Most of us have a few coins lost down the backs of our sofas. Only the foolish think they can solve their money worries by fishing them out.
That’s more or less what politicians in Venezuela and Italy are contemplating at the moment, though. The Latin American government sold more than 40 percent of its gold reserves last year to fund government spending and bond payments, according to opposition lawmakers.
Italy, too, has been roiled with controversy this week after La Stampa newspaper reported that the government was considering selling part of its gold reserves to support its budget – an interpretation of a proposed law rejected by its backer, but which Deputy Prime Minister Matteo Salvini has nonetheless described as “an interesting idea.”
It’s certainly true that the two countries’ central banks probably hold more gold than they need. About 77 percent of Venezuela’s foreign-reserve assets are bullion, according to the World Gold Council, a higher share than in any other major economy. After it, only the U.S., Germany, and Tajikistan have a bigger proportion of gold on their central-bank balance sheets than Italy’s 66 percent.
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