Transcription
For most Americans, Fort Knox is one of those places that we've heard about our entire lives, but rarely think about. It's become part of the mythology of the United States. Somewhere behind those massive vault doors in Kentucky sits what we're told is one of the largest stockpiles of gold on the planet Earth. The image is so deeply ingrained in our minds that Fort Knox has become shorthand for security itself. Like if something is safe, we say it's locked up like Fort Knox.
Okay. But lately something interesting has started to happen. Economists are talking about gold again. Investors are talking about gold again. Central banks are buying gold at record paces right now, the fastest pace in decades. President Trump has repeatedly talked about wanting to inspect Fort Knox. Hey, who does he have to ask? He can just go and do it, but he still hasn't. Remember Elon Musk was going to do a full live stream from Fort Knox? And buried beneath all of this is a story that almost nobody in the financial media seems willing to discuss.
The United States government is carrying its gold reserves on the books at a price of just $42.22 per ounce. What in the world? Not $3,000 per ounce, not even what today gold is trading at, over $4,000 an ounce, but $42. And that bizarre accounting decision raises a much bigger question. If America's debt problem continues to spiral out of control, could Washington eventually decide to revalue its gold reserves? If that happens, what would it mean for investors who already own gold?
Because whether you realize it or not, the conversation around gold is changing. The people who spent the last 20 years telling us that gold is a relic from the past, suddenly seem very interested in talking about it again. And whenever governments start paying attention to something, investors should probably pay attention to it as well. So let's start with the debt, because everything in the story begins here.
America's debt situation is unlike anything we've seen in modern history. The national debt has exploded past 37, not 39 trillion dollars, interest payments on that debt are becoming one of the largest expenses expenses in the federal budget. Every year Washington spends more money than it takes in. Every year that gap gets larger. Politicians love to argue about spending, they love to argue about taxes, they love to argue about who's responsible for the problem. Yeah, newsflash, both parties are responsible for it. What they don't like talking about though is the math. The math is brutal.
The federal government must constantly issue new debt in order to finance old debt. It must continually buy attract buyers for Treasury bonds. It must convince investors around the world that lending money to Washington remains one of the safest investments available. For decades that system worked remarkably well. The dollar was king. Treasuries were king. And anyone who questioned the system was often dismissed as a conspiracy theorist or a gold bug. But something has changed over the last few years.
Countries around the world have begun reducing their dependence on the dollar. Central banks have been accumulating gold reserves at a pace that we haven't seen in generations. Nations that once held large amounts of US debt are increasingly looking for alternatives. That doesn't mean the dollar is about to collapse tomorrow morning, but it does mean that the world is changing and when the world changes government start looking for options and that's where gold enters this picture.
So here's the strange part of the story. The United States has officially owns right now more than 8,000 metric tons of gold, so they say. So if those figures are accurate, America possesses the largest official gold reserve on Earth. Most people assume those reserves are already reflected on the government's balance sheet. They're not. Instead, the Treasury values gold at the old statutory price of $42.22 per ounce. A figure that dates back to the collapse of the Bretton Woods monetary system in the early 1970s.
Think about how absurd this is right now. Imagine owning a home that's worth a million dollars today, but listing it on your balance sheet at the price you paid for it 50 years ago. That's essentially what the government is doing with gold. Why? So, at $42.22 per ounce, America's gold reserves are worth only about $11 billion on paper. At current market prices, they're worth well over a trillion dollars. Nothing changes physically. No new gold suddenly appears. Is suddenly created. The bars sitting at Fort Knox and other locations would be exactly the same bars that were sitting there yesterday. The only thing that changes is the accounting. And that is why people are suddenly talking about gold revaluation.
And the theory is simple. If the Treasury revalued its gold reserves closer to market prices, the government's balance sheet would instantly reflect hundreds of billions, potentially more than a trillion dollars in additional assets. Now, we'll get to our next story here in a minute, but I want to share something with you before I do that. You've all heard us report the dollar is losing value every day. Our national debt is out of control, and you can bet no one in Washington or Wall Street is worrying about your finances or how you'll be able to afford retirement. That's why you and only you need to become financially independent. It's the only way to break free from the system.
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Now, before anyone gets excited, this would not magically eliminate America's debt problem, $39 trillion in debt, and of course, over a trillion dollars just in interest payments. It wouldn't erase any deficits. It wouldn't balance the budget. But, it would accomplish something very important. It would officially acknowledge that gold still matters. And that's where the story gets really interesting.
Because for decades, we've been told that gold doesn't matter. We've been told that modern monetary systems don't need it. We've been told that gold is simply another commodity. Yeah, if that's true, why would anyone even consider revaluing it? Why would policy makers even care? Why would economists discuss it? Why would central banks continue accumulating all of this gold? The answer is obvious, because deep down, everyone understands that gold remains a monetary asset. Not officially, perhaps, because the US dollar is not backed by US or gold. And not not in the way it once was, of course. But, psychologically, economically, historically, gold still occupies a unique place in the global financial system. And nowhere is that more apparent than at Fort Knox.
So, let's talk about this mystery, because for decades, Americans have accepted the government's assurances that gold is there. We've been told the vaults are full. Don't worry about it. We've been told the reserves are secure. We've been told everything is exactly as it should be, and perhaps it is. But, to be clear, there's no evidence that America's gold reserves are missing. There's also no evidence that Fort Knox is empty, but there's also no evidence at all that in fact, all of the gold is accounted for. So that's really the point here.
