Another day another stealth recognition that gold is money
Back in early 2011 we noted that “quietly and behind the scenes gold is once again being recognised as money” when JPM Morgan came out and and said that they would start accepting gold as a type of collateral.
This was in the same week that one of London’s biggest clearing houses announced that it would also start to accept gold as collateral.
Fast forward to May 2011 and we got the European Parliament announcing that the commission on Economic and Monetary Affairs had unanimously approved gold to be used as central bank counter-party collateral.
At the time we noted:
There can be no surer sign that gold is once again being seen as money and that other pieces of paper collateral are becoming increasingly difficult and risky to hold and value. The WGC has a great bit of analysis explaining the importance of using gold as collateral.
Which brings us up to today’s announcement by another clearing house, this time CME Clearing Europe, extending the trend to recognise gold again:
LONDON, Aug. 17, 2012 /PRNewswire/ – CME Clearing Europe, the London-based clearing house wholly-owned by CME Group, the world’s leading and most diverse derivatives marketplace, today announced it has extended the range of eligible collateral types to include gold bullion.
The extension offers additional flexibility at a time when high quality collateral is at a premium and the clearing of over-the-counter (OTC) derivatives is increasing. CME Clearing Europe has followed the lead of CME Clearing, which has accepted gold to cover margin requirements since October 2009.
Launched in May 2011, CME Clearing Europe currently clears OTC commodity derivatives and plans, subject to regulatory approval, to introduce OTC Interest Rate Swap clearing later this year.
When you couple this with this week’s news that central banks bought record amounts of gold in Q2 2012 you can see why the case that gold is already being rightfully recognised as money once again is a pretty powerful one.
However, just don’t tell Ben Bernanke though – he still hasn’t got the memo:
- European Parliament approves gold to be used as collateral – another step to being money?
- Quietly and Behind the Scenes Gold is Once Again Being Recognised as Money
- ECB money injection not a reason for optimism
Link to this article: : http://www.goldmadesimplenews.com/analysis/another-day-another-stealth-recognition-that-gold-is-money-2-7686/