Last week we published an article from Hugo Salinas Price titled “The Crumbling World Order and Who Will Pick Up the Crumbs?“, where he pointed out that International Reserves have been contracting since August 2014 and up to November 27, 2015, had diminished by $752 billion dollars, or 6.25% of the total achieved at the peak back in August, 2014.
He remarked that this contraction was unprecedented, since there is data going back to 1948, and never, ever, has there been a sustained contraction in the total of Central Bank International Reserves since the creation of the present international monetary system in 1944, at Bretton Woods.
In his opinion, “the present contraction of International Reserves announces a secular change of trend to liquidation of international debt and consequently to Depression.”
Following this article he noted that:
“On Friday, December 11 of the present year, Bloomberg published no information regarding International Reserves as of that date.
On Friday, December 18, once more, Bloomberg published no information regarding International Reserves as of that date…
…Why has Bloomberg decided to suspend the publication of International Reserves on its website? Is Bloomberg hiding information from the public? Has Bloomberg been pressured to suspend publication of sensitive data?
We hope Bloomberg resumes publication of the important data on International Reserves at once.”
In the below article he reports that Bloomberg again has available updated data of international central bank reserves which continues to be a shockingly large fall. He posed some interesting questions about where their reserves have gone?
By Hugo Salinas Price
First published at Plata.com.mx
Bloomberg is back and presents updated data on International Reserves held by Central Banks, excluding gold, as of Friday, January 8, 2016, after a hiatus on this information since December 11, 2015 (for reasons unexplained).
The data for Friday, January 8, 2016 are shocking, as expected: Total International Reserves held by Central Banks, excluding gold, expressed in US dollars, amount to $11.032 Trillion dollars as of that date.
The decrease in Reserves thus amounts to precisely $1 Trillion dollars, as of January 8, 2016. This gigantic fall, of 8.31% of the maximum amount of Reserves – $12.032 Trillion dollars recorded on August 1, 2014 – took place over the course of only 17 months, whereas the growth of Reserves to its maximum figure took some 70 years, roughly since the end of WW II.
The fall in International Reserves is a clear indicator of a world-wide economic slump, which will become a severe depression.
It would be much easier to stop the flow of water over Niagara Falls, than to halt the contraction in International Reserves.
World liquidation has set in. The Piper must be paid. Growth is gone. This will be story in this epic year 2016.
There is a One Trillion Dollar Question: What entity or entities have purchased – for cash – the $1 Trillion dollars worth of Government Bonds that the central banks of the world have sold off in the course of the past 17 months?
What discount on the value of the Bonds did the purchaser or purchasers of the Bonds apply? If there was no discount, why so?
$1 Trillion dollars’ worth of Government Bonds has disappeared from the books of the world’s central bankers, sold by them for cash. WHO DID THE BUYING? On what Balance Sheets do the acquired $1 Trillion dollars of Bonds now rest?
Are the parties to these gigantic transactions to remain unknown? And what happens to the world’s confidence in its financial system, when $1 Trillion dollars’ worth of Bonds, and counting, just magically turn into cash?
UPDATE: See this article and video for a possible answer as to where this $1 trillion has gone: