Central Banks don’t trust each other

August 21st, 2011:   Venezuela’s central bank has requested its 99 tons of gold holdings from the Bank of England, according to a bank statement sent by e-mail, citing the institution’s president Nelson Merentes.  “We’ve contacted the Bank of England and the corresponding protocols have been initiated to complete this operation as soon as possible,” Merentes said, according to the statement. “Once that’s done, the shipments will begin by sea.”  Chavez ordered the central bank Aug. 17 to repatriate $11 billion of gold reserves held in developed nations’ institutions. Venezuela holds 211 tons of its 365 tons of gold reserves in U.S., European, Canadian and Swiss Banks.

Then Germany: specifically, the Bundesbank will be bringing to Frankfurt all of its 374 metric tons stored at the Banque de France (11% of its total reserves), and 300 metric tons held in the vault of the New York Fed, reducing its share in the U.S. from 45% to 37%.  At market prices, that’s about €27-billion ($36 billion) worth of physical gold bars.

In October of 2012 the Netherlands asked for their gold back.

Over the past few years, Libya and Iran have also repatriated their gold holdings.

Now Austria wants to audit its gold at the Bank of England.

There is a breakdown in trust among those who have gold held in New York and London.  It may be gone.

It has been alleged that there is no gold left in the U.S. Official Reserves.  Requests for audits have been denied.  If there was no issue, you would not deny the requests.  If it is found that the reserves are gone, you will see gold skyrocket.  Gold bars held by a custodian have serial numbers and have a chain of custody.  It would be interesting to find out where all those bars are at.  Gold Bars get shipped to Switzerland to be melted down and recast for new buyers.  That may eliminate the ability to track the origin of some gold.  Food for thought.

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