Tag Archives: NY Fed

US Gold Reserves, Of Immense Interest to Russia and China

Recently, Russian television network RT extensively quoted me in a series of articles about the US Government’s gold reserves. The RT articles, published on the RT.com website, were based on a series of questions RT put to me about various aspects of the official US gold reserves. These gold reserves are held by the US Treasury, mostly in the custody of the US Mint. The US Mint is a branch of the US Treasury.

The first of these articles, published by RT on 30 December 2017, is titled “US gold of low purity & that’s why audit of reserves will never be allowed – expert tells RT”.

The second article was published by RT on 8 January 2018 and is titled “Russia-China combined gold reserves could shake US dominance in global economy – expert tells RT

As the subject matter of US gold reserves is broad and wide-ranging, the RT questions and my answers and opinions covered a lot of material and RT therefore decided to divide it’s coverage into 2 articles. The first RT article covered the lack of transparency into the US gold reserves, the fact that has never been any of independent audits of the gold, and the fact that a lot of gold bars that the US claims to hold are actually low purity gold bars which do not conform to international industry standards on tradable wholesale gold bars (i.e. Good Delivery standards).

The first article also touched on the international reaction to and the effects on the US dollar that might unfold if the US gold reserves were found to be less than they are claimed to be.

RT article 30 December on the low purity of US Gold Reserves

The second RT article looked at the gold holding strategies of China and the Russian Federation, where the central banks of both nations have been actively accumulating their national gold reserves over the last 10-15 years, and where both central banks have been vocal about this monetary gold accumulation, possibly in preparation for a future return to a gold-backed monetary standard.

The second RT article also explored the scenario under which both China and Russia could have significantly more gold accumulated than they have publicly divulged, a situation which if revealed would put the spotlight back on to the claimed gold holdings of the US Treasury.

RT article 8 January on Russian and Chinese gold and the US Dollar

Following the RT articles, on 11 January, Beijing-based Chinese business and financial website BWChinese picked up on my quotes in the second RT.com article, and in a geo-political article about oil, the Renminbi, the US Dollar and gold (written in Chinese), the Chinese website linked the gold accumulation of China and Russia to part of a strategy of moving away from the dominance of the US dollar. The BWChinese article (in Chinese) can be seen here.

Then finally on 16 January, Moscow headquartered Sputnik news agency, in an article titled “Chinese Media Explain How Russia & China Can Escape ‘Dollar Domination”, profiled the BWChinese article, and essentially (and conveniently) summarized the entire Chinese article back into English. Interestingly, there was therefore coverage of the topic of official US gold reserves from Moscow across to Beijing, and back to Moscow again, all within the space of a week and spanning 3 media publications, namely RT, BWChinese and Sputnik.

Sputniknews coverage on 16 January of BWChinese article

As background to this media coverage, this blog post looks at the topics covered in the RT.com articles, and details the opinions and material that formed the basis to the original RT articles.

The claimed physical gold held by the US Government

The US Government claims to hold 8133.5 tonnes of physical gold in its official reserves. However its impossible to verify this number because the entire story around the US gold reserves is opaque and secretive. Therefore, it’s impossible to say how much, or how little, physical gold the US actually has. This is so because there has never been a full independent audit of the US gold reserves, and the custodians of the gold (the US Mint and the Federal Reserve of New York) will not let anybody into the vaults to view the gold or to count it.

Even the details that have been provided on the supposed US gold holdings show that a majority of the gold bars are low purity and in weights that don’t conform to industry standard ‘Good Delivery” gold bar specifications.

The US Government gold reserves are held in the name of the US Treasury and are supposedly held in Fort Knox, Kentucky, and West Point, New York, and in the US Mint in Denver. And further small amount of US Treasury gold (5%) is supposedly held in the vaults of the Federal Reserve bank of New York (FRBNY). The US Treasury reports on this gold in a monthly report called “Status Report of U.S. Government Gold Reserve”.

Of the 8133.5 tonnes, this means, based on the official reporting, that:

  • 58% is allocated to Fort Knox, Kentucky: 4583 tonnes
  • 20% is allocated to West Point, New York State: 1682 tonnes
  • 16% is allocated to US Mint Denver, Colorado: 1364 tonnes
  • 5% is allocated to the NYFED: 418 tonnes

Afur ther 1% of the US gold reserves are listed by the US Treasury as being in working stock of the US Mint (a figure which never changes), which is 86 tonnes (or 2,783,218 ounces). This working stock probably represents a loan of gold that the US Mint took from the gold stock, that is now a liability of the US Mint to the US Treasury. So overall, 7629 tonnes of the gold is supposedly held between Fort Knox, West Point and Denver, and these holdings are said to be held over 42 gold storage compartments.

Interestingly, both the Fort Knox depository and the West Point facility are adjacent to US army bases. But the US Mint facility in Denver is not. Notably, the US Mint website was recently updated and no longer claims that any US gold is stored in Denver. See BullionStar blog “Is there any gold bullion stored at the US Mint in Denver?” for more details.

A “Good Delivery” gold bar, as traded and accepted on the international wholesale gold market, and as generally held by central banks across the world, has to satisfy the following criteria:

  • Have a minimum gold content of 350 fine troy ounces (approx 10.9 kilograms) and a maximum gold content of 430 fine troy ounces (approx 13.4 kilograms).
  • Have a minimum acceptable fineness is 995.0 parts per thousand fine gold

US Official Gold Inventories – Low Purity Bars

Surprisingly, there are gold bar weight lists in the public domain detailing all of the gold bars that the US Treasury claims to hold. These weight lists were included as part of a submission to a June 2011 US House Committee on Financial Services hearing on oversight of US gold holdings.

The US Treasury gold claimed to be stored at Fort Knox, West Point and Denver is detailed in a pdf document here (http://financialservices.house.gov/uploadedfiles/attachment_4_mints_schedule_of_inventory_of_deep_storage_gold_reserves.pdf). The same list is also in an Excel spreadsheet here (http://financialservices.house.gov/uploadedfiles/mints_schedule_of_inventory_of_deep_storage_gold_reserves.xls).

