Fort Knox vs. China: The Global Gold Race Nobody Discusses

The United States officially reports holding 8,133.5 metric tons of gold, equivalent to approximately 261.5 million troy ounces. Government figures indicate that roughly 147.3 million ounces are stored at Fort Knox, with the remainder distributed across the Denver Mint, the West Point Bullion Depository, and the Federal Reserve Bank of New York. That stash has anchored the dollar's credibility since the Bretton Woods era, even though President Richard Nixon severed the dollar's direct convertibility into gold in 1971, closing the gold window and ushering in the modern fiat currency system.

While the question of how much gold the United States possesses may appear settled on the surface, Money Metals Midweek Memo host Mike Maharrey contends that a more pressing question remains: whether those official figures have ever been independently verified through a comprehensive audit.

The Case for a Full Fort Knox Audit

In a recent interview on Fox News with Jesse Watters, Treasury Secretary Scott Bessent stated that Fort Knox's gold is "present and accounted for," noting that members of his staff and the U.S. Treasurer have visited the facility. Maharrey argues that while such assurances may reassure some observers, they are no substitute for an independent audit.

Drawing on his accounting background, Maharrey explains that audits are designed to detect honest mistakes, verify records, and provide accountability. Nearly every business managing valuable assets relies on regular external audits to ensure transparency and maintain public confidence. He argues that any institution responsible for billions of dollars in assets should welcome independent verification rather than discourage it, and that resisting routine audits raises more questions than it answers.

Why the 1974 Inspection Falls Short of an Audit

Government officials have frequently cited inspections conducted during the 1970s as evidence that America's gold reserves have already been examined. Maharrey contends that these events fell far short of accepted auditing standards.

In 1974, the Treasury opened only one of Fort Knox's 15 vault compartments to members of Congress and the media in what Maharrey characterizes as a public relations event rather than a legitimate financial audit. Visitors observed stacks of gold bars and briefly handled some of the bullion, but no meaningful verification took place. According to Maharrey, none of the bars were matched to serial numbers, weighed, assayed for purity, or reconciled against official inventory records. A true audit, he notes, would require every bar to be counted, tested, documented, and independently verified before results were released publicly.

Transparency Questions Persist Decades Later

Following the 1974 event, the Treasury conducted inventory procedures and installed tamper-evident seals on vault compartments. Maharrey argues these measures still did not meet accepted auditing practices. He points to missing reports, the absence of publicly available assay records, incomplete transactional histories, and evidence that some vault seals have been broken and later replaced without new comprehensive audits. In his view, these shortcomings would not satisfy the standards expected of a professionally managed private bullion depository.

Germany's Bundesbank set something of a transparency benchmark in 2013 when it announced a plan to repatriate hundreds of tonnes of its gold from Paris and New York, completing the transfer by 2017 and publishing bar-by-bar inventory lists. The move came partly in response to domestic pressure over the lack of independent verification of foreign-stored reserves.

Rather than opposing an audit, Maharrey believes the government should embrace one. If the reported gold reserves are accurate, he argues, an independent examination would strengthen public confidence rather than undermine it.

Money Metals Emphasizes Independent Verification

Maharrey contrasted the government's approach with the auditing procedures used at the Money Metals Depository in Eagle, Idaho. According to Maharrey, the depository conducts both continuous internal audits and regular external audits performed by independent firms. Customer holdings are routinely verified, inventory is spot-checked, and clients may request an annual photograph of their segregated holdings to confirm that their precious metals remain securely stored. He argues that transparency, accountability, and routine verification should be considered standard practice whenever valuable assets are entrusted to a storage facility.

Governments Continue Holding Gold Despite Fiat Currency

Although modern monetary systems are no longer backed by gold, Maharrey notes that governments continue to maintain substantial bullion reserves. He identifies what he calls an interesting contradiction: public officials often emphasize that fiat currencies make large gold reserves unnecessary, yet central banks around the world continue accumulating physical bullion. Their actions, according to Maharrey, suggest that gold still plays an important strategic role within the global financial system.

