Fed Reserve admits 'We Have No Gold'

OK, I know this will be a touchy subject, but here goes...

First, a link to the Global Research article/and video of Ron Paul speaking with members of the Fed Reserve (Bernanke is not in this one). To my surprise, the Fed Reserve admits they have no gold, and haven't had any since 1934. Isn't it ironic how it exactly overlaps the Gold Confiscation Act of 1933 (you 'hoarders' beware) in scope and purpose?

I know, I know.... the Federal Reserve is not required to, or has to have gold. They issue Federal Reserve notes authorized by the US Treasury via Treasury bills (gurantee of assets).

Here is where it gets sketchy. After a bit of searching, I ended up on the US Treasury website on their page containing this chart. So we are essentially under the assumption the the US Treasury is using gold as one of the assets backing currency/debt repayment. In looking at the chart, it seems pretty legit, until you start doing the math.

Here's an example:

Department of the Treasury
Financial Management Service
STATUS REPORT OF U.S. TREASURY-OWNED GOLD
July 31, 2011

The Treasury claims they have 261,498,899.316 ounces of gold with a Book Value of $11,041,058,821.09. If you do the math under the premise that gold is at $1700/oz, we can calculate that the Treasury spot price on gold is $0.02368 per ounce. WHAT!?! 2 cents per ounce? Calculate it yourself and see. 261 million divided by 11 billion. Surely the decimal point is in the wrong place, but even if you shift it 3 places to the right, it still only gives $23.68 per ounce. Doesn't sound all that precious to me. But even so. If the Treasury only has $11 billion in gold, then how/why can it issue trillion dollar loans? MBS? Nah, the housing bubble popped. Bank assets? Wasn't that the bubble that crushed Lehman brothers? Or was it AIG? No maybe it was Fannie and Freddie? Ummmmmmmmm I dunno. One of those pyramid schemes caused it.
BUT if you go back to the Treasury website, they also indicate that the Federal Reserve has gold too. Exactly 13,452,783.620 ounces of it! And it has a Book Value of $568,006,120.59. And oddly enough it has the exact same value of 0.02368 also! But... didn't that... Federal Reserve guy.... the one Ron Paul just asked.... in that first video.... he said the Federal Reserve..... had no gold.... and hasn't had any since 1934?
So if they value gold at 2 cents per ounce, how much wiggle room does that give them to manipulate markets, economies, banks, governments, gold-bugs? If the federal reserve has no gold, and the treasury has 'some gold' then how much of that 'cheaper than aluminum' metal is in Fort Knox?
But the word on the street is BUY BUY BUY! It's a hedge against inflation! It will save your portfolio! They've baited that cage pretty well, and turned it into a circus event. Just FYI, here a quip from Roosevelts 1933 Executive Order:

I, Franklin D. Roosevelt, President of the United States of America, do declare that said national emergency still continues to exist and pursuant to said section to do hereby prohibit the hoarding gold coin, gold bullion, and gold certificates within the continental United States by individuals, partnerships, associations and corporations and hereby prescribe the following regulations for carrying out the purposes of the order:

Section 1. For the purpose of this regulation, the term 'hoarding" means the withdrawal and withholding of gold coin, gold bullion, and gold certificates from the recognized and customary channels of trade. The term "person" means any individual, partnership, association or corporation.

So you folks riding the yellow metal gravy train might be in for a bit of a surprise when currencies crash. What could all this possibly mean? Well, I'm no economist, or investor. But look at it this way. If the IMF/BIS/UN are the global moneylenders and they are bailing out country after country using Special Drawing Rights as 'asset capital' for loans (fiat credit) and they much prefer repayment in physical assets such as gold, then any country indebted to the IMF will ultimately repay with resources (gold, oil, land, etc). When the endgame comes around, and after all the smoke clears, who do you think will have total authority over the global finances? Yep the UN (Gosfather to the IMF). Does the US owe them money. Probably so. How will we ever repay the Rothschild International Banks? Not with fiat currency. Flash back to 1933 when our gold was gathered up and sent to England. We got some of it back, but doesn't history repeat itself if we let it?
So if you have more than let's say, an ounce or 2 of gold and the markets crash (bank holidays, etc), you can consider yourself a 'Hoarder!' and your extra precious metals will be flashed back to the central banks and whisked overseas again. Remember, the endgame goal of IMF loans is their covert plan of the Structural Adjustment Policy, which creates unpayable loans, reduced social benefits, higher taxes and.... hold up a sec..... sounds like what's going on HERE. I wonder........