The US Treasury gold claimed to be stored at the Federal bank of New York (FRBNY) vaults is listed in another weight list which can be seen here (http://financialservices.house.gov/uploadedfiles/112-41.pdf) starting on page 132 of the pdf (or page 128 of the document). According to this inventory statement, about 5% of the US Treasury’s gold is held at the FRBNY in the form of 31,204 bars stored in 11 compartments (listed as compartments A – K). See BullionStar blog post “The Keys to the Gold Vaults at the New York Fed – Part 3: ‘Coin Bars’, ‘Melts’ and the Bundesbank” for screenshots of the actual weight list of US Treasury gold listed as being at the FRBNY. You will notice that a lot of the gold bars, about 50 tonnes worth,  are very old bars, and are listed as being in the form of low gold purity coin bars, bars that were fabricated from melting down gold coins.

These weight lists states that there are just under 700,000 gold bars in Fort Knox, West Point and Denver combined, and 31,000 bars held with the NY Fed vaults in New York.

Two short tables summarising the weight and purity of the US Treasury’s gold bar weight lists can be seen at the Goldchat blog site in an article titled from March 2014 titled “US deep storage gold reserves bar list made public“. These tables are as follows:

All claimed US Treasury gold bars broken out into size and purity categories
US Treasury gold bars clustered by weight and purity classifications

However, the Fort Knox – West Point – Denver weight list shows that nearly all the gold bars in Fort Knox and Denver are “coin bars”, again gold bars that were produced from melting down gold coins. Many of the gold bars listed as being in West Point are also coin melt bars. Around half of the US Treasury’s gold bars at the Federal Reserve Bank of New York are also in the form of coin bars.

In general, most of the US Treasury gold comprises bars that are either smaller and larger than the weights of Good Delivery bars and that are of low-grade purity bars (below the required purity of Good Delivery bars); e.g. a lot of the gold bars that the US treasury claims to hold have gold purity of 0.90 or 0.9167. Overall, less than 20% of the gold supposedly held between Fort Knox, West Point and Denver is Good Delivery Gold.

Without looking at a US Treasury weight list of claimed gold bar holdings, there are other data points which collaborative that the US official gold stock contains a lot of coin bar gold and other non-industry acceptable gold.

In March 1968, the London Gold Pool collapsed primarily because the US Fed and US Treasury did not have any Good Delivery Gold to supply to the London market. Bank of England memos at that time make this very clear as they say that:

“It has emerged in conversations with the Federal Reserve Bank that the majority of the gold held at Fort Knox is in the form of coin bars, and that in certain cases these bars have a gold content of less than 350 fine ounces. If the drain on U.S. stocks continues it is inevitable that the Federal Reserve Bank will be forced to deliver what bars they have.

Capacity to further refine coin bars to the current minimum fineness of .995 in the United States is entirely inadequate to cope with conversion on the scale that would be required if the Americans wished to continue to deliver bars assaying .995 or better. Equally the capacity in the U.K. is inadequate for this task.”

it would appear that the circumstances might well be such that very few bars of the current acceptable fineness could be found” (by the Americans).

See section titled “Scrapping the Barrel – March 1968” in BullionStar blog “The Keys to the Gold Vaults at the New York Fed – Part 3: ‘Coin Bars’, ‘Melts’ and the Bundesbank

Additionally, nearly half of the US Treasury gold auctions over 1978-1979 were of coin bars, suggesting that the US Treasury did not have sufficient access to good delivery gold even back then, and that it had ran out of good delivery gold by 1979.

Between May 1978 and November 1979, the US Treasury engaged in 23 gold auctions, and started by selling 8.05 million ounces of high grade gold (99.5% fine) before switching to selling 7.75 million ounces of low grade gold (90% fine). That was over 15 million ounces (466 tonnes) of gold in total auctioned by the Treasury. The last US Treasury auctions were on 16 October 1979 when 750,000 ounces of low grade coin bars, and finally on 1 November 1979 when the Treasury auctioned 1,250,000 ounces of low grade coin bars.

Note, that Deutsche Bundesbank ‘officially’ holds some of its gold in the vaults of the New York Fed, and has never been on record as having held gold in the US Mint’s Fort Knox depository. But the delays on the Germans repatriating their gold from the US to Germany in 2013 – 2014, and the fact that a lot of bars had to be smelted into new bars suggests that whatever source it came from, it was from a source that supplied low-grade gold coin bars. Could it have been Fort Knox?

Impact on US position in global economy due to Russia and China increasing their official gold holdings

China and Russia have both been aggressively accumulating their official gold reserves over the last 10-15 years. The Bank of Russia, on behalf of the Russian Federation, claims to now hold 1828 tonnes of gold. The People’s Bank of China (PBoC), on behalf of the Chinese state, claims to hold 1842 tonnes of gold.

However, a decade ago, the Bank of Russia only held 400 tonnes of gold. And in 2001 the PBoC held less than 400 tonnes.  But now both these nations hold a combined 3670 tonnes of gold. See BullionStar blog “Neck and Neck: Russian and Chinese Official Gold Reserves” from October 2017 for more details.

Interestingly, both Russia and China publicize and promote their accumulations of gold and publicly refer to gold a strategic monetary asset. They make no secret of this On the flip side, the US does the opposite, and constantly downplays the strategic role of gold. China and Russia appear to view gold as the only strategic monetary asset that can provide independence from the US dollar.

So there is a shift occurring in terms of Russia and China building up their gold reserves, to maybe in future have gold-backed currencies, and to move away from the global dominance of the (unbacked by gold) US dollar.

And even if the dollar is backed by oil (petro-dollar), the gold accumulation by China and Russia can still be seen as part of a strategy to move away from international trade denominated in US dollars.

Additionally, both China and Russia could conceivably be holding a lot more gold than they declare in their official gold reserves. China through other entities such as SAFE, or the large Chinese commercial banks, and Russia through entities such as the Gokhran.

If China and Russia combined showed that they held more gold on a combined bases than the US, this would, even symbolically, be a low to the US dollar and to the position of the US in the global economy.

