Could you kindly tell me what the law is when the party (party can be a fund, bank or another country) to whom the gold has been swapped to goes bankrupt?
My common sense tells me the person who made the swap will then hold a worthless piece of paper at this point in time.
This information will be invaluable to countries which have swapped their physical gold reserves. This could be an item also given in your blog which could prevent further gold swaps.
That is exactly the problem – gold has been rehypothecated many times over so there are MANY people holding worthless pieces of paper. This is why real gold in your hands will be so valuable.