maandag 10 november 2014

Monitoring the Foreign Gold Deposits Held at Federal Reserve Bank of New York (FRBNY)

With repatriation of gold in the picture, especially when the Swiss gold referendum vote comes in a few weeks to repatriate their Swiss gold (30 November), we need to keep an eye on the gold deposits at the Federal Reserve Bank of New York.

Each month they issue this report of gold deposits at the FRBNY.

The value of the gold deposit is calculated at value $42.22/troy ounce.

Take an example September 2014: 8305 million USD of earmarked gold.

So you first divide 8305 million USD by $42.22/troy ounce and then you convert it to tonnes. You get 6118 tonnes.

Now we chart it out over two years and we see that people are not deposition gold in the U.S. Instead they are pulling out their gold from the U.S. FRBNY at a very fast pace. I expect this to accelerate till there is no gold left in the U.S. or something breaks in the rehypothecation scheme.

This is what it looked like in the past. If you take a good look, you will notice that gold repatriation typically occurs when there is a recession.

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