Federal Reserve's Gold Revaluation Study Sparks Controversy
A recent Federal Reserve paper, titled 'Official Reserve Revaluations: The International Experience', is being dubbed 'Gold Revaluation for Dummies.' It examines how countries like Germany have revalued gold reserves to mask financial instability.
Connections to Bitcoin Ambitions
Just weeks after this study's release, Treasury Secretary Scott Bessent tweeted about 'budget-neutral' methods to acquire bitcoin, hinting at undiscovered funds. This aligns with a bill by Senator Cynthia Lummis proposing the use of gold revaluation profits to fund a U.S. strategic bitcoin reserve.
The Math Behind the Madness
- The U.S. values its gold at $42.22 per ounce (the 1973 price), while the current market price is around $3,400.
- This creates a $863 billion gap on the balance sheet—larger than Denmark's GDP.
- Revaluing gold could provide funds for Trump's goal of acquiring 1 million bitcoins (the U.S. already holds 200,000 from seizures).
Global and Domestic Implications
- China and Russia, heavy gold hoarders, would benefit massively from a revaluation, validating their anti-dollar strategies.
- Domestically, admitting to currency devaluation could spike interest rates, making mortgages and savings less valuable overnight.
- The U.S. dollar has lost 98.7% of its value against gold since Nixon ended the gold standard, highlighting a long-standing fiat money 'Ponzi scheme.'
Political and Legal Hurdles
- Revaluation requires Congressional approval, with the Lummis bill ready but facing political resistance.
- Expect delays until post-2026 midterms, but a debt crisis could force rapid action.
This situation represents a financial standoff, with the Fed, Treasury, and Congress preparing for an inevitable monetary reckoning that could reshape global economics and boost bitcoin to unprecedented heights.
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