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Chavez to nationalize Venezuelan gold industry

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Terry
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« on: August 21, 2011, 12:24:44 pm »

Venezuelan President Hugo Chavez Sends Precious Metal ETFs A Wakeup Call

<snip>
It was reported in The Wall Street Journal that Mr. Chavez said “we don’t only have oil wealth; we also have one of the largest reserves of gold in the world so we might as well convert it into our international reserves because gold is increasing in value.”

President Chavez also released documents showing that he plans to transfer billions of dollars in cash reserves held abroad to banks in China, Russia and Brazil. The documents also showed that he planned to move 211 tons of gold it has stored abroad and values at 11 billion to the Central bank in Caracas, where the government keeps its remaining 154 tons of bullion.

While Venezuela is a relatively minor player on the world stage, this could be a big game changer here in the United States because one of the banks that holds 10.6 tons of Venezuela’s gold is none other than JP Morgan. In a recent audit of JP Morgan’s holdings it was reported that they held 338,303 ounces of gold or roughly 10.6 tons. While this is a modest size deposit it is sure to cause some jitters at JP Morgan as they scramble to find the replacement gold which has already been pledged about 100 times across various paper markets to ETF’s like the SPDR Gold ETF (NYSE:GLD). Oddly I had a conversation with one of my readers yesterday about his concerns of holding ETF’s that “lease” the gold that he purports to own. I will certainly be keeping an eye on gold in the illiquid after market and pre market. The long overdue scramble for delivery may be about to begin. “What you do in the Dark, You See in the Light.”


http://etfdailynews.com/2011/08/17/venezuelan-president-hugo-chavez-sends-precious-metal-etfs-a-wakeup-call-gld-iau-slv-gdx-agq/
Don't spend a lot of time worrying about Chavez.  He'll be dead very soon.  Cancer came knockin' on his door. 
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