The point is that millions of Americans no longer trust institutions the way they once did. When trust declines, questions naturally emerge. How often is the gold audited? Who has actually inspected it? How frequently are reserves independently verified? I've spoken to Congressman Thomas Massie of Kentucky where Fort Knox is located and I've asked him specifically, have you been invited there? Have you asked to go there? Have you been rebuked? He's never been there. He's never been invited. He's asked to go. Senator Rand Paul of Kentucky tried to go there multiple times and he was kind of blocked from going there, but he was assured, they told him, that the gold was there. So a senator, member of Congress can't go there and it's in their backyard? So why is there so much secrecy surrounding one of the country's largest assets?
But these questions are no longer being asked by only by gold enthusiasts. They've entered mainstream political discussion. When President Trump talks about wanting to visit Fort Knox, people pay attention. When investors start discussing audits, people pay attention. When governments begin discussing the monetary value of gold again, people are really paying attention. Because it suggests something larger may be happening beneath the surface here.
Think about it. The Bank of International Settlements, the secret the secret bank that really is free from any laws that sits in Basel, Switzerland. Obviously controls a large amount of gold. So if they didn't care about it, why would the Bank of International Settlements care about gold? And just think about all of this from like a psychological perspective. Imagine Washington announces tomorrow that America's gold reserves will be revalued. What message does does that send to investors? The message isn't simply, "Hey, the accounting has changed." The message is that gold is important enough for the government to care about it. That means gold remains a significant enough asset to strengthen the nation's balance sheet. That gold remains relevant enough to be part of a serious policy discussion.
Once that message is delivered, investors begin looking at gold differently. Central banks already have. And what would that price be, by the way? Because you have like mining legend Brian Szal check, one of the co-founders of K92 Mining, who recently told me he sees gold hitting $10,000 an ounce. Um you have multiple banks, big banks have price targets of gold at $6,000, $7,000 an ounce. So, where would the federal government value gold at? And then what would that mean for the gold that you already own? Like you think it's $4,300 an ounce, which at the time of this recording is roughly where it is, but maybe the government now says, "Nope, it's $10,000 an ounce." You've literally doubled your value of your money overnight. This is crazy.
So, in many ways central banks are telling us the story before the story becomes obvious here. Retail investors are chasing the latest technology stocks, financial television debates whether gold is outdated. Central banks have been quietly accumulating it. Shh. Why? Because gold carries no counterparty risk. It can't be printed. It can't be sanctioned. It cannot default. It's one of the few financial assets that exists entirely outside the promises of governments and financial institutions. And in a world where a debt continues rising, where I mean, my god, the Strait of Hormuz closed one week, back open again the next. All of these geopolitical tensions, confidence in institutions continues to fall. Those characteristics become increasingly valuable, the valuable in you know, the the the characteristics of gold specifically.
So, that's why they think the real story here isn't Fort Knox. It isn't even really gold revaluation. The real story is confidence. Every monetary system ultimately runs on confidence. Confidence in governments, confidence in central banks, confidence in debt markets. We think about after World War I, the way to renew confidence in Germany, instead of runaway inflation, was to essentially create a brand new currency. Trade your old German [clears throat] currency for the new one. And even though it was kind of a fake illusion, fake confidence, it worked. Um and confidence that tomorrow will look roughly like today. So, when confidence is strong, nobody cares about gold. When confidence begins to weaken, gold suddenly becomes very interesting. History has shown us that repeatedly, and that's why investors should pay attention to this conversation.
Not because Congress is guaranteed to revalue gold, not because Fort Knox is guaranteed to become the center of some massive controversy, and maybe not because it's empty or full. And not because we're returning to a gold standard, although I would love that, because that would prevent the Fed from just printing money like it does and keep us out of foreign wars. There would have to be a gold-backed currency, therefore a one-for-one standard, which we don't have anymore. But because the fact that these conversations are happening at all tells us something important is happening. It tells us policy makers are looking for solutions. It tells us investors are looking for alternatives outside the US dollar. It also tells us that central banks are preparing for uncertainty. And that tells us, of course, that gold may become more important, not less important, in the years ahead.
And the biggest mistake investors often make is like waiting for certainty on this. They wait until everyone agrees. They wait until the story is obvious. They wait until the headlines are screaming about it. But then the opportunity is usually gone, right? By By the time that happens, all of all of that is priced into it. So, [snorts] markets reward anticipation, not confirmation. If Washington even, you know, ever former formally revalues gold, owners won't be scrambling to understand what happened. They'll already be positioned because they own gold already at a certain amount. And if gold is now doubled in value, it's remarkable. That's why I find this story so fascinating. Not because I know exactly what happens next. I don't. Nobody does. But, when government starts talking about gold again, when central banks are buying gold again, when questions about Fort Knox start resurfacing resurfacing again, and when America's debt problem continues growing larger every year, I think investors owe it to themselves to start paying attention to this.
Because the people who told us that gold was irrelevant seem to be spending an awful lot of time talking about gold lately. That may be the biggest clue of all in all of this. So, let me know what you think about all of this. Thank you for subscribing. Are you positioned in gold? Are you buying gold? Accumulating gold? Where is your gold position right now? Let me know down below and leave a comment if you like. Thank you guys so much for subscribing. We'll see you next time.