RUSSIA vs. USA: Where’s The Gold Going??

As the United States continues to push towards a military conflict with Russia, there will likely be no real winner when the dust settles.  However, if we compare the these two superpowers in the current “gold market”, the Russians are the clear winners.

While the U.S. has been (secretly) liquidating its once massive official gold holdings, the Russians have be doing quite the opposite.  According to the data on Smaulgld.com, the Russians have added a hefty 3,000,000 oz of gold to its official reserves since the beginning of the year.  If you haven’t checked out Smaulgld’s site, I highly recommend it.

In Smaulgld’s article, Central Bank Of Russia Continues To Boost Overall Reserves, here were the monthly additions to Russia’s official gold holdings:

JAN 2017 = +1,000,000 oz

FEB 2017 = +300,000 oz

MAR 2017 = +800,000 oz

APR 2017 = +200,000 0z

MAY 2017 = +700,000 oz

Three million ounces of gold added to Russia’s official reserves is quite a lot of metal… actually 93.3 metric tons.  Now, if we compare Russia & the U.S. in gold mine supply versus additions to official gold holdings, this would be the result:

The gold mine supply figures for Jan-May 2017 are based on the last years production data (GFMS 2017 Gold Survey) and the USGS March 2017 Gold Mineral Industry Survey.  As we can see, of the estimated 106 metric tons (mt) of gold produced by Russia Jan-May 2017, they added 93 mt to the official gold reserves, versus the U.S. which produced 96 mt, with a BIG PHAT ZERO added to its official reserves.

Basically, Russia’s official gold reserve additions Jan-May 2017 accounted for 88% of its domestic mine supply.  Whereas, the United States continues to export all of its gold supply.

Again, using an estimate based om the USGS March 2017 Gold Mineral Industry Survey, the U.S. will suffer a 26 mt gold supply deficit for Jan-May 2017:

For Jan-May 2017, U.S. gold mine supply is forecasted to be 94 mt, imports to reach 118 mt, while total exports are estimated to be 238 mt.  Thus, this leaves a 26 mt supply deficit.  If we look at the actual data for Jan-Mar 2017, the U.S. mine supply was 54 mt, imports of 71 mt and total gold exports of 143 mt.  This leaves a supply deficit of 18 mt for the first three months of 2017.

So, here we can see that the United States continues to export more gold than it mines and imports.  However, Russia is doing the opposite and continues to add to its official gold reserves.

If we consider that Russia exported approximately 7,000,000 barrels per day of oil in May, this was a total of 217 million barrels of oil.  The total cost of the 700,000 oz of gold that Russia added to its reserves in May was approximately $817 million (based on Kitco’s May average of $1,245).  Thus, Russia only had to make $4 profit for each barrel of oil it sold in May 2017 to make purchase the 700,000 oz of gold.

Now, let’s compare this with the United States.  The U.S. would have likely imported a net 4,500,000 barrels of oil per day in May.  This is a total of 139 million barrels at a cost of $7 billion (based on Brent crude price of $50).  Furthermore, the U.S. Government monthly deficit in May 2016 was $55 billion, but I believe it will be even higher in May 2017, when the U.S. Treasury releases the data.

You see, the U.S. Government cannot buy any gold because it continues to run a fiscal deficit, while the country suffers ongoing trade deficits.  A country can only add gold if it has SURPLUSES… not DEFICITS.  This is why the U.S. continues to print the DOLLAR to continue business as usual.

The U.S. is in serious trouble as it uses extreme leverage in financial and economic markets.  When this leverage finally cracks, those holding real gold and silver will experience the insanity taking place in the CRAZY CRYPTOCURRENY MARKET.

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32 Comments on "RUSSIA vs. USA: Where’s The Gold Going??"

  1. Virginia. In eastern Oregon | June 21, 2017 at 6:00 pm | Reply

    Steve, wow how about that oil price?
    It would be appreciated, could you also post tons when you post ounces? I am math challenged and can’t remember random numbers day to day. I think US is suppose to have 81 tons of gold. Thanks for all your work.

  2. Virginia. In eastern Oregon | June 21, 2017 at 6:05 pm | Reply

    Not smart enough for a smart phone, too stupid to figure out the crypto currencies. Me and my dumb self bought a few more silver Maples, yesterday. Guess I’m just machochistic.

