Earlier quoted context omitted.
I can’t open that link. Too bad.
Cloudflare DNS?
I think I munged the link. Anyway, the answer is in a search result, with some discussion about whether it was a battleship or destroyer.
France pulls last gold held in US
261–270 of 374 posts
Re: France pulls last gold held in US
#262Earlier quoted context omitted.
Did you read the article at all? Or just the title? The article is about bringing gold back to France by selling US bars and buying new bars in Europe. The alternative would be melting the bars down and recasting them to the new standard. The capital gain is just a by-product, standard financial stuff, but apparently broke HN readers brains.
I did read the article, thanks for asking. Sounds like you agree with me, France has the same amount of wealth in gold that they had last week.
I don't care about that. That's not what the article is about.
Re: France pulls last gold held in US
#263Earlier quoted context omitted.
For a country like France it would be on the order of hundreds or a thousand tons. So that’s maybe on the order of hundred trips by delivery trucks at most. Yeah I suppose spread out over a few years it wouldn’t be noticed. At least not by the general public. But since the claim is that this triggered the collapse of the Bretton Woods system it would be documented and referenced a lot more, still.
Most delivery trucks (like a box truck) have capacities more like 10 or 20 tons. A heavy freight truck, like used to load ships? Even more.
The gold would be moved by cash-in-transit trucks which have relatively modest payload capacities of 5000-9000lbs today, a bit less in the 60s. 3 tons per truck is probably on the high end.
Re: France pulls last gold held in US
#264This is not gain at all. At least in theory: You own some tons of gold at the start of the process, you have the same tons of gold at the end of the process. The only real gain is that you have gold in the US custody and the US can be tempted to just use it without telling you anything. In other words, you had "paper gold" or "virtual gold" that the US can confiscate anytime, for example after invading Greenland, bla…
> This is not gain at all. At least in theory: You own some tons of gold at the start of the process, you have the same tons of gold at the end of the process.
I see a lot of comments like this but I just can't get my head around what you are trying to prove (or disprove).
Every definition of gain (or loss for that matter) implies that the same amount of _something_ is now worth more (or less) than when you bought it.
Following you logic, if I buy a share of MSFT at $10, sell it for $100, there is no gain because I still have 1 share of MSFT?
Re: France pulls last gold held in US
#265Earlier quoted context omitted.
For a country like France it would be on the order of hundreds or a thousand tons. So that’s maybe on the order of hundred trips by delivery trucks at most. Yeah I suppose spread out over a few years it wouldn’t be noticed. At least not by the general public. But since the claim is that this triggered the collapse of the Bretton Woods system it would be documented and referenced a lot more, still.
Most delivery trucks (like a box truck) have capacities more like 10 or 20 tons. A heavy freight truck, like used to load ships? Even more.
You don’t generally just throw gold in a box truck… it typically moves by armored freight.
Re: France pulls last gold held in US
#266Good for France to relocate gold back to their own territory, but, uh, how can this result in a 15 B gain? "The overall size of France’s gold reserves still remained unchanged at roughly 2,437 tonnes, which are now entirely held at the BdF’s underground vault in La Souterraine." Is this some special form of French accounting, where the gold becomes more valuable when it returns to French soil?
Over about a year they sold their 'non-standard' (seems to be bars below the modern purity standards) US reserves, and replaced them with new reserves purchased elsewhere which are now stored in France. As the price of gold continued to rise as they did this, they ended up making a bunch of dinero while also centralizing their reserves.
The French gold originally deposited by France in US reserves in the 1950s was of the exact same purity as the French gold now, what is meant by "non-standard" just means "not stored in France".
If it was a lower purity, then when they sold the 129 tons, they would not have obtained 129 tons of "higher purity" gold and still turned a profit. They would have gotten fewer tons of gold. Your logic has the wrong sign.
Also, the fact that gold prices are rising means when France sold the gold and then purchased it later, the higher price to obtain the same quantity of gold would mean they incurred a loss, not a profit. Here, too, your sign is wrong.
Finally, at current prices, 129 tons of gold is worth $19 Billion dollars in total. It seems hard to believe that short term price declines (which is what is needed to turn a profit) would be such that gold fell over 80% in value, which is what would be needed to sell 129 tons of gold, then wait a while and buy 129 tons of gold, and end up with a profit equal to over 80% of the price of gold in question.
Moreover, rising gold prices would cause the French to earn a loss, not a profit
Re: France pulls last gold held in US
#267Earlier quoted context omitted.
That union was a last ditch effort to try and keep France in the war. If they had implemented it, it would have been undone once the nazis were beaten you can be sure.
It was suggested again in 1956 in the context of the Suez crisis: http://news.bbc.co.uk/2/hi/uk_news/6261885.stm
That was also a last-ditch effort to maintain pre-WW2 geopolitical structures rather than a bipolar US-sphere vs Soviet-sphere world. Note that this was basically the nail in the coffin that led to their full-fledged decolonization in the following years. At the time the UK still held very significant military and political sway over the middle east, east africa, and asia
https://en.wikipedia.org/wiki/British_Empire#/media/File:Bri...
Re: France pulls last gold held in US
#268>However, an operation to repatriate its gold holdings began in the 1960s leading up to the US termination of the Bretton Woods system, which effectively stopped foreign governments from exchanging dollars for gold. French-US monetary history after WWII: Under the Bretton Woods agreement (1944-1971), the US dollar was the world’s reserve currency, and it was pegged to gold at $35 per ounce. Other countries pegged the…
"closed the gold window" is a weird euphemism for "defaulted"
"I am altering the deal. Pray I do not alter it any further."
Re: France pulls last gold held in US
#269>However, an operation to repatriate its gold holdings began in the 1960s leading up to the US termination of the Bretton Woods system, which effectively stopped foreign governments from exchanging dollars for gold. French-US monetary history after WWII: Under the Bretton Woods agreement (1944-1971), the US dollar was the world’s reserve currency, and it was pegged to gold at $35 per ounce. Other countries pegged the…
Excessive debt build up in particular due to the Vietnam war caused the US to cancel the dollar gold convertibility.
Re: France pulls last gold held in US
#270Earlier quoted context omitted.
Imagine they bought the gold in the US for 1b and sold for 16b. Yes they turned around and purchased 16b of order gold immediately but there's was still a transaction where they sold an asset for more than they bought it.
If you bought your house for $500k 20 years ago, sold it today for a million, then bought it again tomorrow for a million, would you describe that to your friends as having just made $500k? Like yes in the most pedantic technical accounting way it's a gain. In spirit I would call this an unrealized gain
No, you’d remark that your house has appreciated in value over the past 20 years. But you wouldn’t have realized any of that gain until you sold the house - the point being that the realization is the actual taxable event, which is why it matters from the pedantic technical accounting POV. The fact that you turned around and bought another house just means you’re doing something new with your realized gains. Now you have a new cost basis. Maybe that’s what you’re saying with “unrealized gain” though.