Gold accumulation is happening at a very astounding rate – and the
repatriation of gold by foreign nations, and now states, is setting a tense
deadline for the most massive currency war ever seen on a global scale.
A game of musical chairs has begun, and someone will be left standing when
the music stops.
Texas has just taken it up a notch, with a high profile move to keep its
gold holdings at home for safe keeping and strong collateral. The state
legislature is making moves to allow housing the more than $1 billion
investment in bullion gold by UTIMCO (the University of Texas Investment
Management Company, whose directors are appointed to represent multiple
university systems and other assets.
Texas — long known for cattle, cowboys and oil — could soon be on the map
for something much different.
Gold.
State Rep. Giovanni Capriglione asked the Legislature to create a Texas
Bullion Depository, where Texas could store its gold, which is now in New
York, and where others could keep their precious metals.
[…]
The goal is to create a secure facility that would allow the state to
bring home more than $1 billion in gold bars that are owned by the University
of Texas Investment Management Co. and are now housed at the Hong Kong and
Shanghai Bank in New York. (source)
Texas is just latest in a serious move back towards gold and other “solid”
investments. But symbolically, it signals a shift away from the old line
establishment, and a loss of confidence in the fiat petrodollar pumped out by
a declining empire.
China’s currency has just been reevaluated for entry into global reserve
currency status, signaling enormous changes for the once all-powerful U.S.
petrodollar. With China’s rise, it has been stockpiling gold at perhaps the fastest rate ever
observed.
Theoretically, China’s gold reserves are swiftly approaching par with the
U.S. gold reserves, held by the Federal Reserve.
With the central banks now buying gold… which is quite unique… we
haven’t seen that in our lifetimes… they’ve always been
sellers of gold and now they’re buyers of gold… I think there will be
a reset of the financial industry…
I think China is being allowed to accumulate gold purposefully by
the American government… I believe that the Chinese need to own at
least the same amount as the U.S. owns before this reset occurs. I
think that there’s some kind of deal that’s being made between all the
central banks behind the scenes and that’s why you’re seeing governments
accumulating the metal. (source)
Only, everybody knows the gold isn’t there. There are hints and
signals as to its whereabouts, but the practical fact remains the the NY Fed
isn’t holding what is supposed to, and the Fed will have to obtain the gold
before it can return bullion to those for whom it has been safekeeping it.
To compound this issue, China is likely much closer to parity, or at least
a significant milestone, than its official holdings would indicate. SGT Report states:
As we note, Bloomberg’s mockingbird journalist Nicholas Larkin recently
wrote that if China could obtain 10,000 TONS of gold, it would justify a
re-pricing of gold to $64,000 ounce. However, Larkin argues that China has
well under 2,000 tons by referencing the nation’s last official report from
2009. Steve and I discuss how it’s far more likely that China already has
10,000 Tons of gold NOW! So… what happens to the gold price once China
officially updates its six year old “official” number… huh Bloomberg?!
Essentially, that means a race is on to reclaim gold before it isn’t
redeemable, and have something at the table as collateral for its place in
the global reserve currency. Though these are enormous moves, the timeframe
is one that will not capture the attention of the general public.
Germany, Switzerland, the Netherlands, and numerous other countries in
Latin America and the Middle East are all demanding the return of their gold. Which countries will
be left holding the bag? And which countries will be at the mercy of the
accepted value of the offered reserve currency, perhaps in the form an SDR?:
The German’s are demanding that the U.S. return all of the 374
tons of gold held by the Bank of France, and 300 tons of the 1500 tons of
bullion held by the New York Federal Reserve.
Some say that Germany is only demanding repatriation of its gold due to
internal political pressures, and that no other countries will do so.
But Pimco co-CEO El Erian says:
In the first instance, it could translate into pressures on other
countries to also repatriate part of their gold holdings. After all, if you
can safely store your gold at home — a big if for some countries — no
government would wish to be seen as one of the last to outsource all of this
activity to foreign central banks.
German repatriation has taken much longer than anticipated… the Fed calmly
says they are accommodating their request at a reasonable pace.
There are even rumors that it is buying gold off the street to meet
demands for withdrawal, or that it might have to in the near future.
Some central banks lend out their gold to speculators and gold miners (who
borrow the gold to finance mines—basically, a risk-free hedged loan since the
borrowed gold can be repaid with newly mined gold, regardless of what happens
to the price of gold on the market), which can be a somewhat profitable
activity—especially when the alternative is just letting it sit around doing
nothing but fluctuating in value with the market price. But, as far as we
know, this isn’t something the Bundesbank or the Fed does. (source)
As SHTF reported:
Despite a 2012 decision in Germany to repatriate more than 600 tons of
gold being held by the New York Federal Reserve, only 5 tons had actually been transferred across the
Atlantic at the start of 2014, with the Bundesbank reassuring the German people that all is well, despite
delays in the process.
Was their gold actually there, or have the delays been due to the need to
buy back physical gold to meet demands on their ‘call’?
Now Texas wants its gold back, and stands ready to stop accepting bullion
deposits of its own for safe keeping.
Before there can be panic, big players are running for the exits.
If all the nations across the world, (and other entities as well) demand
return of their gold all at once or in short succession, someone is going to
notice that the game is up.
And then what?
Is that how the dollar dies, in a stick up?
Caught in its own devilish demise…