  3. Virginia. In eastern Oregon | June 21, 2017 at 6:12 pm | Reply

    Sorry, I need to read closer. How many troy oz. in a metric ton?

  4. Thanks Steve, appreciated.

  5. “The insanity taking place in the CRAZY CRYPTOCURRENCY MARKET,” I LOVE this statement!

    I’m ready to see the digital “money” crowd provide people with mirrors, solar panels, and any of the myriad other unique things only silver can provide. But I mean, let’s see them do it WITHOUT silver.

  6. I think tulips are more important than cryptocurrency but you may still profit from cryptocurrency until the rug is pulled out from under you.

  7. Doesn’t the US import more than 4.5 million barrels of oil/day? It uses roughly 20 million/day and extracts about 9.5 million/day. The EIA states that it imports about 10.5 million/day. I know the natural gas liquids are a factor. The info is very difficult to get. Would you mind shinning some light on this. Thanks.

    • jim bo,

      The U.S. does import more crude oil than the 4.5 million barrels per day, however it also EXPORTS 5.5 million barrels per day of oil and petroleum products. Thus, the NET IMPORTS are 4.5 million barrels.

      steve

  8. There was something that I have read on the web about us oil production. I don’t know if its true but it said that the us refines petroleum for Mexico, Columbia and other countries and that this is counted in US exports. I would think that this would be factored out if true. Adding more to my comment previously the EIA said about 3 million/day is natural gas liquids. Adding this to oil production would be 12.5 million/day. This would still leave about 7.5 million/day of imports. I am somewhat confused about all the different info about this.

    • The EIA weekly petroleum report on Wednesdays usually states about 8 million barrels imported per day. FWIW.

    • jim bo,

      While the United States produces the most petroleum liquids in the world, it is producing a lot of NGLs- natural gas plant liquids. According to the EIA, the U.S. will produce 3.8 million barrels per day of NGLs in 2017. However, the price received for NGLs is about half or 48% of the regular WTIC price. So, with the current price of oil now trading at $43, a barrel of NGLs is going for $21.5. Not much.

      That is due to the fact that there is only 60% of the energy content in a barrel of NGL’s versus regular crude.

      steve

  9. Hypothetically, what position would the US be in if there were to be 1 million ounces of gold in the Grand Canyon? May I suggest Jim Rickards point of view that the ROW is playing catch up.

    • meant to say “1 million tons” not ounces

    • Roota Gold…Only a theory…Bix is an interesting guy…I take a wait and see attitude with pretty much whatever he says…I could go back and show you the many false predictions Bix has made over the last few years…Bold…yes Accurate…no Hype..yes…$300.00 per year to read his predictions…No Signed up and read everything he ever produced @ $199.00 Probably would have let it roll over another year but he jacked the price another $100.00…Not worth it

      • Hey, guys, I should probably read Bix’s stuff before I comment, but what the hey …
        I have been fasinated with the conspiracy theories concerning a Smithsonian cover up of discoveries in the Grand Canyon. My theory is that around 2000BC give or take a couple of centuries, there was a lot of travel and exploration between ancient Egypt and North America. Perhaps NA is the ancient “Ophir” where the gold was good. Mainly stimulated by Joseph’s need for a fertile land to grow more crops to stave off the impending seven year famine he foretold. Suppose to be lots of treasure hidden there.

  10. WOW!!!! What the h*** are we doing!!!?

  11. Why can’t the US buy gold while they’re running a deficit? They buy everything else. That’s why they have a deficit. I have always wondered why they aren’t stocking up on precious metals & base metals while the dollar is still worth something. They could do it in a clandestine way.

    • Because there is not enough fizzical gold available to do so. The global yearly gold market (fizz) is roughly 4500 metric tons composed of mine supply (roughly 3000 mt), scrap/recycled gold and sales/liquidations as far as I know. Taking round numbers this would be 5000 * 32150 * 1250 = ~ $ 200 Billion. That’s it, that’s what available world wide. But Shanghai Gold exchange alone takes about 2000 mt of aurum single handedly off the table each year. Plus India, the rest of China (BoC !!!), Russia, Turkey et al. and likely much less than $ 100 Billion are left for the rest of the world. And the ECB is QE-ing the Eurozone with over € 60 billion each month… If any of the FEDECBSNBBoEBoJ et al. start buying (back their leased out) gold… Go figure.

