THERE IS NO GOLD BACKING CANADA'S CURRENCY

 

Canada’s Gold: How We Sold the Family Silver (and Gold)

CANADIAN SENTINEL– Op‑Ed

 Canada once sat on a serious stack of gold. By the mid‑1960s, our official reserves peaked at roughly 1,023 tonnes. Over the next decades, Ottawa steadily sold it off, arguing that a modern reserve should favour liquid, interest‑bearing foreign assets over bullion. By 2016, the government’s gold line was essentially zero. Alone among the G7, Canada now holds no official gold.

Why we sold

This wasn’t a midnight fire sale. It was a policy choice stretching back to the 1980s. Finance officials said gold didn’t fit a floating currency and a liquidity‑first reserve mandate. Better, they argued, to hold highly rated bonds and cash‑like instruments that pay interest and can be deployed quickly in a crisis.

What that choice cost (and saved)

Up to about 2003—the year Canada sold its last bullion—Ottawa’s own accounting said the 'sell‑gold and hold interest‑bearing assets' strategy generated more income than sitting on bullion. After 2003, the story flips. Gold surged. On a simple thought experiment—keeping roughly the 1,023‑tonne peak from 2003 to today—the opportunity cost of selling looks on the order of US$100–120 billion versus just holding the metal. Paper assets grew modestly; bullion exploded.

G7 context

Every other G7 member still holds significant gold. The U.S., Germany, Italy, France, Japan, and the U.K. treat bullion as a strategic reserve asset. Canada stands out for having effectively none. You can call that modern and nimble—or needlessly exposed to the fashions of finance. Either way, it’s a choice, not an accident.

What should citizens take from this?

·       Reserves are policy tools. Canada optimised for liquidity, not long‑run price gains.

·       Gold has no yield—but it has delivered massive price appreciation since 2003.

·       If the aim is crisis backstop, liquid paper makes sense. If the aim is long‑horizon wealth insurance, some bullion helps.

·       Being the only G7 with zero gold is a strategic statement. Voters can decide if it’s the right one.

A spiritual footnote

Scripture puts it plainly: 'The silver is mine, and the gold is mine, saith the LORD' (Haggai 2:8, KJV). It also cautions against trusting in 'uncertain riches' (1 Tim 6:17), while commending honest measures (Prov 16:11) and diversified prudence (Eccl 11:2). Translation for public policy: don’t idolise paper or metal. Steward resources with integrity, humility, and a view to the long term.

Canada chose paper over metal. That decision brought flexibility—and a hefty opportunity cost once gold ran. If we’re serious about resilience, we should at least be honest about the trade‑offs—and who ultimately owns the silver and the gold.