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Did U.S. Export Over 175 Million Ounces of Gold?
panning for goldBy Patrick A. Heller, Market Update
June 01, 2009
panning for gold

The United States Geological Survey (USGS) publishes monthly Mineral Industry Surveys with one series that focuses on gold production, imports and exports. These reports include information from the U.S. Census Bureau on the quantities of refined gold bullion and gold compounds exported from the US.

The latest monthly report is from February 2009, which includes data for 2008 and early 2009. The February 2008 report is the oldest of these reports available at the USGS Web site (www.usgs.gov), which includes data for all of 2007. For prior years, there are annual reports that do not lay out the data in the same format.

In 2008, domestic U.S. gold mine production was reported at between 228 and 230 metric tons. Since a metric ton contains 32,151 troy ounces of gold, that means U.S. mine output was somewhere between 7.33 million and 7.395 million troy ounces last year. In 2007, gold mine output was about 244 tons, or 7.845 million troy ounces.

U.S. net exports (gross exports minus imports) of refined gold were about 10.8 million ounces in 2008 and 11.2 million ounces in 2007.

The intriguing statistics contained in these two annual totals is the net exports of gold compounds. For 2008, there were net exports of 2,818 tons (90.6 million ounces) of gold compounds. In 2007, the net exports were 1,988 tons (63.9 million ounces).

Rob Kirby of Kirbyanalytics in Toronto contacted a USGS employee knowledgeable in the preparation of these reports. This employee told Kirby that the USGS had contacted the U.S. Census Bureau to confirm the accuracy and details of gold compounds exported.

According to the Census Bureau, gold compounds include industrial type products containing low percentages or amounts of actual gold content, with gold paint being given as one example. Kirby mentioned to the USGS employee that the increase in net exports from 2007 to 2008 did not make sense given the global economic downturn. The USGS employee acknowledged that the figures did not make sense, which was one reason that the Census Bureau had been contacted to confirm the data.

Kirby then observed that the high value of such exports did not make sense if it could include only industrial goods, given the decline in global commercial activity. Rather, Kirby speculated the amount of gold exported indicated that it was more likely to be gold bullion or equivalent forms. To this, the USGS employee responded, "That would be correct."

So, for 2007 and 2008 combined, the U.S. exported 22 million ounces of refined gold and over 154 million ounces of "compound gold." This is more than 11 times U.S. gold mine production during those two years. In fact, this is higher than global gold mine output. Where did all this gold come from?

This amount of gold exceeds what is held by all private parties in the U.S. combined. When the U.S. government called in gold in 1933, it then melted down the coins without refining. As a result, such bars from the coin melt would have a purity of around 90 percent gold. These would not qualify for description as refined gold, but could fit the definition of compound gold.

In the past few years, several gold traders have commented that a surprising number of coin melt gold bars were being delivered in London and Zurich markets, bars which almost certainly came from the U.S. Treasury vaults.

It is possible that some of these gold exports could be the repatriation of foreign central bank gold that had been stored with the New York Federal Reserve. Such transfers would be classified as "exports" for purposes of this report. The other possibility is that it could be gold formerly held by the only central bank in the world that had that much gold - the United States.

Wherever this gold came from, it is bad news for the U.S. government. If foreign central banks are pulling their gold reserves out of storage in the U.S., that signals lost faith in U.S. financial strength, which the U.S. government would not want the general public to learn about. If the U.S. government has actually been exporting its own gold, while still trying to pretend that the quantity in its vaults is unchanged, confirmation of such exports would clobber faith in both the U.S. government and the dollar.

The U.S. government has not had a genuine audit of its gold holdings in decades. In recent years, it has changed the description of gold holdings in reports so that now it is only described as "custodial gold" rather than gold reserves.

The so-called experts such as the World Gold Council, GFMS, and CPM Group do not include the appearance of all these gold supplies in their reports on global gold supplies and demand, which makes their analyses grossly inaccurate.

The U.S. government has a huge interest in hoping that the general public will not notice or care where all this gold came from. On the other side, for their personal financial protection, Americans urgently need to know the source of all this gold.

