As speculation grows around the Fed's expected interest rate cut, possibly by 25 basis points, the financial world is buzzing with anticipation. Meanwhile the Central Bank's balance sheet in the U.S. increased slightly from $7.112 trillion to $7.115 trillion within a week but still remains in the phase of a relatively fast shrinking or 'consolidation'. There's still a lot of appetite for US debt in the world.
But there's an elephant in the room that’s often overlooked if it comes to the damage the last year's bond crash has done to central banks' balance sheets that in a lot of cases show negative equity capital: the Fed's gold reserves. What if a significant revaluation of these reserves could wipe out the balance sheet damage of recent years? With the BRICS nations boosting their gold purchases to fortify their future currency system, are we on the cusp of a global gold revaluation?
I cannot imagine that after years of manipulation of the gold price, the now controlled rise will happen without a plan by the central bank.
No comments and someone already zapped you?
This is interesting.
I always thought gold prices were be depressed.
Maybe they will rise now because of this economic uncertainty?
No idea... maybe passive readers?
I think people are using different means to get on the leadership board.
You mean zapping to get to the top?
Isnt it not just zapping?
Thats what I dont understand.
If you zap, and comment, wont you reap more of the rewards?
I really have no idea. Maybe You should ask one og the mods
Yeah, probably.
If you don't already know this, prepare yourself for almost unbelievable government stupidity. By law, they can only redeem their gold certificates for $42/oz.
If they change that to market value, they immediately get an almost 20x on their gold holdings.
I didn't know this. Thank You.
I had read it a long time ago and forgotten about it. Then the Mises guys were talking about it in a discussion about why the gold holdings are essentially useless for paying down the debt, because it can only be redeemed at that price.
And what if they change the law? Law is just a funny paper nowadays
I don't know how easy or difficult that would be. The issue is that they have gold-backed certificates that are redeemable for a specific dollar value, rather than a specific quantity of gold.
They might have to essentially seize the gold from whoever owns it, which they could obviously do.
Ah, OK. So that's the way to do it. I don't see any problems.
Have you got any data of gold reserves in Spain?
281t
Thanks ! Interesting that many European countries have bigger reserves than us.
Leftovers of centuries of colonialism for those (unlike England) who had the good idea to keep it
I don't like the idea that BRICS are chasing USA in Gold reserves believing that by this they gonna make their currency stronger. The fiat is doomed and by looking around everyone can tell the future of it. Only these leaders won't accept. The BRICS had a chance to defeat USA by accepting and embracing Bitcoin but it seems that USA has already much ahead of all of them in every respect, be it Bitcoin adoption.
The potential interest rate cut by the Fed could have significant implications for the economy and markets.
It's interesting to see how the Fed's balance sheet is still shrinking, yet there’s still strong demand for US debt.
The idea of revaluing gold reserves is particularly fascinating.
As BRICS nations increase their gold purchases, it suggests a shift towards gold as a more stable asset in the global economy.
If central banks do have a plan for a controlled rise in gold prices, it could greatly impact how we view currencies and investments in the future.
With all these changes happening in the financial world, it will be interesting to see how it unfolds.
Do you think this shift towards gold could affect everyday investors?
i actually like gold , not as much ass btc by a long shot, but you have to respect the OG sound money (and origin of the term 'sound money' because of its distinctive sound)
as USD devalues further, the fiat-price of gold is only going to keep going up
We are living in an awesome time in history. The real battle is money: sound money vs unsound money. Whichever wins will rule the world from now henceforth. Old, ancient Goldie aside.
From central banks’ POV:
The benefits of revaluing gold reserves against a higher gold price need to be considered against the negative element of a rising gold price; all is not well in fiat money land.