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How Central Banks Can Use Gold Revaluation Accounts in Times of Financial Stress
Because central banks are the root of the modern money tree, they can use entries in their gold revaluation accounts to turn into capital, pay for expenses, or transfer it to their respective Treasuries. In addition, gold revaluation accounts can be used to cancel government bonds held on central bank balance sheets to lower the public debt. Multiple large central banks are currently operating at a loss while public debt levels are elevated. In this article we will examine how central banks' gold revaluation accounts can offer solace in these challenging financial environments. Central banks’ accounting rules are ... (full story)