Kirby released his report last Friday. I expect that it will foster a clamor for disclosure. If the U.S. government resists providing the information, people will assume the worst - that the U.S. government has a lot less gold than it claims. It would be difficult for the government to lie about the source of this gold and get away with it - too many analysts will be double checking the information. Alternatively, the U.S. government could honestly admit where the gold came from, which I am confident will show much lower gold holdings than reported. No matter how the U.S. government responds, I anticipate that this matter will spark a sharp increase in the price of gold.





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Comments
On June 3, 2009 tony bonn said
while i have no doubt that the fed (not usa government) overstates the amount of gold it has we still have no idea what the 4800+ tons of gold compounds represents. until someone can state the average purity it may be a small amount....is the average purity .01%? if so then we are talking .48 tons of gold....is it 90%? then we are talking 4320 tons...

there are no doubt valid questions about what is happening and has happened to usa gold but without better data there is no case for anything.

i am all for a 100% audit but unless i am missing something i cannot make heads or tails out of 4800 tons of gold compounds....

on the other hand the gold held by the treasury does not belong to the american people....it belongs to the fed with the treasury acting as custodian...so it belongs to the private bankers....they can do with it as they please.
On June 3, 2009 Man said
Remembering a documentary about DeBeers diamonds and that the size of their vaults indicated much more diamonds exist then the current value warrants.
Making fiat money the same as fiat diamonds. Anyone who can do math would know that gold is the same. Rare Earth metal is a myth so Tony Bonn has it right. The amount is not the point since no one will every know the true rarity.
On June 3, 2009 Patrick A. Heller said
Tony Bonn asks a very sensible question, which is one of the questions that the USGS asked the Census bureau to double check.  The amount of tons reported reflects only the gold content of what was exported, not any alloy in addition to the gold.  Actually what the Census bureau reported was the value of gold, which then was translated into the weight of gold.  It does not matter the purity of the exported gold products as only the gold content was reported.
On June 3, 2009 The Surveyor said
The Fed was created by congress in 1913 and exists at the discretion of the American people.  The people foolishly surrendered USE and ONLY USE of their gold currency through the 1930s in exchange for fiat.  It is invalid to assume that any agency of government has ownership other than as custodian for the American People.  The private banks are provided a gold facility via government entities created by our representatives.

If needed, we can reverse the current condition and move for the Fed's elimination and determine what happens to the gold then.  It may indeed be time to rein in this separate government psychology, either by electoral means or the second amendment.
On June 3, 2009 tony bonn said
patrick, confirm my understanding then....so you are saying that under the heading of gold compounds during 2007 and 2008 that 4806 tons of gold was exported? i.e. if the gold were extracted from the compounds then the gold would weigh 4806 tons?

if so i completely misunderstood.

the usa fed i believe has only 7500 +/- tons and i am not sure if that number includes foreign sovereign gold kept in custody...

of course i am sure that everyone knows that germany and dubai are in the process of repatriating their gold....i wonder how much that is.

so if i finally understand what patrick is saying the next step is to figure out how much of the export represents foreign sovereign gold as i recall rob kirby reporting that the export figures include foreign sovereign gold.

once all of this is sorted out we can figure out how much gold the fed has been selling or giving away....me thinks ft knox is a little light on gold....

many authors and even a congressman reported massive gold disgorgements from ft knox during the 1960s part of which was related to the london gold pool..

I have forwarded to gata other sworn statements where gold was removed from gold knox but not accounted by the fed. The director of the mint also confirmed extractions from ft knox which were not recorded in a report from 1975 showing additions and subtractions of gold from inventory.

