Why Central Banks Hate Physical, Love “Earmarked” Gold, And What Is The Difference
Several days ago we showed the dramatic conclusion of what happened to Czechoslovakia’s gold which had been placed at the Bank of England for safekeeping days after Germany annexed the central European republic ahead of the start of World War II. We hate the spoil the punchline for those who haven’t read the post yet, but the her it is: it was gone; it was all gone.
And all of this happened with the explicit assistance of the Bank of International Settlements which was formed in 1930 to promote the free flow of capital and global economic growth. Instead, time and again, what the BIS has proven its only mission to be, is to facilitate the spread of intangible assets and fiat currencies while it quietly confiscates, sequesters and aggregates (for a select group of individuals) he world’s physical assets. Mostly gold.
In fact, until the advent of the BIS, gold held by central banks came in one version. Physical.
It was only after the BIS arrived on the scene did gold’s macabre doppelganger, so-called paper, registered or “earmarked“, gold emerge for the first time.
Courtesy of Adam LeBor’s book exposing the history and inner workings of the BIS, “The Shadowy History of the Secret Bank that Runs the World“, below is a brief story of how earmarked gold came into being.
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The Czechoslovak gold affair also highlighted how the bank’s increasingly sophisticated gold operations were growing in reach and importance. The BIS’s gold trades were a primitive forerunner of today’s globalized economy where vast sums instantly fly back and forth at the touch of a keyboard. The technology available in the 1930s was far more primitive, but the principle of buying and selling assets sight unseen and without taking physical possession is the same.
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