Is it Still Important for a Country to Hold Vast Gold Reserves

Yes. Gold is an asset of last reserve for central banks. Gold is a high-quality asset, analogous to a war chest. Countries with larger gold reserves are more immune to crises. And if gold is revalued in a new international monetary system, the countries with more gold will be more powerful monetarily.

Physical gold is highly liquid, it doesn’t have any counterparty risk, it’s a safe haven asset in times of crisis, and its an asset that can be called upon for liquidity by central banks in times of monetary crises.

Central banks can also activate gold by lending, leasing and swapping part of their gold holdings to generate a return. Most central banks value gold at market prices on their balance sheets, which creates one of the most valuable assets on most central banks’ balance sheets.

Is Holding Physical Gold becoming an Outdated Concept in the Western World

It’s true that western investors seem to now place less emphasis on ownership of physical gold relative to the past. For example, look at the huge growth of over-the-counter trading in London of synthetic fractionally backed gold positions and the huge growth of gold futures trading on venues such as the COMEX, both of which are mostly cash-settled and both of which have very little to do with any underlying physical gold holdings. The growth of gold-backed ETFs where the holders cannot take delivery of any gold is also symptomatic of this dislocation. However, these trends are in the institutional space.

Physical gold demand among retail investors is still very strong. Just look at some of the large physical gold markets such as Germany, Switzerland, Austria and the US and Canada where retail investors still know the value and benefits of holding real physical gold, as opposed to paper promises.

If the US doesn’t have as much Physical Gold as it Claims, what does it mean for the US Dollar in International Trade.

If the US was shown to have less physical gold that it claims to have, it would have a negative effect on the US dollar is indirect ways, but not through an immediate weakening of the US dollar or an immediate shift away from using the US dollar for international trade.

Firstly, proof of lower US gold reserves than claimed would add pressure for a full independent audit of all US gold reserves. It would also put the spotlight on the gold reserves of other major trading blocs such as the Eurozone and China and Russia, and open up a debate as to what is the role of gold in the international monetary system. Which is something the US government constantly tries to avoid (i.e. discussion about gold). It might also precipitate a move by nations which seek to replace the US dollar to advance their agendas in introducing an international monetary system backed by gold, knowing that the US would be on the back foot.

It would also then refocus attention on international holders of US dollars pre-August 1971 when Nixon closed the gold window, because after all those outstanding dollars held at the time by foreign central banks are still technically convertibility into gold at the official gold price of the time.

Indirectly, if the US Treasury gold holdings were seen to be falsified, it would also add pressure on the central banks that claim to hold gold at the Federal Reserve Bank of New York to prove that they too hold the amount of gold they claim to on US soil.

Can We Expect a Proper Audit of US Treasury Gold Reserves

A proper audit of the US Treasury gold reserves would be in the form of a full and independent audit of all US Treasury claimed gold reserves at the same time, i.e. across the 4 claimed storage locations. Weighing all gold bars, checking assays and publishing a full weight list in the public domain. It would have to be conducted by a fully independent auditor.

Can we expect such as proper audit of the US gold reserves?  No, never. The chances of that ever happening are practically zero since the US Treasury (via the US Mint) does not even let anyone in to see the US gold reserves. Nor does the NY Fed ever let anyone in to see all of the US gold (and foreign held gold) claimed to be held in the NY Fed vaults. There has never been at any one time a full physical independent audit of all the gold which the US Treasury claims to hold.

Even a summary explanation of the US gold ‘audit’ history is confusing and convoluted. Try explaining it to someone, and they will quickly come to the same conclusion.

For example, the physical gold audit at Fort Knox in 1953 was only conducted on gold within 3 compartments and this represented only 13.6% of the gold claimed to be held in Fort Knox at that time. Anyway, this historic audit is so long ago it is irrelevant since much of the US gold was sold off in the 1950s and 1960s.

There have supposedly been audits of the US Treasury gold since 1973, but these have been partial, confusing and have dragged out over many years (continuing audits), and most importantly, these audits have never been conducted by an independent auditor.

Over October and November 1974, a physical audit was carried out on 21% of the gold held at Fort Knox. This audit was done by the General Accounting Office (GAO), in conjunction with auditors from the US Mint, the Bureau of Government Financial Operations (BGFO), US Customs, and the Treasury Department’s Office of Audit.

In June 1975, the US Secretary of the Treasury ordered a continuing audit of all US Government-owned gold, with a target of auditing 10% of US gold every year. A committee comprising the US Mint, the US Bureau of Government Financial Operations (BGFO) and the Federal Reserve Bank of New York were appointed to carry out these continuing audits. Continuing audits were undertaken between 1975 and 1986, after which the Treasury claimed that 97% of all US gold had now been audited.

By September 1982, the continuing audit program had supposedly audited 100% of the gold stored at Fort Knox. By September 1984, the continuing audit program had supposedly audited 99.9% of the gold stored at the Denver Mint.

But in 1983, the US Department of Treasury’s Office of the Inspector General (OIG) issued revised audit guidelines and more than 1,700 tonnes at Fort Knox and Denver being supposedly re-audited between July 1983 and July 1986.

Then from 1986 to 1992, the US Mint supposedly undertook additional audits of gold storage compartments that hadn’t been placed under official joint seal by the continuing audits committee.

In 1993 the OIG took over the annual audits of US Mint held gold. By 2008, all the gold held by the Mint had been placed under official seal. In 2010, the OIG claims to have renewed the joint seals on all 42 gold storage compartments at the US Mint storage facilities.

These annual audits merely consist of checking the official joint seals put on the vault compartment doors during the continuing audits from 1974 until 1986,  

There should be 13 annual audit reports of the continuing audit. But 7 of these audit reports are missing and neither the OIG or the Treasury Department, or the National Archives can produce them.

Is physical gold still moving from West to East

Yes, there is a trend of physical gold moving from West to East, much of which goes to China and India. In the case of China, gold imported into the Chinese market cannot easily flow back out of China due to general prohibitions on gold exports out of China. And so it stays there and is accumulated by the Chinese population. The People’s Bank of China (PBoC) (Chinese central bank) has also been accumulating gold reserves, some of which it buys on the international gold market (e.g. in London) and transports by air to Beijing.

