Tag - Central Bank Gold

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Monday, October 16 2017

Neck and Neck: Russian and Chinese Official Gold Reserves

Official gold reserve updates from the Russian and Chinese central banks are probably one of the more closely watched metrics in the gold world. After the US, Germany, Italy and France, the sovereign gold holdings of China and Russia are the world’s 5th and 6th largest. And with the gold reserves ‘official figures’ of the US, Germany, Italy and France being essentially static, the only numbers worth watching are those of China and Russia.

For the Bank of Russia, its latest report, published on 19 September 2017 addressing August month-end, shows the Bank holding 56.1 million fine troy ounces of gold (1745 tonnes). For the Chinese State, the latest SAFE release is reporting Chinese official gold reserves of 59.24 million ounces (1842 tonnes).

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Sunday, October 15 2017

Russia Stockpiling Bullion Like There's no Tomorrow

The Central Bank of Russia has recently been buying bullion at an unprecedented pace. According to Argentine financial expert Gabriel Rubinstein, this policy is aimed at protecting the Russian economy in the event of crisis situations, including against dollar-related "manipulations" by the US.

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Wednesday, October 4 2017

Russia's rush for gold sees record reserves for Putin era

Meanwhile, the Bank of Russia has more than doubled the pace of gold purchases, bringing the share of bullion in its international reserves to the highest of Mr Putin's 17 years in power, according to World Gold Council data.

In the second quarter alone, it accounted for 38pc of all gold purchased by central banks. The gold rush is allowing the Bank of Russia to continue growing its reserves while abstaining from purchases of foreign currency for more than two years. It's one of a handful of central banks to keep the faith as global demand for the precious metal fell to a two-year low in the second quarter. But what may matter most is that gold is as geopolitics-proof an investment as any in the age of sanctions and a deepening rift with the US.

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Saturday, September 16 2017

BIS gold swaps soar from zero to record high

Disclosures in the August statement of account published by the Bank for International Settlements indicate that during August the bank increased substantially its use of gold swaps.

An estimated 130 tonnes of new gold swaps were made last month, worth about $5.9 billion at the month-end gold price, and the total level of gold swaps at the end of August was close to 500 tonnes.

As this table shows, the use of gold swaps by the BIS fell considerably from 2013 to zero in March 2016. In the financial year ending in March 2017 a new year-end peak of 438 tonnes was reported.

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Thursday, August 24 2017

The Truth About the Fort Knox Gold

The Truth About the Fort Knox Gold

One of the little-known items on the Fed’s balance sheet is a vital asset it received from the U.S. Treasury a long time ago…

During the Great Depression, in 1933, President Roosevelt issued an executive order requiring anyone with gold to surrender it to a Federal Reserve bank or any member bank of the Federal Reserve system.

The Federal Reserve banks also required the commercial banks to hand over their gold to the Fed. Now, suddenly, the gold went out of the commercial banks into the Federal Reserve Bank.

But under the Gold Reserve Act of 1934, the Fed was ordered to surrender all its gold to the Treasury Department. All the nation’s gold in effect came under direct government ownership.

Now, this is key: The Federal Reserve is actually a private system, while the Treasury is an arm of the U.S. government. And the Fifth Amendment of the Constitution prevents the government from taking private property without just compensation.

To get around that legality, the “just compensation” was a gold certificate the Treasury issued to the Fed in exchange for its physical gold.

To this day, the Fed carries that gold certificate on its balance sheet.

The Treasury officially values its gold at $42 an ounce. That was the official gold price from 1973, two years after the U.S. abandoned the Bretton Woods system. Of course, the market price of gold today is almost $1,300 an ounce.

But if you take the face value of the gold on the Fed balance sheet, divide it by $42 an ounce and then come up with a number of ounces and convert that into tons, it comes out to over 8,000 tons.

That’s highly interesting, because that’s how much gold the Treasury currently owns.

The Treasury needs at least 8,000 tons of gold to back up that paper certificate it handed the Fed back in the 1930s to satisfy the Fifth Amendment.

If you take the 8,000 tons on the Fed balance sheet in the form of this gold certificate, market to market at $1,300, that mounts to well over $300 billion.

So the secret to the Fed’s balance sheet is its “hidden gold asset,” that gold certificate it received from the Treasury in the 1930s.

Nobody talks about this or admits it. But our whole system is based on gold.

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Germany repatriates gold reserves ahead of schedule

Germany's central bank has completed an initiative to bring half of the country's gold reserves home three years ahead of schedule, as it repatriated all of its gold kept in Paris and a third of its reserves in the US.

