Gold Reserves in Doubt

Why Germany Wants to See its US Gold

Der Spiegel – SVEN BOLL & ANNE SEITH – Oct 30, 2012

For decades, German central bankers have contented themselves with written affirmations from their American colleagues that the gold still remains where it is said to be stored. According to the report, the bar list from New York stems from “1979/1980.” The report also noted that the Federal Reserve Bank of New York refuses to allow the gold’s owners to view their own reserves. Go to story

Sure, there’s probably still gold in central bank vaults, but how many claims to it? – CHRIS POWELL, Sec/Treas, GATA – Oct 28, 2012

“The compartments do not have labels reading ‘Germany’s gold’ and so on. They are instead numbered, and only a few people at the Fed know what numbers correspond to which country. The Fed says it does this to protect the privacy of the depositors. But this also makes actual inspection less reliable. There’s no way for Germany to know that the gold it is being shown is Germany’s, as opposed to some other depositor’s. In an extreme case — which I have no reason to believe is true — miscreants at the Fed could just show everyone who came to visit the same pile of gold.” Go to story

From gold to paper to electronic to will o’ the wisp

What is your money worth?

excerpt from Conversation, Toronto, June 17, 1976:

HARI-SAURI: …One of the major issues always in political battles is how would you control inflation, how would you solve the inflation problem?

PRABHUPADA: Inflation problem, I suggested, make gold coins as medium of exchange.

HARI-SAURI: That means that there’ll be the same…, it’ll have the same value all over the world.

PRABHUPADA: No question of value. Money has to be paid by real money-gold, silver. No paper.

HARI-SAURI: But whether it’s gold or paper, isn’t it all just representative of…

PRABHUPADA: No, medium of exchange.


PRABHUPADA: If I have to pay you, if you don’t accept paper, then I’ll have to give you gold or silver, and international exchange is going on. Then there is no inflation, because you’ll not accept paper, so what is the use of printing notes? They are printing notes without any gold reserve.

HARI-SAURI: Nothing. It’s just imaginary wealth.

PRABHUPADA: That’s it. Bank will give you loan, they are eager to give you loan, and you haven’t got to pay anything in gold and silver. One check, that’s all. And with that check you can purchase lots of commodities and hoard it, and price will be increased. If I have to pay gold for (indistinct), then I have limited source. The price will not increase. This is the only way. Introduce gold only, gold and silver. In the British period in our childhood there was practically no notes. Silver. If I have to take payment from you, one thousand rupees, you will give me so much silver. For counting, counting, I have to see whether it is…. There were some imitation, counterfeit. So each coin you have to see, they were saying like that, that, “For thousand rupees I have to occupy so much space.”

HARI-SAURI: And weighed so much.

PRABHUPADA: Yes, and weight was so much.

Wealth in gold, land, cows

excerpt from: Conversation, Los Angeles, December 31, 1973:

PRABHUPADA: …Issue metal coin and the problem will be solved. But they will not take your advice.

PRAJAPATI: This is part of our platform. To even run for political office, we need solutions to the problems to offer as a platform. We will draw up various bills, ready for legislation, show them that we are serious.

PRABHUPADA: So how you’ll present it? The cheating process is going on. Unless you become God conscious, the cheating process will not stop. So there is no solution.

PRAJAPATI: So therefore we introduce bill into the schools to introduce God consciousness to all the children there.

PRABHUPADA: Yes. God consciousness. Then everyone will be honest, and everything will be adjusted. Everyone can understand this is pure cheating. I give you a hundred dollars, a piece of paper. That’s all. And you accept it. You want to be cheated. You thought, that “I have got now daily, hundred dollars. So let me work very hard.” He does not consider that “I am not getting a hundred dollars. I am getting a piece of paper.” So people have no brain to understand even. “This is not hundred dollars. Give me cash, hundred dollars.” Then everything, solution will be… There will be no inflation. Because I know that paying you a piece of paper, I can cheat you, therefore I am printing notes, to cheat so many people. Therefore inflation. But when there will be no possibility to cheat you, then there will be no inflation. Here I have got the opportunity, because I know that pushing forward a piece of paper, I can cheat so many people. So there must be inflation. Is it not? This is not psychological? If I know that I can cheat you by this instrument, so why shall I not increase that? That is inflation. What do you think, Karandhara?

KARANDHAR: That’s the basic principle, yes.

PRABHUPADA: Yes. I am cheating you, and people accepting my cheating.

