Banyan Gold Corp. (TSXV: BYN, OTCQB: BYAGF)
The New Yukon Gold Rush
The price of gold has risen nearly 20 per cent in 2024, and despite the fact that the price is currently near an all-time high, a growing number of analysts and investors remain bullish. At the end of 2023, China, Australia, Russia, Canada and the United States were the five countries producing the most gold in the world, with 370 tonnes, 310 tonnes, 310 tonnes, 200 tonnes and 170 tonnes of gold produced respectively.
However, according to the World Gold Council (WGC), as of May 2024, the country with the largest gold reserves in the world is the United States at 8,133 tonnes, worth $628 billion, more than double the 3,351 tonnes of Germany, which is in second place.
Since the United States does not have a huge domestic supply of gold mines, where did the country get such a large amount of its gold reserves? In fact, the U.S. gold reserves were rapidly accumulated after World War II, which set the foundation of the U.S. dollar economy.
During the Second World War, because the United States mainland completely did not suffer the impact of the war, which fueled the nation’s rapid economic development, industrialisation development is further accelerated.
Some of the countries that suffered heavily from the war need to rebuild, the materials needed were mostly imported from the United States.
At that time because the world currency system is not perfect, those who imported goods from the United States must use gold settlement, so the United States has accumulated a large number of gold reserves, and after this it began to use the dollar to buy gold on a global scale. Because of the huge gold reserves as a support, the credibility of the dollar is very high, so many countries are willing to change gold into dollars.
It is precisely for this reason that the United States has such a huge gold reserves, and also let the dollar become the world’s currency, further established the status of the dollar. Today, these huge gold reserves, half of which are stored in Kentucky in the U.S. Army’s Fort Knox Bullion Depository (commonly known as Fort Knox), the rest is mainly stored in the Federal Reserve, Denver U.S. Mint, West Point vault.
Because of the security, liquidity and returns of gold, central banks have maintained huge reserves of gold, representing about one-fifth of all gold mined in history. In the first half of 2024, central banks purchased a record 483 tonnes of gold.
Turkey was the largest buyer of gold in the first half of the year, purchasing 45 tonnes of gold, followed by India, which bought 37 tonnes of gold in the first half of the year. And China’s central bank slowed down the pace of gold purchases recently, suspended gold purchases in May and June. Prior to that, China’s central bank had increased its gold reserves for 18 consecutive months.