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Mnuchin's PR Visit to Fort Knox proves nothing about the US Gold Reserves

As a freebie trip for 4 select political insiders, last Monday’s trip to Fort Knox was undoubtedly a memorable one for them. In the same radio interview Bevin said that:

“This is like the mother of all field trips. This is pretty cool”

But as a validation and verification of over 56% of the supposed US Official Gold Reserves, the visit was a complete farce. Announced the morning it took place. No evidence that any media were allowed to participate. Only peaked into one of the 13 storage compartments. And then to round it off, Mnuchin (an ex Goldmanite) tweets that ‘Glad gold is safe“. You couldn’t make this up. And finally, no mention of the fact that most of the gold bars even supposedly stored in Fort Knox are low purity ‘coin bars’ made from melted down gold coins. In fact, of all the gold bars reported to be held within the US Gold Reserves, only 16% of these bars are of LBMA Good Delivery size and purity range.

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Wednesday, August 23 2017

Mnuchin’s Fort Knox Quip: ‘I Assume the Gold Is Still There’

U.S. Treasury Secretary Steven Mnuchin paid a rare official visit to Fort Knox to check out the nation’s gold stash on Monday

“I assume the gold is still there,”

“We have approximately $200 billion of gold at Fort Knox,” said Mnuchin. “The last time anybody went in to see the gold, other than the Fort Knox people, was in 1974 when there was a congressional visit. And the last time it was counted was actually in 1953.”

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After 40 years, Fort Knox opens famed vault to civilians

The depository holds more than 147 million ounces of gold, which puts its market value at more than $186 billion. While primarily known as a vault for gold, the depository also held the Declaration of Independence and the U.S. Constitution during World War II.

Mnuchin said it was the first time Fort Knox opened its vaults to outsiders since a Congressional delegation and some journalists were let in to view the gold for the first time in 1974.

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Saturday, August 19 2017

BullionStar quoted in Wall Street Journal article on New York Fed Gold

had expected the WSJ article to be a lot longer and more in-depth than it actually was, and to obtain some publishable response from the NY Fed. The WSJ however says in the article that:

“The Fed declined to comment”

The lack of any quotation by the Fed within the WSJ article is a glaring omission, and actually proves the complete lack of cooperation by the Fed on the entire topic of gold bar storage. The WSJ article does say that it filed Freedom of Information (FOIA) Requests with the NY Fed, which again underscores that without FOIAs, the Fed wouldn’t voluntarily reveal anything.

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Friday, August 11 2017

The Fed Has 6,200 Tons of Gold in a Manhattan Basement—Or Does It?

Eighty feet below the streets of lower Manhattan, a Federal Reserve vault protected by armed guards contains about 6,200 tons of gold.

Or doesn't.

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Thursday, July 27 2017

PBoC Gold Purchases: Secretive Accumulation on the International Market

If the PBoC is buying gold in excess of the amount that it offically reports, then logically it will not want these purchases to appear in import/export trade statistics. Like all central banks, the PBoC classifies and holds its gold reserves as “monetary gold” (i.e. “monetary gold is gold held as a reserve asset that is available to and controlled by monetary authorities”). Monetary gold is also exempt from reporting in international trade statistics / customs data. Therefore, like all central banks, the PBoC would not have to report any monetary gold that it purchased abroad and then imported into China.

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Monday, July 24 2017

Did The Dutch Central Bank Lie About Its Gold Bar List?

Head of the Financial Markets Division of the Dutch central bank, Aerdt Houben, stated in an interview for newspaper Het Financieele Dagblad published in October 2016 that releasing a bar list of the Dutch official gold reserves “would cost hundreds of thousands of euros”. In this post we’ll expose this is virtually impossible – the costs to publish the bar list should be close to zero – and speculate about the far reaching implications of this falsehood.

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Sunday, June 11 2017

State investors stock up on record gold reserves amid uncertainty

The gold reserves of the world’s biggest public sector investors reached an 18-year high as they hoarded the precious metal after Donald Trump’s election and the Brexit vote added to geopolitical uncertainty.

State investors increased their net gold holdings by 377 tonnes to an estimated 31,000 tonnes last year — the highest level since 1999, according to a study of 750 central banks, public pension plans and sovereign wealth funds with $33.5tn in assets.

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Tuesday, May 23 2017

New Gold Pool at the BIS Basle: Part 2 - Pool vs Gold for Oil

This is Part 2 of a two-part series. The series focuses on collusive discussions and meetings that took place between the world’s most powerful central bankers in late 1979 and 1980 in an attempt to launch a central bank Gold Pool cartel to manipulate and control the free market price of gold. The meetings centered around the Bank for International Settlements (BIS) in Basle, Switzerland.

