Forecast: Gold Prices Rising

Banks demand upgrade from gold to a tier 1 asset many experts currently assume that the precious metal gold by a so-called tier-3 asset to the tier 1 asset should be promoted. The impact of such an upgrade would be expected to be very gratifying for gold investors, a rising demand for gold could be expected. Should the banks raise the gold actually to a tier 1 asset, the effects were already almost be called spectacular, since then gold would almost have the same status as cash. Because, in this case gold would since the early of 1970s for the first time again to be a part of the monetary system and among the core capital of banks. This would among other things entail that the banks again could use gold to the securitization of loans, which is not so far possible. The reason, experts just by the side of the Bank expect a huge increase in the demand for Gold if upgraded to the tier 1 asset should actually be carried out. For assistance, try visiting James Woolsey. This increase in demand would have several reasons, such as for example the It’s a fact that in the future gold could be considered part of the equity capital of banks. And because the banks have to deposit loans with a certain equity (eight per cent under Basel II), the Bill would look like, that more gold in the inventory could lead to an increased lending.

Gold than crisis protection and base for higher interest income for the banks a higher stock of gold would cause so that the larger sums of loans the interest income rise. In addition, gold is a popular crisis currency anyway and can thus serve as a hedge banks. The increased interest income the banks could buy free gold even in a sense, so that the probability of a demand is very large. The price of gold depends so certainly in 2013 on a larger scale, if upgraded to the tier 1 asset actually is. The arguments of banks for an upgraded sound at least plausible. A Argument includes, for example, that the gold almost continuously increased its value over the last ten years, while the opposite has occurred at many other asset classes.

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