Media Questions for Adrian Orr: 11 Apr: World Bank: Gold Investing Handbook; Federal Reserve: Considering Gold Standard?
I bet the RBNZ Governor is watching the New Zealand dollar gold price...like a field mouse on the ground watches a soaring golden eagle.
Emailed:1 11 April 2024
Dear Adrian or spokesperson
I have three questions.
In February this year two important documents were published by two important institutions:
the Philadelphia branch of the U.S. Federal Reserve published Price-Level Determination Under the Gold Standard which concluded
"While the gold standard exposes the Home country to short-term fluctuations in money, prices, and output caused by external shocks, it ensures long-term price stability as the quantity of money and prices only temporarily deviate from their steady-state levels."the World Bank published Gold Investing Handbook for Asset Managers.
Given the fiat New Zealand dollar, the RBNZ's only product which it creates out of thin air,* is rapidly losing purchasing power (a.k.a. consumer price inflation) against all commodities and has lost over 99% of is purchasing power against gold since its 1967 creation:
QUESTION 1:
Has the RBNZ been doing any research along similar lines to that done by the United States central bank system on whether a different basis for currency, other than the debt based currency system we have now, has been investigated? Gold or otherwise? If so please forward me any research you have. I've had a look on the RBNZ website but there doesn't seem to be any research on this topic.
QUESTION 2:
Does the RBNZ agree with the Philadelphia Federal Reserve's conclusion that a gold standard
"...ensures long-term price stability as the quantity of money and prices only temporarily deviate from their steady-state levels."
Unlike the New Zealand dollar, the supply of which just grows and grows never reaching a "steady-state" as indicated by the New Zealand M3 money supply measurement (https://tradingeconomics.com/new-zealand/money-supply-m3).
Though I appreciate the RBNZ does not offer investment advice, and given the RBNZ does not own any gold, and given many central banks have been purchasing record amounts of gold in recent years,
QUESTION 3:
Does the RBNZ have any comment to make on the fact that the World Bank is now offering advice for asset managers on how to invest in gold.
Regards
* Or "print[s]" as you said before the Finance and Expenditure Select Committee in February.
COMMENTARY
The following three charts show how many grams of gold the New Zealand dollar would purchase over time.
The left chart shows what has happened to the NZ$’s gold purchasing power since the beginning of Adrian Orr’s tenure as Governor of the Reserve Bank of New Zealand. The purchasing power decline is ubiquitous across all goods, and is systemic and unavoidable. It’s built into the current fiat debt based system. Gold just reflects that.
At the start of Orr’s tenure the NZD would buy around 0.017g of gold (i.e. the price was ~NZ$1800 per troy ounce).
Today it buys about 0.0079g of gold (i.e. the price is just over $3900).2
The NZ dollar purchasing power of gold has
declined ~53% since 2018
when Orr became Governor and
declined »99% since 1967
when it was created.
Gold cannot be created out of thin air. The NZ dollar on the other hand is printed out of thin air and, as Adrian Orr said “people believe it. Touch wood.”
So is gold changing its properties and becoming more valuable? Somehow?
Or is the dollar, created out of thin air, losing value?
This is why bankers hate gold.
Because it always, 100% of the time, eventually reveals fiat currency’s true value. Which is
ZERO
See also:
“Today“: 13 April 2024
Gold price from https://goldprice.org/
Your posts make me nervous.
But good on you for exposing the belief system.
I think there is hope for younger generations presently locked out of home ownership etc., as a fiat collapse may (or will) deflate the bubbles and return us to what I would call reasonable asset prices. We shall see. And I have often wondered that if, and when it does all collapse (i am certain) and revert back, what will all the financial experts and vested interests say? Oh, sorry about that?