In the case of India, much of the gold imported into India stays there as is it horded by the Indian population. Net imports of gold into India are nearly as high as gross gold imports, since gold exports from India are quite low (mostly in the form of gold jewellery).

A final Point – Chinese gold at the NY Fed: 600 tonnes

After translating the 11 January BWChinese article from Chinese into English, I noticed that the last few paragraphs discussed Chinese gold being held at the Federal Reserve Bank of New York, and the inability of the Chinese to get this gold back. The relevant paragraphs are as follows (which I translated and re-edited):

“A BWC Chinese network report mentioned that the Federal Reserve had on several occasions rejected China’s request to ship back about 600 tonnes of gold reserves stored in underground vaults in the New York.

Some analysts said at the time that for China to overcome the sanctions imposed by the United States, it had no choice but to use gold as collateral. A report by People’s Daily’s “IFC” in December 2012, “How Much Gold Has Been Pocketed by the United States” has been confirmed:

It is reported that more than 60 countries have allocated some or most of their gold reserves hidden in the New York Federal Reserve Bank’s underground vault.

Some experts said that China once had shipped 600 tons of gold reserves to the United States and continuing its search, found that China first deposited its gold reserves with the United States in 1990.”

This is the first time I have heard of such a scenario. Perhaps its true. If its true, it could mean that the People’s Bank of China (PBoC), the agent of the Chinese State, could still be holding a significant quantity of its gold in the vaults of the NY Fed, that the Fed will not return. There again, maybe it’s not true, or my translation might be wrong. Perhaps a native Chinese speaker can read the text and translate it into English properly. The text is as follows:



Although the US is very secretive about its official gold reserves and their storage, so too are the Russians and the Chinese. But whereas the Americans downplay the role of gold as a monetary asset, the Russians and Chinese do the opposite and openly talk about the strategic importance of gold.

I find it interesting that it takes a Russian media publication and a Chinese media publication to openly discuss the state of the US gold reserves, while at the same time the mainstream US financial media will never do any serious investigative analysis of the official gold reserves in their own country.

What would Trump make of all of this? Especially since he is supposed to like the shiny stuff himself. Perhaps an enterprising US reporter can ask Trump next time they are in the same room. Perhaps trump would tell him to get “out’. Perhaps not. last word goes to Trump, who in March 2015 said the following in interview with WMUR-TV, New Hampshire, in a segment called ‘Conversation with the Candidate’,:

“In some ways, I like the gold standard and there is something very nice about it but you have to go back at the right time… We used to have a very solid country because it was based on a gold standard for it.

We do not have that anymore. There is something very nice about the concept of that. It would be very hard to do at this point and one of the problems is we do not have the gold. Other places have the gold.

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

On August 10, the Wall Street Journal (WSJ) published an article about the Federal Reserve Bank of New York (FRBNY) custody gold and the NY Fed’s gold vault. This vault is located under the New York Fed’s headquarters at 33 Liberty in Manhattan, New York City.

The article, titled “The Fed Has 6,200 Tons of Gold in a Manhattan Basement – Or Does It?”, can be read on the subscription only WSJ site here, but is also viewable in full on both the Fox News Business and MorningStar websites, here and here. It also appeared on the front page of the Wall Street Journal print edition on Friday, August 11.

Wall Street Journal article about the NY Fed stored gold
Wall Street Journal article about the NY Fed stored gold, August 10 2017

The NY Fed offers a ‘custody gold’ storage service to its customers, customers which are exclusively foreign central banks and international financial institutions, except notably, the US Treasury is also a gold storage customer of the NY Fed. The Fed’s gold vault, which is on level E (the lowest level) of its basement area under its downtown Manhattan headquarters, open in 1924, and has been providing a gold storage service for foreign central banks since at least the mid-1920s. Custody gold means that the NY Fed stores the gold on behalf of its customers in the role of custodian, and the gold is supposed to be stored on an allocated and segregate basis, i.e. “Earmarked gold”.

NY Fed stored gold has risen in public consciousness over the last few years arguably because of recent Bundesbank gold repatriation operations from New York as well as also similar gold repatriation from the central bank of the Netherlands. The moves by the Chinese and Russian central banks to actively increasing their gold reserves have also put focus on whether the large traditional central bank / official sector gold holders (such as Germany, Italy and the International Monetary Fund) have all the gold that they claim to have, much of which is supposedly stored at the NY Fed vault.

The main theme of the August 10 WSJ piece, as per the title, is whether the NY Fed actually stores all the gold in the vault that its claims to store, a theme which it introduced as follows:

“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.”

Front Page - Wall street Journal, August 10, 2017
Front Page – Wall street Journal, August 11, 2017: Fed gold article bottom of page

The WSJ article intersperses a number of facts about this custody gold alongside various quotes, and while I cannot speak for anyone else quoted in the article, the quotes could probably best be described as being on the sceptical side of the NY Fed’s official claims.

Since I am quoted in the article, it seems appropriate to cover it here on the BullionStar website. The relevant section is as follows:

‘But “no one at all can be sure the gold is really there except Fed employees with access,” said Ronan Manly, a precious-metals analyst at gold dealer BullionStar in Singapore. If it is all there, he said, the central bank has “never in its history provided any proof.”

Mr. Manly is among gold aficionados who wonder if the bank is hiding something about what it’s hiding.’


Extract from Wall Street Journal article on NY Fed stored gold, August 10
Extract from Wall Street Journal article on NY Fed stored gold, August 10

Let me begin by explaining the basis of my quote.

The only reporting which the New York Fed engages in for the custody gold recorded as being held on behalf of its customers (central banks and official sector organizations) is a single number communicated each month (with a 1 month lag) on Federal Reserve table 3.13 – “Selected Foreign Official Assets Held at Federal Reserve Banks” and listed as “Earmarked Gold”.

See the following link, line item 4 for the latest reporting date of July 2017: https://www.federalreserve.gov/econresdata/releases/intlsumm/forassets20170731.htm

As of the end of July 2017, the Fed reported that it was holding $7.84 billion of “Earmarked Gold” in foreign and international accounts. This amount is a valuation at the official US Treasury / Fed price of gold of US $42.22 per fine troy ounce, and which works out at approximately 5775 tonnes of gold.

