Italy Is Latest Country Seeking To Bring Their People’s Gold Home

Gold Is A “Reserve Of Safety” – Mario Draghi

by Virginia Filder for Gold Telegraph

European Central Bank’s President Mario Draghi recently announced that the ECB would be required to approve any management of gold reserves within the euro zone countries.

The statement was specifically directed at two Italian members. Why was Italy singled out?

According to the Wall Street Journal, Italian citizens are preparing to take control of Italy’s gold reserves. During the past few years, a multitude of small investors lost billions of dollars due to the failure of several Italian banks. The Bank of Italy is seen as an elitist, inefficient entity indifferent to the needs of ordinary people. Deputy Prime Minister Luigi Di Maio is leading the attack against Italy’s central bank, along with the “5 Star Movement” and the nationalist “League,” all of whom blame the countries financial woes on the incompetence of the central bank.

The 5 Star Movement is asking Italy’s Parliament to approve measures that would allow private banks to sell their share in The Bank of Italy at 1930’s prices. Taking it a step further, they are also demanding that ownership of the Bank of Italy’s 2,451.8 tons of gold be taken over by the country’s citizens and spent on populist policies. The current value of these gold reserves is $102 billion.

If these laws are passed, investors would be able to sell gold and greatly deplete the central bank’s reserves. As Giorgia Meloni of the Brothers of Italy states, “The gold belongs to the Italians, not the bankers.”

Italy’s lawmakers hold a different view and are warning against any action that will upend the sovereignty of the central bank’s policies. Such expropriation of government gold would not be tolerated.

But the 5 Star Movement and the League are determined to return ownership of the country’s gold to the public. Approximately 60 percent of lawmakers support the movement, guarantying the law will be enacted. There is also rumbling about nationalizing the Central Bank of Italy entirely.

In the realm of global commerce, gold has become a most potent weapon.

Italy is not the only country embracing gold. Romania has plans to repatriate gold reserves currently being held by the Bank of England. Romania currently has around 103.7 tons of gold, valued at $3.84 billion. Sixty-five percent of the yellow metal is being kept in storage at the Bank of England. According to a new law, only 5 percent of the country’s gold may be stored abroad. The rest will be repatriated. While the current leadership approves of the repatriation, the National Bank of Romania does not. Mugur Isarescu, director of the central bank, insists that the gold is for economic emergencies and should remain where it is.

Another European country, Germany, has quietly called back 674 tons of gold from France and the U.S. Federal Reserve to its central bank, the Bundesbank. Ninety-eight percent of Germany’s gold was stored abroad during the height of the Cold War to keep it out of the reach of Russia. With the weakening of the Euro, Germany wants the gold closer to home. The Bundesbank now has half of the country’s gold in safe storage.

Following the trend to keep gold close to home, the National Bank of Hungary will be recalling 100,000 ounces of gold from the Bank of England. Hungary has traditionally kept its gold reserves low, with only 50 tons being held in 1989. The global 2008 financial crisis had Hungary rethinking its approach to gold. Now, it wants its gold reserves home for safekeeping in the event of a geopolitical crisis.

Gold is seen by central banks as a way to maintain financial trust during economic upheaval. The move by global central banks to repatriate their gold may be a sign that an economic crisis could be looming in the near future.

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