Wednesday, July 7, 2010

Cash for gold scam! BIS giving cash to European banks in exchange for their gold holdings -

July 7th, 2010 by stacyherbert
Stacy Summary: Unbelievable, truly unbelievable. Wonder why the BIS is taking the gold as collateral from the European banks rather than just a paper promise? Don’t the BIS know they can’t eat gold?

European commercial banks have begun using their holdings of gold to raise cash with the Bank for International Settlements, in a further sign of strains in the money markets on which many rely for funding.

The BIS, the so-called “central banks’ central bank”, took 346 tonnes of gold in exchange for foreign currency in “swap operations” in the financial year to March 31, according to a note in its latest annual report.

In a gold swap, one counterparty, in this case a bank, sells its gold to the other, in this case the BIS, with an agreement to buy it back at a later date.

In the past the BIS has occasionally engaged in gold swaps.

There has been no mention, though, of any such operation in recent years.

The BIS annual report says the gold received in the swaps was held “at central banks”.

The swaps are being blamed for gold crashing as seen in this gold chart:

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