reply to post by OuttaTime


Why is this even news???? We haven't been on the gold standard for DECADES (nor should we). The "no gold" isn't a problem. The problems lie in other economic areas. But this, well ... again, why is this news??

reply to post by Scytherius


Maybe so, but with gold at over $1700/oz, why does the treasury value theirs at less than 3 cents? And if the Feds admit they have no gold, yet the Treasury indicates that they do, what does that tell you about the bankers that are creating this mess? It's isn't always about the gold, but the motives they imply with it to destroy economies. I would like to know what 'solid assets' the treasury uses as a gurantee for their loans, besides debt and interest. What solid and secure asset are they basing their business on?

If they enact the 1933 executive order, then what would be the purpose of collecting a metal that is not money?

You have got your divide upside down to work out the price per ounce 11 Billion / 261 Million = $42 per ounce. It still does not make any sense and no surprise there is anarchy when such simple accounting practices have been thrown out the window. The reason for this is clear, to cloud the corruption.

reply to post by kwakakev


I thought I had it right 261 million ounces divided by 11 billion dollars = price per ounce. Either way it's government math so we won't be able to understand it

reply to post by OuttaTime

Either way it's government math so we won't be able to understand it

And that is the way they like it, creates too many uncomfortable questions when you try and make sense of it. Look what happened to the S&P ratings agency when they started digging into it, huge government backlash and CEO is replaced. Or look what happens when someone tries to get the Pentagon's books at add up, they send a plane or missile into the building to help bury it. While there is no comprehensible transparency it is all a game of heads they win, tails you lose so the war machine can keep grinding away.

Gold has always been the rich man's stash and always will be. Hence, The fed laying a trap for these gold buyers is just impossible and foolish, because they'll be bankrupting themselves too if they do
Besides, since JP Morgan has a lot of influence over the fed, when they say gold will be $5000 next year, it will be $5000 next year because they are the ones who are going to make insane amounts of profits with the price increase.

Apparently we are confusing the roles of the Treasurary Dept and the Fed. The Fed does hold no gold, but the Treasurary Dept does hold gold. Here is a basic article that explains some of the differences:

Difference between the Treasury and the Fed

We also have to remember that the Fed is a private institutin that operates outside of the US Government.

As far as the valuation of he gold that the Treasury Dept holds. As stated above me, the math was backwards, Yu will actaully arrive at approx $42 per troy ounce of gold. This is the book value that is listed for the US Depository in Ft. Knox as seen here:
source

Now why is the book value of this gold so much lower than the market value of gold, which is right now about $1783? Because the book value is what was paid for the gold, not what it would be valued at if made liquid. This price will never change. It will be $42 today, as it was yesterday as it will be 100 years from now. If you want to see an obscenely high number, calculate the market value of the Treasury Dept's holdings.

Here is a source that explains this idea very well.Difference between book value v. market value

if you bought a house 10 years ago for $300,000, its book value for your entire period of ownership will remain $300,000. If you can sell the house today for $500,000, this would be the market value.

This explains it fairly well.

reply to post by youdidntseeme


Pretty close... but the value of gold vs. the U.S. dollar was "pegged" to a value, determined by the government, and not the book value, in an attempt to curb inflation.

The $42 per ounce was the price set in 1973 when the U.S. effectively went off the gold standard and it became obsolete to peg the dollar to gold.

Previous to that, gold was at $35, then $38/ounce. Every time the value of gold (in dollars) was increased, it was akin to deflating the value of the dollar.

The value decided upon by the U.S. was always lower than the actual market value, so that the actual gold producing nations would not become the world economic powerhouses because of the sizes of their mines. It should be noted that these were the U.S.S.R. and South Africa at the time.

However, if the U.S. really does hold that amount of gold in reserves, it has an amazingly robust balance sheet in terms of "real-world" value, and I am confused as to why this is not publicized more widely.

the Billmeister

reply to post by kwakakev


Yep. I was watching another vid from another GlobalResearch link where

Rep. Alan Grayson asks the Federal Reserve Inspector General about the trillions of dollars lent or spent by the Federal Reserve and where it went, and the trillions of off balance sheet obligations. Inspector General Elizabeth Coleman responds that the IG does not know and is not tracking where this money is.

