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The sad thing is...as you just implied...I don't have to 'phone a friend' because I've been there seen it done it and got the tee shirt for a total of over 30 years...
You on the other hand....
And it would help if you ACTUALLY read and understood what I post.
The two authorities I quoted in that post were:
The Corporate Finance Institute...the professional body for Corporate Finance in the UK...
Oh and BTW I was Head for Corporate Finance for a leading firm of Chartered Accountants...and
Moodys....which of course you wouldn't know is the Number One Credit Rating Agency in the world...but of course Credit ratings have nothing to do with lending and capital adequacy...
Oh and BTW I've worked closely with ALL the major Credit Rating Agencies, i.e. Moodys Standard & Pooers and Fitch...
On credit ratings and capital adequacy issues, inter alia...
Tell you what Redknight, your filtered, as this is not helping the discussion on Solgold, and more people are going to get fed up with our bickering.
You carry on insulting me, you don't fool me.
As soon as I asked you a question you couldn't easily find on google, you replied I don't need to answer that.
That told me everything.
Q, not very few - none. And even if you live to 200 years of age, which I guess you probably think you will, especially as you're also an expert in genetics, you still won't get a dividend.
Redknight the website you posted was incorrect, had you known what you were talking about you would have spotted it.
I corrected you, made a phone call to check my facts, and posted a link to the correct information.
We may well get a dividend, but only if we buy shares in BHP or one of the other likely buyers
Sorry sipptrader according to Redknight and addicknt, very few on here will ever get a dividend, as most of us will be dead.
What you fail to notice is the difference between what I say and what is fact from a website, as evidenced by the quotation marks you failed to spot...
All that experience Redknight, and yet you can't read a simple statement that I said at 15.23 and about 100 times, everything on here is opinion.
By the way your facts said 7% on capital tier lending ratio 1, it's not it's 8% and that doesn't include the 2.5% from the capital adequacy ratio.
So while I say everything I post is opinion and should be treated as such.
You say what you post is fact and you are wrong.
Well said sipptrader!
You absolute fool...
"Of course the amount of money savers have in accounts of one form or other, adds to a banks liquidity, and is used in calculating it's level of lending."
I was CEO of a Major Building Society...this was my CORE business...
I was also Treasurer of a major Financial Services company managing £4.5 Billion of LIQUIDITY day after day, including trading Gilts abank and commercial paper
The biggest single Gilt swap I ever did was £1.6 BILLION in one transaction...
I prepared a £860 million stock market flotation of a Building Society, including working with the Nomad, and Citibank, Goldman Sachs and J P Morgan
I pioneered securitisation for Building Societies and the use of Derivatives for Balance Sheet management...
I've written hundreds of articles on this stuff...
But I bow to your superior knowledge as a 'Trainee Actuary'...
Do you actually realise how stupid you are with your increasingly desperate posts...
Redknight you know nothing about banking, I have just realized.
Of course the amount of money savers have in accounts of one form or other, adds to a banks liquidity, and is used in calculating it's level of lending.
No I'm not arguing about commercial banks sipp...it is the "Trading banks" and manipulating banks that control the US gold and silver futures markets that will have to replace paper gold with physical gold or get out of the game...
THATS where the price effect is, but because he doesn't know what he is talking about, Quday is citing and posting outstate stuff about Basel that has nothing to do with the paradigm shift about to take place with gold...
And ironically,if it happens, it should HELP Solgold...doesn't he get that...? Especially as he is citing the PEA as being out of date at $1300 gold...
This is hysterical...
"the paper stuff, is asset backed"
"A precious metals futures contract is a legally binding agreement for delivery of gold or silver at an agreed-upon price in the future. A futures exchange standardizes the contracts as to the quantity, quality, time, and place of delivery. Only the price is variable.
Hedgers use these contracts as a way to manage price risk on an expected purchase or sale of the physical metal. Futures also provide speculators with an opportunity to participate in the markets without any physical backing."
I agree with sipptrader, he doesn't believe banks will hold gold as a tier one asset any more than I do.
It you Redknight that does, and you have still failed to answer why banks will buy gold.
Lastly please stop the lies, I do not tell people how to invest, and nothing I have said will discourage people from owning gold or gold shares.
Your full of it.
At last a correct statement sipptrader...breath of fresh air...
Why does everyone argue with his opinions...just keep checking and posting the facts as I am...
He desperately picks up on an incomplete element of something I posted verbatim...
Do you have the first idea how stupid this statement is?
"It will be the paper money held by savers ETC that will provide the Capital tier 1 resources"
First, gold is NOT a Tier 1 Capital item...it is a Tier 1 asset...
Second, 'Paper Gold' has to be discounted by 50% as a Basel Asset...Physical gold is doscounted 0% so even with the mark to market risk it is immeasurably more attractive...
Oh and BTW...implicitly you are trying to dissuade people from buying physical gold or gold mining shares with your dumb statements...
Sorry sipptrader...you are absolutely right, but as one who has managed assets that are marked to market and prepared Accounts to Basel 1 and 2 standards, why wouldn't you want to buy physical gold?
yes you have to mark to market, but if the price goes up that INCREASES your Tier 1 Assets...furthermore, while gold was in Tier 2 it had to be reduced by 50% and a qualifying asset...wouldn't you rather risk marking gold to market down by a smaller amount than 50%...when did the price of gold last fall 50% in one accounting year...
And if you and Quady are right, why have banks and especially the big manipulators been moving physical gold through the LBMA to get round the fact that COMEX is only backed by 2% gold and physical gold is in increasing shortage to deliver in the US...
The price to buy retail gold is $71 higher than the price for 'paper' gold...
