Is Italy Launching A Gold-Backed Currency Called The ‘Mini-BOT’?

The world’s third largest gold holder may be exploring the launch of a new parallel currency that’s backed by gold. Here’s the details…

One thing is certain: The closer we get to the global reset, the more speculation there is as what the reset will look like.

It’s starting to look more and more like nations are taking matters into their own hands, as opposed to a ‘one size fits all’ solution.

For example, I recently wrote about the possibility of a Russian Silver Rouble.

The theory on the Russian Silver Rouble was arrived at by connecting four dots. Monetary dots that have formed over the last several years.

Then there’s uber-silver advocate Hugo Salinas Price, who we have been covering for years, who is relentless in his efforts to back the Mexican Peso with silver. For example, here’s an article we posted back in 2014 on Hugo’s efforts.

More recently, there’s been plenty of speculation on whether China will back its yuan with gold, much of which Jim Willie has been covering, as well as many other analysts and experts. Just check out our Chinese gold backed yuan pages for all the different articles on the topic.

Fast forward to May, 2018 and there are all sorts of financial problems in Italy.

A notable piece of news from just this week is that the anti-establishment coalition formed in Italy is actively wanting debt forgiveness from the ECB.

Fast forward to today, and we’ve just learned about a possible secret weapon that Italy could bring to the global reset table: The ‘Mini-BOT’

Here’s an explanation from Zero Hedge

So what are ‘Mini-BOTs’?

In order to settle bills with suppliers or creditors the state might consider “instruments such as mini-government notes” which may also be used in turn to repay tax arrears, says the government program agreed by the two parties’ representatives and leaders.

Earlier this year, outgoing Economy Minister Pier Carlo Padoan described the proposal as “a plan to circulate a disguised parallel currency”.

It is this section of the Five Star-League Accord that raised eyebrows…

“Something must be done to resolve the problem of the public administration debts to taxpayers.”Claudio Borghi, the League’s economic chief who helped write the government plan, told la Verita newspaper that the new securities “could be spent anywhere, to buy anything”.

The minibot was in the Lega’s election manifesto. Five Star is far less radical on the eurozone, having dropped the idea of a referendum, but also seeks changes that are incompatible with the the EU fiscal rules.A parallel currency stands a much greater chance of success in Italy, and it would go some way to solving the government’s fiscal dilemmas. The open question is whether it would constitute a slippery slope towards euro exit.

How would it work?

Bloomberg’s Stephen Spratt explains that basically the Italian government would mail you a certificate that says it’s worth a certain amount — and you can sell that if you want to get the money quicker.But it would be likely to trade at a discount to its face value in euros, in effect creating a parallel currency — particularly if people were to start using the new note as cash to exchange for goods and services, rather than using euros.

But Mish Shedlock takes it one step further to ask, why not back the Mini-BOT with gold?

Here’s more from Mish Talk:

Italy has the third largest gold reserves in the world after the US and Germany.

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Italy’s gold has had an eventful history. Robbed by the Nazis and taken to Berlin. Loaded on to gold trains and sent to Switzerland. Flown from London to Milan and Rome. Used as super-sized collateral for gold backed loans from West Germany while sitting quietly in a vault in New York. Leveraged as a springboard to prepare for Euro membership entry. Inspired Italian senators to visit the Palazzo Koch in Rome. Half of it is now in permanent residency in downtown Manhattan, or is it? Even Mario Draghi, European Central Bank (ECB) president, has a view on Italy’s gold. The below commentary tries to make sense of it all by bringing together pieces of the Italian gold jigsaw that I have collected.

According to officially reported gold holdings, and excluding the gold holdings of the International Monetary Fund (IMF), Italy’s central bank, the Banca d’Italia, which holds Italy’s gold reserves, is ranked as the world’s third largest official holder of gold after the US and Germany, with total gold holdings of 2,451.8 tonnes, worth more than US$ 105 billion at current market prices. Notable, Italy’s gold is owned by the Banca d’Italia, and not owned by the Italian State. This contrasts to most European nations where the gold reserves are owned by the state and are merely held and managed by that country’s respective central bank under an official mandate.

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In its Palazza Koch vaults in Rome, the Banca d’Italia claims to store 1199.4 tonnes of gold. Of this total, 1195.3 tonnes are in the form of gold bars (represented by 95,493 bars), and 4.1 tonnes are in the form of gold coins (represented by 871,713 coins). While most of the bars in Rome are prism-shaped (trapezoidal), there are also brick-shaped bars with rounded corners (made by the US Mint’s New York Assay Office) and also ‘panetto’ (loaf-shaped) ‘English’ bars. The average weight of the bars in Palazzo Koch is 12.5 kg (400 oz), with bar weights ranging from relatively small 4.2 kgs up to some very large 19.7 kgs bars. The average fineness / gold purity of the Rome stored bars is 996.2 fine, with some of the holdings being 999.99 fine bars.

The Banca d’Italia also states that 141 tonnes of gold that it transferred to the ECB in 1999 as a requirement for membership of the Euro is also stored in Palazzo Koch. This would put the total gold holdings in the Palazzo Koch vaults at 1340 tonnes. Gold transferred to the ECB by its Euro member central banks is managed by the ECB on a decentralised basis, and is held by the ECB in whatever location it was stored in when the initial transfers occurred, subject to various location swaps which may have taken place since 1999.

 

Bullion Star writer Ronan Manly asked the Bank of Italy, Mario Draghi, and other officials a bunch of question on location, leasing, etc. The questions were all refused.

Manly also uncovered a bit of history, translating a video in Italian into English, noting that when the bars were moved to Germany they were stamped with a Swastika:

The RAI broadcast video shows a 1940 Nazi bar from Berlin, stamped with the eagle and swastika insignia and with Prussian mint markings. The Nazi bar holdings can be explained by the fact that the Italian gold was confiscated by the Nazis during World War 2 and ended up being moved out of Rome up to the north of Italy and then most of it was transported onwards to Berlin in Germany or else to Switzerland.”

The reporter, Angela, states that in addition to Rome, the Italian gold is stored at the Federal Reserve Bank in New York, the Bank of England in London, and at the Bank of International Settlements (BIS) in Switzerland. The reporter uses the exact words “Banca dei Regolamenti Nazionali”.

So what are we to make of all of this?

One key take-away is that sovereign nations around the world are coming to the same conclusion: The monetary system cannot go on as it is.

There is just too much debt, there’s a currency war race to the bottom, and there’s a debt-based fiat dollar has been devalued nearly down to its intrinsic value of zero.

That intrinsic value is coming, so sovereign nations are exploring options on what they can do to survive and thrive in a post-dollar world.

Italy is just the latest example of sovereign nations looking for solutions, and Italy could have a gold lining if they were so inclined.

Furthermore, as more and more nations begin exploring alternatives to the financial and monetary status quo, including gold-backed and silver-backed currencies, all of these recent, call them “post-dollar global financial system explorations” if you will, demonstrate that truth and honesty are returning to the monetary system.

And as the ultimate forms of monetary truth and honesty, that means gold and silver are returning to the monetary system.

They always do.

Stack accordingly…

– Half Dollar

 

 


 

About the Author

U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.

Paul’s free book Gold & Silver 2.0: Tales from the Crypto can be found in the usual places like Amazon, Apple iBooks & Google Play, or online at PaulEberhart.com. Paul’s Twitter is @Paul_Eberhart.

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