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Friday, April 28 2017

Bank of England releases new data on its gold vault holdings

An article in February on BullionStar’s website titled “A Chink of Light into London’s Gold Vaults?” discussed an upcoming development in the London Gold Market, namely that both the Bank of England (BoE) and the commercial gold vault providers in London planned to begin publishing regular data on the quantity of physical gold actually stored in their gold vaults.

Critically, this physical gold stored at both the Bank of England vaults and the commercial London vaults underpins the gargantuan trading volumes of the London Gold Market and the same market’s ‘liquidity’. Therefore, a new vault holdings dataset would be a very useful reference point for relating to London’s ‘gold’ trading volumes as well as relating to data such as the level and direction of the gold price, the volume of gold held in gold-backed Exchange Traded Funds (ETFs), UK gold import and export statistics, and Swiss and Hong Kong gold imports and exports.

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Monday, April 24 2017

Sweden's Gold Reserves: 10,000 gold bars shrouded in Official Secrecy

he Swedish Riksbank claims to hold 10,000 large Good Delivery gold bars in 5 locations across the world and now claims to have conducted physical gold audits of this gold. Yet it has never published any physical gold audit results of any of these gold bars nor published any of the serial numbers of any of the 10,000 gold bars it claims to have in storage. For a so-called progressive democracy this is shocking, although not surprising given the arrogant and unaccountable company that central bankers keep with each other.

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Sunday, March 12 2017

Mexico's Earmarked Gold Bars at the Bank of England vaults

Guillermo Barba, the Mexican financial and economic journalist, has recently published an article on his website confirming that through an information request that he had made to Mexico’s central bank, Banco de México (Banxico), the central bank has now released what amounts to a relatively comprehensive list of Mexico’s gold bars held in storage at the Bank of England gold vaults in London.

Mexico’s list is an inventory of wholesale market gold bars that Banixco owns and stores in custody at the Bank of England vaults in London. In the contemporary parlance of the gold market, most people would call this type of holding an allocated gold holding, but more historically in the Bank of England world, it has been known as an “earmarked gold” holding or a “set-aside gold” holding because the specific bars are set-aside for a specific central bank, in other words the central bank has its name attached to those particular bars (earmarked).

Wholesale gold bars are also known as London Good Delivery gold bars or variable weight gold bars, and each weighs in the region of 400 troy ounces ( ~ 12.5 kilos). On the Banixco list, there are 7,265 wholesale gold bars listed. This new list is one of the very few detailed central bank gold bars lists (weight lists) which exists in the public domain, and it could be useful for a number of purposes (see below).

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Tuesday, March 7 2017

The Bank of Mexico reveals its gold bar list

Last December, thanks to an official Request for Information by means of the Transparency Law, Banxico informed us that:

‘Of the 3.881 million ounces of gold that the Bank of Mexico has at the end of October 2016, 98.95% are held in the United Kingdom, 0.0004% at the Federal Reserve Bank in the United States and the remaining 1.05 % in Mexico.’

Banxico also told us that it had a total of 7,265 gold bars in allocated accounts at The Bank of England (BoE), which means that only about 2.9 million ounces are well identified with serial number, brand code, gross weight, assay and fine weight at that location.

The rest –more than 930,000 gold ounces at the BoE- are still ‘held’ on an unallocated basis. These unallocated accounts are those in which the ‘owner’ has not been assigned specific gold bars but simple ‘rights’ to a certain amount of gold. That is why Banxico could not tell us how many ingots it owned in this last case.

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Saturday, March 4 2017

Germany's Gold remains a Mystery as Mainstream Media cheer leads

On 9 February 2017, the Deutsche Bundesbank issued an update on its extremely long-drawn-out gold repatriation program, an update in which it claimed to have transferred 111 tonnes of gold from the Federal Reserve Bank of New York to Germany during 2016, while also transferring an additional 105 tonnes of gold from the Banque de France in Paris to Germany during the same time-period.

Following these assumed gold bar movements, the Bundesbank now claims to have achieved its early 2013 goal of repatriating 300 tonnes of gold from New York to Frankfurt, but after 4 years it is still 91 tonnes short of its planned transfer of 374 tonnes of gold from Paris to Frankfurt. In essence, over an entire 4-year period (i.e. 208 weeks), the Bundesbank has only been able to transfer 583 tonnes of gold back from New York and Paris to Germany. And the Bundesbank still claims to have 1236 tonnes of gold remaining in storage with the New York Fed.

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