Council on Foreign Relations

Alan Greenspan: Gold Is A Currency, And Currently A Good Investment

Back in late October I recall The Wall Street Journal talking about some comments made by former Federal Reserve Chairman Alan Greenspan to the Council on Foreign Relations concerning gold. I’ve been meaning to look into what Greenspan, who served as Fed Chair from 1987 to 2006, actually said about the precious metal. During lunchtime, I dug up the final version of the transcript from his visit with the CFR in New York City on October 29, 2014. From the exchange between the president of Greenspan Associates LLC and presider Gillian Tett:

TETT: I’m going to turn to the audience for questions in one minute, but before I do though, I just want to ask though, one of the really interesting chapters in your book is about gold. And there’s been a lot of media debate in the past about your views on gold.

You yourself oppose a question as to why would anyone want to buy this barbarous relic — I don’t know whether John Paulson is in the audience — but it’s an interesting question. But do you think that gold is currently a good investment given what you’re saying about the potential for turmoil?

GREENSPAN: Yes.

(LAUGHTER)

TETT: Do you put…

GREENSPAN: Economists are usually perfect in equivocating. In this case I didn’t equivocate. Look, remember what we’re looking at. Gold is a currency. It is still by all evidences the premier currency where no fiat currency, including the dollar, can match it. And so that the issue is, if you’re looking at a question of turmoil, you will find, as we always have in the past, it moves into the gold price.

But the gold price is actually sort of half a commodity price, so when the economy is weakening, it goes down like copper. But it’s also got a monetary characteristic which is instrinsic. It’s not inbred into human beings — I cannot conceive — of any mechanism by which you could say that, but it behaves as though it is.

Intrinsic currencies like gold and silver, for example, are acceptable about a third party guarantee. And, I mean, for example at the end of World War II, or just at the end of it, Germany could not import goods without payment in gold. The person who shipped the goods in would accept the gold, and didn’t care whether there was any credit standing — associated with it. That is a very rare phenomenon. It’s — it’s the reason why, for example, in a renewal of an agreement that the central banks have made — European central banks, I believe — about allocating their gold sales which occurred when gold prices were falling down, that has been renewed this year with a statement that gold serves a very important place in monetary reserves.

And the question is, why do central banks put money into an asset which has no rate of return, but cost of storage and insurance and everything else like that, why are they doing that? If you look at the data with a very few exceptions, all of the developed countries have gold reserves. Why?

TETT: I imagine right now, it’s because of a question mark hanging over the value of fiat currency, the credibility going forward.

GREENSPAN: Well, that’s what I’m getting at. Every time you get some really serious questions, the 50 percent of the gold price determination begins to move.

TETT: Right.

GREENSPAN: And I think it is fascinating and — I don’t know, is Benn Steil in the audience?

TETT: Yes.

GREENSPAN: There he is, OK. Before you read my book, go read Benn’s book. The reason is, you’ll find it fascinating on exactly this issue, because here you have the ultimate test at the Mount Washington Hotel in 1944 of the real intellectual debate between the — those who wanted to an international fiat currency which was embodied in John Maynard Keynes’ construct of a banker, and he was there in 1944, holding forth with all of his prestige, but couldn’t counter the fact that the United States dollar was convertible into gold and that was the major draw. Everyone wanted America’s gold. And I think that Benn really described that in extraordinarily useful terms, as far as I can see. Anyway, thank you.

TETT: Right. Well, I’m sure with comments like that, that will be turning you into a rock star amongst the gold bug community…

(Editor’s note: Bold added for emphasis)

I’m not sure if the above will mean Greenspan is now a rock star among the “gold bugs”- he’s still considered by many as being a habitual asset bubble blower. But such a high-profile individual within the global financial community lending support to the ideas that gold is a currency and currently a good investment will no doubt anger a number of gold bears and haters.

