Re: [gang8] Dollar Hegemony Revisited

["Hugh Whinfrey" <econ@xxxxxxxxxxxx>]

Barkley notes:

>       Correct me if I am wrong, but I do not think that
> there has been an intergovernmental transfer of gold
> from the US to any other country since the 1960s, when
> de Gaulle demanded that gold bars be moved in the
> basement of the New York Fed from the trays labeled
> "US" to the trays down the hall labeled "France."
> So much for all this "bleeding" and "physical movement,"
> although I stand to be corrected if wrong on this.

As far as I've heard, some gold was paid for the Iranian
hostages. That would be 1979-1980 as a time frame.
I seem to recall that the accounting involved a swap
scheme. There have been others, I believe I heard
somewhere that the US was dealing with Syria in gold
not all that  long ago. That doesn't seem all that
surprising to me. If I were Syria, I probably would
insist on it too under the circumstances.

So it's still out there somewhere evidently. Stories do surface
periodically of gold bars coming out of London that clearly
were melt bars made of confiscated gold in the US. There is
also an older story out there of LBJ having bet Ft. Knox and
lost it all in the 1960s.

People in the rarefied circles have disdain for these 'stories' though
and I'm just repeating them because they're in the relevant folder.
I don't know any more than anyone else whether they are true.

>       Again, they do not sell it to each other or transfer it to
> each other.  They sell it into the private market.  None of
> them are accumulating gold, unless maybe the South Africans
> are.  They are all trying to unload it as gracefully as possible
> in a manner that creates the least discruptions to the global
> market in gold.

Russia is accumulating gold. France bought more recently.
I believe Italy also bought more recently. The Iranians were
trying to get theirs shipped home from London the last I heard.
I think it's a no-brainer that they are not decreasing their
holdings. I believe the Chinese holdings are also on the rise. I
recall mention that Poland was also purchasing gold recently. Malaysia
is also knee-deep in its Gold Dinar project. They curently are
in the process of finalising a bilateral deal with the Iranians to
use gold (i.e. 'evil' commodity money) to settle their bilateral trade
account - other Muslim countries are also in on it and looking to
take part in the initiative. And that also implies that state-owned
bullion stocks will be increased. My initial point in this long thread
was that it was stupid of the US to let these folks exit the dollar
system under these artificially low gold prices in the marketplace. And
I stand by that remark.

So, no, while it's true that they do sell the stuff into the private
sector - there is a lot going on . The central banks of countries
that the US is more likely to not consider to be its allies seem
to be the main ones showing a purchasing interest, although the
Europeans seem to be all over the board, making it more difficult
to generalise. I know the Dutch tried to proclaim a moratorium on
new leases of their gold - I don't know whether they went through
with it in the end.

Hugh