According to IMF statistics, the United States is the world’s largest single holder of gold, with a reported 8,133.5 tons. Germany is a distant second with 3,417.5 tons, and the IMF controls 3,217.3 tons. Also according to the IMF, the “world” owns 30,120 tons. So, the United States owns 27% of the world’s official gold holdings.
Considering the great effort made to compile these statistics, we can fairly much rely on them. Except one thing: Who really owns our gold?
More often than not, articles and reports about US gold holdings leave the impression that the 8,133.5 tons (261,500,158.5 troy ounces) belong to the American people and held for them by the US Treasury. Most Americans believed than “our” gold is held at Ft. Knox, Kentucky, but there are no public reports or audits that verify where the 8,133.5 tons actually reside. I’ve seen reports that much of it is in the bowels of the Federal Reserve Bank in New York City. Still, if it turns out that one or more special vaults have built around the country for storage of the “nation’s gold,” it would not surprise me. While gold is disparaged by the Establishment, governments go to great lengths to protect “their gold.”
But, here is the real question: Who “owns” the 261.5 million ounces of gold: the American people via the US government, or the Federal Reserve? (Just in case any readers are new to this concept, the Federal Reserve is not a government agency. It is owned by its “member banks,” which means it is effectively owned by the persons who control the major banks in the United States, many of which are owned for foreigners.
Do a web search for “Who owns the Federal Reserve?” and you will find a plethora of material. At the top of the search will probably be an article by the Fed, which is more confusing than enlightening:
The twelve regional Federal Reserve Banks, which were established by Congress as the operating arms of the nation’s central banking system, are organized much like private corporations–possibly leading to some confusion about “ownership.” For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.
The “Reserve Banks are not operated for profit” so says the Fed site, but the banks that “own” the Fed certainly are operated for profit, and the Fed is operated for the benefit of the “banking industry,” which means the huge banks that own the Fed. One of the best books—and a short one at that—is Murray Rothbard’s The Case Against the Fed.
Another point: when US banks that “own” the Fed are merged into foreign banks, foreigners become “owners” of the Fed, our central bank. Two such cases immediately come to mind: the absorption of Republic National Bank by HSBC, one of the world’s largest banks. The other was the acquisition of Fleet Bank by Swiss Bank Corporation.
Do the other large US banks care that these two banking behemoths have footholds in the US? Not really. They’re all members of the same exclusive club: banks too big to fail, which means government bailout if they get in trouble. But, I’ve digressed.
Who owns “our” gold?
The IMF reports it is owned by the Federal Reserve System, and so do the writers at mineweb.com, which has just posted an article about the last gold sales under the Central Bank Gold Agreement. In that article: The Bundesbank . . . is the second-largest hoarder of gold behind the U.S. Federal Reserve.
Now, a single statement by a web-based news publication is not the final word; however, what is to be noted is that when such assertions are made, there are no refutations by the Treasury, the Fed, or any other US monetary authority. The Fed owns “our gold.” You better buy your own gold.
Very interesting article Mr. Haynes. But these 3 big owners only holds 49.03% of the world’s Gold. Where is the remaining 59.07%?
The World Gold Council keeps excellent statistics on gold ownership and on “official” (government and government entities such as the IMF) buys and sells. WGC stats can be found at gold.org. You have to register to access the data, but it’s free. Remember, though, that the WGC has to rely on US numbers as to how much gold it holds and that Paul pointed out that US gold holdings have not been audited since the Eisenhower administration.