The Aboveground Gold Stock

With the rising gold price this past decade, there has been some discussion about the size of gold's aboveground stock, but little recent analysis of it.

To provide an accurate accounting of this stock and to explain its importance, I have therefore prepared this study for the GoldMoney Foundation. I would like to acknowledge, with sincere gratitude, the assistance of Juan Castañeda of the University of Buckingham in the United Kingdom, who provided valuable research for this project.

Gold has been money since pre-history. Even though it does not actively circulate as currency
today, it is useful in economic calculation, one of the most important functions of money. Its monetary role is the principal reason gold is highly valued throughout the world.

The primary evidence that gold is money arises from the fact that it is accumulated. In other words, gold does not disappear like consumable goods. Gold's usefulness — and hence, its value — does not arise as an item of consumption. It arises from gold's monetary usefulness.

The purpose of this study is twofold. First, it examines the importance of gold's aboveground stock. Because it is money, its aboveground stock — or simply the "gold stock", as it will be referred to hereafter — can be viewed as gold's M3. It is the world's total quantity of gold money.

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