KARANDHAR: The governments actually started the whole thing. They instituted paper money and they instituted it because it is a cheating process. But everyone is participating. So it is just going on and on. That is the real cause of inflation.

PRABHUPADA: Yes. That’s it. They are getting encouragement in their cheating business.

BAHULASVA: They won’t let you have any gold.

PRABHUPADA: Now they have made law that you cannot store gold?

KARANDHAR: That’s been since 1933.


KARANDHAR: Americans cannot own gold, store gold. Pretty soon they are going to pass the same law for silver.

PRABHUPADA: Just see. Even they cannot have ornaments.

KARANDHAR: Well, you can have ornaments, jewelry.

PRABHUPADA: So by law they are cheating. So how you can stop?

KARANDHAR: Now they have introduced a law that even the penny, which is the smallest denomination, it used to made out of copper, so now they are going to make it out of aluminium, because copper is too expensive.


BAHULASVA: It will be worth less than a penny when it is made out of aluminium.
PRABHUPADA: Why not cement? (laughter) Because by law everything will be acceptable. Make it cement.

BAHULASVA: Srila Prabhupāda, what can we do to curb down these rascals?

PRABHUPADA: Chant Hare Kṛṣṇa.

BAHULASVA: That will curb them down.

PRABHUPADA: Yes. They will be purified. The more you chant Hare Kṛṣṇa, they will be purified. This is… All problems are there on account of misunderstanding. What we are distributing? We are simply moving misunderstanding and bringing them to knowledge. This is our propaganda. So Mr. Theologician, is this suggestion appealing to you?

PRAJAPATI: It seems all right for ordinary dealings, Srila Prabhupāda, having this money, what’s going on, but for large scale transactions it might be very difficult.

PRAJAPATI: And as the practical basis, transactions of thousands and thousands of dollars, would be…

PRABHUPADA: That will be good for the people. Because large scale transaction is there, therefore the capitalists hoarding. Capitalists hoarding. Goods are there, everything is there. You pay black price, you get it. Then, when somebody’s hoarding, he is not giving to the market. So if the large scale industry and trade becomes stopped, that is good for people.

JAGAJIVANA: Does that mean the same amount of gold is here?

PRABHUPADA: No, larger scale… Suppose if you want to store, say, thousand kilos or a thousand bags of rice, so you have to pay me gold. But you have no such gold. Therefore large scale industry will be stopped. Just see.

KARANDHAR: Then the price of rice would go very low.

PRABHUPADA: Yes. Then you get actual price and actual value. Goods are there, any part of the world you…, there is enough commodity. But these rascals, they are hoarding, and they are not giving in right time. So people are suffering.

KARANDHAR: Yes. There’s a… They buy now. They buy the goods before they are even grown, from the commodity market.

PRABHUPADA: Yes, because they can pay in this paper, the bank will advance. So as soon as you… You have to introduce this metal coins, value. The whole cheating scheme will fail. … And gold is such a metal, any part of the country, any part of the world you go, you get immediately value.

KARANDHAR: Yes. Whenever there is an economic depression, then gold remains valuable. Just like when the stock market crashed in 1929, if you had gold you could still purchase goods. No matter how bad the economy was, people would accept gold as barter, but not currency.

PRABHUPADA: Yes. Indian economy was that if you have got extra money, you get gold ornament for your wife. So then your money is stocked there. Or purchase some utensils, silver utensils. That was Indian economy. This depositing in the bank and thinking that I am getting good interest, that is another cheating. It is another cheating. If things are not available, what will you get by getting interest? Therefore I am advising that purchase land and produce our own food. There will be no problem.

KARANDHAR: The inflation rate is higher than the interest rate. If you earn 5 3/4 % interest in a year, the inflation has gone up 6% in a year. So actually your money, at best it’s kept the same.

PRABHUPADA: The money is to be kept in cattle and grains. That is Indian economy, cattle and grains. If you have got many cows, you get milk. Milk preparation. And if you have got grain, then where is your problem? You prepare your foodstuff at home and eat and chant Hare Kṛṣṇa. Where is your problem? You want to eat and live peacefully. So if you have got grains and milk, you have got enough food and there is no problem. You haven’t got to go fifty miles for your work, and then you require a tin car. So many problems. But if you get your food at home, then eat them and chant Hare Kṛṣṇa and go back to home, back to Godhead. Simple thing.

This entry was posted in Economy, Money and tagged , , , . Bookmark the permalink.

Leave a Reply