[Music] I'm Charlotte Mloud with investingnews.com and here today with me is Craig Hempy, publisher of tfmetreport.com. Thank you so much for being here. Great to have you, Charlotte. It's always good to see you. Thank you for having me on. Really good to be speaking with you. probably a perfect time to have you on with the gold price trading at or near all-time highs. I'm hoping you can help us unpack what's going on. You recently wrote a great piece where you talk about some odd occurrences in the gold market


that seem to keep happening and I think that really sums it up or maybe it understates it. I think we'll find out during this conversation. Where I was hoping we could begin is with this transfer of gold from London to New York. Can you talk about why that's happening? What's going on there? Well, there's Yeah, there's definitely something interesting going on. Um, we've been told by the mainstream media, this is all due to tariffs and metal being reshorted in the US to shore up


the comx uh before any tariffs might kick in. I've yet to see where Trump discusses something about gold and silver getting a tariff, you know, and maybe there's some specifics just with countries and things like that, but I don't know. I I I started thinking about a month ago that maybe we're being gas lit. Is that the proper conjugation of that? Gaslighted, gas. And and the more I thought about it, that the more I'm convinced that maybe that is exactly what's happening. If if you spin things


back the calendar back, uh you'll recall, listeners will recall, you know, gold was at previous all-time highs. Uh right before Trump got elected in late October, and the day after Trump got elected, gold plunged. And then later on in November, it plunged. By the middle of November, it was down 10%. And you know at the time it was like well you know it's going to be inflation and you know maybe no cuts of interest rates and who knows what else. And so that was this rationale for you know and


for gold going down. Then we got to the uh early part of December and suddenly what we started getting the first hints of this current situation where the spot price and the futures price moved away from each other. They should always be pretty close. The front month future should always be pretty close to spot just through simple arbitrage, you know, where you buy the spot, you sell the future, and you know, the whole thing can sort itself out when that contract goes into delivery. And because that


arbitrage wasn't taking place, that spread widened out to 30 or $40 in December. Well, then here came the December FOMC meeting, you know, and hawkish, you know, no more rate cuts, that kind of stuff. Gold plunges again. Ever since that meeting, Charlotte, we got down to 26 2620 uh in the 18th or 19th of December and particularly since the first of the year, I mean, it's just been a 45 degree angle straight up. So again, now, so what changed? Well, something changed with the election of Trump. Um, and we


started seeing this in December. Whether it's Well, gosh, they might put on tariffs eventually. I don't know, man. I I think it's more gets more the idea that there's something else brewing behind the scenes and that's why there's been this consistent bid for gold uh for the last 6 weeks. Yeah, I think it's it's really interesting because definitely that tariff narrative is so dominant and and maybe that is a red herring or as you said we're getting gas lit or gaslighted


whatever we want to conjugate that as you had written in your piece that maybe there's something else going on and it could be that the US wants to bring this gold back home for this monetization idea. Can you can you go into that and explain for those who might not be familiar with this idea? Yeah, and and this ties into this uh audit Fort Knox thing. Um, a couple of signposts that got people's attention along the way was an article in the Financial Times, the veritable financial times, you know, the pink paper


Financial Times. um this is about 4 weeks ago or so where they said so much gold is leaving London that there are now delivery delays of up 4 to 8 weeks. Now you're supposed to be able to get a delivery in 2 or 3 days. So if it was anything other than gold and all of a sudden it's 4 to 8 weeks. People say, "Well, that's a default. You you you promised me this, you know, at a certain time period. You're telling me it's this long." Um and so that started getting people's


attention, right? And then there was a a like an impromptu little news conference in in the Oval Office on I think it was the 3rd of February where Trump is sitting down signing executive orders and to his right is the new secretary of the treasury uh Bessent Bet I don't even know how they pronounce his name yet because he's so new. And um Trump says, "Hey, Scott, you know, we're going to be doing some things." And Scott's got some words on that. And Scott kind of camera