Federal Reserve reported Foreign accounts stored gold – Earmarked Gold, July 2017. Source: www.goldchartsrus.com
The reason that this figure differs from the ~6200 tonnes number quoted by the Wall Street Journal is that it doesn’t include 416 tonnes of US treasury gold also claimed to be stored in the NY fed vaults. When the US Treasury claimed quantity is added, the figure comes to 6191 tonnes, hence the WSJ citation of circa 6200 tonnes.

NY Fed Gold – Opacity and Secrecy

Other than that, the Federal Reserve does not publicly communicate any other relevant information or details about the quantity of custody gold bars said to be stored in its vault, and furthermore, the Fed has never in its history publicly communicated any such relevant details or information.

So it is a fact that the Federal Reserve has “never in its history provided any proof” that all the gold it claims is there is really there, hence the quote is factual, and hence the connected quote that “no one at all can be sure the gold is really there except Fed employees with access” is a valid conclusion also.

I have done a lot of in-depth research into the NY Fed gold vault and its customer base, for example, see my articles “The Keys to the Gold Vaults at the New York Fed – Part 1“, and “The Keys to the Gold Vaults at the New York Fed – Part 2: The Auxiliary Vault“, and “The Keys to the Gold Vaults at the New York Fed – Part 3: ‘Coin Bars’, ‘Melts’ and the Bundesbank“, so I have made my conclusion based on that research.

The NY Fed has never provided any of the following:

– details of the names of the central banks and international financial institutions that it claims to hold gold on behalf of

– details of how much gold is held by each customer

– details of whether any of the gold stored in the vault is under lien, claim encumbrance or other title

– details of whether any of the custody gold is lent or swapped

– details of location swaps and / or purity swaps of gold bars between the NY Fed vaults and other central bank or commercial bank vaults around the world

– details of the fact that nearly all of the gold bars supposedly held in the NY Fed vault are a combination of old US Assay office gold bars and low grade coin bars made from melted coins

The NY fed has never allowed the conduct of any independent physical gold bar audits or published any results of its own audits. It has never published any gold bar weights lists (note one weight list for some US Treasury gold bars stored at the NY Fed vault made it into the public domain in 2011 as part of documentation that was submitted to a ‘Investigate the US Gold’ hearing in front of the US House of Representatives Committee on Financial Services. That weight list starts on page 132 of the pdf which can be accessed here.

Mainstream Media Cheerleaders and Detractors

The lack of transparency of the New York Fed as regards the custody gold that it stores for its central bank customers is therefore a valid point. The Wall Street Journal article of August 10 is merely highlighting this valid point. However, predictably this did not stop some mainstream US media critics from denouncing the WSJ article such as can be seen in the following tweet from a POLITICO ‘chief economic correspondent‘.

I would wager that this Ben White chap has never asked the New York Fed any serious questions about its custody gold, preferring instead to throw around tweets using accusatory language such as ‘lunatics’. But this sort of reaction is par for the course from elements of the cheerleading US mainstream media, who seem to feel an obligation to protect the Fed and the status quo of the incumbent central bank led financial system from any valid criticism.

However, I have asked the NY Fed serious questions about its custody gold.

On February 15 this year, I asked the Central Bank and International Account Services (CBIAS) unit of the Fed’s Markets group to confirm the following:

– the number of central banks and official sector institutions that have gold in storage with the NY Fed in Manhattan.

– the identities of these central banks / official sector institutions that have gold in storage.

– could FRBNY CBIAS / Account Relations provide me with gold bar weight lists for the gold holdings that these central banks and official sector institutions hold with the NY Fed?

As the first query went unanswered, I then resubmitted the query a month later in mid-March. On neither occasion did the Fed respond or acknowledge the request. Realistically, I didn’t expect the NY Fed to answer, since they have track record of being aloof and unanswerable to anyone but their own stakeholders, however, the outcome of the emails has established that the NY Fed does not engage on this issue nor provide any transparency in this area to the public.


I 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.

What these Freedom of Information requests actually contained is not, however, even revealed by the WSJ, except hilariously in one passing reference to “a heavily redacted tour guide manual“. Hilarious in the sense that the NY Fed would even see fit to heavily redact a simple tour-guide manual. To quote the WSJ:

‘The Wall Street Journal filed Freedom-of-Information requests with the New York Fed. Among the Journal’s findings, from a heavily redacted tour-guide manual provided by the Fed: Tour guides are informed that “visitors are excitable” and should be asked to “please keep their voices down.”‘

Why doesn’t the Wall Street Journal do a full publication of all the NY Fed FOIA responses that it received and publish them on its website? This at least would be some sort of backup evidence to the published article.

There are a multitude of angles that the Wall Street Journal could cover if it wanted to do a proper investigation into the gold bars supposedly stored in the NY Fed vault below 33 Liberty on Manhattan Island.

For example:

Why did the German Bundesbank take multiple years to transfer back a small portion of the gold that it claimed to have held at the NY Fed vaults, with much of that gold having to be recast / remelted into new bars en route to Frankfurt in Germany. If the gold was allocated and segregated to the Bundesbank account at the NYFed, there would have been no reason for the multi-year transfer delays and no reason to need to melt down and recast any gold bars.

Why did low-grade coin bars start turning up in the NY Fed vaults from 1968 onwards? The only place they could have come from is Fort Knox in Kentucky. The fact that these low-grade coin bars had to be used suggests there was not enough high-grade gold bars (995 US assay office Good Delivery gold bars) to satisfy central bank customer requirements at the NY Fed vault at that times. Some of these coins bars were over time shifted out of the NY Fed vaults and refined into high-grade bars and sent to the Bank of England in London. How much coin bar gold is still in the NY Fed vault.

For the 3 largest claimed gold holders at the NY Fed, which are the Banca d’Italia, the Bundesbank and the International Monetary Fund, and which between supposedly hold at least 4000 tonnes of gold at the NY Fed, there is no way to validate the accuracy of any of these holdings, neither from IMF, Bundesbank or Banca d’Italia sources, nor from the NY Fed. These gold holdings have, on paper, not changed since the early 1970s, but thats over 40 years ago and there is no way to check the accuracy of these 3 holdings which make up the lions share of all the gold supposedly held at the NYFed.

