This is a fascinating podcast. It makes a very interesting point with regard to the merits of buying the most gold that you can get for your dollar as opposed to the less recognized virtue of buying the form of gold with the narrowest spread.
This is way ahead of banks in the West who are still trying to pretend that all is well with our debt-based paper money system.
“Citizens of Kazakhstan bought 1,813 small bars of total weight 60.7 kg from second-tier banks and separate non-bank currency exchange shops in May 2021.
“The National Bank launched a program of sale and repurchase of small bars of refined gold for population (hereinafter the ‘Program’) in 2017. Overall, 54,780 gold bars of total weight 1.95 ton have been sold since its launch.”
From the Bank of Kazakhstan website HERE for full details.
Welcome to the Basel III and Gold Resource Center! This page is for gold investors who want to understand the impact of Basel III regulations on gold. Monetary Metals has been covering Basel III since 2019. You’ll find all our videos and articles on Basel III and gold here. If you have a question we don’t answer, let us know in the comments section!
What is Basel III?
Born out of the global financial crisis, Basel III is an international regulatory accord intended to mitigate risk within the banking system and make banks more resilient to financial stress, thereby preventing system-wide failure. Key requirements cover leverage ratios and reserve capital (Source: Investopedia). The stated purpose of Basel III regulation is to prevent the repeat of another global financial crisis event.
Originally written in 2009, over 28 central banks participated in drafting the regulation. It has been repeatedly delayed and is now set to go into effect on January 1, 2022.
A comment on the symbiotic relationship between China and the U.S. of A. It could be viewed as a non-kinetic version of the M.A.D. doctrine that was developed in the 1960s and continues through to the present…
China and the USA regard each other as enemies – we read hostile remarks on the part of the USA, regarding China. And China rattles its weapons.
USA sends warships into the Taiwan Straight (sic), annoying China, which still regards Taiwan as part of China.
And the USA has armed to the teeth all the islands of the Western Pacific, and makes noises regarding China.
However, the fundamental, irrefutable fact is that the USA depends on China, and China depends on the USA.
Without Chinese goods in its stores, not to mention American goods manufactured in China, by American enterprises, American stores would be virtually empty.
Without a huge American market for its exports, the economy of China would collapse into unemployment.
China’s gigantic exports to the USA provide China with huge surpluses of Dollars, which China uses to purchase US Bonds, knowing that they are junk.
China has to keep these junk Bonds, because if they sell them to get rid of them, they will collapse the value of the Dollar.
If the Dollar collapses, a great part of Chinese manufacturing will also collapse, for lack of a market, and then China will have a gigantic problem of unemployment for their enormous population of some 1.4 billion Chinese.
This is all happening because neither the USA, nor China – nor any country in the world, for that matter, is using real money: gold money.
In a World in which all countries used gold as their money, all countries would have their own stable economies, and exports and imports would compensate each other in each country.
This is the way the World functioned in the Victorian Age – the 19th Century – which has been compared for stability, prosperity and peace with the Age of Augustus Caesar, who reigned in Rome for 41 years – from 27 B.C. to 14 A.D.
The Present Age – the Age of the US Dollar – will inevitably come to an end, because all lies come to an end, sooner or later.
How it will end, nobody knows. But we can be sure of one thing: the death of the Dollar will upset absolutely everything that we take for granted today.
This was originally published HERE. It should give everyone pause for thought.by Keith Weiner
On June 24, the Champlain Towers South condominium building fell, killing at least 24 people. The collapse of this building provides a surprising number of insights into the collapse of a currency. The following discussion is based on information that is emerging about the incident. Some of the particular details we cite may later prove to be wrong. Our focus is not to try to prescribe remedies for the construction or maintenance industries, but to shed light on problems in our monetary system.
The first takeaway from this disaster is that problems can fester for a long time. Years, or even decades, can go by. During this time, the parties responsible are surely telling themselves that “it works”. By “work” they mean they are getting away with it. It doesn’t really work, but the consequences are postponed for a long time.
Two, the politicization of decision-making is an important factor. Especially where there is a long-term capital investment, and something like a fiduciary duty of care. The condo Board is not just a social club, deciding how to decorate the Clubhouse for the Fourth of July. They have a duty to hire engineering firms to assess the health of their building, and to hire contractors to perform the maintenance recommended by the engineers.
Unfortunately, some people think that if the consequences are off in the future, they can squander time and money. They fail to realize that it’s much easier to pay for maintenance, via a small charge every month, than it is to wait until there is a crisis and then assess a large amount. Maintenance deferred becomes more expensive.
Three, there is an element of dishonesty. No matter how nice the Board members may have been, wishing everyone “good day” at the pool, they were dishonest in a sense. By their actions, and their inactions, by their words, and by the words they did not say, they led the residents to think that the building was safe. All during the time when it was gradually decaying. And up until the moment when it fell. The Board was getting away with it, while knowing that it cannot be gotten away with forever.
Four, it seems likely there was a corrupt element. Cronyism. We are not casting aspersions on the Board of this particular building, but instead speaking in general to all situations of long-term neglect of maintenance required for safety. From voting not to increase the assessment, out of deference to some residents who may have wanted to sell soon or who were old enough that they expected that any disaster would be after they were gone, to the choice of engineering firms and those contractors they hired, there is often a perverse incentive at work. Board members will not gain any popularity, if they vote for big assessments to spend on things that most people don’t see. Conversely, those who say there’s no need to spend now will win over most of the residents who vote for their reelection.
Five, this is a clear example of consumption of capital. While their building decayed, leading inexorably towards its collapse, the residents were spending more on Bimmers, boats, and benders to Vegas than they could really afford. If, that is, they were paying for the necessary work to keep their tower standing. By not paying to upkeep the capital in the form of the building, they could consume more. It’s a false economy, that seems to be working for decades.
Six, and this may be the most counterintuitive point about the monetary system. We hope that seeing it in this analogous situation with a collapsed building, it becomes clearer. The decay in value—and certainly market price—is not linear. We assume that the selling price of a condo in this building held steady up until 23 June. Zillow shows one unit sold for $700k as late as 17 June. On 24 June, the price went to zero. This is because it’s not a problem of quantity, dilution, hidden tax, or a transfer of purchasing power. It is a problem of soundness. That is, the building slowly became unsound as the structure rotted. Then it failed, catastrophically. Such failures tend to be that way.
Finally, there are horrific consequences. These are suffered by guilty and innocent alike. Whether one voted for or against spending to repair the building, one can be killed in the collapse. And the same is true about monetary collapse. Indeed, in a catastrophic failure, one may be lucky to get out alive.
In certain things, there are perverse incentives. Those in charge seek to cheat, neglect the capital, and conceal the consequences. So consumptions of the edifice on which everyone depends continues. This dynamic is especially dangerous when the people are aggressively indifferent, when they eagerly look away because they feel it expedient to do so. On the surface, everything seems to be working, which is to say they’re temporarily getting away with it. But the structure that holds it up is degrading. This process can go for a long time, perhaps many decades.