An estimate of the stock of gold (1493-2011)
As part of a research project founded by GoldMoney Foundation, last year I had the opportunity to conduct a research on the world’s stock of above ground gold. As we found out, the current stock of gold is less than generally believed. The exact amount of this overestimation may be controversial and subject to further analyses and I will welcome more research on this topic; but, to the best of my knowledge, all available direct and indirect sources and information indicate that there is an overestimation of the current stock of gold. Anyhow, this is an ongoing research and I intend to provide more information and, possibly, more accurate estimates on this question in short.
The reason for this overestimation is the widely very differing views of the above ground gold stock existing in 1492, which is the starting point in our estimation. As we justify in our essay (page 9 on), 1492 is a good starting point because it marks the beginning of relatively formal record keeping. Accordingly, the estimate of the stock of gold at 1492 becomes essential and determines the discrepancy between our estimates and the World Gold Council’s (WGC) estimates of the current above ground stock of gold. Furthermore, as notable scholars of the XIX and XX c. have estimated series on gold production since the end of the XV c. , we are able to produce a series on gold the stock of gold since 1492 to present time; so we think that a better estimate of the gold stock existing at 1492 will provide a more accurate measure of the current above ground stock in our days. Finally, there may also be significant implications of this discrepancy on the gold market, and, in particular, on the expectations of the price of gold.
You will find our estimate and the discrepancy with the current (“official”) figures in the essay in which I collaborated with James Turk (the main author) and the GoldMoney Foundation recently. You may also find interesting some news and reactions already published in The Telegraph (22nd October 2012).
- The essay, “The Aboveground Gold Stock: Its Importance and Its Size”: http://www.goldmoney.com/goldmoney-foundation/essays/the-aboveground-gold-stock
- The reactions to the essay: http://www.telegraph.co.uk/finance/personalfinance/investing/gold/9624119/Less-gold-in-world-doesnt-necessarily-mean-higher-prices.html
All comments very much welcome.
Juan Castaneda
the old lady of threadneedle street 
[…] topic familiar. This is because it is the second paper I have just published on this question; in the first one (2012), “The aboveground gold stock: its importance and size”, published by the […]