Well, having a reserve of gold in case of global war would seem one case of where a gov't could justify holding gold.
But unfortunately, when a country is at war, it is normally under martial law and has the ability to institute price controls and rationing, both of which distort the supply and demand equation.
Those who held large quantities of gold would likely find it declared illegal again as occurred in the '30s.
Not very democratic, but when your nation is at risk of being destroyed, preserving good order and opposing outright subversion of your national currency becomes a matter of national security.
Personally, I would feel more secure if the US hoarded oil and industrial metals that we don't produce here. Thus, in that case, I would be long Platinum, not Gold.
Regards,
Ron |
