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To have
some idea of the order of magnitude of gold vanishing into private
hoards during the period from 1950 through 2007, let us recall some
facts and figures.
Output
from Western mines plus Russian gold sales
before the collapse of the Soviet Union (approximate quantities in gold
dollars at $35/Troy oz.):
1950-51: $ 2,000m; 1952-65: $ 21,000m; 1966-68: $ 3,400m; 1969-2006: $
77,500m.
Absorption
into private hoards from mine output, gold pool sales plus
US/IMF/central bank gold auctions
(approximate quantities in gold dollars at $35/Troy oz.):
1950-51: $ 100m; 1952-65: $ 9,000m; 1966-68: $ 3,200m; 1969-2006: $
80,000m. ............... This private absorption of gold is
unprecedented, both as to its magnitude and its speed. The total amount
of gold absorption for the entire 56-year period 1950-2007 was
approximately $ 90,000m, an amount greater than all the gold produced in
history before 1950. .................. Fifty
percent of all the gold in existence has been produced since 1960. The
same fifty percent has been withdrawn from the public domain during the
same period of time and disappeared in private hoards. There is no
way to account for this gold. We do not know the location, the identity
of owners, nor their intentions what they wanted to do with it. This is
a sea change portending a still greater sea change to come. This is a
situation comparable to the disappearance of the gold and silver coinage
of ancient Rome portending the fall of the Empire. For this sea change
the public is totally unprepared. It is left in complete ignorance, due
to the deep silence of the media and academia. ............. The gold hoarder must be prepared to, and mentally
capable of, using gold exclusively as his numeraire
in calculating asset values as well as pofit and loss. He must
understand that profit/loss accounting in terms of the paper dollar is
tantamount to trying to measure length with an elastic measuring-tape. |