There was a meeting in Dubai this past weekend with various ministers and economists. And one of the leading economists in Britain made a comment that caught my attention. He essentially said that there was an inevitability that gold would become part of a global Special Drawing Rights (SDR). He also said it would certainly help if China told us how much gold they have. But you have to back to when gold plunged roughly 30 percent in 2013. Everyone expected the Bank for International Settlements to say that gold was a qualify top-tier liquidity buffer in the event of another 2008 – 2009 liquidity event. Ultimately the decline in 2013 mainly took place because the Bank for International Settlements did not mention gold as one of the assets that qualified as a liquidity buffer. In fact, gold was not mentioned at all.
At that point gold started to behaving in a way that was counterintuitive. When things got rough in Europe, there was really no upside response in the gold market. And when the crisis erupted in Cyprus, the gold market actually declined.
Please follow SGT Report on Twitter & help share the message.