All bars brought into the vault for deposit are carefully weighed, and the refiner and fineness (purity) markings on the bars are inspected to ensure they agree with the depositor instructions and recorded in the New York Fed’s records. This step is vital because the New York Fed returns the exact bars deposited by the account holder upon withdrawal—gold deposits are not considered fungible. –NY Fed website
Recall, after a couple of weeks of negotiations in the proverbial smoke-filled room, it was agreed that the U.S. would return 300 tonnes of Germany’s 1500 tonnes being kept in NY Fed vaults over seven years. This equates to a pro rata 43 tonnes per year (approx).
First year scorecard: the U.S. shipped back 5 tonnes and they were in the form of bars that had to melted and re-cast. If you re-read that passage above, it should leave you scratching your head. [Read more...]