You can read the entire transcript of Greenspan’s visit to the CFR on their website here.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

Tags: , , , , , , , , , , , , , ,

Nuclear Material On The Loose

“The Obama administration is warning that the danger of a terrorist attack with nuclear weapons is increasing, but U.S. officials say the claim is not based on new intelligence and questioned whether the threat is being overstated.”

Washington Times, April 14, 2010

I don’t agree with President Obama on a number of things, but here’s one we do see eye-to-eye on:

The threat posed by nuclear terrorism.

Consider recent events in the former Soviet Union. Desmond Butler of the Associated Press reported back on December 9:

Despite years of effort and hundreds of millions of dollars spent in the fight against the illicit sale of nuclear contraband, the black market remains active in the countries around the former Soviet Union. The radioactive materials, mostly left over from the Cold War, include nuclear bomb-grade uranium and plutonium, and dirty-bomb isotopes like cesium and iridium.

The extent of the black market is unknown, but a steady stream of attempted sales of radioactive materials in recent years suggests smugglers have sometimes crossed borders undetected. Since the formation of a special nuclear police unit in 2005 with U.S. help and funding, 15 investigations have been launched in Georgia and dozens of people arrested.

(Editor’s note: Italics added for emphasis)

And what of the years between 1991 (Georgian independence) and 2005? I shudder to think how much radioactive material might have found their way across the Georgian border and into the hands of the bad guys during those 14 years.

According to the piece, highly-enriched uranium has also recently been seized from smugglers in Moldova, another former Soviet republic.

From the Council on Foreign Relations website:

There have been no confirmed reports of missing or stolen former-Soviet nuclear weapons, but there is ample evidence of a significant black market in nuclear materials. The International Atomic Energy Agency (IAEA) has reported more than a hundred nuclear smuggling incidents since 1993, eighteen of which involved highly enriched uranium, the key ingredient in an atomic bomb and the most dangerous product on the nuclear black market.

(Editor’s note: Italics added for emphasis)

That portion of the CFR website was last updated in January 2006.

While the Council said there have been no confirmed reports of missing or stolen nuclear weapons, the same can’t be said of nuclear material. Butler added:

Russia maintains that it has secured its radioactive material — including bomb-grade uranium and plutonium — and that Georgia has exaggerated the risk because of political tension with Moscow. But while the vast majority of the former Soviet Union’s nuclear arsenal and radioactive material has been secured, U.S. officials say that some material in the region remains loose.

“Without a doubt, we are aware and have been over the last several years that not all nuclear material is accounted for,” says Simon Limage, deputy assistant secretary for non-proliferation programs at the U.S. State Department. “It is true that a portion that we are concerned about continues to be outside of regulatory control.”

(Editor’s note: Italics added for emphasis)

“U.S. officials say that some material in the region remains loose.”

If smuggling is taking place and the whereabouts of the nuclear material is unknown, I wonder if the above shouldn’t be changed to “some material from the region remains loose?”

Since illegal aliens and drugs routinely manage to find their way into the United States, it requires no stretch of the mind to envision nuclear material for a terrorist weapon also being smuggled in.

Butler’s incredibly-informative piece be read on the Yahoo! News website here.

Tags: , , , , , , , , , , , , , , , , , , , ,

Friday, December 21st, 2012 Crime, Europe, Public Safety, Terrorism No Comments


Survival And Prosperity
Christopher E. Hill, Editor
Est. 2010, Chicagoland, USA

Successor to Boom2Bust.com
"The Most Hated Blog On Wall Street" (Memorial Day 2007-2010)

