Gold: Uses of U.S. Official Holdings (CRS Report for Congress)
| Release Date |
Revised April 22, 2012 |
| Report Number |
RS21204 |
| Report Type |
Report |
| Authors |
Craig K. Elwell, Government and Finance Division |
| Source Agency |
Congressional Research Service |
| Older Revisions |
-
Premium April 22, 2002 (6 pages, $24.95)
add
|
Summary:
For centuries nations have accumulated gold as a symbol of wealth and power. Gold was once
also
of practical value as a medium of exchange and until recent times provided a commodity backing to
most paper currency. Recent decades have seen a steady erosion of gold's economic significance.
Nevertheless, the U.S. government continues to hold a sizable stock of gold. What is this stock used
for? Although there continues to be some confusion about the role of government agencies and other
institutions with relation to the gold stock, gold is little used. The U.S. Mint, the principal custodian
of the government's gold holdings, engages in minor gold transactions associated with producing
and selling commemorative coins. The Federal Reserve Bank does not own or have market
transactions in gold, but it does facilitate the "monetization" of U.S. gold holdings, through its gold
certificate account. The Exchange Stabilization Fund, an agency of the Treasury Department, no
longer undertakes actions that use gold, and gold is not used as the basis of the Treasury's Special
Drawing Rights. The "gold standard" that established a gold backing for the dollar ceased for
domestic purposes in the 1930s and for international purposes in the 1970s. The continued willingness
of the U.S. government to hold a large underutilized stock of gold is, perhaps, best understood as a
hedge against times of severe economic crisis when paper assets could be useless. This report will not
be updated.