goes over to him. He says, "Yeah, you know, we're looking at ways to monetize assets that we have on the balance sheet. You know, any balance sheets got assets and liabilities, and US has a lot of liabilities. Uh 36 trillion of them. So, we got some assets. We're going to try to monetize them." And well, okay. Well, what's an asset that the US has? Well, one of them is gold. H. And then you look at all this flow of metal that is so significant that it's disrupted this just in time delivery that the LBMA


and you know London operates on. You well why are we onshoring all this gold? Maybe we're looking to monetize the gold that the US has and then that another step down that path is well how much does the US really have? You know they we tell everybody we got 8133 metric tons. Um do we have all of that? What what kind of form is that gold in? All these things, all these questions are starting to get asked. And so it seems to me, Charlotte, that there is, you know, again, it started with the election of Trump,


right? I mean, Trump didn't start talking about, you know, we're going to put on some kind of EU tariff or something in the middle of December. Why all of a sudden gold start moving higher? So, you start connecting some of these dots and it seems like that's where we're headed. Some uh we got to know how much gold there is. We might they might try to revalue it to some newer level than what it's been valued at since 1933. And then they'll try to and maybe they'll, you know, I'm going on and on


and on here, but there is a lady by the name of Judy Shelton. I don't know if you've ever spoken with her, but um she's written a number of books. Her big idea is that the US should issue 50-year Treasury bonds that are somehow backed or indexed to gold with the principle. And if you do that, you know, you keep the interest rate on that 50-year debt really low. And then maybe if you do something like that, then you could use those funds that you collect and that bond issuance to fund your sovereign wealth fund and


all this stuff. Well, Judy Sheldon is not just some quack. Um, Trump knows her. He nominated her to be on the board of governors of the Fed back in 2018. So, I mean, you can kind of, like I said, there's a lot of these what seem to be disperate dots out there. And I don't mean to be like Russell Crowe, you know, in his garage playing, you know, um, oh god, now the guy's John. Um, h senior moment. Um, anyway, you know the movie. Um, and I don't mean to be like that, but that's


kind of what we're all trying to do here. We're all trying to connect the rising price, the onshoring of the gold, all the all of a sudden we all look at fort trying to see where maybe this is all headed. That's what we're trying to do. Yeah. Yeah. I know exactly what you mean. So, we've got the dots. We need to see if they make a picture and and what picture exactly do they make? So, many many paths to go down here. If if the US ends up doing this gold revaluation, how do they choose a value?


Right. Well, it can't you would think it could just be arbitrary. Would it be arbitrary? If you if you roll things back, um it was $20 an ounce back before we had the gold confiscation, if you will. Everybody was forced to sell their gold back to the government at $20 an ounce in the early 30s. And then they repe it at 32. So, uh nobody got the benefit of that, right? Um that's a whatever that is 60% devaluation. Uh but everybody was told to turn their gold at 21st. We've been carrying it at


32 and now actually it's 42 um on the US balance sheet since after World War II. Well, I mean everybody listening knows the spot price of gold is more like $2,900. So if in fact the US does have 8,133 metric tonses of gold and I think even if all the bars are there, it's probably overstated by 10%. And I can explain that if you'd like me to, but let's just do that math. 8133 at 2900 bucks gets you about 720 or $30 billion you could say uh just out of the blue by valuing it differently. So what then if


you took that $720 billion and you back some Treasury bonds with it that you know maybe nobody wants to buy 50-year US paper at 3% because your loss of purchasing power over 50 years but if you index your principle to gold okay I'll take 3%. So maybe there's a way they do all this. Um again it all all of this math where do you revalue it? Well, heck, Charlotte, what if we revalue at $10,000 an ounce? Well, now we got 2.5 trillion to work with. So, I don't know. I if I might continue, you


know, people say, "Well, that would be so terribly inflationary because they'd be creating, you know, $2.5 trillion out of thin air basically." Well, I don't know, would it? I mean, they created five trillion out of thin air and pumped it out to everybody during COVID and that was inflationary. This would be half that amount and it wouldn't necessarily, you know, be all it be a little more like the QE programs in the great financial crisis more than it would be what happened in COVID. So, I


