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Obvious question about US gold stock goes begging

By JGalt, on December 9th, 2009
I came across this strong argument today on Jim Sinclair’s website, linking to an article he credits to GATA, which could explain why Ron Paul’s audit the fed bill has created a major stir and resistance from the Federal Reserve elite. If this logic is confirmed by fact, the US dollar isn’t backed by any physical metal, and is nearly 100% paper money, or money substitute.

An Obvious Question About The U.S. Government Gold Stock Goes Begging

Given the “robust” inventory of 100 oz. gold bars being reported by the Comex, how on earth is it possible that the U.S. has to keep suspending production of gold eagle and gold buffalo coins due to “a shortage of supply of gold?”   The U.S. Mint announced yesterday that it is suspending production of 1 oz. gold eagles and buffalos for the balance of 2009.  This is, I believe, the third time this year the Mint has suspended production:

“U.S. Mint now suspends all one ounce gold coin sales due to shortage of physical gold”

Here’s the article link:  U.S. Supends Gold Eagle/Buffalo Production

As a matter of fact the Gold Bullion Act of 1985 authorizes the U.S. Mint to use U.S. Government gold reserves if necessary:

In the absence of available supplies of such gold at the average world price, the Secretary may use gold from reserves held by the United States to mint the coins issued under section 5112(i) of this title. The Secretary shall issue such regulations as may be necessary to carry out this paragraph”.

It would seem that if the United States has 8100 tons of gold, as reported by the Federal Reserve and U.S. Treasury, then there should NEVER be a shortage of gold with which to mint coins.  What gives?

Here is the complete text of Gold Bullion Act of 1985:  Where’s Our Gold Coins?

Fort_Knox

Fort Knox

Again, inquring minds want to know, where is all the gold?

How come the U.S. Mint didn’t foresee the same shortage everyone else in the market has been seeing and make sure that it had plenty of production blanks to meet demand?  If the Comex supposedly has 9 million ounces of 100 oz. bullion bars, the Mint should have been able to take delivery of some of that gold in order to meet its legal obligation to produce gold coins in an amount that meets demand.  How come the U.S. Mint is not using U.S. Government gold reserves, as per the law?

Something smells fishy here, and I think we all know what it is:  the physical supply of gold is extremely tight, the paper shorts in gold (Comex, GLD, LME, etc) are in big trouble and the price of gold is now at the mercy of the physical market.  I would suggest this situation is one of the primary reasons that the Federal Reserve and its supporters in Congress are going to any lengths to derail efforts to force an independent audit of the Fed, which would include a physical audit of the gold it supposedly holds.

By JGalt, on December 9th, 2009 | Category: Sound Money

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