Gold stock (revaluation) can be used to rebuild if TSHTF (Dutch Central Bank)

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I saw this posted at ZH. I didn't attach the same level of importance to it that ZH did, but I do find it curious. Someone at the DNB probably going to lose their job after letting this get published (emphasis is mine):
...
Shares, bonds and other securities are not without risk, and prices can go down. But a bar of gold retains its value, even in times of crisis. That is why central banks, including DNB, have traditionally held considerable amounts of gold. Gold is the perfect piggy bank – it's the anchor of trust for the financial system. If the system collapses, the gold stock can serve as a basis to build it up again. Gold bolsters confidence in the stability of the central bank's balance sheet and creates a sense of security.
...
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https://www.dnb.nl/en/payments/goud/index.jsp
 
But how could that be? Don't they know metals like Gold & Silver are worthless? :paperbag:
 
Yes I also saw this but on another website and when you read the words its a fairly neutral statement from DNB. Why wouldnt you offer a bit of worst case scenario ? -

https://www.dnb.nl/en/payments/goud/index.jsp#

and I cannot establish a date for it ..........


The ZH treatment of it is a fairly typical example of ZH's need for drama.
 
What surprised me the most upon reading it was that an editor of content for the website of a central bank apparently thought it OK to allow a comment hypothesizing the ultimate failure of the institution. I mean, it's supposed to be one of those elephants in the room that no one acknowledges.
 
By selling and immediately buying back some of its gold reserves, the central bank of Curaçao and Saint Martin managed to use its gold revaluation account to offset losses in 2021. Because many other monetary authorities are currently making losses too—and there is no limit to revaluing gold against fiat money—this trick could be used the world over to heal central banks’ balance sheets.
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A gold revaluation account (GRA) is an accounting item that records unrealized gains (or losses) of gold assets. When the price of gold rises, as it inevitably does in the long run, gold assets increase in value and concurrently the GRA swells. As a formula:

GRA = present gold market value – gold purchasing cost

The GRA is usually part of a central bank’s equity (net worth), while it’s not part of its capital (a narrower definition of equity)*. By their own rules, central banks can’t use their GRAs to cover general losses.
...
Late in 2022 the Dutch central bank (DNB) revealed it was suffering losses due to rising interest rates after consecutive years of Quantitative Easing (QE). During QE it bought domestic government bonds that yielded close to nothing with newly created reserves. When the European Central Bank instructed DNB to raise interest rates to combat inflation, its interest expenditures on reserve liabilities exceeded interest income from its assets, which equals a loss.

DNB Governor Klaas Knot was interviewed about losses and a weakening balance sheet in October 2022. Knot mentioned Dutch taxpayers possibly need to recapitalize their central bank as EU statutes prescribe. However, he also brought up DNB's GRA as a solvency backstop:
The balance sheet of the Dutch central banks is solid because we also have gold reserves and the gold revaluation account is more than 20 billion euros, which we may not count as capital, but it is there.
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Based on Knot’s remarks, and an email exchange I had with the German central bank prior, I speculated DNB and other central banks could change the accounting rules for their GRAs to absorb losses. Why let taxpayers foot the bill if GRAs can be used? More recently, I discovered a loophole through which some central banks can use their GRAs for this purpose.
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The central bank of Curaçao and Saint Martin (CBCS) ...
...
In 2021 CBCS decided to sell and immediately buy back 2,945 ounces of gold to turn an unrealized gain into a realized gain to offset losses. The value of the gold traded was NAf 9.55 million. On page 51 of their Annual Report 2021 it shows the metal was sold and repurchased at exactly the same price, implying the trades were handled off the market.
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More:

www.gainesvillecoins.com

How a Central Bank in the Caribbean Recently Used Its Gold Revaluation Account to Cover Losses

By selling and immediately buying back some of its gold reserves, the central bank of Curaçao and Saint Martin managed to use its gold revaluation account to offset losses in 2021. This trick could be used the world over to heal central banks’ balance sheets.
www.gainesvillecoins.com www.gainesvillecoins.com
 
From the article;

"the international monetary system can be deleveraged and stabilized by a substantial higher price of gold. More gold (a higher value) on the balance sheets of central banks increases the ratio of hard assets (gold) against international credit assets (foreign exchange), and hard assets against credit liabilities"

As of last thursday the federal reserve valued it's gold at 42 bucks an ounce plus change on it's balance sheet.

Federal Reserve Balance Sheet: Factors Affecting Reserve Balances - H.4.1 - March 30, 2023

The Federal Reserve Board of Governors in Washington DC.
www.federalreserve.gov
 
Jan's latest post on this subject:
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Multiple large central banks are currently operating at a loss while public debt levels are elevated. In this article we will examine how central banks' gold revaluation accounts can offer solace in these challenging financial environments. Central banks’ accounting rules are but fictional obstacles, as these are self-imposed and can be discarded.
...
Click to expand...