Why is there a tunnel between the NY Fed level E basement gold vault to the Chase Manhattan Plaza level B5 basement gold vault across the street? i.e. Why is a central bank vault linked to a commercial vault run by a commercial bank (JP Morgan Chase)?

Does, or has the JP Morgan / Chase in the past, facilitated the activation of NY Fed stored central bank gold into the commercial gold market via movements of gold bars from 33 Liberty to Chase Manhattan Plaza vaults?

Why is there no mention in the Wall Street Journal article of the NY Fed’s Auxiliary vault which was built in 1963 and its location, and which supposedly stores gold bars in a “wall of gold”. Was this not newsworthy?

Why did the 2004 version of the NY Fed gold vault brochure ‘The Key to the Gold Vault’ state that gold bars “belonging to some 60 foreign central banks and international monetary organizations” were stored at the NY Fed vault, and then the 2008 version of the same brochure had changed this statement to gold “belonging to some 36 foreign governments, central banks and official international organizations”.

Why the drop from 60 customers to 36 customers. I have heard from a very reliable senior ex-NY Fed executive that some central banks were unhappy to keep their gold in Manhattan in the aftermath of 9/11 and wanted it stored elsewhere. You wouldn’t blame then given what happened to the Scotia gold vaults under the WTC 4 on 9/11.

Why does the NY Fed decline to comment for a Wall Street Journal article? Surely this should ring alarm bells at the Wall Street Journal?

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.

Predictably, instead of prompting the mainstream financial media into asking why these supposed gold bar movements have taken so long, the Bundesbank press release threw the mainstream media into a frenzy of immediately back-slapping the Bundesbank while regurgitating its press release with articles such as “Germany brings its gold stash home sooner than planned” from Reuters , “Germany Gets Its Gold Back Faster With Job Seen Done in 2017” from Bloomberg, and “Germans Sent Gold Away to Keep It From the Soviets. Now Much of It Is Back” from the New York Times.

Furthermore, if the mainstream financial media had bothered looking at Federal Reserve “Table 3.13 – Selected Foreign Official Assets Held at Federal Reserve Banks” under ‘Earmarked Gold’ (line item 4), they would have seen that the foreign custody gold figure that the Fed reports has not changed since September 2016, and that the Fed’s foreign custody gold figure had dropped by 113 tonnes between March 2016 and September 2016, meaning that the Bundesbank’s 111 tonne gold transfer from the US to Germany had been completed by September 2016, i.e. at least 4 months before the Bundesbank reported it.

table frb
Selected Foreign Official Assets Held at Federal Reserve Banks – ‘Earmarked Gold’, 2016. CLICK TO ENLARGE

100 tonnes of gold per day Air-Lifted

All gold withdrawals from the Fed’s “earmarked gold” reporting category in 2016 occurred between March and September 2016, with activity each month throughout that period except in May. As to why there were gold withdrawals from the Fed of 113.45 tonnes when the Bundesbank only reported transferring back 111 tonnes is not clear. Was an additional amount withdrawn from the Fed vault by another foreign central bank or did the Bundesbank conduct further melting down of its US Assay office gold bars and lose 2+ tonnes (1.7%) of fine ounce content that was overstated in its Federal Reserve holdings? Or perhaps this amount was lost when weighing old US Assay Office ‘melts’ (batches of 18-22 bars) which had never been properly weighed before.

Whatever the case, we will never know because the Fed does not divulge the identities of its central bank gold custody customers, nor does the Bundesbank divulge simple details such as gold bar serial numbers on its so-called gold bar list (more of which below).

Simple common sense would have alerted the mainstream media robots to the fact that it is not normal for international gold movements to take 4 years to complete, and that there is something absolutely not right with Germany’s foreign held gold taking so long to transport from New York and Paris. Paris is just a 1 hour flight from Frankfurt and 6 hours by road, and New York is less than 9 hours flying time to Frankfurt.

Other simple questions which the mainstream financial media have failed to ask or have failed to think of include why does the Bundesbank need to keep any gold at all stored at the Federal Reserve in New York, let alone 1236 tonnes, when the New York Fed vault is not even an international gold trading center. And is this gold left in New York is under any liens, claims, encumbrances, loans or swaps?

In contrast to the Bundesbank’s laughable repatriation program duration, take for example, the Banco Central do Venezuela, which was able to transfer 160 tonnes of gold from Europe to Venezuela’s capital, Caracas, over a 2 month period from 25 November 2011 to 30 January 2012. See “Venezuela’s Gold Reserves – Part 2: From Repatriation to Reactivation” for details.

That’s 80 tonnes per month, which would equate to a 4 month transfer window for 300 tonnes of the Bundesbank’s gold stored in New York, not 4 years. Furthermore, why is the mainstream media not asking the Bundesbank why it takes more than 4 years to transfer 374 tonnes of gold from Paris to Frankfurt?

More damning to the contemporary Bundesbank, the same Americans (Federal Reserve) were able to fly over 800 tonnes of gold from the US to England exactly 50 year ago, in November and December 1967, to prop up their share of the London Gold Pool gold holdings at the Bank of England. This gold was flown into RAF Mildenhall in Suffolk over 9 days in batches of around 100 tonnes each day using US air force cargo carriers, and then this gold was ferried by police escorted convoys down to the City of London.

The first 4 of these US air force flights were on Tuesday 28 November 1967, Wednesday 29 November, Friday 1 December, and Sunday 3 December, with the Americans flying in 100 tonnes of gold each day to RAF Mildenhall over those 4 days. That’s 400 tonnes of gold flown from the US to Europe in just 6 days. See screenshot below.

100 tonnes per day
The Federal Reserve is able to organise massive and rapid gold movements by air when it wants to

These 4 flights in late November and early December 1967 were followed by 5 more flights on Tuesday 19 December, Thursday 21 December, Thursday 28 December , Friday 29 December, and Sunday 31 December 1967. These 5 flights transported another 445 tonnes of gold bars (14,317,458 fine ounces) from the US to the Bank of England vaults (see screenshot below). That’s another 445 tonnes of gold moved from the US to London in just 13 days.