Ahh, the unstoppable justice runs into the immovable globalist puppets

Originally posted by Billmeister
reply to post by youdidntseeme

 

Pretty close... but the value of gold vs. the U.S. dollar was "pegged" to a value, determined by the government, and not the book value, in an attempt to curb inflation.

The $42 per ounce was the price set in 1973 when the U.S. effectively went off the gold standard and it became obsolete to peg the dollar to gold.

Previous to that, gold was at $35, then $38/ounce. Every time the value of gold (in dollars) was increased, it was akin to deflating the value of the dollar.

That clarifies a question that I had created for myself and was about to research, because I am sure that gold was much cheaer than $42/ounce at the time of its purchase. Thank you for clarifying the historical aspect here, saved me from pullng my hair out.

My point was to differentiate between the 'market' value and 'book' value a la economics 101.

.

However, if the U.S. really does hold that amount of gold in reserves, it has an amazingly robust balance sheet in terms of "real-world" value, and I am confused as to why this is not publicized more widely.

The belance sheet truly is robust, but its not really liquid and operational is it? In fact I am sure if we affix a value to all of the holdings of the USG, ie real estate, historical buildings, dcuments, etc, and lok at 'market' values, or what they would fetch in the open market,as one may do when compiling assets in say a divorce, bankruptcy or loan applcation, that balance sheet would be even more robust. The USG is far from bankrupt, however they simply operate at a deficit when we look at truly liquid assets, much like many indivduals do. In fact I operate at a deficit every week, but if I liquidated all of my assets and held onto nothing, I would be very much in the black.

reply to post by youdidntseeme


It's odd they would use 'purchase value' over FMV, being a financial asset and all. You're right about the Fed Res. They are a private corporation operating outside US jurisdiction, just like the IRS and the Treasury, all of which are private corporations/banks. They all fall under the IMF umbrella, which would explain the 'austerity measures' we, as a nation, are undergiong. So it's not just our govt, and our financial empires. It's the underpinnings of the global financial system based on the authority of the IMF/BIS. IAW 'structures within the IMF:

How the IMF acquired its gold holdings
The IMF held 90.5 million ounces (2,814.1 metric tons) of gold at designated depositories at end March 2011. The IMF’s total gold holdings are valued on its balance sheet at SDR 3.2 billion (about $5 billion) on the basis of historical cost. As of March 31, 2011, the IMF's holdings amounted to $130.2 billion at current market prices.

The IMF acquired its current gold holdings prior to the Second Amendment through four main types of transactions.

•First, when the IMF was founded in 1944 it was decided that 25 percent of initial quota subscriptions and subsequent quota increases were to be paid in gold. This represents the largest source of the IMF's gold.
•Second, all payments of charges (interest on member countries' use of IMF credit) were normally made in gold.
•Third, a member wishing to acquire the currency of another member could do so by selling gold to the IMF. The major use of this provision was sales of gold to the IMF by South Africa in 1970–71.
•And finally, member countries could use gold to repay the IMF for credit previously extended.
The IMF’s legal framework for gold
Role of gold. The Second Amendment to the Articles of Agreement in April 1978 fundamentally changed the role of gold in the international monetary system by eliminating the use of gold as the common denominator of the post-World War II exchange rate system and as the basis of the value of the Special Drawing Right (SDR). It also abolished the official price of gold and ended the obligatory use of gold in transactions between the IMF and its member countries. It furthermore required that the IMF, when dealing in gold, avoid managing its price or establishing a fixed price.

Transactions. Following the Second Amendment, the Articles of Agreement limit the use of gold in the IMF’s operations and transactions. The IMF may sell gold outright on the basis of prevailing market prices, and may accept gold in the discharge of a member country's obligations (loan repayment) at an agreed price, based on market prices at the time of acceptance. Such transactions require Executive Board approval by an 85 percent majority of the total voting power. The IMF does not have the authority under its Articles to engage in any other gold transactions—such as loans, leases, swaps, or use of gold as collateral—nor does it have the authority to buy gold.

The IMF factsheet, in it's entirety explains in great detail about their dependency on, and financial control to their recipients.

So there we have it . The IMF prefers gold, but Bernanke says gold is not money. Therein lies the conundrum

Originally posted by youdidntseeme
Apparently we are confusing the roles of the Treasurary Dept and the Fed. The Fed does hold no gold, but the Treasurary Dept does hold gold. Here is a basic article that explains some of the differences:

Difference between the Treasury and the Fed

We also have to remember that the Fed is a private institutin that operates outside of the US Government.