If the gold reserves are as low as we think or even non-existent then all of the shortings of gold are not based upon treasury or fed actions but completely unknown private owners of the gold. Yet it raises the question of who owns it. I believe that the gold was transferred to just one or two people.
On June 3, 2009 tony bonn said
regarding gold ownership of the fed. the gold confiscated in the 1930s plus all other us government reserves were given to the fed starting in 1913. it was not loaned, it was not leased, it was not an accounting gimmick. the fed owns the gold. the treasury maintains the gold on a custodial basis - it does not own it.

the american people are the most foolish and ignorant morons in the world and of all time.

it appears that the fed has since given the gold to other private parties. ft knox is empty. the american people bent over, handed the rockefellers the lube, and started squealing like a pig - all without a struggle.
On June 3, 2009 SuperManos said
The American people are not foolish.  We have saved lots of lives, have provided much safety and security to many who had none, and are still the shining beacon of hope to REVERSE the trend toward tyranny.

We - and I include myself among the "We" - are simply allowing ourselves to be distracted by irrelevant triviliaties - when the defining issue of our time is whether or not to abolish the Federal Reserve system.

I agree with The Surveyor - we revolutionize our fraudulent monetary system through the ballot box, or by the same means with which our founding fathers liberated these united States from the evil clutches of the banksters of England.
On June 4, 2009 tony bonn said
the issue of the federal reserve is single most important issue in american national life. he who controls the money controls the destiny and lives of its users. he who controls the money is the master. the federal reserve controls our money.

the founding father recoiled at central banking and specifically provided for the people to control money.

anyone who denigrates the issue of the federal reserve is in favor of tyranny.

there is no freedom from tyranny when a private cartel controls the money. unfortunately seeing that requires a good knowledge of history, monetary science, and economics - something in short supply today.
On June 4, 2009 tony bonn said
i have been able to confirm that the fed has 8134 metric tons of gold....there is a separate accounting for foreign gold held by the bullion banks called ear marked gold. at the end of 2008 it was 8412 tons; at the end of 2006 it was 8967 tons...thus a net change of -555 tons....so was it consumed locally (usa) or exported (repatriated)?
On June 4, 2009 Samson said
What about all the people in America that have been hit by high gas prices over the past few years? I thought they pawned all their gold.  Would that account for the increase?
On June 5, 2009 Jim said
 Hay look its all over the net As of Sept 15 2008 Governments want their Gold thats in custodial holding here in the U.S sent back to them and the rightful owners and so far the bankers cannot deliver because they have run off with the gold years ago and the foreign counties don't want the worthless paper notes they want their fiscal gold back "NOW". There was some activity at the White House just a few days ago [and this has been confirmed] the President and most of the staff is in on it and part of the coverup,  Also there is going to be high price to pay or at lest thats the word put out and going around this country may get its freedom back from the hand of other government's and it sounds like they intend to make good on their threat or promise.
On June 5, 2009 Adam Tas said
If true, the export of gold worth some $130bn would have artificially inflated the US exports and likewise have overstated the importing nation/s' imports. The result would have been a lower trade deficit for America and a lower surplus for the importing countries.
In addition, this massaging of trade statistics would conveniently not have showed up in an unexplained rise in foreign reserves (paper reserves that is).
On June 6, 2009 Alex said
At a boy Scouting event, I met another leader, who was a career military officer at Ft. Knox. I asked him if he ever got to see the gold he was protecting. He told me when he retired, he was granted access to the depository. He told me he was taken down several levels to a bank vault, and it had inside of it a lot of what he described as like safe depoit boxes. They were full of precious stones ( Probably debeers diamonds ! )
He said He saw NO Gold. He was told that was removed years ago, and replaced with what he got to see.
On June 16, 2009 jaideep chatterjee said
sir,
consequences of un planned expendinture&  exploitation over the limited natural/manual resources by none other than human population,manifold of unexpected volume, were well known.......
This is nothing but creation of fully fledged human civilisation
On June 18, 2009 JAG said
Although I agree the outflow of Gold is startling and quite scary, however, I beleive too much is being read into this.
Could it be that the outflow is from all of the Gold Redemtion Ads on TV? All of this is probably being financed by foreign capital... I recently saw one which stated they were paying 20% more between now and July 4th. HOW PATRIOTIC! We should disallow Gold Exports in the name of national security...
On August 30, 2009 John said
Where did all the gold come from to start with?

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