5 flights
Federal Reserve had 445 tonnes of gold flown from the US to London in just 13 days in December 1967

Overall, the November and December 1967 gold airlifts transported nearly 850 tonnes of gold from the US to Europe in just 1 month.

There were also further massive gold airlifts from the US to the Bank of England in the summer of 1968 which ironically the Federal Reserve needed to do so as to pay back physical gold swaps which the Bundesbank had made available to the Americans at the Bank of England during the last days of the London Gold Pool in March 1968.

These rapid and massive physical gold movements over international borders in 1967 and 1968 show how laughable the Bundesbank’s current gold repatriation program actually is, and how servile the mainstream financial media are in not even questioning the timeframe of the Bundesbank’s repatriation operations.

RAF Mildenhall police escort
POLICE ESCORTS for Gold Run from RAF MILDENHALL to BANK OF ENGLAND, December 1967. Source here

Updated “So-Called” Bar List

Following its press release on 9 February, the Bundesbank then published an updated version of its so-called gold bar list on 23 February, specifying its gold holdings as of 31 December 2016. A so-called gold bar list, because the format of the Bundesbank’s gold bar list does not follow any accepted industry standard format and does not contain basic details such as bar serial number and bar refiner name that are crucial to any normal gold bar weight list. The updated Bundesbank bar list was also released in a very low-key way, and its publication does not seem to have been picked up by any of the mainstream financial media. The updated Bundesbank ‘list’ can be viewed here in a file that the Bundesbank had actually created on 14 February 2017.

DB 2016
Bundesbank gold bar holdings as per 31 December 2016

To reiterate, a proper gold bar weight list, as per the definition of the London Bullion Market Association (LBMA) in its Good Delivery Rules for Gold and Silver Bars, contains the following details:

  • Serial Number of bar
  • Bar Refiner Brand
  • Gross weight (troy ounces)
  • Assay (Fineness)
  • Fine Weight (troy ounces)

For example, here is a recent gold bar weight list from the iShares Gold Trust (IAU). For each bar held in the iShares Gold Trust, the weight list lists:

  • bar brand (refiner name)
  • bar serial number
  • shape (400 oz)
  • Assay (fineness)
  • Gross ounces
  • Fine ounces
  • Vault (example JP Morgan London)

The Bundesbank claims that all of its gold bars are good delivery bars, so it and its gold custodians (Bank of England, Banque de France and Federal Reserve Bank of New York) have all of this information stored on their respective gold bar accounting systems, including real bar serial numbers and refiner names. They have to store this information since any bars entering or leaving LBMA network gold vaults need to be accompanied by proper weight lists, including serial number and bar refiner brand.

Compare a proper weight list with the sparse and incomplete what the Bundesbank includes in its gold bar list:

  • Inventory Number (internal sequence numbers or incomplete bar numbers)
  • Gross Weight
  • Fineness
  • Fine Weight
Bundesbank 'list' format
Bundesbank gold bar ‘list’ format – No serial numbers, No bar refiner names

For Germany’s bars listed as held by the Bundesbank, Bank of England and Banque de France, these inventory numbers are merely “internally assigned inventory numbers”, and ludicrously in the case of the Bank of England and Banque de France gold vaults, they only allow other central banks to publish partial internal inventory numbers (the last three digits).

The secrecy with which the Bank of England, Banque de France and other central banks treat real gold bar serial numbers and other identifiers is most likely due to their paranoia that publication of such serial numbers would undermine their ability to operate with secrecy in the gold lending and gold swap market where bar identities might pop up in the gold holdings of commercial operators such as gold-backed Exchange Traded Funds (ETFs).

Numbers listed against Bundesbank bars held at the Federal Reserve Bank of New York do supposedly show a refiner number, or a melt number, but without the refiner name and year of manufacture of these bars being divulged by the Bundesbank, there is no way to verify and cross-check these bar numbers.

Note that this new Bundesbank gold bar list is the third such list that it has published, and it is in the same format as the previous two versions, both of which are also not real gold bar weight lists since they lack refiner serial numbers and refiner names.

For the purposes of this article, let’s refer to a “Bundesbank bar list” as an “incomplete partial weight list”. The Bundesbank had actually signalled the publication of its updated list at the bottom of its 9 February press release, where it stated:

“On 23 February, the Bundesbank will publish an updated list of its gold bars on its website. This list contains the bar, melt or inventory numbers, the gross and fine weight as well as the fineness of the gold.”

3 Bundesbank gold bar lists

To recap, the Bundesbank had already published 2 incomplete partial weight lists. The first of these was published on 7 October 2015 and showed holdings as of 31 December 2014. The file can be accessed here, or at the bottom of the page here. The Bundesbank actually created this file on 5 October 2015 and saved it with a file name of 2015_10_07_gold.pdf.

DB 2014
Cover page of Bundesbank’s 2014 incomplete partial gold bar list

The publication of this first bar list was elegantly and deftly dissected and critiqued by Peter Boehringer, of the German campaign “Repatriate our Gold”, in his October 2015 article “Guest Post: 47 years after 1968, Bundesbank STILL fails to deliver a gold bar number list”.

The Bundesbank’s second incomplete partial weight list was created on 4 February 2016 and listed holdings as of 31 December 2015, and was published sometime after 4 February 2016. Confusingly, the incomplete partial weight list as of 31 December 2015 file was uploaded to the same web page and with the same file name as the 31 December 2014 file (i.e. it was uploaded with the filename  2015_10_07_gold.pdf and it over-wrote the first list). This second incomplete partial weight list can be accessed here.

DB 2015
Cover page of Bundesbank’s 2015 incomplete partial gold bar list

Why no lists prior to December 2014?

Given that the Bundesbank has now demonstrated its ability to generate files itemising its gold holdings, even with limited bar details, the fact that the Bundesbank only began publishing its gold holdings’ lists in October 2015 should immediately raise suspicion as to why it did not publish such bars lists as of the end of 31 December 2012 (prior to the repatriation beginning), and as of 31 December 2013.

