From Zero Hedge:
Wonder why Europe is pressing so hard for Greece (and soon the other PIIGS) to collateralize its pre-petition loans on a Debtor in Possession basis?
Here is your answer: "Yesterday's unanimous agreement by the European Parliament's Committee on Economic and Monetary Affairs (ECON) to allow central counterparties to accept gold as collateral, under the European Market Infrastructure Regulation (EMIR), is further recognition of gold’s growing relevance as a high-quality liquid asset. This vote reinforces market demand for a greater choice of assets that can be used as collateral to meet margin liabilities."
Luckily for Greece, it has 111.5 tons of gold in storage (somewhere at the New York Fed most likely). Looking down the road, Portugal has 382.5 tons, Spain 281.6, and Italy leads the pack with 2,451.8 tons.
Complete press release:
The Economic and Monetary Affairs Committee of the European Parliament has approved gold to be used as collateral confirming its status as a…
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