Will the Audit the Fed bill also require a real audit of the Federal Reserves Gold reserves?   If not, it should.   It has been many decades since there was a full and open audit of the Federal Reserve's gold.   A recent article asked a lot of pointed questions.  The article was published in the UK Times and was entitled:

Is there any gold inside Fort Knox, the world's most secure vault?

Since its construction in 1937 the treasures locked inside Fort Knox have included the US Declaration of Independence, the Gettysburg Address, three volumes of the Gutenberg Bible and Magna Carta.

For several prominent investors and at least one senior US congressman it is not the security of the facility in Kentucky that is a cause of concern: it is the matter of how much gold remains stored there – and who owns it.

They are worried that no independent auditors appear to have had access to the reported $137 billion (£96 billion) stockpile of brick-shaped gold bars in Fort Knox since the era of President Eisenhower. After the risky trading activities at supposedly safe institutions such as AIG they want to be reassured that the gold reserves are still the exclusive property of the US and have not been used to fund risky transactions…."

"…

In other words, they want to be certain that the bullion has not been rendered as valueless as if a real-life Goldfinger had stolen it.

“It has been several decades since the gold in Fort Knox was independently audited or properly accounted for,” said Ron Paul, the Texas Congressman and former Republican presidential candidate, in an e-mail interview with The Times. “The American people deserve to know the truth.”

Mr Paul has so far attracted 21 co-sponsors for a Bill to conduct an independent audit of the Federal Reserve System – including its claims to Fort Knox gold – but an organisation named the Gold Anti-Trust Action Committee (GATA) is taking a different approach.

It has hired the Virginia law firm William J.Olson, PC, to test President Obama's promise to bring “an unprecedented level of openness” to the Government and next month it will file several Freedom of Information requests for a full disclosure of US gold ownership and trading activities.

“We're taking the President at his word,” said Chris Powell, of GATA. “If you go online you can find out how to build a nuclear weapon but you won't find any detailed records on central gold reserves.”

A month after President Nixon resigned over the Watergate affair Congress demanded to inspect the contents of Fort Knox but the trip to Kentucky was dismissed by critics as a photo opportunity. Three years earlier Mr Nixon brought an end to the gold standard when France and Switzerland demanded to redeem their dollar holdings for gold amid the soaring cost of the Vietnam War.

Many gold investors suspect that the US has periodically attempted to flood the market with Fort Knox gold to keep prices low and the dollar high – perhaps through international swap agreements with other central banks – but facts remain scarce and the US Treasury denies that any such meddling has gone on for at least the past decade.

Pressure for more openness is mounting after the collapse of the global banking system and renewed interest in a return to the simpler era of the gold standard – a subject that is likely to be raised at the G20 summit next week. China and Russia are calling for the creation of a new world reserve currency amid fears that the Federal Reserve's quantitative easing policy – essentially printing money – might cause hyperinflation, then collapse.

A spokesman for the US Treasury told The Times that US gold holdings are audited every year by the Department of Treasury's Office of Inspector General. He confirmed that although independent auditors oversee the process they are not given access to the Fort Knox vault. …"

Today there was another article on the subject which serves as the title of this post and here is an excerpt from

An Obvious Question About The U.S. Government Gold Stock Goes Begging

"…Given the "robust" inventory of 100 oz. gold bars being reported by the Comex, how on earth is it possible that the U.S. has to keep suspending production of gold eagle and gold buffalo coins due to "a shortage of supply of gold?"   The U.S. Mint announced yesterday that it is suspending production of 1 oz. gold eagles and buffalos for the balance of 2009.  This is, I believe, the third time this year the Mint has suspended production:

"U.S. Mint now suspends all one ounce gold coin sales due to shortage of physical gold"

Here's the article link:  U.S. Supends Gold Eagle/Buffalo Production

As a matter of fact the Gold Bullion Act of 1985 authorizes the U.S. Mint to use U.S. Government gold reserves if necessary:

In the absence of available supplies of such gold at the average world price, the Secretary may use gold from reserves held by the United States to mint the coins issued under section 5112(i) of this title. The Secretary shall issue such regulations as may be necessary to carry out this paragraph”.

It would seem that if the United States has 8100 tons of gold, as reported by the Federal Reserve and U.S. Treasury, then there should NEVER be a shortage of gold with which to mint coins.  What gives?

Here is the complete text of Gold Bullion Act of 1985:  Where's Our Gold Coins?

Again, inquring minds want to know, where is all the gold? How come the U.S. Mint didn't foresee the same shortage everyone else in the market has been seeing and make sure that it had plenty of production blanks to meet demand?  If the Comex supposedly has 9 million ounces of 100 oz. bullion bars, the Mint should have been able to take delivery of some of that gold in order to meet its legal obligation to produce gold coins in an amount that meets demand.  How come the U.S. Mint is not using U.S. Government gold reserves, as per the law?

Something smells fishy here, and I think we all know what it is:  the physical supply of gold is extremely tight, the paper shorts in gold (Comex, GLD, LME, etc) are in big trouble and the price of gold is now at the mercy of the physical market.  I would suggest this situation is one of the primary reasons that the Federal Reserve and its supporters in Congress are going to any lengths to derail efforts to force an independent audit of the Fed, which would include a physical audit of the gold it supposedly holds…."

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