Yes the U.S. Dollar Has Something Behind It; Fed's Gold Holdings Are Worth $340 Billion - Bove

In an interesting note on Friday, Rochdale banking analyst Richard Bove pointed out that the dollar may be more solid than originally thought based on the value of the gold holdings at the Federal Reserve.

Bove said the United States has more gold than any other country in the world by a relatively wide margin. The Federal Reserve currently values its gold at $42.22 per ounce or $11 billion, but based on the current market value this gold is worth $340 billion.

"The gold backing of each American dollar is rising rapidly," Bove said. "This increase in value is accelerating not decelerating as the growth in dollars is failing to keep pace with the growth in the value of gold."

"Thus, the fear that the Federal Reserve may be debasing the currency may be over stated."

Gold is trading just shy of the $1300 level after crossing above it last week. December gold futures last traded at $1297.10.

Related ETFs:
(NYSE: GLD), (NYSE: IAU), (NYSE: GDX).

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