Letter to Hugo Salinas-Price: Forget a Silver Backed Currency, Mexico’s Got To Bring Its Gold Reserves Home
Last year the Bank of Mexico did not reveal the location of its gold reserves for national security purposes. This came after it purchased 93 tonnes of gold. The Federal Transparency Law in Mexico, however, has forced Banxico to state the amount of its gold holdings as well as the names of its custodians and the locations of where its gold holdings are held. The bank refused time-and-time again to release the information, but has been compelled to do so by the “Department of Management for Rules Control.”
Banxico claimed that revealing the location of its gold would “harm the financial, economic or monetary stability of the country.” Here are some of the facts regarding the disclosure:
- “At month’s end, April 2012, Banco de Mexico maintained a position in fine gold of 4,034,802 ounces, of which only 194,539 ounces are located in the territory of the United Mexican States.”
- Banxico “has been informed and knows the specific location of the gold position that forms part of its reserve of International assets”
- The countries where these reserves are located are “United States of America, England and Mexico.” And also, “the acquisitions of gold during March and April 2012 are under custody in England”.
- And besides, it is precisely there in “the city of London, England, where more than 99% of the gold which the Bank of Mexico maintains outside the country is presently under custody…”
Of Mexico’s gold:
94.23% are stored in London, BoE
4.82% are stored in Mexico
and 1% is stored in the NY Fed
In the central bank’s latest communiqué it stated it has currently no interest in transporting the bars: “The Bank of England is one of the world’s most important custodians of gold, for which reason maintaining our gold position with this institution minimizes the costs of storage and transfer of gold.”
Perhaps what Mexico means by this is that it is bound by the Empire of the North and its allies to hold its metals with the Cartel. That means that the Mexican people are being bent over by its government, to kowtow the globalists party-line. In other words, London and NY remain the core and Mexico is the periphery.
As ZeroHedge covered, Germany has concerned itself over the safety of its gold reserves, held in the custody of the victors of World War II, the US, and other countries.
German lawmakers are to review Bundesbank controls of and management of Germany’s gold reserves. Parliament’s Budget Committee will assess how the central bank manages its inventory of Germany’s gold bullion bars that are believed to be stored in Frankfurt, Paris, London and the Federal Reserve Bank of New York, according to German newspaper Bild.
The German Federal Audit Office has criticised the Bundesbank’s lax auditing and inventory controls regarding Germany’s sizeable gold reserves – 3,396.3 tonnes of gold or some 73.7% of Germany’s national foreign exchange reserves.
There is increasing nervousness amongst the German public, German politicians and indeed the Bundesbank itself regarding the gigantic risk on the balance sheet of Germany’s central bank and this is leading some in Germany to voice concerns about the location and exact amount of Germany’s gold reserves.
The eurozone’s central bank system is massively imbalanced after the ECB’s balance sheet surged to a record 3.02 trillion euros ($3.96 trillion) last week, 31% bigger than the German economy, after a second tranche of three-year loans.
The concern is that were the eurozone to collapse, Bundesbank’s losses could be half a trillion euros – more than one-and-a-half times the size of the Germany’s annual budget.
In that scenario, Germany’s national patrimony of gold bullion reserves would be needed to support the currency – whether that be a new euro or a return to the Deutsche mark.
The German lawmakers are following in the footsteps of US Presidential candidate Ron Paul who has long called for an audit of the US’ gold reserves.
It is believed that some 60% of Germany’s gold is stored outside of Germany and much of it in the Federal Reserve Bank of New York.
Germany and other central banks may follow in Hugo Chavez’s footsteps and repatriate their gold to Germany so as to have direct possession of and ownership of their gold reserves in order to be better prepared for a systemic or monetary crisis.
Jim Rickards has outlined possible plans by the Federal Reserve to commandeer Germany’s and all foreign depositors of sovereign gold at the New York Federal Reserve in the event of a dollar and monetary crisis leading to intensified “currency wars” and the ‘nuclear option’ of a drastic upward revision of the price of gold and a return to a quasi gold standard is contemplated by embattled central banks to prevent debt deflation.
And Switzerland wishes to “save” its gold:
As Silver Vigilante covered last year, Hugo Chavez had Venezuela’s gold returned to the country:
Venezuela’s president Hugo Chavez has lost confidence in western markets, in particular the international mega-banks which function as shepherds of most nation-states and global markets. Deeming U.S. and European economic prospects too uncertain, Chavez has decided to place Venezuela’s gold reserves and other liquid assets in China, Russia, and perhaps even Iran. Chavez’s decision, in part, might have to do with his domestic petroleum reserves. He can sit on his petroleum reserves at home, with a stash of off-shored gold in emerging nations.
Venezuela’s gold holdings, 440 tons, ranks 15th in the world. And so, Venezuela holds more gold than Saudi Arabia or the United Kingdom. So, with this in mind, markets should not expect Libyan gold to hit the markets, resulting in a drop in the gold price. Instead, much of this gold might find its way onto the balance sheets of Venezuela. In order to drop the price of gold, with demand as high as it is, only further margin hikes will do the job.
Hugo Salinas-Price has indicated that Greece and Mexico could fix their economic problems by switching to a silver standard. He has been an outspoken proponent of this action, and it would certainly empower the Mexican state, and perhaps by proxy its people, by divorcing so decisively from the Federal Reserve Note. But, the Mexican government has indicated it has no interest in its gold. It will trust the corporate banking cabal with its gold, assuming its perceived status of “old friends” will give them delivery preference. This is not the case, likely. What Mexico needs to do is begin a movement like Venezuela, Switzerland and Germany to get its gold back from the victors of World War II, and exit from the remnants of Bretton Woods.
With an apparent gold standard oncoming, countries like Mexico, with their gold with the demise-of-the-nation-state globalists, could find themselves losers of the future.
Of course, were Mexico to demand its gold back, cries would wail out of NY and London calling them socialists on the side of the tyrannical Chavez Regime…