  12. Do we KNOW, for sure, that all of these stats which you helpfully provide here (thank you) are for PHYSICAL gold?

    Obviously, if we’re counting how much is mined, that’s pretty physical. But bought and sold–ain’t necessarily so.

    E.g. I’m thinking of that surreal dump of 82 tons of PAPER gold on the market by an anonymous seller all in one day, just a week or two ago. Only a fool thinks that gold actually exists! But will that 82 tons get factored into this year’s stats for US (or whatever country’s) sales/exports of gold? If so… then like pretty much everything else going on in the markets these days, these PM figures unfortunately don’t mean a doggone thing.

  13. William Chandler | June 22, 2017 at 5:52 am | Reply

    The US has not won a war in a century ….
    NATO wants to take on RUSSIA?! (and maybe China)
    NATO cannot defend it’s own people at HOME.
    NATO cannot beat ISIS-AlQueda-Taliban-AlNusra
    NATO families will be raped & murdered as NATO Troops fight far from home.
    NATO installations will be sabotaged by Refujihadi Invaders.
    NATO Troops should turn their weapons on their ENEMIES that are betraying them.

    NATO defeated itself by being invaded and overrun by the REFUJIHADIS from the wars NATO started but can’t FINISH …………. THAT has to be a FIRST in all history.

  14. The Hills Group ETP model is proving to be accurate so far, we need an update from them on their predictions. Oil discoveries at a record low over last 3 years, energy companies deeply in debt, 75% of their OPEX is being used to service debt, forget repayment, high oil paying jobs lost, EROI is falling. How long before the dark ages? When the system falls apart? It’s a system that’s issuing tokens faster and faster while the real economy is spinning out of control resulting in political chaos and the threat of world war or civil conflicts in many countries.

  15. Robert Forshee | June 22, 2017 at 7:47 pm | Reply

    Steve,

    While “You see, the U.S. Government cannot buy any gold because it continues to run a fiscal deficit, while the country suffers ongoing trade deficits. A country can only add gold if it has SURPLUSES… not DEFICITS. This is why the U.S. continues to print the DOLLAR to continue business as usual.” May be true, however, I believe that the Secret Society that controls this country is only interested in protecting the Fiat Dollar Status and uses any means necessary to accomplish that. Including invading sovereign countries and capping PM’s pricing. Making gold more scarce would not be in their interest. So they are not interested in the US .gov accumulating gold. They have almost unlimited power using Fiat. Why use gold if they can make Fiat for nothing?

    Bob F.

    • Robert Forshee,

      Actually, you are correct. Furthermore, if the U.S. started to buy gold, that would put more pressure on the market. That being said, most people do not understand what a STORE OF VALUE IS. They believe STOCKS, BONDS and REAL ESTATE are stores of value. They are not. They are ENERGY IOU’s. Gold and Silver are stored economic energy, thus they are a true STORE OF VALUE.

      steve

  16. Thank you Steve. As always very educational!!!

  17. THE MAIN AND ONLY SUPREME FACTOR BETWEEN RUSSIA VS THE UNITED STATES IS THAT RUSSIA HAS LITERALLY KICKED-OUT THE ROTHSCHILD/ZIONIST DYNASTY AND IS INDEPENDENT OF ANY ROTHSCHILD CENTRAL BANK!! THE US OF A IS COMPLETELY OPPOSITE! THE ROTHSCHILD FEDERAL RESERVE HAS STOLEN THE GOLD & SILVER FROM THE AMERICAN PUBLIC AND MADE THE AMERICAN CITIZEN TO BE IN DEBT BY THE AMOUNT OF 19+TRILLION DOLLARS!!

  18. bruce barrett | July 2, 2017 at 11:27 pm | Reply

    93 FOR USA….are you counting all in ground? i dont think so. chocolate mountain, ca or grand canyon ? the govt is hiding the big ones from us all since 1912

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