Where is the gold?

We all know the terminally inept Gordon Brown, Britain's second worst post-war PM, sold off much of the nation's gold at a discount price for a short-term political gain (and no doubt Mr McDonnell will sell off the rest in short order if Labour take power). Britain's gold holdings are now somewhere on the low side, it appears. But are they? (The 395 tonnes sold by Brown would now be worth $13.1bn more - he really was a humungous dickhead)

Our 310 tonnes remaining after Gordon's sell-off seem to leave us somewhere between Portugal and Austria, one of the smaller holdings. And Italy's precipice financial status seems a little less serious when you know she has almost two and a half thousand tonnes of gold squirrelled away - but all is not as it seems.

Zero Hedge reports on an unseemly squabble over who owns Italy's gold - the banks or the Italian State. As entertaining as this is, the more important point is that no-one has physically audited those gold bars since the 1970s. As ZH reports

The Banca d’Italia furthermore claims that 1199.4 tonnes of the gold (or roughly half), is stored in the Bank’s gold vaults under it’s Palazzo Koch headquarters building in Rome, with most of the other half stored in the vaults of the Federal Reserve Bank of New York (FRBNY), and a small balance kept the Bank of England in London, and in an account of the Bank for International Settlements (BIS) in the vaults of the Swiss National Bank (SNB) in Berne, Switzerland. But without any documentary evidence or independent auditing or verification of any of its gold, especially the foreign held gold, these claims are impossible to verify.

There are strong suggestions that Italy's actual gold may be somewhere on a par with the UK's holding - just a few hundred tonnes - the rest of it having been stolen, sold off, defrauded or evaporated. Some bright spark may have realised that what's important is how much gold the world believes you have, rather than how much you actually have.

Which really also leaves all the other claimed balances open to question, doesn't it?

Normally this would be a sort of anorak issue, but with dire warnings that should a catastrophic global financial collapse finish-off paper money we will need to return to the gold standard, perhaps it's something that should be checked?