USA should sell it's gold

[BigBagel]

http://www.ft.com/cms/s/0/2bbd4dbe-d...44feabdc0.html

Opinion column in Financial Times recommending that the US government sell all it's gold.

[ThePythonicCow]

Re: USA should sell it's gold

Opinion column in Financial Times recommending that the US government sell all it's gold.

This column is written by:

a senior fellow at the Peterson Institute for International Economics in Washington

I suppose that is the institute founded with a $1 Billion endowment by Peter G Peterson, chair of the Council on Foreign Relations from 1985 to 2007. That $1 Billion was part of the money he made from Blackstone's IPO.

Peterson has been beating the drums of austerity, and the need to cut back on the U.S. debt and unfunded liabilities such as Medicare and Social Security. In this article, a senior fellow of his institute is suggesting the U.S. sell its gold, to trim a little more (a modest $340 Billion) off the debt.

I don't know what Peterson's real motive or private views are on these matters, but I am confident that he's thinking more than he's saying.

[Starving Steve]

Re: USA should sell it's gold

The U.S. holds 8000 metric tonnes of gold. At $1350 per ounce, I divide 1,000,000 grammes per metric tonne by 31.103 grammes per troy ounce, and that yields 32,151 troy ounces at $1350 per ounce for each tonne. Then I get $43,403,850 for each metric tonne. Then I multiply by 8,000 and I end-up with 43.4 billion multiplied by 8. This yields $347 billion dollars for the entire gold supply at Ft. Knox. This latter figure is sweet nothing when the U.S. is trillions in debt and has trillions-upon-trillions of dollars in circulation.

The bottom-line is Argentina. The dollar is no good at all, at least not in terms of gold. So, if I were the U.S, I would be asking China to buy U.S. assets, immediately. I would not be trying to pull China's tail..... But what do I know because I am just Starving Steve, the troll here at itulip? I am no economist, and I have never believed in faith, nor a faith-based currency of any kind.

Selling gold might buy the U.S. time, in theory. But in fact, selling gold will create a run on the dollar of mammoth proportions, and the run on the dollar will happen immediately.......... Bernanke is a complete moron! The folks around the world are not "Ma and Pa Kettle". This is not 1933....... An old saying in Europe, "If the central bank is selling gold, you had better be buying."

[jpatter666]

Re: USA should sell it's gold

How interesting. Long ago I stated an opinion that *at some point* I expected government gold sales in a final last gasp attempt to crush the "gold bugs". There is some rough precedent with the Hunt brothers and the attempt to corner silver in the 80s.

The attempt has not been made, but I think the groundwork is perhaps being laid.

[shiny!]

Re: USA should sell it's gold

" Opinion column in Financial Times recommending that the US government sell all it's gold."

What gold?

[blazespinnaker]

Re: USA should sell it's gold

. But in fact, selling gold will create a run on the dollar of mammoth proportions,

Uhhh, why's that? The total money supply is around 10 trillion. Gold is irrelevant.

If anything, selling gold might firm up the USD as people freak out.

If the country with the most powerful military many times over decided gold wasn't worth anything, you can be assured that would catch on a bit.

[Down Under]

Re: USA should sell it's gold

Uhhh, why's that? The total money supply is around 10 trillion. Gold is irrelevant.

If anything, selling gold might firm up the USD as people freak out.

If the country with the most powerful military many times over decided gold wasn't worth anything, you can be assured that would catch on a bit.

ROW would call their bluff.

[ThePythonicCow]

Re: USA should sell it's gold

This column is written by:

a senior fellow at the Peterson Institute for International Economics in Washington

...

I don't know what Peterson's real motive or private views are on these matters, but I am confident that he's thinking more than he's saying.

ZeroHedge has a message from Jim Rickards with more about the author of this column, Ted (or Edwin) Truman, in the post Jim Rickards On The Last Gasp Of The Fiat Money Regime. Rickards (perhaps not surprisingly, but still quite possibly accurately) describes Truman's motives as gold price suppression.

Rickards concludes:

Ted Truman is not a fringe figure or a minor intellectual; he is a giant in the field. He is not just close to the establishment. He is the establishment. An op-ed by Truman appearing one day after the IMF semi-annual meeting ended with no effective solutions on the currency wars is no coincidence. It is a metaphorical Message to Garcia, to the gold insurgents, from the President and the powers that be. It is price suppression without having to engage in actual sales. It is a warning to gold bugs that they may get crushed. It is meant to induce fear into those newly interested in gold that it’s a rough game with no holds barred. It is a show of bravado by the fiat money crowd. But it is also a sign of desperation; the last gasp of the ancien régime of fiat money. If a smart guy like Ted Truman is reduced to the old canard about gold being good only for hanging around your neck, then what else is there to say? The intellectual opponents of gold are now as exhausted as the mines.

[BK]

Re: USA should sell it's gold- He is talking is book- he worked for the Federal Reserve

Bio for the Author follows - I'm not even sure why this is worth discussing. Edwin is former Fed Employee - what would you expect him tosay... Edwin's
other writings focus on Inflation targeting - the Inflation targeting is working pretty well....hey!
----------------Bio for Edwin Truman ------------------------
Edwin M. Truman, senior fellow since 2001, served as assistant secretary of the US Treasury for International Affairs from December 1998 to January 2001 and returned as counselor to the secretary March–May 2009. He directed the Division of International Finance of the Board of Governors of the Federal Reserve System from 1977 to 1998. From 1983 to 1998, he was one of three economists on the staff of the Federal Open Market Committee.

[sishya]

Re: USA should sell it's gold

Indians will be happy if USA sold their Gold. come on let's get it started and see.
There will be run on dollar if that happens, since others attach value to it.

Military can neither create confidence or destroy confidence in Gold or dollar either.
It depends on the characteristics of money or commodity. Gold fits perfectly as money.