Wednesday, March 11, 2009

Gold Holdings

In 2001 it was estimated that all the known gold holdings in the world totaled around 145,000 tonnes, and would fit into a cube roughly 82 feet a side (or about 25m). I say known as it is also estimated that of all the gold on or in this planet, only about 5 percent has been dug up. Now we can expect the global gold holdings to be closer to 150,000 tones.

Gold does not deteriorate or 'expire' and all that gold is still around ... somewhere. Yet, currently, we are experiencing a shortage of gold. So where has all the gold in the world gone?

Gold Coins
The US mint manufactured 2,055,000 one ounce gold American eagles in 1999. Over the years their production of American gold eagles has been steadily reducing so that in 2008, the U.S. Mint production for the year of one ounce gold American eagles was down to 710,000 with just under half its prior yearly production of one ounce gold buffaloes.

When the American eagle shortages first emerged in August 2008, the Mint laid the blame squarely on the vendors stating they were "not able to supply enough one ounce gold bullion blanks to meet the unprecedented demand we are experiencing." The Mint then suspended all sales of the popular one ounce coins. The one ounce gold blanks come from one refiner in Western United States and it seems there are no other vendors willing to hand over their blanks.

In addition, those mints that do produce gold coins are now tending to produce them in less than 24 karat .999 fine gold. Many, in fact, now produce gold “theme” coins in 22 and less karat gold and often mixed with silver. Indicating an apparent shortage of gold.

The current economic situation has certainly been instrumental in the increased demand for gold if only as a safe haven to protect assets. This is evidenced also in the increasing price and premiums for existing gold coins on eBay and other auction sites as well as numismatic and coin dealers.

Gold Bullion
Gold Bullion is suffering the same. A shortage of gold available to meet the demand. This is likely the result of increased demand rather than a sudden shortage of gold. The same amount of gold but more people wanting it, results in a shortage and consequent higher prices for physical gold. Waiting periods of up to 3 months are being reported for the delivery of physical gold.

The world gold holdings would include all the gold in the world regardless of the form. That means, gold holdings by country, US Federal Reserve gold holdings, IMF gold holdings, as well as government gold holdings, coins, bars, jewellery, gold used in industry etc.

But this would be far more than the official gold holdings.

World Gold Holdings
According to theWorld Gold Council, the world official gold holdings as of December 2008 show the following 10 countries hold most of the world gold reserves.


The United States gold holdings equal 8,133.5 tonnes.
Germany’s gold holdings equal 3,412.6 tonnes.
The IMF’s* gold holdings amount to 3,217.3 tonnes.
France’s Gold Holdings equal 2,508.8 tonnes.
Italy’s gold holdings are just 2,451.8 tonnes.
Switzerland has 1,040.1 tonnes.
Japan 765.2 tonnes and the
Netherlands 621.4 tonnes of gold holdings.
China has gold holdings of just 600.0 tonnes and the
ECB** a total of 33.6 tonnes of gold holdings.

*IMF. International Monetary Fund – There is some question over the IMF Gold holdings amount as it is considered by some experts that the IMF is counting debts owed to them by member countries and these may or may not be paid out, if they ever are, in gold)

**European Central Bank

World reserves are 29,697.1 tonnes with all countries 26,354.0 and the Euro Area (including the ECB) of 10,886.8

So there is a fair amount in the reserves held by banks and countries, but nowhere near the estimated total gold available in the world. Somewhat less than 20 percent in fact.

The united States gold holdings is likely to be the single largest biggest with the Treasury Gold holdings over 8.1 tonnes. But in world terms this is a minute amount.

So where is all the gold in the world?

Gold Holdings Conclusion
It seems that all the gold that ever was ‘there’ is still there. The amount of gold being dug up by mining companies is well documented and so the amount of gold in existence is well known throughout the world. One conclusion that we can come to is that many gold holders are not reporting their gold holdings. Gold is being horded in other worlds, by private individuals companies and perhaps even banks and countries. All this goes to substantiate the value being placed on gold. Perhaps the potential collapse of the current monetary system is partially responsible for this determination to put assets into gold.

One thing is certain. Gold is here to stay and the value of gold against currency is going to continue to increase long term as more and more people buy up and hoard gold in defense of their assets against the current economic crisis, so that might give a good idea of where all the gold in the world has gone and it seems evident gold holdings are going to continue to increase over the coming years

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