A casual observer would deduct that the Bundesbank does not want anyone to see an itemised list of its gold holdings on these dates in 2012 and 2013, and the casual observer would probably be correct in deducing such a conclusion. For its was during 2013 and 2014 that the Bundesbank melted down and recast 55 tonnes of the gold bars that it had held in New York. Five tonnes of its gold was melted down and recast in 2013 and a whopping 50 tonnes was melted down and recast in 2014. Recall that in January 2014, the Bundesbank stated that during 2013:

We had bars of gold which did not meet the ‘London Good Delivery’ general market standard melted down and recast. We are cooperating with gold smelters in Europe,” Thiele continued. The smelting process is being observed by independent experts. It is set up in such a manner that the Bundesbank’s gold cannot be commingled with foreign gold at any time.’

Some of the bars in our stocks in New York were produced before the Second World War.” “Our internal audit team was present last year during the on-site removal of gold bars and closely monitored everything. The smelting process is also being monitored by independent experts.”

“The very same gold arrived at the European gold smelters that we had commissioned.” “The gold was removed from the vault in the presence of the internal audit team and transported to Europe. Only once the gold had arrived in Europe was it melted down and brought to the current bar standard.”

And again in January 2015, the Bundesbank revealed that: during 2014 it:

“took advantage of the transfer from New York to have roughly 50 tonnes of gold melted down and recast according to the London Good Delivery standard, today’s internationally recognised standard.”

For more details of these statements, and follow-up questions to the Bundesbank, please see “The Keys to the Gold Vaults at the New York Fed – Part 3: ‘Coin Bars’, ‘Melts’ and the Bundesbank“.

If the Bundesbank had published weight lists as of the end of years 2012 and 2013, then details such as bar gross weight, fineness (gold purity), and bar fine weight would have to have been divulged. By not publishing earlier bars lists, no one outside the Bundesbank – Federal Reserve nexus will ever be aware of the weights and purities of these 55 tonnes of gold bars that were melted down and recast. The Bundesbank obviously has or had the details of these smelted bars, since it commissioned and monitored the smelting process. But as Peter Boeringher stated in his October 2015 article “it appears the bar lists for these transferred bars were lost or destroyed.”

What secrets did these bars hold? One distinct possibility was that they were low-grade coin bars, that had been produced from melted gold coin. In this case they would have been bars of 0.90 or .9167 gold purities or similar. Low grade coin bars began appearing at the NY Fed vault in Manhattan in 1968 and most likely came from the US Treasury’s gold holdings at  Fort Knox, Kentucky which consist of about 80% low-grade coin bars. It would not look good for the NY Fed if such low grade bars appeared on a foreign central bank’s gold bar list, and would invariably raise questions as to which US vaults this gold was sourced from.

Perhaps the bars that the Bundesbank melted were Prussian Mint bars from the Nazi era which the Bundesbank would be averse to holding in Germany for political reasons? Or maybe they were problematic US Assay office bars which had a lower fine ounce content than was stated on the actual bar, an issue that dogged another portion of the Bundesbank’s gold stocks in London in 1968. Or perhaps they were gold bars with some other embarrassing provenance which the Bundesbank and Federal Reserve needed to mask the true origin of. Without the Bundesbank ever clarifying this issue, we will never know.

Comparing the 3 Lists

What can we glean from comparing the 3 lists to each other? The only variable on which to compare the lists are gross weight, fineness, and fine weight, and the bar and melt counts per location.

In theory, the lists from December 2014, December 2015 and December 2016 should be identical assuming that the total amount of gold bars has not changed between versions.

If the lists are not identical, then it could suggest a number of things including:

  1. gold bars that were previously held in Melts have now been individually weighed and itemized on the more recent list. This would most likely be for bars that were transferred to Frankfurt, but could also apply to bars which remained in the other storage locations
  2. further instances of gold bars remelted / recast while being transferred from New York or Paris to Frankfurt that the Bundesbank has kept quiet about
  3. gold bars still held in Paris or New York (or London) that have been being recast and upgraded before being moved. This would apply more to Paris going forward
  4. sales of gold bars to ‘fund’ the German official gold coin program.
  5. gold lending / swap / repo transactions

Since the lists do state melt number, if there are less any melt numbers listed in more recent lists compared to older lists, then it means that the Bundesbank or its agents have weighed and itemised the individual bars in various melts (groups of 18-24 bars). For example, if the entries for 20 melts had disappeared from a more recent version of a list, then there should be about 400 extra individual bars of the newer list.

Using some quick eyeballing, the file dated 31 December 2014 has 2307 pages including introduction. The file dated 31 December 2015 has 2401 pages including introduction, i.e. the latter file has 94 extra pages. There are approximately 44 pages of melts in the 2014 file listed from page 2263 to the last page 2307. There are approximately 40 pages of melts in the 2015 file listed from page 2361 to the last page 2401. From a rough count, there are about 85 rows per page. This would mean about 340 melts were weighed and converted into itemised rows of single bars during 2015. Not all melts have full sets of bars, but assuming they did, that would be about 20 bars per melt, which would be about 20*340 = 6800 bars which would appear in individual rows in the 2015 list if the melts were “broken out”, which is about 80 pages, and is fairly near explaining the reason for the extra 94 pages in the 2025 file.

If you look at the number of gold bars listed in the press releases (current version and archived version), you will see that there were in total 270,326 bars at the end of 2014 and 270,058 bars at the end of 2015, so there were 258 less bars at the end of 2015.

As of the end of 2015, there were 34,808 bars in London vs 35,066 bars at the end of 2014. i.e. There were 258 bars less in London (about 3 tonnes). So the London drop explains the total drop. This could be gold used for a gold coin program.

This is just some quick eyeballing. The next step is to do an automated comparison of the 3 lists side by side by comparing the variables gross weight, fineness and fine weight so see which bar details may have changed over the 2 year period, and to look at what might have changed. This matching and calculation exercise will probably be undertaken by a gold bar database expert in the near future, so watch this space for further details.