Please Rate this Blog HERE

Limited Time Offers

Via Banner Ads Below (navigate to vendor home page if necessary); Updated 9/3/15:
ANY CHARACTER HERE
>Airsoft Megastore Free Shipping On All Orders (no code required)
ANY CHARACTER HERE
>BGASC On Sale Now 1 Oz. SilverTowne Eagle Silver Bar; 5 Oz. Monarch Silver Bar; 100 Oz. Asahi Silver Bar
ANY CHARACTER HERE
>BUDK 25% Off Sale ($39 min. order; code needed)
ANY CHARACTER HERE
>BulletSafe Bulletproof Baseball Cap $119 Pre-Order Price; Ballistic Plate Only $169
ANY CHARACTER HERE
>CHIEF 20% Off Rainwear Thru 9/30 (code needed); Free 5.11 Tactical Boot Knife With Boot Purchase Thru 10/1
ANY CHARACTER HERE
>Food Insurance Free Emergency Supplies With Long-Term Meal Plan; Save Up To 43% On Freeze-Dried Seasoned Ground Turkey Pieces
ANY CHARACTER HERE
>Nitro-Pak Labor Dale Sale Save Up To 40% Off Thru 9/7
ANY CHARACTER HERE
>Pyramyd Air Labor Day Sale Discounts/Coupon Savings Up To 50% Off
ANY CHARACTER HERE
>Tractor Supply Co. Labor Day Sale (Too Many Savings To List!); Free UPS Ship To Store
NEW! Advertising Disclosure HERE
ANY CHARACTER HERE
Buy Gold And Silver Coins BGASC Review Coming Soon
ANY CHARACTER HERE
Free UPS ship to store on all Tractor Supply Company orders! Shop now! Tractor Supply Co. Review Coming Soon
ANY CHARACTER HERE
Nitro-Pak--The Emergency Preparedness Leader Nitro-Pak Reviewed HERE
ANY CHARACTER HERE
MyPatriotSupply.com Reviewed HERE
ANY CHARACTER HERE
Food Insurance Reviewed HERE
BullionVault BullionVault.com Reviewed HERE
ANY CHARACTER HERE
CHIEF Supply Reviewed HERE
ANY CHARACTER HERE
BulletSafe Reviewed HERE
ANY CHARACTER HERE
BUDK bowie knife BUDK Reviewed HERE
ANY CHARACTER HERE
Pyramyd Air is your one-stop shop for everything airgun related. PyramydAir.com Reviewed HERE
ANY CHARACTER HERE
Airsoft Megastore Reviewed HERE
ANY CHARACTER HERE
Survival Titles Save 20% Paladin Press Reviewed HERE
 

Categories

Archives

Prepper Website
  • Observation, Theory About Greek Bank Safe Deposit Box Restrictions

    Continuing “Greek Week” on Offshore Safe Deposit Boxes, Greek state television has announced Greek banks will remain closed for the remainder of this week. Both Reuters and the Associated Press have reported cash withdrawals from Greek bank safe deposit boxes have been prohibited. Reuters ran its story Sunday while the Associated Press revealed Monday: No […] ...
  • Safe Deposit Boxes In Private Vaults See ‘Huge Increase In Demand’ By Wealthy Greeks

    While pouring over the latest news of Greece’s sovereign debt crisis tonight, I spotted the following snippet on the Daily Mail (UK) website. Nick Fagge reported Wednesday: Safety-box deposit firms have reported a huge increase in demand with wealthy Greeks storing their cash and other valuables anywhere other than their bank… (Editor’s note: Bold added […] ...
  • Confusion Over Accessing Cash In Greek Bank Safe Deposit Boxes

    Yesterday, I blogged about a Reuters piece from Sunday which said cash withdrawals from Greek bank safe deposit boxes were now prohibited. Monday, the Associated Press reported that accessing currency from these containers might be left to the legislative process. From the Fox News website: There was confusion Sunday night over the fate of bank […] ...
  • Cash Withdrawals From Greek Bank Safe Deposit Boxes Forbidden

    Something tells me confidence in bank safe deposit boxes is going to plummet as word of the following gets out. Reuters’ Lefteris Papadimas and George Georgiopoulos reported Sunday: Greeks cannot withdraw cash left in safe deposit boxes at Greek banks as long as capital restrictions remain in place, a deputy finance minister told Greek television […] ...
  • Happy Independence Day!

    Just wanted to wish readers of Offshore Safe Deposit Boxes a happy Independence Day. Christopher E. Hill Editor ...