More (long):

www.gainesvillecoins.com

How Central Banks Can Use Gold Revaluation Accounts in Times of Financial Stress

In this article we will examine how central banks' gold revaluation accounts can offer solace in challenging financial environments, such as high public debt.
www.gainesvillecoins.com www.gainesvillecoins.com
 
In a recent interview the Dutch central bank (DNB) shares it has equalized its gold reserves, relative to GDP, to other countries in the eurozone and outside of Europe. This has been a political decision. If there is a financial crisis the gold price will skyrocket, and official gold reserves can be used to underpin a new gold standard, according to DNB. These statements confirm what I have been writing for the past years about central banks having prepared for a new international gold standard.
...
Click to expand...

More (long and fascinating):

www.gainesvillecoins.com

Dutch Central Bank Admits It Has Prepared for a New Gold Standard

Interview reveals Dutch central bank (DNB) has equalized its gold reserves to the eurozone and rest of world. Could official gold reserves underpin a new gold standard?
www.gainesvillecoins.com www.gainesvillecoins.com
 


Around the 11:20 mark, Andrew Maguire talks about gold revaluation. He claims the Jubilee happens early 2024.
 
86nq0q.jpg
 
Jan Nieuwenhuijs said:
The Polish central bank has bought roughly 300 tonnes of gold in recent years to bring its gold to GDP ratio in line with the average in the eurozone. For medium and large economies in the eurozone, to which Poland might be included in the future, an equal monetary gold to GDP ratio is a covert requirement for nations to be prepared for a shift to a new gold standard. Based on these requirements I expect Poland to buy an additional 130 tonnes of gold.
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Click to expand...

More:

www.gainesvillecoins.com

Polish Central Bank Buys Gold According to Secret EU Plan

The Polish central bank has bought roughly 300 tonnes of gold in recent years to bring its gold to GDP ratio in line with the average in the eurozone.
www.gainesvillecoins.com www.gainesvillecoins.com
 
If TSHTF-EOTWAWKI - the rebuilding won't need gold.

It will need MATERIALS and SKILLED LABOR.

I guess this is the banksters and arbitragers all showing their Normalcy Bias. Yeah, a devastated world needs MONEY MEN!

I don't think so. That comes after trade, which comes after surplus, which comes after back-breaking WORK.
 
Casey Jones said:
If TSHTF-EOTWAWKI - the rebuilding won't need gold.

It will need MATERIALS and SKILLED LABOR.

I guess this is the banksters and arbitragers all showing their Normalcy Bias. Yeah, a devastated world needs MONEY MEN!

I don't think so. That comes after trade, which comes after surplus, which comes after back-breaking WORK.
Click to expand...
However what will the people supplying the materials and skilled labour want in consideration for their products?
 
Dollars said:
However what will the people supplying the materials and skilled labour want in consideration for their products?
Click to expand...
Food...liquor...nookie...just like with all devastated societies, postwar, post-disaster, whatever.

Only when the dust settles, and a new normal asserts, will trade for tokens, chits, representations, begin.

A man who hasn't eaten in two days, isn't going to take logs off your wagon...for a gold coin. Not happening.
 
DYODD............

Inside The European Union's Secret Plan For Gold​

Dec 6, 2023


15:17

The EU has a plan for gold that not many expected. If we track data for gold for some nations that are in the EU or want to be, we have an indication of what is to come.
 
In a SHTF scenario I will finally realize the true value of my beanie baby collection. That thing is gonna keep me in high cotton for years!
 
Was re-reading this thread this morning and realized that it does not yet contain an obligatory reference:

Tradition!
 
More commentary on the issue (decent summary):
... Gold-holding central banks in Europe seem likely to resort (either formally or informally) to using their gold revaluation accounts to plug balance sheet losses to be unveiled in coming years. ...
...
... De Nederlandsche Bank President Klaas Knot remarked in a November 2022 interview that the current gold revaluation accounts can be used to restore central bank balance sheets: ...

Earlier this year, Bundesbank executive board member Joachim Wuermeling agreed gold revaluation accounts could be used to cover losses on the balance sheet: ...
...
International market participants as well as central bankers around the world will be watching whether – perhaps after the presidential election in less than 12 months – the US will move towards any explicit or implicit gold revaluation. That would mark a further step in gold’s long journey back towards the centre of the monetary stage.
Click to expand...

www.omfif.org

Central banks and the revival of gold - OMFIF

Is this an opportunity to restore balance sheets?
www.omfif.org www.omfif.org
 
Went from $20.67 to $35 or +69% in 1934!

A similar move would put gold @ $3400+ today.
 
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