China's Official Gold Holdings May Be Only Part of the Story

China officially reports holding 2,346 metric tons of gold and has increased its reported reserves for 21 consecutive months. In June, the People's Bank of China announced a 15-tonne increase following a 10-tonne purchase in May, representing a noticeable acceleration in official buying.

Maharrey argues that these official figures likely understate China's actual gold accumulation. He cites research from Goldman Sachs estimating that China acquired more than 48 tonnes of gold through London's over-the-counter market during May alone, despite officially reporting only a 10-tonne increase. Goldman ultimately adopted a more conservative estimate, concluding that China has likely accumulated approximately 80 tonnes of gold during 2026 so far—roughly double its reported purchases.

Evidence Suggests China Holds Far More Gold

Additional research cited by Maharrey indicates China's actual reserves may be significantly larger than official disclosures suggest. Money Metals researcher Jan Nieuwenhuijs previously estimated that China's central bank quietly acquired approximately 570 tonnes of gold during 2024 while officially reporting purchases of only 41 tonnes. His research suggests that since the Ukraine war began, China has been acquiring roughly five times more gold than it reports to the International Monetary Fund. Based on multiple sources, he estimates China's monetary gold holdings could already exceed 5,000 tonnes.

The Financial Times later reported that China's undisclosed purchases could exceed ten times its official figures, highlighting the country's continued efforts to diversify reserves away from the U.S. dollar while supporting global gold demand. That diversification push accelerated after Western sanctions froze roughly half of Russia's central bank reserves in 2022, a move that prompted several nations to reconsider the concentration of their reserves in dollar-denominated assets.

China's Gold Strategy Has Been Building for Years

Maharrey also referenced longtime analyst Jim Rickards, who argued more than a decade ago that China deliberately keeps large quantities of gold outside its officially reported central bank reserves. Rickards wrote that after China announced a 604-tonne increase in 2015, much larger holdings remained under the control of the State Administration of Foreign Exchange (SAFE), with only gradual transfers appearing in official People's Bank of China reserve reports. Maharrey says this strategy allows China to satisfy international reporting requirements while concealing the true scale of its gold accumulation.

Recent analysis has even suggested that if current trends continue, China could surpass the United States in total gold holdings within the next five years.

Central Banks Continue Diversifying Into Gold

According to Goldman Sachs, China's purchases are part of a broader multi-year trend among central banks worldwide. Net central bank gold purchases have set consecutive annual records in recent years, with countries including Poland, India, Turkey, and Singapore among the most active buyers. The bank continues forecasting gold to reach $4,900 per troy ounce by the end of 2026, arguing that sustained central bank demand should provide long-term price support even if higher interest rates create short-term headwinds. Goldman also believes private investment demand could expand further if geopolitical risks continue increasing.

Maharrey notes that central banks have increasingly diversified reserves away from U.S. Treasuries and toward physical gold, reinforcing what he sees as gold's enduring role as a reserve asset.

Federal Reserve Policy Remains a Near-Term Headwind

As the July Federal Open Market Committee meeting concluded, Maharrey observed that most investors expected Federal Reserve Chairman Kevin Warsh to leave interest rates unchanged, although some market participants had speculated about the possibility of another rate increase. He argued that additional tightening could accelerate debt problems that have accumulated following years of quantitative easing, historically low interest rates, and nearly $5 trillion in pandemic-era monetary expansion.

While acknowledging that gold and silver prices may continue trading sideways in the near term, Maharrey believes the underlying monetary environment remains favorable for precious metals over the longer term.

Chinese Investors Continue Buying the Dip

Beyond central bank purchases, private Chinese demand has also strengthened. China imported 173 tonnes of gold during the previous month, marking a two-year high. Maharrey cited Jinrui Futures analyst Zijie Wu, who said investors viewed recent price weakness as an attractive buying opportunity, while Chinese banks also increased purchases to utilize import quotas and replenish bullion inventories.

Maharrey concluded that regardless of near-term Federal Reserve policy, inflation continues reducing the purchasing power of fiat currencies over time. As central banks continue expanding their gold reserves and investors increasingly seek tangible assets, he argues that physical gold and silver remain important long-term stores of wealth.