As far as the valuation of he gold that the Treasury Dept holds. As stated above me, the math was backwards, Yu will actaully arrive at approx $42 per troy ounce of gold. This is the book value that is listed for the US Depository in Ft. Knox as seen here:
source





Now why is the book value of this gold so much lower than the market value of gold, which is right now about $1783? Because the book value is what was paid for the gold, not what it would be valued at if made liquid. This price will never change. It will be $42 today, as it was yesterday as it will be 100 years from now. If you want to see an obscenely high number, calculate the market value of the Treasury Dept's holdings.

Here is a source that explains this idea very well.Difference between book value v. market value

if you bought a house 10 years ago for $300,000, its book value for your entire period of ownership will remain $300,000. If you can sell the house today for $500,000, this would be the market value.

This explains it fairly well.

Whaaaaaat? Since when does Book value mean cost paid?
In what business world is that terminology used?
I'll tell ya.. NONE.

That explains nothing, it simply confuses the reader and begs more questions.


Excuse me folks, but that is not the definition of "Book Value".
Confusion based on misunderstood terminology.
Par for the course with the Fed.

In every other business on the planet, the term "book Value" refers to ACV or ACTUAL CASH VALUE.
It is used to separate true value of an item, from the inflated retail price.

Book Value means the price without profit so to speak.. never cost paid.
Example.. I buy a $25 face value ticket to a local ball game from my friend for $10.
The book value, or actual cash value is $25
Cost paid is $10.
I sell it for $50 the day of the game, and made $40 profit.
The ACV or "Book Value" of the ticket is and was $25.
Just because I paid less than it's worth, doesn't mean my cost is the Book Value.

So it this an example of the government again confounding terminology to suit their agenda and to confuse?
Or is $42 an ounce the REAL CASH VALUE of an ounce of gold.
Either way, it looks like we are in alot more trouble than they admit.



Reminds me of when the MSM began referring to elected politicians as " Leaders".
Last time I checked...we elect representatives of the will of the prople, not leaders or "deciders".

Originally posted by BadNinja68

Book Value means the price without profit so to speak.. never cost paid.
Example.. I buy a $25 face value ticket to a local ball game from my friend for $10.
The book value, or actual cash value is $25
Cost paid is $10.
I sell it for $50 the day of the game, and made $40 profit.
The ACV or "Book Value" of the ticket is and was $25.
Just because I paid less than it's worth, doesn't mean my cost is the Book Value.

Since we are talking abut book value here, you are right that the book value of the ticket to its original buyer is $25, however the book value of the ticket if you were to apply it to your own balance sheet would be $10 and the market value would then be $50, meaning you have the potential to make $40 profit or 400%

So it this an example of the government again confounding terminology to suit their agenda and to confuse?

Not so much, although we would agree that they do that at times, that much we can agree on, but in this case it is basic economics

Or is $42 an ounce the REAL CASH VALUE of an ounce of gold.

If you are talking about market value, then abslutely not, no more than the market price of the hypothetical ticket was $10.

reply to post by BadNinja68


I believe what you are describing is a "suggested retail price" and not "book value", but really, these definitions are somewhat meaningless to anyone but the IRS, because actual, real-world value is relative.

The real answer to "what is something worth"? is: "whatever someone is willing to pay for it."

In an actual, un-manipulated market, (something which has not been seen in a while!) there is a thing called the "price discovery mechanism". Which, essentially, is the market auto-determining the value of goods which is pretty much as close as you can get to a determination of "real" worth, as it is a consensus among different, free-thinking entities as to what they are willing to actually pay for something.

Your baseball ticket is a great example.

Apart from the paper (and all the man hours involved in transforming it from trees) and ink value, the rest is all very relative. What is the "real" value... $25, $10, or $40?

What is the value of a nation's currency to gold, or any other commodity for that matter?

the Billmeister

Originally posted by Billmeister
Your baseball ticket is a great example.

Apart from the paper (and all the man hours involved in transforming it from trees) and ink value, the rest is all very relative. What is the "real" value... $25, $10, or $40?

