Luke, If you follow gold bug news then you would have high confidence that a significant portion of gold that is stored by the big international banks on behalf of others has actually been loaned out. China over the last few years has been importing more gold than produced. If this trend continues there will be all sorts of short squeezes, defaults, and cash settlements. Look how long its taking to give Germany its gold back. Theres a global trend over the last 10 years or so for gold repatriation... this is just one more. I would personally much rather store gold in a Texas state government or Texas company than one of the Federal Reserve members. Especially given that it would have audits... Unlike the HSBC gold that hasn't been audited in my lifetime. On the subject of defaults, just this month of June it is suspected that the Federal Reserve bailed out the COMEX to meet the June gold delivery.
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