Currencies, in which all investments are denominated, are being competitively debased. This is reflected in increasing central bank purchases of gold bullion and a rising price for the yellow monetary metal in all fiat currencies.  This signals that something is profoundly wrong with our currencies and global financial system. Bullion ownership offers protection from these systemic risks. LB Now facilitates the wholesale purchase and sale of bullion on the London market for clients. Professional custodial services are also available.

Gold and silver are not just commodities; they are monetary metals. Bullion, in other words, is money. But unlike fiat currencies, in which all investments are denominated, gold and silver bullion represent money that cannot be created out of thin air by central banks. In other words, holding bullion is like holding cash. But, unlike fiat money or investments, bullion is an asset you can own which is uniquely not also somebody else’s liability while you own it.

J.P. Morgan himself said it best when he was cross-examined by a US Congressional committee in 1912. He said: “Money is gold, and nothing else”.  How times have changed! Most people now seem to have forgotten or are unaware that gold is money. Yet, gold is becoming a trade settlement currency again for some nations and even seems to be evolving back into becoming a reserve asset of choice for some nations, as major fiat currencies including the US dollar are beset with issues. Indeed, currencies today are not money, but credit. Everything in the financial system is based on and measured in credit, not money.

Again, 87 years later, Alan Greenspan himself said as much, when he was asked by a US Senate Banking committee in 1999 whether the US should sell its gold: “Gold still represents the ultimate form of payment in the world. Fiat money, in extremis, is accepted by nobody. Gold is always accepted.”  Maybe that’s why central banks eventually became net buyers of gold again, in 2010, after being net sellers for decades. According to the World Gold Council, central bank demand for gold hit a record high in 2022, totaling 1,082 tonnes, as the following chart from the latest In Gold We Trust report of Incrementum shows.

An increasingly complex geopolitical and financial environment is making reserve asset management more relevant than ever for sovereign nations. In 2023, central banks added another 1,037 tonnes of gold to their reserves and in 2024 another 1,045 tonnes. Central bank demand has exceeded 1,000 tonnes now for three consecutive years and shows no sign of slowing down.

The World Gold Council conducts an annual Central Bank Gold Reserves Survey. When asked about gold’s future share in global reserves, 69% of central banks responding thought that gold would occupy a higher proportion five years from now, up from 62% in 2023 and 46% in 2022. The chart below, taken from the Survey’s report, shows those results. The Survey further reports that while 57% of advanced economy respondents think gold’s share will rise, 75% of emerging market and developing economies respondents believe it will do so.

Clearly, gold continues to be viewed around the world favorably by central banks as a reliable reserve asset. Investors should take note and act accordingly.

LB Now became an Authorized Bullion Dealer with access to the London wholesale market in 2009 and continues to facilitate the purchase, custody and sale of gold and silver bullion bars and coins for clients at wholesale prices. Clients can either take delivery or keep their bullion in allocated and insured storage in locations around the world.

LB Now bullion services are available to everyone. For more information on becoming an approved client to be able to purchase bullion at wholesale prices on the London market and opt for professional custodial services of your bullion, please contact us.