Oh, Canada… zero gold reserves (comments welcome)

What is Ottawa thinking?

Canada’s gold holdings at zero

What is going on up there? I ask Canadian readers or anyone with knowledge of the situation to advise what sort of insanity this is. I just found this out, and the first scary thought that comes to my mind is that maybe the government would plan to nationalize all the Canadian gold mines should a financial emergency come about. That contradicts my view of Canada being a safer location for gold mining investments.

Here is a partial list of global gold reserves. Canada is a major producer of gold and feels no need to hoard the stuff. I don’t like it if I’m Canadian, and I maybe also don’t like it if I’m an investor in Canadian gold mines.

gold reserves

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13 thoughts on “Oh, Canada… zero gold reserves (comments welcome)

    1. Yeah, I guess I’ve been sort aloof about this and other news events. Indicator nerd and all… ;-)

  1. Canada’s been at zero for years now, since shortly after the current (“fiscally prudent”) regime showed up.

    1. People to the south tend to view our northern neighbors as prudent. Meanwhile, so many seem to hate what America stands for. But at least it’s got a hoard of sound monetary rocks.

  2. Shouldn’t it be irrelevant for an investor if the country of a company I am buying shares of buys the stuff that will be produced?

    If people in the rest of the world badly want the stuff (Gold), I do not care if the home country is not keen to have it.

    BTW: Canada still has it, but it is just in their ground.

  3. “BTW: Canada still has it, but it is just in their ground.”… exactly my point.

  4. Gary, You are apparently not familiar with the Canadian oligarch, Mr. Sprott !?
    He has the concession to hoard gold and other PM´s for the Canadian governement.

    1. You are right. I tend to tune it all out. Esp. when the name Sprott is involved. I don’t chase news items around because they put noise into my style of market analysis. But that also leaves me a little, err, ignorant sometimes.

    1. I am no authority on such ghost stories, but with government involved I think it can’t be good. Taxation issues maybe. Also, I would think that by government decree investors can easily be subordinated in the name of national security.

  5. This from the Mad Hatter :-)…

    Canada gold = 0

    Do you really believe the US has 8133 tonnes? Hasn’t been audited since 1955.

    I’ve got some swamp land for ya

  6. Another that came in by email from JB…

    I nearly wrote as a comment on CDNX —

    For way over a decade I have predicted, more or less privately, that some system of gold-backed currencies might come into use except that they will use gold-in-the-ground using The Environment as an excuse. Inspectors will go over geochemical, geophysical, and historical mining data and use various fudge factors.

    There would be all sorts of cute and sleazy ad hoc tricks for countries that don’t necessarily have gold. By decree, for example, the Eifel Tower and the Louvre could be decreed to have the equivalent of gold buried beneath. There would of course be all sorts of cute and sleazy tricks for the benefit of owners of stock in, say, a UK company with properties in Africa or Australia. I once had a model figured out with more details.

    I had also suggested some other tricks, such as that instead of confiscating private hoards, as long as you declare them, they will declare them part of the national treasure and protect it with all their police power. They will even give you immunity if you let them search the property for the gold that your demented relative hid somewhere but doesn’t know where. Selling the protected and declared gold other than in restricted fashion (inheritances ok, sell to government ok, unclear what else) will be not condoned.

    But the point is that I suspect that gold-in-the-ground, both within national boundaries and in investments, will be considered as backing for currency For the Environment. Thus Canada may not need any above ground.

    AND…

    Fine, thank you. Good to make it anonymous since I am a compulsive editor-and-re-editor–perfectionist as far as style goes. Feel free to rewrite or paraphrase. I also have thought this thing out with further details but not here. Consider deleting the 2nd part, which I only partially explained (I’d go into how they would have your declared gold nontaxable, and theft of it treated as theft from the nat’l treasury). (If I had time I’d add even more parts though.)

    Among other details I thought out are that they would automatically assume as true any official figures — whatever is declared in Ft Knox would be declared as true, for ex.

    The point would be that with only minor fudging most of the 5-eyes countries and big European countries would come out strong (big investments, supposedly lots of gold already, or gold underground). Russia, China, and even India could also and could be allowed into the club pretty easily.

    Exploration companies and geophysics companies etc would do well. A company would be paid not to develop or produce–but could do minimally invasive studies in Yellowstone, the Matterhorn… and then of course there would be all sorts of politics involved in determining which pretend deposits count as 60% gold, which as 80% gold etc etc.

    Thanks. Not a good day for me for writing though.

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