The World’s Largest Gold Reserves

An interesting slideshow on listing the largest gold reserves by country (or institution). What makes this list even more interesting is aside from the raw value of gold, we also can see how prominent gold is as a % of total foreign reserves. This can show not only the discrepancy amongst countries, but if central banks decide to further diversify into gold – how much potential demand there could be to move from say a mid single digit % of the yellow metal, to something in say the 20-30% range.

What is striking is how large a proportion of European countries foreign reserves are in gold (Portugal!), whereas Asians have yet to really make their mark. There was a huge fuss earlier this year when China revealed it had been buying quietly in the background to move up this list, but as a % of reserves the amount is still tiny. [Apr 25, 2009: China has Begun Building Gold Reserves] Unfortunately for China it is very hard for them to make good size acquisitions without alerting the entire world, since their footprint is so massive.

I’ve compiled the data in chart form below but first two notes:

1. Of course America does not believe in foreign reserves – so the last column is a big fat “Not Applicable”. Far better to spend over your means indefinitely than to have national savings; let the rest of the world save for us…. we excel at the spending part.

2. The SPDR Gold ETF (GLD) has now grown to such a size that if it were a stand alone country it would now be the 6th largest holder of gold in the world. That’s remarkable. Even more remarkable, 1 man – hedge fund manager John Paulson – owns nearly 10% of this gold ETF. [May 16, 2009: John Paulson Continues to Pile into SPDR Gold] By the transitive theory this would make John Paulson, if he was a stand alone country, somewhere in the 16- 20th largest holder of gold.

About Mark Hanna 543 Articles

Affiliation: Hanna Capital, LLC

Mark Hanna is President and Owner of Hanna Capital, LLC, a registered investment advisory firm. Mark has been a follower of markets since the late 80s, with a focus on individual equities since the mid 90s. He has been a well known commentator in the financial blogosphere for the past 5 years, following a career in corpoporate finance and accounting. Mark attended the University of Michigan where he graduated with a degree in Economics.

As an avid reader, Market Montage is the personal blogging site for Mark to share his views on economics, markets, and the like. Occasional cynicism and wit shall be deployed in his postings.

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