LewRockwell
According to recently released data by the World Gold Council (WGC), as of September 2021, the total amount of gold held in reserves by central banks globally exceeded 36,000 tons for the first time since 1990. This 31-year record was the result of the world’s central banks adding more that 4,500 tons of the precious metal to their holdings over the last decade and it provides ample support for the investment case for gold, in both directly performance-related terms, but also from a big picture perspective.
This new record went largely underreported in the mainstream financial press and almost entirely unmentioned in official central bank statements and their guidance or policy commentary. Quite to the contrary, policymakers in the US, the Eurozone and in most other major economies, have for over two years now insisted on repeating the exact same talking points and all kinds of arguments and convictions that would in fact nullify the case for holding gold at all.
For example, up until very recently, inflation was largely and decisively dismissed as “transitory”, with leading figures from the Fed and the ECB repeatedly assuring investors and the public at large that consumer prices were under control and that the early hikes we saw last year in official data were nothing but a glitch. Of course, as the pressures continued to build and as it became clear that the CPI figures (that are already a very poorly constructed and misleading gauge of inflation) were not aligned with the version of reality that central bankers publicly espoused, they were forced to perform a policy U-turn, at least in theory if not in practice. However, the most important element to note here, is that if their public statements were actually consistent with their policymaking and strategic outlook, there would be no conceivable reason to ratchet up their gold stockpiling.
