Ron Paul says 'people ought to own the gold, not the government' as he doubts the accounting at Fort Knox is 'trustworthy'

Back in August, the U.S. Treasury announced it would increase its buyback operations to $4 billion to try to stabilize yields. As CNBC reported, Treasury officials increased that number yet again to $6 billion in September. Despite all of these massive buybacks, yields for long-dated bonds like the 30-year remain at multi-year highs.

And Ron Paul fears these failed strategies are just the start.

As he told Kitco News, “It eventually won’t work and they’ll have to do a lot more because they will not be able to hide the shenanigans that go on in order to keep this machine of monetary embezzlement going.”

These steep bond repurchase totals have also made Ron Paul question where all this money is coming from, suggesting this could lead to another round of quantitative easing (QE).

For Paul, the only way to counter these worrying federal decisions is to buy and hold gold for the long term. As Paul recommended, “I think that the people ought to own the gold, not the government.”

Paul also said he has no plans to ever sell his stash of gold — ever. Quoting one of his friends in the precious metals market, “He says true gold bugs never sell. And no, I wouldn’t.”

The gold vault full of questions

Ron Paul’s critique of the U.S. Treasury didn’t end with the current bond chaos. He also has doubts just how much gold Fort Knox holds.

The questions Paul raised on Kitco came shortly after his son, Senator Rand Paul, literally went to inspect Fort Knox. After his visit, Rand Paul told The News-Enterprise, “For many years I’ve wanted to see the gold, so I went down and saw it, and it’s impressive.”

But even with his son’s testimonial, Ron Paul says he has issues trusting how the U.S. government accounts for these reserves.

Paul told Kitco News, “I don’t think anybody’s going to know what’s going on there, and they’re not likely to,” adding that, “Sometimes you price it at $42 and sometimes you price it at $4,000, and then they claim the amount of gold is such and such. So no, I don’t think that’s trustworthy.”

The “$42” Paul is referring to is the statutory price set by U.S. law for its gold reserves, which the U.S. Mint reports, “has been a constant $42.22 per fine troy ounce since 1973.” Even though gold’s market price is much higher today, the U.S. Treasury maintains this static price as an accounting tradition.

Beyond this unreliable accounting number, critics of Fort Knox dislike how secretive it is. Even though Fort Knox has welcomed select lawmakers and journalists a few times in the recent past, those don’t count as a comprehensive third-party audit. The only available reports on what’s in these vaults today come from the government’s own Office of Inspector General (OIG).

While official records suggest there are 147.3 million troy ounces of gold in Fort Knox, Ron Paul argues the lack of transparency is yet another reason to distrust the government and own your own gold.