Gold Re-Monetization Is Much Closer Than Many Realize -Palisade Research
"February 2018 marked a major turning point for gold - monetary gold to be more specific - when the Swiss National Pension Fund switched out of synthetic gold derivatives into physical gold.
Monetary gold is defined as 'physical gold held in their own vaults or in trust.' The Swiss decision complied with the new banking standards regarding capital adequacy as it relates to solvency and viability....Lessons learned from the last liquidity crisis, when Lehman Brothers nearly caused a global financial meltdown, forced a rethink in how assets held on an institution's balance sheet are to be valued. Counter-party risk became extremely important again...The need for liquidity was a key change in the creation of the new standards, and it shone a spotlight on an asset that had largely been ignored for this purpose - physical gold....A point to consider here is that gold is not traded at the commodity desks of large banks. It is traded at the currency desks....Central banks and large institutions will increasingly turn to monetary gold in the coming months and years. They will seek to add the quality that only monetary gold provides. Capital flows into monetary gold will reflect the need for an asset that is liquid, tested and trusted. Gold's re-monetization is now officially a matter of global monetary policy."