Thoughts from an active pensioner who is now somewhat past his Biblical "Use-by date"

"Why just be difficult, when with a little more effort you can be bloody impossible?"

Saturday, 29 October 2011

Gold Reserves

Earlier this year, the Daily Telegraph listed the ten countries with the largest gold reserves. Needless to say Britain wasn't on the list as Gordon Brown sold over half our reserves at rock bottom prices, leaving us at No 17 in the list.
OK, Gordon was right in saying that you can't actually do anything with gold, but as long as others value it, gold is a very good investment, particularly in troubled financial times like the present.
As might be expected, USA is the biggest holder of gold with over 8000 tonnes. But rather surprisingly, Germany came second with 3400 tonnes, somewhat more than the IMF with some 2800 tons. So in terms of actual recognisable wealth, as distinct from fiat money such as the Euro, Germany has more wealth than the IMF.
Again, somewhat surprisingly, Italy came next with around 2450 tonnes, closely followed by France with some 2435 tonnes.
The point that I am making is that the IMF is asking for more money in order support the southern European Countries, and it is likely that we are will be expected to contribute far more than those countries with these large gold reserves. For some reason, last time the IMF wanted more funds, we apparently contributed more than these other countries in order to "maintain our standing" within the IMF, and it seems likely that this will happen again.

So exactly what is our "Standing" within the IMF ? Precisely zero, as far as I can ascertain. The Head is a Frenchwoman with a proven track record of being an enthusiastic supporter of the Euro. Why we supported her, rather than the Australian candidate is beyond my comprehension; someone from a country which has managed to avoid the worst of the recession would have seemed an ideal choice. Not only does this show how pro-Europe this government is, but it also demonstrated that we support IMF funds being used to prop up the Euro.

The stated objective of the IMF is to support individual countries, not currencies, and support is only given to countries who are prepared to take appropriate steps to rectify their economic shortcomings. Support for the Euro, and Greece in particular, should thus be refused on both counts.
As has been said by others, the IMF would not support, say, California which is virtually broke, as it is the responsibility of those issuing the fiat currency, in this case the US Treasury. Why then does it support Greece, which is part of another fiat currency which in itself has no problems as it is still retaining its value against both the Pound and the Dollar.
So much for our "Standing" in the IMF; it appears to be breaking its own rules and we can do nothing about it - indeed we seem to be aiding and abetting in the matter.

Oh, and our Gold reserves?  A mere 310 tons last February!

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