The Morgan Report Blog

After the Welfare State, what?

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One of the most important people on the planet regarding real economics and of course the silver market.
I had the pleasure of interviewing Hugo at the Silver Summit this year and for those serious metals heads
the DVD of that interview is available at our website.

In any event here is a clip of Hugo’s article…

After the Welfare State, what?
by Hugo Salinas Price

In the 40’s and 50’s of the last century, about 70% of reserves of central banks were in the form of gold at $35 US dollars an ounce.

At the present time, reserves of central banks, excluding gold, are about $8 Trillion dollars (not all of which, however, are dollars).

If these imaginary digital reserves (for such they are) were to once again amount to not more than 30% of total central bank reserves, the price of gold would have to increase substantially.

We can calculate the approximate price of gold that would be necessary in order to have the gold component of reserves resume the proportion it at one time took up of total central bank reserves, 70%.
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