HOLTHE: Gold still matters and Trump wants to know it's all there in Fort Knox

Kris Holthe is a precious metals broker with Calgary-based New World Precious Metals

They say countries are more secretive about their gold holdings than their nuclear capabilities.

Why? Because gold underpins the financial system.

It is not really talked about in the mainstream media, but gold does more to anchor financial trust than any other asset. When trust is lost and new financial systems are needed, gold will be re-instituted. It has ‘no counterparty risk’ therefore it does not require trust.

Gold is not just a promise to pay, it is payment itself. All other financial instruments are 'a promise to pay.'

There are only two Tier 1 Assets — gold and US treasury bonds. The US treasury bond is a promise to pay. Should an economic calamity occur and confidence is lost in the bond market, what is left is gold.

Gold is almost useless from an industrial perspective. But, that’s one of the reasons it makes for the perfect money. It is an element that is indestructible. It has all the characteristics of money.

Currency has done the job of money for a long time but gold has one thing over currency — it is a store of value over time. It takes a lot of energy to produce gold, so it acts as a store of energy value. Over time, energy costs inflate and the price gets reflected in an ever increasing price for gold. Its limited supply ensures its value.

Gold is the ultimate canary in the coal mine, monitoring the continued de-valuation of fiat currency.

In 1933 you could buy an ounce of gold for US$20.67. it is now approaching $3,000 for that same ounce of gold.

This is inflation at work, the loss of purchasing power over time. Gold makes evident the corrosive reality of inflation.

Those that have the gold make the rules. According to official records, the largest gold holder is the United States Treasury, coming in at 8,133 metric tons.

There are many things happening in the gold market today that are indicating something big is about to occur... frequent gold references from President Trump and Elon Musk, for example... and talk of auditing the US Treasury's gold holdings.

The COMEX received 750 tons of gold in the last three months. It is said, in total, the USA has imported 2,000 tons of gold since the end of November using over the counter methods, much of the gold coming from Switzerland. (COMEX is the Commodity Exchange, a part of the Chicago Mercantile Exchange.)

So much gold has moved from London to New York that shipping times have changed from the traditional 2-3 days to 4-8 months. London supplies are dwindling. Is it the US government re-shoring gold in anticipation of the audit? Nobody knows but there are indications this is the case.

Debt has also been a topic of conversation in the alternative media. The implementation of DOGE (Department Of Government Efficiency) shows the United States is working to tackle their debt problem.

There is a lot of talk about reducing spending and remonetizing assets to help balance the budget. If they remonetize their gold holdings they will mark to market the value from the current $42 per ounce to $2,900 an ounce, significantly improving their balance sheet.

There are also discussions of creating long-dated gold backed treasury bonds. The intent is to use gold held in the Treasury to improve the trust for the reserve currency of the world, the US dollar.

For 5,000 years, gold has been money. It has been 50 years since President Nixon removed the gold standard. Is the time coming when gold will once again be used to bring back stability and trust?

The importance of gold has mostly been forgotten by the general public in the west, but the world's central banks have not forgotten.  Why are the central banks, currently buying record amounts of gold? The last time central banks bought record amounts of gold was in the 1970’s. 

What followed was an 800% increase in gold prices. What do they know that we do not?

If you were ever considering adding gold to your portfolio, now may be the time. 

Kris Holthe is a precious metals broker with Calgary-based New World Precious Metals.