Finance, Forex and Investments

India's Central Bank buys gold, your thoughts?

India’s central bank bought 200 metric tons of the metal from the International Monetary Fund on November 2nd. What are your thoughts on this? My thoughts are that this is going to be a very significant event. They will have a good amount of transfer of economic power because of this. Unlike our fiat currency, it has value. Now you can say the dollar has value, but it doesn't. A dollar defined by the Fed is a federal reserve note, which defined is a dollar. Gold is a precious metal and has been a reliable currency for over 5000 years. In all seriousness though every country's economic power ratio has been predetermined by the amount of gold it has, not by the amount of paper reserve notes it has. http://www.bloomberg.com/apps/news?pid=20601090&sid=aUm.roGyeOR0

Public Comments

1. Wrong. The worlds economic system is NOT backed by gold. You just made that up.
2. They're smart, and they know they need to protect themselves in the global economy. Although India is the world's largest democracy (population-wise) they don't have as strong of an infrastructure as the U.S., and some other Western nations even though those nations are suffering from a recession. So, yes, bottom line I think they're smart.
3. Russia's Central Bank was selling gold only a decade ago. Central banks buy sell and trade gold bullion on a regular basis. YAWN! The US Gold Depository at Fort Knox, Kentucky holds not only US Bullion reserves, but that of several other nations as well.
4. USA is in serious trouble.Gold has never lost its value and will always trump paper money.
5. They are smart. Gold is going up. The dollar is being debased and India is trying to do something to be stable in the uncertain future world of global finance.
6. My thoughts are that everybody thinks the future of the dollar is no longer as the worlds hegemony. It is really a shame our progressive government and the federal reserve banksters have destroyed a once great independent country and made us dependent on the rest of the World buying our debt. Now that this will no longer be viable we're going to become a third world fascist hell hole.
7. The dollar may not be the world standard for currency. I am only suprised it is not the Euro. America's swan song was the end of it's industrial output. There is little or nothing made here any more. And the major left over companies are foreign owned. The greed of ceo and owners did America in. America did not keep up with modernization. When Walt Disney did the a WW2 film they used Gary IN steel mills. G.M. used to control 78% of the car/truck market in the U.S., but they worried more about saving money on cheaper parts to save money. It happened all over American Industry, and then the ceo's worried more about making short term quarterly profits over long term vaibility.
8. It just shows that India may be getting wise to the coming collapse of fiat currency. Investment in gold would be a smart decision for everyone. India is already a major power-player, but they suffer from extremely high population density and massive inequality. As their rich get richer and their poor stay destitute there will probably be a high degree of civil unrest. Frankly I'm surprised their isn't more violence there already with the tension between Hindus, Muslims, and Sikhs as well as the income disparity.
9. To the misinformed above, Ft Knox contains zip. That's right, a decoy. To answer it's a smart move on India's part and a sign of the times.
10. India is stupid to buy gold. Oops! I must be stupid, too, because I took a large position in gold more than a year ago! India is obviously concerned about its investment in U.S. treasuries and is mitigating its risk by investing in gold. Gold has long been a hedge against inflation, which we will see soon. The dollar is depreciating, having lost over 20 percent of its value since 2000. India is concerned about the security of its investments in our treasury securities. So are China, Japan and other countries that hold a big part of our debt. Our creditor nations will likely reduce and then all but stop their purchases of our treasuries. Then we won’t be able to fund our deficits. That will be a disaster unless we stop trying to do everything we want to do. We are on a financial suicide mission.