Ecuador, Goldman Sachs Gold Deal in 2014

Posted on May 7, 2016 • Filed under: Economy, Ecuador Zeiler /June 6, 2014 wrote: Unbowed by fines and new regulations, Goldman Sachs (NYSE: GS) has simply looked elsewhere for fresh victims.

In a deal that barely registered with the mainstream media, Ecuador’s central bank agreed earlier this week to swap half of its gold reserves – worth $580 million – with Goldman in exchange for liquid assets.

The Ecuadorian central bank thinks it’s going to earn $16 million to $20 million in profit over the three-year duration of the deal. Of course, the details of the transaction, such as the fees and interest rate that Goldman is charging, were not disclosed.

And as we all know, the devil is in the details – particularly when you’re dealing with a Wall Street pirate like Goldman Sachs.

And whatever Ecuador is saying publicly, that it was willing to make any kind of deal with the likes of Goldman Sachs indicates that the country is in serious trouble.

That much is obvious to everyone.

“It does raise a red flag,” Bianca Taylor, a sovereign analyst at Loomis Sayles, told Bloomberg News. “Whenever a country needs to sell or monetize its gold reserves, it’s definitely a signal that the sovereign is strapped for cash.”

Maybe Ecuador genuinely believes that swapping its gold with a shark like Goldman will work out for the best, but history says otherwiseRead Article


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