look at Glazyev’s new Eurasian currency proposal. It is here in his article a few days ago.
Gold-Backed is British, rejected in 1934 by FDR. Gold-Reserve is FDR’s Bretton-Woods system that Nixon deep-sixed in 1971 undermined by Britain, leaving the 1974 Petrodollar, totally floating.
So the Petrodollar is now on the way out.
Goldbugs of the British London School of Economics ‘Austrian’ School – Prof. von Hayek’s caper, are still stuck in 1934.
for what the FED did since the financial freeze up Sep 2019. The $trillion pumping to zombie US AND foreign banks is the cause of the inflation hitting everyone right now. Blaming it on Putin is a sham.
It is very simple not rocket science
The government just spends into the economy and borrows back its own spending.
The US Treasury BORROWS money from private banks, it does not CREATE it.
It pays interest to the banks on US Treasury Bills and also uses the IRS to bilk the US population out of its hard earned money, or the capital gains derived from speculation in the commodities and stock markets.
Usury is a drag on the US economy that Paul Warburg and his cronies engineered at a secret meeting on Jekyll Island in 1913.
Despite warnings, Woodrow Wilson signed the 1913 Federal Reserve Act. A few years later he wrote: “I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world, no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.”
-President Woodrow Wilson
Where are the gold bugs, Austrians and deficit terrorists?
From 12 years ago.
The real data free from propaganda and the nonsense that clogs up the internet always each and every time proved them wrong.
Has done for at least 100 years.
Billy, do you suggest borrowing our nation’s monetary supply into existence (bonds), or do suggest creating the nation’s monetary supply as an interest-free national asset?
If you want to borrow money into existence, then why do you believe that those who create your loans, have capital, when they seize the Title to your collateral, and create the loan capital, using their license to create bank credit? (Pawnbroking/street mugging)
Also what do you wish to use for your monetary unit, your Aristotelian measure of intrinsic value? Simply legal decree?
And Billy, how does MMT solve this problem?
Thomas Edison. Inventor. AD1847-1931.
‘…if the nation can issue a dollar bond then it can issue a dollar bill… it is absurd to say that our country can issue bonds and cannot issue currency. Both are promises to pay, but one fattens the usurer and the other helps the People.’
This same article — with due credit to “The Saker” — has been RE-published this morning by “Naked Capitalism”. As an introductory prologue Ives Smith adds her mostly contrarian and controversial comments although to her credit she does emphasize the ´Importance of Custody´ and the specific and unavoidable duties of the authorized Custodian in charge, which is not the case, is it ?
As always, the abundant commentariat analysis is mixed in quality.
Some excellent, some good, some not-so-good, some plain paper-buggery style (sorta)
Still, of course, it does add to the debate.
If you wish link you may link at
The use of gold as currency is an anachronism and no longer needed to create money as debt on bank computers, since banks always take collateral from the borrower before granting a loan in case of default.
It is however, usually a good hedge against inflation of any currency
Far worse Kapricorn4.
‘..since banks always take collateral from the borrower before granting a loan in case of default’
The banks use a bookkeeping system which converts the value of the customer’s collateral, into bank capital, owned by the banks. The banks are using a financial magician’s trick, cunningly designed to ‘steal’ the customer’s assets. Debt banking is a fraud, and the people ‘pay the cost of their own slavery’!
Gold is going to be useful for heatsinks in the future. However, sine the future of the human race is multi planetary, all non-digital assets are worthless on a long enough timeline.
Sir, are you in anyway related to Tyler Durden editor at Zero Hedge ?
Sir, I´m not sure I quite follow your line of thought.
Unless it´s basically a sarcastic comment applied to a very serious and life-threatening subject.
Let´s think of millions of Europeans without power or food either starving or freezing to death.
Or very uncomfortably ´melting´ with a terminal A/C crisis come June-July-August.
So please allow me to interpret your post if I may.
And in the event my interpretation is not correct, please let me know.
You are saying that
(1) “in the future” gold will NOT be valuable and only good for “heatsinks” i.e., heat dissipators, meaning very a minor industrial application making gold easily replaceable by many other substances be it metals or otherwise
It would be very useful to know how long a future (“in the future”) you envision that planet Earth would have such ´value-less´ gold
(2) And then you suggest that in a very VERY very distant future — which you do not define and is definetly up for grabs — when the human race inhabits ´other planets´… then for sure gold and all other ” non-digital assets” would be worthless on the basis (I dare to guess) that transportation would be very cumbersome including a single gold coin.
Am I anywhere near to what you originally meant ?
The gold is safe. Lord Rottedchild has it tucked away in his private vaults, it’s his now.