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American gold is leaking out of the country at a record pace.
While most countries and central banks are adding gold, the US has been selling gold abroad.
You’ll notice from this chart (HT @ekwufinance), gold was the top export for the US in February.
For Q1, the US exported $47 billion worth of gold, or about 9% of total annual gold production.
Maybe that’s not alarming – but put it in context that the US does not mine 9% of the world’s gold. It only mines about 5% of total annual gold production domestically. To make up the difference, the gold leaving the US is coming out of vaults, savings and storage. Grandma’s jewelry and granddad’s proof set – melted down and sent overseas.
Put another way, the world is draining US gold at an increasingly high rate – and it all started only about a year ago.
For decades, gold exports from the US were basically flat at around $5-$10 billion. And you already know where the bulk of this gold is going: to India and China.
But now we’re seeing new record gold exports quarter after quarter with no end in sight.
At the same time, the Fed and Treasury are stepping in to help prop up the Japanese Yen.
Scott Bessent (head of the US Treasury) is intervening by selling Euro bonds to support the Yen – because if he doesn’t, the concern is that Japan will dump Treasuries…
But Japan has been dumping Treasuries already. In Q1, Japan sold ~$30 billion in US Treasuries.
Simultaneously, the Treasury itself is buying record amounts of US Treasury securities – at a faster pace than they did during Covid.
In 2026 (so far), the Treasury purchased nearly $300 billion in Treasuries. And in July alone, the US government posted a $500 billion budget deficit.
If this rapid exodus of gold from US vaults along with the US Treasury stepping in to help another Central Bank, buying its own bonds and running a massive deficit seems a bit harried, chaotic and strange – that’s because it is all of those things.
We’re headed towards something, very quickly, and monetary authorities are scrambling to keep the plates spinning. They’re running ad hoc plays to do whatever it takes to prevent a collapse in Treasury prices.
The Fed and Treasury like to project the notion that they’re in control, anticipating the economy and making subtle nudges in one direction or another. Whether they believe it or not, they want to be seen as the most serious stewards who have an almost god-like omnipotence. Confidence in their policies is key. They know that.
Right now, they’re reacting in real time to events they clearly do not have control over.
The mask is coming off.
Best,
Garrett Goggin, CFA, CMT
Lead Analyst and Founder, Golden Portfolio
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