Eric Sprott and David Baker expand: The Committee’s newest ‘framework’
One of the most important facets of Basel III is that it will treat gold as an asset class. Many specialists think Basel III may officially label gold as a “Tier 1” asset in addition to money and AAA-government securities. Banks will have elevated incentive to select gold vs. money or bonds if gold is granted “a favorable liquidity profile below its proposed Basel III framework.” Why would they select otherwise when gold continues to outperform the U.S. dollar and bonds? Rare Coins, Silver Coins, Gold Coins, Learn more >> http://www.silverpricestoday.cc/
Other banks across the globe - non-Western banks - have already adopted this philosophy in regards to their foreign exchange reserves, vulnerable to erosion from 'Central Planning' currency printing programs, according to Sprott and Baker.
Turkey and China are two nations that have been encouraging their citizens to own physical gold. Turkey is doing it to increase the country's financial savings rate “and propel loan development.”
In the midst of all this, Basel III would add a new layer of regulation concerning relative liquidity of the bank's assets and liabilities.
Nevertheless, the Basel Committee and also the FDIC stay elusive. Apart from a study paper from April and one conference call on behalf of Eric Sprott, the groups have kept silent regarding gold's liquidity. Still, that paper and phone call recommended that gold will be give a 15% liquidity cut, even though which has not been officially confirmed from Basel or the FDIC. We'll simply have to wait and see if the fragile fate of our financial wywtem can be saved using the valuable yellow metal. Printing currency for liquidity, can't resolve these basic issues.” My suggestion would be to purchase gold and silver to prepare for the coming monetary storms ahead. Better be safe, than sorry! How high will silver go? Learn more >> http://silverpricestoday.cc/