don't know if it'd be inflationary and not to mark it all the way up to 10,000. Again, these are all these mental gymnastics that everybody that watches gold and writes about it is kind of flipping themselves around trying to figure out. Yeah. Yeah. It's it's very tricky right now. And I was going to I think it's probably too soon to tell, but I'll ask you any way. I was going to ask what does this mean for the gold price? And then, you know, there's all these concerns over the US debt and and that


kind of thing. Does that is that a path to fixing it? How how does that possibly play out? Yeah, I don't think it's a path to fixing it. Um because again, if you all of a sudden called all the gold uh $10,000 an ounce on the balance sheet, well, that makes what the US alleges they have worth $2.5 trillion or $ 36.5 trillion in debt. So, it doesn't really help that. Um I I've seen some people write that it shores up the dollar if suddenly you issue some treasuries. Judy Shelton has written


about this, the original person with the idea. You issue some treasuries backed by gold. Maybe that kind of shores up treasuries as a foundational asset helps a dollar by extension. You could make that case as well. Again, I'm not everybody's always said, you can't do that because it would be so inflationary. And I'm not I don't know. I'm not so sure about that argument as I was just saying. So anyway, the get back down to what uh the secretary of the treasury said about monetizing the


assets sometime in the next 12 months. You know, do it in a way that other, you know, this within the financial system. And people with their active imaginations like myself have just thought, okay, well, maybe this is what he's talking about. But he didn't say 12 months, so I guess maybe we won't have to wait long to find out. We might. And yeah, you know, you mentioned you're going in a a bold direction with your interpretation of that statement. What are other possible interpretations we could look at?


Well, you know, what other assets the US have? You mean that kind of thing? I, you know, you wonder um what do we count as assets? The strategic petroleum reserve. I' be interesting to see what you know. All I know is I don't think the balance sheet adds up cuz I don't think you know you're supposed to I the only class in college I ever dropped was accounting. I hated it. It was all black and white. There was no gray and I'm more of a saleserson. I like the gray and so I I hated accounting. But I do


remember you're the assets are supposed to equal your liabilities, right? So we have a lot of liabilities. So I you know I but I don't think they're totally uh matched with the assets. And so that's all part what they're trying to get at to shore up the US's financial position because it's still pretty bad, right? Uh the numbers so far just in the first four fiscal months of the current fiscal year, the US has run a deficit of $840 billion, about four or five% ahead of the pace of


last year that came in at 1.8 trillion. So, we're on a pace to run about add another two trill this year. Doge and everything else notwithstanding. So, we got to be doing something. And so, that's why I think they're kind of trying to think out outside the box a little bit. Okay. Okay. Sorry to make you speculate so much when, as we keep saying, there's so little information available. I want to I want to go back to this Fort Knox gold audit that Elon Musk is proposing that Doge perhaps undertake. I have a


really hard time when it comes to Elon Musk gauging when he's serious and when he's, you know, talking on social media and just just trolling everybody. So, what what is your sense there? Is this something that's actually going to happen? Is this signaling that this administration really really cares about this? What do you think? Yeah. How do you figure, you know, because this has been talked about lots of times and would they run Trump's first secretary of treasury minutian in


there in about 2017, you know, and took some black and white photos of him holding gold bars as if that meant anything. You know, I've been there, you know, you read Congress people who should have the power to go to Gold Knox or denied access, you know, and the full audit, I think, hasn't been done in about 70 years. So, we don't know what's there. Now, Trump, we'll see, but he's done other things that are like, wow, they really going to release all the JFK files, you know, stuff like that. So, I


mean, that's some stuff that's I mean, no other president has ever even discussed doing. So, maybe they really will go in. And if you know, and frankly, if you're if this gold revaluation and bond issuance monetization thing, you better you're going to need to know exactly what you have. So, is there gold in Fort Knox? Of course there is. I'm sure there is. Is it all the US's gold? You know, has it been leased and, you know, sold out into the global market? Who has a title of


the gold? Well, I guess whoever owns the, you know, whoever has the gold has it. You know, you got it first. The other part of it though that I mentioned earlier is uh the overstating of it. Most of the gold at least in Fort Knox or really in all the most of the US gold reserves are what's called the coinmelt variety um I mentioned the confiscation earlier right and uh back in the 30s that's where a lot of this gold came from and so all the gold was collected and then melted down and then poured into the you


