BIS says gold is money

[Ad Orientem]

The Bank of International Settlements is adding to the trend towards monetization of gold.

See this post from friend of the forum Bron Sucheki...
http://goldchat.blogspot.com/2012/06/bi ... odity.html

[craigr]

But all of these investing gurus keep telling me it's just a worthless yellow metal? You mean these banks hold tons of the stuff in their vaults for reasons other than it looks pretty? Bizarre!

[bronsuchecki]

Also see this from FT Alphaville http://ftalphaville.ft.com/blog/2012/06 ... old-swaps/

See also this comment on that article from a Philip Pilkington (known gold hater on that site):

"The 456t annual buying is nothing when compared to the fact that CBs hold 30,922t of gold. Why do they hold it?"

Good question. Hangover from Bretton Woods?

"If it is not rational then why are we allowing them to be in control of anything?"

Not so good question. CBs do dumb stuff all the time. Doesn't mean its time to go back to frontier banking.
And my response

@Philip

Hangover from Bretton Woods is a weak answer, but not as weak a Ben's answer to the same question from Ron Paul, which was "tradition". That was a telling answer. I think it is because they know their currencies are, well, fiat.

Re frontier banking - no, I'd rather take my chances with Free Banking rather than relying on some wizard of oz to correctly pull a few levers and think that that can control a complex feedback infested economic system.