Gresham's law is an economic principle that states 'when a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.'
And notice how the Western financial media views this phenomenon.
China Savers Buying Gold As 'Rest of the World' Exits
The 'Rest of the World' apparently does not include India, Russia, Turkey, much of the Mideast, and the European central banks who have been busy trying to repatriate their gold from New York and London.
I have included a chart showing 'Silk Road' gold consumption below.
In addition to all the wealthy individuals in the US and UK who are buying it for their own private vaults.
Who are the idiots who own most of the gold in the central bank crowd anyway? The numbers are a bit hard to come by because for some reason the bankers are notoriously secretive in response to questions.
The 'official gold reserves' of all central banks in the world is also included below. And the biggest goldbugs are the US, Germany, Italy, France, the IMF, Russia, China, Switzerland, Japan and the Netherlands.
True, a few central banks have disgorged some of their gold. The UK sold quite a bit of their sovereign reserves at the bottom, the lowest price for gold in dollars. Brown's Bottom it was called, presumably to rescue some 'trading houses' who were caught short.
"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it."One might wonder what has some of the NY and London banking crowd so worked up? What have they gotten themselves into now? Their spokesmodels have been quite active in the media lately.
Sir Eddie George, Bank of England, September 1999
I am sure the truth of this will come out some day. Most likely over some long weekend.
This is how Nixon unilaterally took the US off the international gold standard, and declared a new fiat regime for 'the rest of the world' under the rule of the US dollar reserve, thereby rewriting the Bretton Woods agreement by executive decree.
Is it true that only a few 'goldbugs' really care about this and no one else?
Most of the central banks know the truth of things. They are just keeping quiet about it for now, for whatever reason. I suspect that they are receiving pressure related to the antics of one or more of the Banks.
"Gold is unique among assets, in that it is not issued by any government or central bank, which means that its value is not influenced by political decisions or the solvency of one institution or another."Do these fellows take us for complete fools? Really?
Salvatore Rossi, Central Bank of Italy, 30 Sept 2013