London bullion banks have developed a pretty convenient system for rotating gold liabilities among themselves to minimize the need to move actual gold around or even to have gold on hand as they conduct our business. Further, we can fairly assume that if the system ever runs into difficulties, central banks, as former Federal Reserve Chairman Alan Greenspan told Congress in 1998, still "stand ready to lend gold in increasing quantities should the price rise." The London bullion banks' system is described by the Perth Mint's Bron Suchecki in commentary today at his Internet site, Gold Chat, headlined "Fractional Reserve Bullion Banking and Gold Bank Runs -- Interbank Buddies Business":
http://goldchat.blogspot.com/2014/02/fraction...ion-banking-...
