Are central banks not trusting the Federal Reserve anymore? The latest trend over the past couple of years has been for central banks worldwide to yank their gold out of the Fed’s vaults. Austria wants its gold back. Germany wanted its gold back. Russia is piling onto its gold holdings. And even the state of Texas is petitioning the Fed to get its gold back.
A new report from the Federal Reserve found that physical gold holdings from foreign official assets declined 9.6 tons in August to 5,950 tons. This means total foreign physical gold holdings stand at $8 billion, down roughly $67 million year-to-date.
Over the past year, foreign central banks have taken out 192 tons of gold. Since January 2014, that number has risen to 246 tons. This year, it has accelerated significantly as Fed foreign gold holdings have fallen every month except in June.
Here is what SchiffGold.com writes on the latest data:
“In the midst of uncertain currency wars, countries want to bring this essential reserve asset back home in case of financial emergencies. Some analysts also see it as a sign of distrust of the Fed, and an indication that the Federal Reserve may not hold as much bullion as it claims. The continued exodus of gold from the Fed’s vaults seems to support this analysis.”
On a personal level, it’s a wise and prudent move to own gold, silver and other precious metals. But on a national level, it’s imperative for a central bank to maintain a considerable amount of the yellow metal. Gold helps preserve and keep your wealth while providing security in times of economic collapse and currency wars.
In the end, you can’t trust the Fed.
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