Kinross Says Gold Industry Faces Reserve Crisis

That's the title of a Bloomberg article. Tye Burt, CEO of Kinross Gold, Canada's 3rd largest gold producer:

"Globally, production has been in decline since the peak of 81 million ounces in 2001 to 77 million ounces last year, and we see that decline continuing long term."

Which is interesting, because according to Ed Steer:

"the bullion banks are short north of 31 million ounces of gold... that's 40.2% of last year's gold production!"

I'd love an independent audit of the commercial banks' vaults to verify the physical inventory. In fact, an independent audit of the Fed's gold reserves at Ft. Knox, KY and in New York's Federal Reserve Bank is in order. An independent audit has not been performed at Ft. Knox since 1953, when President Eisenhower was in office.

Does the amount of gold the Fed claims it has in its vaults exist? Why do other countries report declining amounts of gold, yet the Fed insists its' inventory has remained constant over the years? And if so, why don't they open up their vaults for audit? What are they hiding?

Here is Stewart Dougherty's account of KMPG's annual "audit" of the Exchange Stabilization Fund (ESF):

"Even the Treasury Department’s clandestine $50 billion Exchange Stabilization Fund (ESF), which is only one-fifth the value of America’s reported gold holdings, undergoes an annual audit. For fiscal year 2008, this audit was conducted by KPMG, a well-known, independent CPA firm. KPMG’s 2008 ESF audit uncovered “significant deficiencies,” “material weaknesses,” a “weak control environment,” and “several control deficiencies.” If a Treasury organization subject to annual audits could fail its recent exam as broadly as that, what are we to assume about the safety and security of the people’s gold supply, which, like the national money geyser, the Federal Reserve Bank is never audited? And if the ESF is audited each year, what legitimate rationale can there be for not auditing the nation’s gold supply? Something isn’t adding up."

Here's the full length, but insightful article:

http://news.goldseek.com/GoldSeek/1248373722.php