know the kind of standard issue 400 ounce bricks. Well, the problem is a lot of that coin melt stuff is not the 49 standard. You know, the the shiny kilo bars you see, you know, when we talk about what's going on in Shanghai and other parts of the world, those are 49s, 99.99% pure gold, okay? The bars in Fort Knox are 90% primarily because they're all that coin melt stuff. So even you know so even if we do have 8,133 metric tons by the time you sift through all that is it is the gold is actually


there overstated by 10%. It's not all coin melt but I so to say it's 8,100 metric tonses is it's not maybe necessarily 7,400 metric tons by the time you bring it up to full purity but it might be more like 76 or 7700. Do you see what I'm getting at? So again, the pieces kind of fit together. You know, if you're going to actually monetize the gold, as the secretary of the treasury said, then you need to know how much gold you actually have. So therefore, you're going to be onshoring


and bringing all this gold back. And you know, the US was a net importer last month from the UK, from Switzerland, from Singapore. every place that you get gold has been coming into the US ahead of the tariffs or is it ahead of getting it all back on shore because we're going to monetize. We're gonna find out what we but we got to find out what we have first. It's a possibility that I maybe it is just a tariff. I maybe it is and we're all just making a mountain out of nothing. But again, you look at all


these things, you know, uh if and when the time comes a few months from now that they they actually do audit and they do have a number and then all of a sudden it's announced sometime that they're going to revalue gold to X and issue these bonds, we're all everybody else is going to sit back, you know, on Bloomberg and M and CBC and go, damn, how do we miss that? you know, while people like you and I are sitting here, you know, speculating and talking about it now. Yeah. Yeah. It's definitely a wait and


see mode. And I like that you keep the possibility open that this could be wrong, could be the tariffs, could be something else. Yeah. Really good to look at. And that question of is the gold there and how much of it kind of takes us back around to another piece that I wanted to ask you about, which is okay, so all this gold is coming from London. How is the situation in London looking? Because I've been hearing, you know, they don't have enough gold. What What do you see there? Right. This um I have railed against


this, you know, in the history of this for as long as I've been that was 15 years now. Um the the London New York pricing structure scheme uh relies upon kind of a just in time delivery physical delivery at a price that's determined through the trading of derivatives futures contracts in New York, Ford and Londons. It gives you the impression there's far more gold than there really is just in the trading volumes that you see. I mean the billions and billions of gold are gold are traded every day but


what are traded are these you know just these derivatives these swaps these these forward contracts whatever and it it's kind of like a fractional reserve system you know that you've seen you know like your local bank you deposit $100,000 in your bank they don't just put it in the in the vault right and they put it in people's homes and businesses and all this stuff and if you want your $100,000 out you can't just walk into the local bank and have them bring it out to you in a briefcase


And that's kind of what the gold system is. Now, the Bank of England, which runs the vaults in London, um they store their gold there. 4,500 tons or whatever the Bank of England says they they have. Um almost all of the primary ETFs like the GLD and the other ones, they store their gold in London as well. Now, the LBMA looks at that as part of the available float that like that that's somehow able to be delivered. You know, if somebody were to show up and say, "Hey, I need a metric


ton of gold." Well, okay. Look, we got 8,000 metric tons here. Well, do you? Because you're not supposed to be able to, you know, that the gold that's in the ETFs is for the ETFs. It's not just for the bank to reach in and grab some and send it out the back door. So there have been some great analysis has been done over the last 10 years. A guy by the name of Ronan Manley has studied this and broken it all down and he thinks the actual float the actual amount of gold that's available


for to be delivered in London is more like 7 or 800 um let me get my number seven or 800 metric tons, right? Yes, that's right. Okay, make sure I'm getting my numbers right. of the 4,000 8,000 metric tons that they say they have, it's maybe 7 or 800 metric tonses they actually have. That sounds like a lot, right, Charlotte? Then we see the latest World Gold Council numbers. Third year in a row of record central bank demand totaling about 3,200 metric tons. Okay. Versus this 800. All right. Well, that So where's this


