Bumped ~ original article ~ below ~Germany Considers Central Bank Gold Reserves for European Monetary Fund
The EFSF passed today .. hmm, I wonder if gold will back currencies when they rebalance? ..
Snip ~ G20 Secret Debt Solution ...
1. It would be a strategy designed to ease the burden of ALL debts — by simultaneously devaluing ALL currencies … and re-inflating ALL asset prices. The G-20may propose devaluing all currencies, including the U.S. dollar and the euro.
2. To end the Great Depression in 1933 Franklin Roosevelt devalued the dollar via Executive Order #6102, confiscating gold and raising its price 69.3%, effectively kick starting asset reflation.
3. They cease all gold sales and instead, raise the current official central bank price of gold from its booked value of $42.22 an ounce — to a price that monetizes a large enough portion of the world’s outstanding debts.
September 26, 2011 London Gold Exchange ~ Due to operational difficulties the London Gold Exchange is permanently closed for business ...
That way, just like in 1933, the debts become a fraction of re-inflated asset prices (led higher by the gold price). And this time, instead of staying with the dollar as a reserve currency, the G-20 issues three new monetary units of exchange, each with equal reserve status.
The three currencies will essentially be a new dollar, new euro, and a new pan-Asian currency. (The Chinese yuan may survive as a fourth currency, but it will be linked to a basket of the three new currencies.)
What are the perspectives of the US Dollar as the global reserve currency?
A. A new fixed-rate currency regime. Immediately upon upping the price of gold and introducing the new currencies, a new fixed exchange rate system would be re-introduced. The floating exchange rate system would be tossed into the dust bin along with the old currencies. This would kill any speculation about further devaluations in the currency markets, and drastically reduce market volatility.
B. To sell the program to savers and protect them from the currency devaluation, compensatory measures would be enacted. For instance, a one-time windfall tax-free deposit could be issued by governments directly to citizens’ accounts, or, to employer-sponsored pensions, to IRAs, or Social Security accounts.Income taxes may subsequently be raised to pay for the give-away, or a nominal global type of sales tax could be enacted to help pay for the new system and the compensatory measures.
C. Additional programs would be designed to protect lenders and creditors. Lenders stand a much higher chance of getting paid off under the new monetary system — but with a currency whose purchasing power would now be a fraction of what it was when the loans were originated.
So programs would have to be designed to help lenders offset the inflationary costs of their devalued loans, probably via the tax code. EU set to go ahead with £50bn Robin Hood tax ...
The Big Question: What gold price would be legislated to reflate the U.S. and global economy?
I can’t tell you what gold price the G-20 would ultimately agree to. But here’s what they will be looking at …
To monetize 100% of the outstanding public and private sector debt in the U.S., the official government price of gold would have to be raised to about $53,000 per ounce.
To monetize 50%, the price of gold would have to be raised to around $26,500 an ounce.
To monetize 20% would require a gold price a hair over $10,600 an ounce.
To monetize just 10%, gold would have to be priced just over $5,300 an ounce.
Those figures are just based on the U.S. debt structure and do not factor in global debts gone bad. But since the U.S. is the world’s largest debtor and the epicenter of the crisis, the G-20 will likely base their final decision mostly on the U.S. debt structure.
Read full article G20's Secret debt Solution @ link
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2010-03-13
Germany considers Central Bank gold reserves for EMF
BERLIN, Germany is considering the possibility of euro zone countries using their central banks' gold reserves to back a European Monetary Fund, German magazine Focus reported on Saturday.
The German Finance Ministry declined to comment on the report by Focus, which did not specify its sources.
"A proposal from the finance ministry suggests pooling the gold reserves of the former central banks of euro zone countries in a stabilisation fund," Focus wrote.
According to Focus, Greece still has around 112 tonnes of gold, while the German Bundesbank has 3,407 tonnes with a market value of around 90 billion euros.
German Finance Minister Wolfgang Schaeuble on Friday repeated his call for a fund which could, as a last resort, offer help to euro zone states facing bankruptcy.
Greece is battling a debt crisis and EU policymakers have been debating ways of providing support for it and other troubled euro zone members.
link
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