"an investor can expect to pay a premium of $71 over the gold price to buy the one-ounce American Gold Eagle..."
THIS is the core evidence of manipulation of the Paper Gold market an d why it will substantially migrate to Shanghai after June...
The live price to buy secondhand gold bars in London is £1282/ounce...that's $1773 compared to the live price of $1687...
Redknight surely you understand why banks would use or not use gold.
I can believe some banks, that have repaid their QE liabilities would want to hold some gold, but that increase the price of gold, so we have a point of equilibrium, where you don't buy gold as it's too expensive, and may even sell back to the market. Banks make this calculation all the time.
That's why I said that gold would struggle to get over 2,000 dollars an ounce last year, and yes people did say 5,000 dollars by now, and 10,000 dollars an ounce by the end of 2021.
Some of this was backed up by articles of experts.
By memory only BNC agreed roughly with me on the gold price.
Currently, paper gold is not a 1st tier asset. Only fully allocated physical bullion that has no counterparty risk attached that qualifies as a first-tier asset.
The new rules will require a provable 1:1 ratio of fully allocated gold reserves, with no counterparty risk. Under Basel III rules, every central bank will be able to revalue its physical reserves higher, from a current 50% haircut into a fully cash exchangeable asset.
Since 1944, there's only been one tier 1 asset, and that has been United States Treasuries or fully funded dollar deposits. Gold was considered a tier 3 asset where only 50% of its value was allowed to be calculated on a balance sheet. Therefore, there would be four reasons that central banks would be de-incentivized to own gold. It wouldn't pay interest, costs money to store, it was unpredictable in its movements, but the tier 3 status meant that a 50% denigration on the balance sheet would limit a central bank's ability to sell bonds or transact international business.
So the Bank of International Settlements, which is the central bankers' central bank in Basel, Switzerland, reclassified gold in April of 2019, as the only other tier 1 asset in the world next to U.S. dollars in Treasuries.
Basel III (and Basel II) divides bank assets into three risk categories (credit, market and liquidity risk) and weights its risk depending on its attributes. Gold is “zero percent risk-weighted” in terms of credit risk. This is a huge upgrade for the metal.
And from one of the acknowledged global experts in gold and precious metals...Eric Sprott...
"If the Basel Committee decides to grant gold a favourable liquidity profile under its proposed Basel III framework, it will open the door for gold to compete with cash and government bonds on bank balance sheets – and provide banks with an asset that actually has the chance to appreciate. Given that US Treasury bonds pay little to no yield today, if offered the choice between the “liquidity trifecta” of cash, government bonds or gold to meet Basel III liquidity requirements, why wouldn’t a bank choose gold? From a purely ‘opportunity cost’ perspective, it makes much more sense for a bank to improve its balance sheet liquidity profile through the addition of gold than it does by holding more cash or government bonds."
Sipptrader, I agree with you on gold, however we must remember that the paper stuff, is asset backed by the goods it's loaned against, excepting refinancing of debt, which is then backed by previous spending commitments.
That's my point sipptrader, banks will not buy gold, Redknight has all this experience, but doesn't know this.
It will be the paper money held by savers ETC that will provide the Capital tier 1 resources, but again Redknight doesn't seem to understand how this works.
Yes I realize I have just given him the answer to the question I asked.
But he just googles things and he doesn't understand what he reads.
Well done Redknight, you understand capital one ratio figure, but it's 8% not 7%. You never talked about the capital adequacy ratio, which is 2.5% making The total minimum capital adequacy ratio of both tiers, also including the capital conservation buffer, 10.5%. But you have not answered the question.
What else is considered tier 1 capital.
I asked this question, as although I suspect you could find it on the internet, I tried first and poised you a question that required some knowledge.
So the question stands what else apart from gold is considered tier 1.
Good luck using google.
PS the stuff you googled to get to 7% is wrong, and if you knew what you are talking about you would know that.
I have just talked to someone in banking before typing this reply, and she pointed me to this web page, which I am assured is accurate.
You may fool addicknt and others, but you don't fool me.
I don't need to...
You've never posted anything to support your statements about Basel 3, so here goes, starting with the Number One Rating Agency in the world:
"The most recent iteration of Basel regulation, Basel III, thus introduced liquidity ratios. With this enhancement, the BCBS’ objective is to ensure that banks hold a sufficient amount of assets that can be easily and quickly converted to cash to meet liabilities over both short- and longer-term periods.
At the individual firm level, Basel III seeks to improve the quality of capital that banks hold and make definitions of types of capital more transparent.
"The Basel III accord raised the minimum capital requirements for banks from 2% in Basel II to 4.5% of common equity, as a percentage of the bank’s risk-weighted assets. There is also an additional 2.5% buffer capital requirement that brings the total minimum requirement to 7%. Banks can use the buffer when faced with financial stress, but doing so can lead to even more financial constraints when paying dividends."
While the value of gold may fluctuate, $1 of gold is $1...
For banks and similar institutions that trade in or hold gold roiutinely, the attraction is that there no longer has to be a 50% reduction in the value of PHYSICAL gold for BIS purposes...so there is every incentive to switch from PAPER gold (COMEX) to PHYSICAL Gold...
For those that don't hold gold routinely it makes little difference...
However...for the five banks manipulation gold it makes a huge difference and I believe they are shorting paper gold while secretly buying physical gold...
Max19 - 100% agree. I guess it is because I am very heavily invested in GGP in particular, I can see what progress looks like when all the ducks line up! As I said before, with GGP one will become rich this year, with Solg - within the next 10 years!!!
Both are absolutely rock solid...but GGP is within site of the finishing line. Solg are still settling into their starting blocks!