In September 2012, TheBlaze reported that Russian President Vladimir Putin had been grabbing up gold “as fast as he can get his hands on it.”
And since that initial report, he has only doubled his efforts.
“Not only has Putin made Russia the world’s largest oil producer, he’s also made it the biggest gold buyer,” Bloomberg notes.
“His central bank has added 570 metric tons of the metal in the past decade, a quarter more than runner-up China,” the report adds. “The added gold is also almost triple the weight of the Statue of Liberty.”
For reference, here’s a chart illustrating the rapid growth in runner-up China’s gold holdings:
“The more gold a country has, the more sovereignty it will have if there’s a cataclysm with the dollar, the euro, the pound or any other reserve currency,” said Evgeny Fedorov, a member of for Putin’s United Russia party, in a telephone interview with Bloomberg.
It’s definitely worth noting that the value of gold has jumped by nearly 400 percent since Putin began his gold-acquiring efforts.
Also, it’s widely believed that Putin – along with China, the Netherlands, and Germany – is merely reacting to global money-printing trends. That is, he is simply looking for a safer investment than the devaluing currencies of the EU and U.S.
“In 1998, the year Russia defaulted on $40 billion of domestic debt, it took as many as 28 barrels of crude to buy an ounce of gold,” Bloomberg notes.
“That ratio tumbled to 11.5 by the time Putin first came to power a year later and in 2005, after it touched 6.5 — less than half what it is now — the president told the central bank to buy,” the report adds.
Indeed, Putin has been actively and aggressively encouraging banks to invest in the precious metal. In fact, during a recent tour of the Magadan region in the Far East, the Russian president told Bank Rossii not to “shy away” from investing in gold.
“After all, they’re called gold and currency reserves for a reason,” Putin said, according to a Kremlin transcript.
Putin’s spokesman declined to comment of his boss’ interest in gold.
“While Putin is leading the gold rush in emerging markets, developed nations are liquidating,” according to the report.
“Switzerland unloaded the most in the past decade, 877 tons, an amount now worth about $48 billion, according to International Monetary Fund data through November. France was second with 589 tons, while Spain, the Netherlands and Portugal each sold more than 200 tons,” the report adds.
Still, when all is said and done, at approximately 958 tons, Russia’s gold holdings is only the eighth largest in the world, according to the World Gold Council.
“The U.S. is No. 1 with about 8,134 tons, followed by Germany with 3,391 tons and the Washington-based IMF with 2,814 tons,” the report notes. “Italy, France, China and Switzerland are fourth through seventh.
But at the rate that the Russian’s are snatching up gold, it’s not entirely unlikely that we’ll see a change in these standings soon.
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Featured image courtesy Getty Images.