This Month in Gold – December 2011

Central Bank Gold Purchases Surge in Q3
Wall Street Journal – Central banks have purchased 7X as much gold in the 3rd quarter of this year than the same period last year, the latest World Gold Council quarterly report reveals. The combined purchases amount to a whopping 148.8 metric tons of gold. By comparison, in the third quarter of 2010, central banks purchased only 22.6 metric tons. Although a significant number of the buyers from 2011 remain anonymous, Marcus Grubb, managing director of investment at the Council, hints the answer may lie in central banks from surplus countries in East Asia, Central Asia, and Latin America.
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US Federal Debt Now Exceeds $15 Trillion
Washington Times – In case you were looking for one more reason to stockpile precious metals to hedge against coming inflation, history’s greatest debtor nation passed a new milestone this month: Washington’s debt load now tops $15 trillion! The achievement comes as a result of a one-day, $56 billion (no, not million) increase to the nation’s bar tab. Bottoms up as the politicians dither and squabble, and extend the after-, after-party for just a few hours longer. Will we reach the $16 billion mark before the tab comes due?
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Swiss National Bank Returns to Profit
Financial Times – It has been a challenging year for chairman Phillip Hildebrand and the Swiss National Bank; the man and the institution paradoxically charged with stemming the stratospheric rise of a fiat currency managed too well. The first and second quarters of 2011 saw the central bank report combined loses of SFr10.8 billion. The third quarter, however, was starkly different. Thanks to the bank’s gold holdings and foreign exchange reserve positions, investments that both saw gains, Mr. Hildebrand posted a redeeming SFr16.6 billion, or US$19 billion, profit. It remains unknown precisely how much the bank has spent to cap the swissie to the euro at the 1.20:1 level.
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Salvation Army Receives Golden Donation
Press Citizen, Iowa City – Some Iowan out there really knows how to do a good deed. A Salvation Army red kettle outside the Coralville Walmart this year received a gold coin worth almost $200 from an anonymous donor, continuing what has become a now four-year-old tradition in Johnson County. Given the donation was made in the form of an appreciating gold coin, it is really a gift that’ll keep on giving. And to round it off, Salvation Army red kettles do not dispense receipts; so we can be pretty sure this donor will not be writing off the act of kindness on his or her taxes.
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