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France pulls last gold held in US

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Re: France pulls last gold held in US

#41

Post by tgsovlerkhgsel »

cladopa wrote: post #25

This is not gain at all. At least in theory: You own some tons of gold at the start of the process, you have the same tons of gold at the end of the process. The only real gain is that you have gold in the US custody and the US can be tempted to just use it without telling you anything. In other words, you had "paper gold" or "virtual gold" that the US can confiscate anytime, for example after invading Greenland, bla…

From the full press release:

"In 2025 and at the start of 2026, while the volume of gold reserves remained unchanged, the Banque de France had to align a residual portion (5%) with technical guidelines, resulting in a significant realised currency gain. This exceptional foreign exchange income totalled EUR 11 billion for 2025."

-- the keyword here likely being "realized"

Re: France pulls last gold held in US

#42

Post by bamboozled »

cladopa wrote: post #25

This is not gain at all. At least in theory: You own some tons of gold at the start of the process, you have the same tons of gold at the end of the process. The only real gain is that you have gold in the US custody and the US can be tempted to just use it without telling you anything. In other words, you had "paper gold" or "virtual gold" that the US can confiscate anytime, for example after invading Greenland, bla…

It's more of a loss for the USA, which IMO is the unwritten point of the article.

France upgraded their gold bars to a new standard and as they were doing that, gold has appreciated massively in price, so France has the new shiny easier to trade bars, and the USA has the old harder to trade bars.

Re: France pulls last gold held in US

#43

Post by tonfa »

berkes wrote: post #26
rstarast wrote: post #18

Earlier quoted context omitted.

First sell the gold, then buy same amount at a slightly lower price a bit later (on average)

But the gold price has been rising (on average) a lot over the period July 2025 to January 2026

From the annual report, it looks like the headline number (XXB gain) is just because it's realized capital gain (which due to their reporting requirement appears in their annual report, unlike unrealized gains).

They have ~same amount of gold between both years and it doesn't look like they took extra market risk.

Re: France pulls last gold held in US

#44

Post by tonfa »

kzrdude wrote: post #6
carefree-bob wrote: post #2

Good for France to relocate gold back to their own territory, but, uh, how can this result in a 15 B gain? "The overall size of France’s gold reserves still remained unchanged at roughly 2,437 tonnes, which are now entirely held at the BdF’s underground vault in La Souterraine." Is this some special form of French accounting, where the gold becomes more valuable when it returns to French soil?

They sold the existing holdings and bought new of equivalent weight(?), so somehow they ended on profit on those moves.

The profit is just realizing the gains (resetting the cost basis for accounting purpose).

Re: France pulls last gold held in US

#45

Post by coldtea »

cladopa wrote: post #25

This is not gain at all. At least in theory: You own some tons of gold at the start of the process, you have the same tons of gold at the end of the process. The only real gain is that you have gold in the US custody and the US can be tempted to just use it without telling you anything. In other words, you had "paper gold" or "virtual gold" that the US can confiscate anytime, for example after invading Greenland, bla…

As @somenameforme wrote:

[] they sold their 'non-standard' (seems to be bars below the modern purity standards) US reserves, and replaced them with new reserves purchased elsewhere which are now stored in France. As the price of gold continued to rise as they did this, they ended up making a bunch of dinero while also centralizing their reserves.

sounds like a gain to me.

Re: France pulls last gold held in US

#46

Post by coldtea »

xvedejas wrote: post #21
rstarast wrote: post #18

Earlier quoted context omitted.

First sell the gold, then buy same amount at a slightly lower price a bit later (on average)

> the price of gold continued to rise as they did this This would mean they sold low and bought high, right?

Usually that's how you want your selling and buying combos to be...
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