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Venezuela Takes Delivery of Its Gold

Written by Gary North on November 28, 2011

Socialist leader Hugo [OOgo] Chavez demanded in August that Venezuela’s gold be sent to it for safekeeping. The first delivery has taken place.

It is customary for nations to leave their gold in storage, either in London or at the New York Federal Reserve Bank. It is rare for any nation to take delivery.

Chavez apparently thinks that the official storage centers are not safe. Or maybe he has some other use for this gold. Whatever his reasons, he has drawn attention to the fact that most nations trust the depositories, but he does not. He has sent a message: “I am not convinced that Venezuela can get back its gold in the future. I am getting it now.”

Let’s call this what it is: the first stage of a run on the bank. The bank in question is the European gold bank. Only governments and central banks have deposits there. It is closed to the public. There is no gold standard any longer, but there are gold banks: depositories. Chavez is saying that he does not think there is enough gold in reserve to deliver on all the IOUs that the bank has issued.

I don’t blame him.

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12 thoughts on “Venezuela Takes Delivery of Its Gold

  1. David in MA says:

    Hugo knows something, maybe that there will be a run by saudi arabia or attacks by terrorists or the world exchange will be in chinese money maybe even other countries simply refusing to take American dollars.

    Whatever it is, gold (and silver) will be the only thing you will be able to buy and sell with. UNLESS, you have the Mark of the Beast.

  2. very smart of him, but while hes getting his gold back he better test the bars because china found some fort knox bullion bars were only 1/4" thick gold surrounding a tungsten brick. when hes gotten all his gold back the sanctions we like to put on countries we are mad at will be more pointless that they are now and freezing his assets will be a nonexistant threat. then this scenario will play out 'chavez will demand that all venezuela oil can only be paid for in GOLD, we get a good bit of our oil from them so our only option will be to declare venezuela a terrorist state and then invade' this is why we are pulling so many troops back from iraq

  3. I despise agreeing with chavez but he is right. The FED is neck deep in the financial COLLAPSE of Europe and NOT if, when the FED collapses. It is going to make the Weimar republic look like a cake walk. There will be NO banking left. NO country will be able to help and ALL governments will DEMAND a CENTRAL power to RULE. This is NOT fantasy LOOK at what is happening across the globe a select FEW are financially safe even if the world bank collapses and it WILL collapse. The people involved in world banking can't hide the FACT that putting ALL your eggs in ONE basket, has BUILT a catastrophic failure of the ENTIRE worlds finances that NO ONE in recorded history has EVER dreamed of. OH I am sorry go back to your fantasy football or your Ipad or your OWS protest about how UN fair life is and just LET the government take us farther and FASTER down the road to disaster, dancing with the stars is MORE important than your children having a future.

  4. George Tolhurst says:

    Ron Paul when elected will Audit the Federal Reserve and then he will put and end to the FED.

    Vote for the Honorable Ron Paul and he will cut a trillion $ from our debt in his 1st year and balance the budget in 3.

    Will accept only 10% of his Presidental salery.

  5. Well , looks like Chavez is about to loot his countries gold supply and boogie of to some private island . How typically Socialist of him .

  6. Unfortunately, Chavez may be right and this may be the first of many runs on the banks. Watch and wait.

  7. It's time for the U.S.A. to explore for energy within its boundaries.

  8. Mayflower Decendent says:

    Venezuala is also side by side with Iran. That is how Iran came to have missile platforms built in Venezuela with warheads aimed at the lower US!

  9. When are we going to audit the gold in Fort Knox?

  10. Audit the Ft. Knox gold? That presumes it still is there.

  11. Look at what happened to Gaddafi, Mubarak when they took their federal reserve notes, & traded for gold!

  12. Desi Erasmus says:

    Chavez is probably not long for this world. and where he's going there won't be much use for gold. Reducing the leverage of possible sanctions together with non-confidence in counter-party risk presented by Venezuela's gold custodian (ESPECIALLY post-MF Global + CME reneging on commitment to make MF Global's victims whole) is sufficient warrant to stash the national gold in their own back yard.