Monday, May 09, 2016

Ken Rogoff:
Emerging Markets Should Buy Gold
Economist Ken Rogoff highlights the challenges for emerging market central banks with too many dollars .. "There is a good case to be made that a shift in emerging markets toward accumulating gold would help the international financial system function more smoothly and benefit everyone .. I am just proposing that emerging markets shift a significant share of the trillions of dollars in foreign-currency reserves that they now hold (China alone has official reserves of $3.3 trillion) into gold. .. True, gold does not pay interest, and there are costs associated with storage. But these costs can be managed relatively efficiently by holding gold offshore if necessary (many countries hold gold at the New York Federal Reserve); and, over time, the price can go up. It is for this reason that the system as a whole can never run out of monetary gold."
LINK HERE to the essay

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