I would be remiss if I didn't also bring time into fold here as well. The acquisition value (book value) of the ticket for Badninja is $10 and his market value ended up being $50 on the day of the game. Fast forward 24 hours and his book is still $10 but his market value is now $0.

That is why the market value of gold fluctuates but the reserve is the depository maintains the same book value or acquisition value.

Originally posted by Billmeister
reply to post by BadNinja68

 

I believe what you are describing is a "suggested retail price" and not "book value", but really, these definitions are somewhat meaningless to anyone but the IRS, because actual, real-world value is relative.

Nope.
You gave it backwards.
Im referring to ACV actual cash value.
( or Wholesale Value. Same thing)

Call your bank. ask them the "Book Value" of your used car ( or basically anything than can appreciate or depreciate in value).
then ask them the retail value.
Big difference.
Or just call your bank and ask them to explain the difference in Book value and retail value. They will happily explain it. Then you'll see what I mean.



re read my post. I think you misunderstood my ramblings.

Dealt with finance, loans, appraisals all my working life.
Im very familar with business terminology.
They are idiots or intentionally miswording things.

reply to post by OuttaTime


i'm gonna do this on the fly... here is the article link:
kingdomecon.wordpress.com...



in the body of the text, it is reported that before Nixon took us off the gold standard there was som 740 million ounces in the Treasury... many nations drained 60% of that gold stashed in vaults & caused Nixon to shut the gold window.... before the 740 million oz. minus 60% = (740 - 444 = 296 million ounces) went out the USTreasury vaults

but the article says that only 272 million ounces still exist in the Treasury vaults

that makes 24 million ounces unaccounted for

(add): but you say in the OP: The Treasury claims they have 261,498,899.316 ounces of gold


here's the snip:

the American ‘dollar’ emerged as KING of all currencies. Then in 1971, the Nixon shock occurred. What had happened from 1944 to 1971 was a major decline in our gold supply as a result of the Bretton Woods Agreement to fix our ‘dollar’ to gold at $35/ounce. In 1944, the USA had some 740 million ounces of gold in their possession that served as psychological backing (and real backing) for our ‘dollar’. Gradually, however, this supply diminished as other Nations chose to exchange their excess dollars for our gold. The supply of gold for backing our ‘dollar’ had diminished to some 272 million ounces on August 15, 1971. This was a major international policy issue!

This major reduction in our supply of gold (some 60% since 1944) created the urgency and need for our then President, Richard Milhous Nixon, to close off this exchange option to other Nations. This was done by closing the ‘gold window’ at our Central Bank and allowing our currency to ‘float’ in the open international market.

the value of the existing tonnage of gold is one thing
the quantity of the stored bullion is another thing,
the 3 conflicting claims of stored gold bullion are:
296 million oz's
272 million oz's
261 million oz's


which one is real?

reply to post by BadNinja68


It's all good... the definition of "book value" from the same source, is described in two different ways:

Book value is the price paid for a particular asset. This price never changes so long as you own the asset. On the other hand, market value is the current price at which you can sell an asset.

For example, if you bought a house 10 years ago for $300,000, its book value for your entire period of ownership will remain $300,000. If you can sell the house today for $500,000, this would be the market value.

Source

And from here we get "capital gains" and such.

The same source defines it in the terms you describe:

What Does Book Value Mean?
1. The value at which an asset is carried on a balance sheet. To calculate, take the cost of an asset minus the accumulated depreciation.

Source

So, we are both right and/or both wrong, but as I mentioned in an earlier post, it is insignificant in any other realm than that of accounting, because of the relativity of "real-world" value.

That said, I fear we have diverged quite a ways from the OP, but I do agree with you on the important issues brought up:

So it this an example of the government again confounding terminology to suit their agenda and to confuse?
Or is $42 an ounce the REAL CASH VALUE of an ounce of gold.

And especially this statement!

Reminds me of when the MSM began referring to elected politicians as " Leaders".
Last time I checked...we elect representatives of the will of the prople, not leaders or "deciders".

Cheers,

the Billmeister

reply to post by St Udio


That's the thing. Nobody knows exactly how much we have, let alone the intrinsic value of it, or what we're using it for, or where it is. It's probably trading hands so fast, they can't account for it, leaving loopholes for it to fall in. And all the while, citing that it is not really currency, although they feel the need to place a Fair Market Value on it. The whole foundation of it these days is kinda rubbery
Is it a currency, or just another soft metal to use on circuit boards?