gold? where is it coming from? And that's where people start to wonder. So then all of a sudden you see these this gold that's leaving London and going the US and then you get this story in the Financial Times that says you got to wait 8 weeks. Well now wait a second. If you got all these thousands and thousands of tons, why does somebody have to wait if they want 10 tons? Why do they got to wait 8 weeks? And I mean I think it's logical to ask. Then they put on this charade say well you know we


got to have the loading docks cleared and it's heavy. They actually said that uh in a in a press conference at the Bank of England two weeks ago. So it just makes you know knowing how the system operates kind of on this just in time delivery anyway knowing that the global central banks have eaten up about 3200 metric tons in the last three years. It makes you wonder how much do they really have when you know and if if they're saying oh everything's fine don't look at us. but we can't get it to


you for two months if you want some. Well, again, I think a rational person would wonder what's really going on here. And I think that's what's kind of starting to spread a little bit. Yeah. Yeah. I think it really feels that way. And I don't want to keep you too too long today, but before I let you go, I'll ask you, you know, there's so much going on under the surface in the gold sector right now. Is there anything else that you have on your radar that you think investors should keep an eye on


right now in terms of the gold market or the precious metals in general? In general, yeah, just these kind of subsurface things that are maybe coming to the surface. Yeah. You know, I wrote about that in my forecast this year. I always write these annual forecasts over Christmas holiday and and usually try to put it out in the first of January and I write it for myself primarily because I forget, you know, over the course of the year you forget about all the stuff you were thinking and you know here I thought


price would go here and it never happened. I I need a reference to go back so I can kind of you know learn and do better next time. Well, I did that this year of course and I was like well what did I miss? because I didn't think gold would go to $2,800 last year. I thought it go maybe 23. And here the bond market's selling off and rates are going up and the dollar's going up and gold just keeps on going. What did I miss? And I thought, well, I think the key thing I missed was this central bank


gold demand that that's really putting a floor under the price, kind of a physical floor under that derivative price because, you know, you see it gold just keeps, you know, doing this stuff. So now go going forward what do we want to we outside of all of this stuff you know maybe the the US trying to repatriate all this gold and get their you know get their arms whether it's or maybe just shoring up the comx ahead of tariffs whatever if that's thrown such a wrench into the delivery scheme you know


in the pricing scheme well then this ongoing central bank demand is just going to continue to stress it and so um I would want everybody to continue to watch that. There was a report as recorded this today, Goldman Sachs thinks that China's demand in January wasn't five metric tonses. It was actually 45. So, you know, if we're going to do another year of, you know, officially reported thousand metric tons, price is going to keep going higher regardless of this, you know, what are they doing in the Trump administration?


What do they got cooking for us here? So I would encourage everybody to really keep an eye on that stuff and keep an eye on the silver deficit numbers too. Everybody talks about you know the 700 billion ounces a year in supply deficit the last four years. Um you know but oh don't worry there's billions of ounces above the surface as if you know your candlesticks and grandma's tea set which are counted in that are all part of you know the readily available supply that the amount that gets sold back that's


starting to dwindle too. So, keep a real close eye on the actual physical uh supply demand numbers and as long as they continue to be strong, the shenanigans that can get played with the paper price are going to be limited. And that's what happened last year and hopefully that'll continue this year, too. Yeah. Yeah. Great points. And I I didn't even have a chance to ask you about silver this time, but the next time we have you on, we'll go deeper into silver. For now, this was really great.


Thank you so much. This helps me understand a lot of what's going on or or what could be going on and we'll find out later what turns out to be true or not. Well, I hope that's the case. I didn't just completely confound this guy just talks in circles. I don't know you know what he said, but hopefully it was helpful. Again, my I I informed speculation on my part. Uh and we'll just see where we go from here. Okay. Well, very good. Thank you so much. Once again, I'm Charlotte Mloud


with investingnews.com and this is Craig Hempy with tfmetreport.com. Thank you for watching. If you like this video, make sure you hit the like button and subscribe to our channel. We'd also love to hear your thoughts, so leave us a comment below. [Music]