Muammer Qaddafi is in the midst of a civil-war & UN sanctioned no fly zone. Additionally, the international community attempts to cut off his funding with sanctions & freezing of Libyan assets. Yet, Qaddafi is in control of one of the top 25 gold reserves in the world. All of it, held in Libya at the central bank under his control. At today’s levels it is an estimated $6.5 billion, enough to fund his army for the next months to a year.
Most reserves of central banks are held at international vaults New York, London & Switzerland, but Libya’s reserves are held in Libya. While, we would never make Qaddafi the poster-child for the Tangible Asset Portfolio, this is a take home lesson for physical possession of your assets. These reserves are for an emergency, to provide for your family, finances & interests. It can keep you in business when others are scrambling to find capital.
This is a scary scenario, an unhinged dictator, with the hard currency to provide for his army in an effort to halt the peoples will. As this unfolds over the following weeks and months it will be interesting to see how Qaddafi uses his gold reserves to provide for either exile or a continued civil war. The Financial Times takes an in-depth look: Gold Key to Financing Gaddafi Struggle