GREENSPAN: ...remember, we had that first tapering discussion, we got a very strong market response. And then we reassured everybody to have no -- remember, tapering is still (audio gap) of an agreement that the central banks have made -- European central banks, I believe -- about allocating their gold sales which occurred when gold prices were falling down (audio gap) has been renewed this year with a statement that gold serves a very important place in monetary reserves.
And the question is, why do central banks put money into an asset which has no rate of return, but cost of storage and insurance and everything else like that, why are they doing that? If you look at the data with a very few exceptions, all of the developed countries have gold reserves. Why?
TETT: I imagine right now, it's because of a question mark hanging over the value of fiat currency, the credibility going forward.
GREENSPAN: Well, that's what I'm getting at. Every time you get some really serious questions, the 50 percent of the gold price determination begins to move.
GREENSPAN: And I think it is fascinating and -- I don't know, is Benn Steil in the audience?
GREENSPAN: There he is, OK. Before you read my book, go read Benn's book. The reason is, you'll find it fascinating on exactly this issue, because here you have the ultimate test at the Mount Washington Hotel in 1944 of the real intellectual debate between the -- those who wanted to an international fiat currency which was embodied in John Maynard Keynes' construct of a banker, and he was there in 1944, holding forth with all of his prestige, but couldn't counter the fact that the United States dollar was convertible into gold and that was the major draw.Everyone wanted America's gold. And I think that Benn really described that in extraordinarily useful terms, as far as I can see. Anyway, thank you.
TETT: Right. Well, I'm sure with comments like that, that will be turning you into a rock star amongst the gold bug community.
Posted At : September 15, 2013 10:21 PM | Posted By : Iris Mack
"Earlier today, I spoke with Larry Summers and accepted his decision to withdraw his name from consideration for Chairman of the Federal Reserve," President Barack Obama said in the statement. "Larry was a critical member of my team as we faced down the worst economic crisis since the Great Depression, and it was in no small part because of his expertise, wisdom, and leadership that we wrestled the economy back to growth and made the kind of progress we are seeing today."
No reason was given for the withdrawal by Summers, who was oft-discussed as the president's preferred choice to succeed Ben Bernanke.