U.K. is merely having a garage sale, IMO.
Why hold gold in the first place? For it's intrinsic value based on a finite supply?. . because it is a war time saviour?. . .it's a hedge against an economic collapse?. . .it will be there when currencies fail?. . . . right?
Wrong. . . . . It is no longer any of the above.
Modern mining methods and the vast number of mines are producing more supply than there is demand, therefore mines need closed. We're on virge of WWIII, with Yeltsin barely able to complete a sentence ready to spill Vodka into the remote nuke launchers and thinking of blowing D.C. away to prove a point. . .yet gold sits there. . . and when Asia faced total economic collapse and Russia did, where was gold? . . .sitting there slowly losing it's value.
I think that gold has become nothing more than a raw material commodity like coal. Governments hold on to it just in case of world economic collapse, on the slim chance that it will finally take it's rightful place as the one true currency. . . but we all know that even then it won't.
As a childhood numismatic, I have always held gold in high regard. But save a short period in the seventies when it was all the rage, it has been the poorest investment a country or an individual could make.
It has been an easily manipulated play for some sneaky greedy countries. . . I especially liked the "rumor" of Switzerland selling off it's reserves that led to the "announcement" of them "planning" to sell off over a number of years.
Hey, can someone tell me? Did they ever get around to actually selling any yet?
William is right. Fiat money is here to stay and it is a new era. Why back currency when there is no real intention of holding the promise? When we dropped the gold standard, we set a precedent for the world. So what is in Fort Knox, Kentucky anyway? 30 years worth of presidential memoirs, diaries and videotapes perhaps?
I think U. K. is selling off gold, just like you or I would sell off an old car that is no longer of any use to us. . .or a spare washing machine.
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