25 Mar 13
Why would a bank do this?
http://www.silverdoctors.com/dutch-bank-abn-amro-halts-physical-gold-delivery/
I have never understood why anybody would not want to hold physical gold and have a mere piece of paper. Sure, that paper is supposed to be backed by gold but why trust a bank so much? They could be selling it without your knowledge and you would not know it. I would pull it out immediately if I had any gold there.
Will it result in a run? Will other banks do the same?
25 Mar 13
Originally posted by Metal BrainNot everyone wants to physically hold all of their wealth. Even if I did not get interest (and you virtually don't in a bank), I would not want all of my money in my house. I do not think it is illogical to have an institution that you trust hold gold or money for you. But, as you point out, there are risks in trusting others.
Why would a bank do this?
http://www.silverdoctors.com/dutch-bank-abn-amro-halts-physical-gold-delivery/
I have never understood why anybody would not want to hold physical gold and have a mere piece of paper. Sure, that paper is supposed to be backed by gold but why trust a bank so much? They could be selling it without your knowledge and you wou ...[text shortened]... immediately if I had any gold there.
Will it result in a run? Will other banks do the same?
25 Mar 13
Originally posted by Metal Brain"You can no longer request physical delivery of your precious metals from us ".
Why would a bank do this?
http://www.silverdoctors.com/dutch-bank-abn-amro-halts-physical-gold-delivery/
I have never understood why anybody would not want to hold physical gold and have a mere piece of paper. Sure, that paper is supposed to be backed by gold but why trust a bank so much? They could be selling it without your knowledge and you wou ...[text shortened]... immediately if I had any gold there.
Will it result in a run? Will other banks do the same?
Sounds like you have to go pick up your gold yourself. I don't see how that is a big deal.
25 Mar 13
1 edit
Originally posted by KazetNagorraPerhaps it's security related; wasn't there just a huge robbery of diamonds at a Euro airport?
To save money, I suppose. Why don't you call the number and find out?
I don't think there are as many paranoid conspiracy nuts in Holland as in the US, so I doubt this is really an issue for most ABN customers.
25 Mar 13
Originally posted by no1marauderIf you are right it is no big deal and no bank run would take place. Seems like that would be a big goof for implying there would be a bank run as the link does though.
"You can no longer request physical delivery of your precious metals from us ".
Sounds like you have to go pick up your gold yourself. I don't see how that is a big deal.
25 Mar 13
Originally posted by Metal Brain"I have never understood why anybody would not want to hold physical gold and have a mere piece of paper."
Why would a bank do this?
http://www.silverdoctors.com/dutch-bank-abn-amro-halts-physical-gold-delivery/
I have never understood why anybody would not want to hold physical gold and have a mere piece of paper. Sure, that paper is supposed to be backed by gold but why trust a bank so much? They could be selling it without your knowledge and you wou ...[text shortened]... immediately if I had any gold there.
Will it result in a run? Will other banks do the same?
Ease of exchange, transport, and purchase, doing business. Same reason people get cashier's checks instead of paying with cash (paper money). Secondarily, for security, not having all your wealth at home subject to burglary.
Few banks anywhere today offer unlimited exchange for gold. In some cases, private ownership of gold is illegal.
25 Mar 13
Originally posted by normbenignYou still know anyone who uses checks?
"I have never understood why anybody would not want to hold physical gold and have a mere piece of paper."
Ease of exchange, transport, and purchase, doing business. Same reason people get cashier's checks instead of paying with cash (paper money). Secondarily, for security, not having all your wealth at home subject to burglary.
Few banks anywher ...[text shortened]... oday offer unlimited exchange for gold. In some cases, private ownership of gold is illegal.
25 Mar 13
Originally posted by normbenignStill, only the banks know if the gold reserves are still there. They could be doing what the goldsmiths have been doing for ages. The only way to know your gold is there is for everyone to demand the bank gives them their physical gold.
"I have never understood why anybody would not want to hold physical gold and have a mere piece of paper."
Ease of exchange, transport, and purchase, doing business. Same reason people get cashier's checks instead of paying with cash (paper money). Secondarily, for security, not having all your wealth at home subject to burglary.
Few banks anywher ...[text shortened]... oday offer unlimited exchange for gold. In some cases, private ownership of gold is illegal.
I would hate to be the last person to ask for the gold only to find out it is not there.
25 Mar 13
Originally posted by Metal BrainIf you were the last person to demand your gold from the banks, then the monetary system would have collapsed, everyone would have lots of gold, and it would be worthless.
I would hate to be the last person to ask for the gold only to find out it is not there.
25 Mar 13
Originally posted by Metal BrainAgreed, and the only reason people don't demand their gold, is legal tender laws, which in the US allow banks to pay you with Federal Reserve notes in lieu of gold.
Still, only the banks know if the gold reserves are still there. They could be doing what the goldsmiths have been doing for ages. The only way to know your gold is there is for everyone to demand the bank gives them their physical gold.
I would hate to be the last person to ask for the gold only to find out it is not there.
25 Mar 13
Originally posted by twhiteheadSorry but there just isn't anywhere near enough gold to pay off all the paper money, anywhere.
If you were the last person to demand your gold from the banks, then the monetary system would have collapsed, everyone would have lots of gold, and it would be worthless.
25 Mar 13
Originally posted by normbenignThe thing that bothers me is that banks that hold gold can engage in massive short selling unless there is some sort of accounting that takes place. This could allow manipulation of gold prices if banks act in unison. That is why mere paper bothers me and I think people should hold physical gold.
Agreed, and the only reason people don't demand their gold, is legal tender laws, which in the US allow banks to pay you with Federal Reserve notes in lieu of gold.
What is to keep banks from selling 90% of the gold they hold? All I can think of is the risk gold prices might increase, but if it is done by banks acting in concert with each other the people holding paper could get screwed while unwittingly helping the banks do it. The people holding physical gold might get screwed too, but they would not be helping the banks screw all gold investors.