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BIS annual report confirms GATA analysis of gold interventions, avoids Russia issue
9:10a Monday, June 27, 2022
Dear Friend of GATA and Gold:
In his latest report on the gold market interventions of the Bank for International Settlements, appended here, GATA consultant Robert Lambourne is far too modest. For the bank's annual report, published Sunday, confirms the accuracy of Lambourne's years of doing monthly calculations of the bank's gold market interventions -- its involvement in gold swaps, about which the bank has been almost completely secret.
The BIS does not candidly provide its level of gold swaps in its monthly reports. The swaps can be calculated from the bank's monthly reports only by deduction from other data in the reports, which Lambourne studiously undertakes to do. He appears to be the only non-governmental analyst of the bank's gold market interventions.
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Five years ago GATA asked the BIS what it does in the gold market, for whom, and why, and whether Lambourne's monthly calculations of the bank's gold swap positions were accurate. The bank responded to the inquiry but refused to answer it:
https://www.gata.org/node/17793
Now, with the bank's annual report yesterday, Lambourne's calculations and methodology have been vindicated.
During its more than two decades exposing and litigating against gold market manipulation GATA has compiled overwhelming documentation of Western central banking's policy and mechanisms of controlling the gold price, usually surreptitiously and deceptively, cheating investors and rigging markets throughout the world:
But Lambourne's work on the BIS' monthly reports is always the most contemporaneous proof of central bank interventions. His work provides information available only from GATA -- information suppressed by the Financial Times, Wall Street Journal, Bloomberg News, and all other mainstream financial news organizations that purport to cover the gold market but more often conceal what is really happening there.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org
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By Robert Lambourne
Monday, June 27, 2022
The 2021-22 annual report of the Bank for International Settlements was published Sunday --
https://www.bis.org/about/areport/areport2022.pdf
-- and affirms in passing that the bank's level of gold swaps as of March 31 was 358 tonnes, very close to the estimate of March 31 swaps that was calculated by GATA and reported two weeks ago: about 360 tonnes:
https://www.gata.org/node/21994
The bank's swaps total appears on Page 179 of the annual report, which is Page 182 of the PDF copy linked above.
The bank's confirmation of GATA's calculation for the March gold swaps provides confidence that GATA's monthly estimates of the swaps, which long have been calculated by GATA from the bank's monthly statements -- not provided candidly and directly by the bank itself -- are generally accurate.
At the moment it seems that a downward trend is in place as the swaps have been declining for months.
The annual report also confirms that the BIS has sold none of its own gold, which remains at 102 tonnes. The report shows that the largest contributor to the bank's Comprehensive Income in 2021-22 of SDR 918 million (where SDR means “International Monetary Fund Special Drawing Rights") resulted from the gain on those 102 tonnes, due to the increase in the gold price over the year. This gain on gold contributed SDR 682 million or 74% of the bank's total income.
Given gold's continuing importance to the bank's annual financial results, the information provided about the bank's dealings in gold is inadequate, since 358 tonnes of swapped gold involve a huge amount of money and the bank provides no explanation for the swaps.
The annual report also discloses the level of earmarked gold held via the BIS. This is gold in allocated accounts and comprises specific gold bars deposited with the BIS on a custody basis. The report says the BIS holds 378 tonnes of earmarked gold on behalf of other central banks. This compares to 390 tonnes held a year earlier. As the BIS does not have its own gold vaults, it can be safely assumed that this gold is deposited in earmarked accounts at major central banks in gold trading centers, like New York.
The report has a surprising lack of information on the approach of the BIS toward the Russian central bank. This seems ironic insofar as the report was published on a day when several Western countries announced that importing Russian gold was to be banned.
There is no official statement from the BIS confirming whether the bank has imposed its own sanctions against the Russian central bank. On Page 129 of the annual report the BIS confirms that the Russian central bank remains a member. Ordinary accountability in an annual report might call for clarifying the BIS' relationship with Russia's central bank.
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Robert Lambourne is a retired business executive in the United Kingdom who consults with GATA about the involvement of the Bank for International Settlements in the gold market.
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