On Wednesday morning, US Treasury Secretary Scott Bessent announced a tripling of the maximum repurchase limit for long-term government bonds, raising it to $6 billion. Bond repurchases, where the government buys back outstanding treasuries, aim to improve liquidity and lower financing costs. However, the market reaction was far from calm, with the 10-year Treasury yield climbing about 6 basis points to 4.85% and spot gold surging past the $4,400 mark.

Former Congressman Ron Paul, who has spent decades studying monetary systems, issued a stark warning about the current fiscal and monetary framework, drawing on years of observation and firsthand experience.

Controversy Over Fort Knox Gold Ledger, Advocating Self-Custody of Physical Gold

Ron Paul has maintained a consistent core stance throughout his decades of focus on currency and gold. He argues that individuals should hold gold themselves rather than entrusting it to government custody, as this is the only way to truly understand and control their assets. In August, his son, Senator Rand Paul, spent about two hours inside the US gold reserve at Fort Knox, confirming that physical gold is indeed stored there. According to US Mint data, total reserves stand at approximately 147 million ounces, with officials noting that lawmakers conducted an inspection in 1974 and that regular audits occur. Critics, however, contend this does not constitute an independent, bar-by-bar public inventory.

Ron Paul's concern is not whether the physical gold exists, but rather the official accounting methods. He says the public has little insight into what truly happens inside the vault, noting that officials sometimes value the gold at $42 per ounce and at other times reference $4,000 gold prices before announcing total reserve figures—a ledger system that lacks credibility. The Treasury still values national gold reserves at the 1973 statutory price of $42.22 per ounce, a figure that persists today even as spot gold prices have risen more than a hundredfold.

Ron Paul is not predicting price levels; his core logic is straightforward: holding physical gold yourself is far more reliable than trusting someone else's bookkeeping. When asked under what circumstances he would sell his gold holdings, he cited a friend in the numismatics industry, saying true gold believers never sell, and neither would he. He also believes that simply raising the statutory gold price cannot solve deeper systemic issues, pointing to Britain's failed attempt at a similar approach in the 1920s.

Treasury Bond Buyback Harbors Hidden Risks, Warning of a Second Quantitative Easing

Regarding the Treasury's debt market intervention, Ron Paul suspects the repurchase program could ultimately evolve into a second round of quantitative easing. He expressed curiosity about where the government will source this massive funding. After 2008, the Fed launched quantitative easing, where the central bank printed money to buy bonds—a policy officially concluded years ago. What concerns him more is that the Fed no longer prioritizes discussing M1 and M2 money supply indicators. He notes that many people care about M1 and M2 growth rates and money supply changes, yet officials now dismiss these as outdated analytical frameworks. However, he and others still believe monetary aggregates hold significant reference value.

He predicts these bond-buying interventions will escalate, that the operations will eventually fail, and that authorities will be forced to intensify intervention efforts. The various measures used to sustain this monetary system will become increasingly difficult to mask. Treasury Secretary Scott Bessent previously spoke in Texas about FX intervention, stating that he now leads policy. Ron Paul interprets this as propaganda—a signal to markets that everything is under control and that he holds decision-making power. He maintains a strong skepticism toward current monetary policy formulation.

Government-Business Ties Amplify Risks, Massive Debt Bubble Awaits Reckoning

Ron Paul highlights a new development worth watching: since 2025, the US government has taken equity stakes in over 30 private enterprises. He describes this as corporatism, where companies are nominally private but operationally guided by government. He says government agencies and executive branches are directly purchasing corporate shares, becoming part-owners. He draws on historical examples, noting that railroad companies receiving government funding and regulation mostly ended in bankruptcy, while those that refused government money survived.

With affordability now a frequent topic of discussion, he believes the conversation is misguided. People lament that they cannot afford oil and other goods, but rarely recognize that the root problem is not purchasing power—it is the depreciation of money itself. Brent crude has surpassed $100 per barrel for the first time since July, up about 65% year-to-date. Diesel prices have hit new highs, and 30-year mortgage rates have risen to 6.85%, the highest in over a year. Geopolitical conflicts in the Gulf region transmit through energy prices to residential mortgages, raising costs across society. Ron Paul assesses the current system as likely the largest asset bubble in human history, where accumulated debt and misdirected investments will inevitably lead to a market reckoning.

Conclusion

Ron Paul's views are rooted in family memory and the era of the Bretton Woods system's collapse, holding firm to principles of sound money and freedom. The Treasury's debt market rescue operations have shown limited effect, indirectly confirming the fragility of the current debt framework. Global central banks continue to accumulate gold, yet Ron Paul reminds investors that ledger reserves do not equal physical control, while cautioning against the monetary expansion risks from sustained government market intervention. With massive debt, distorted investments, and geopolitical disruptions, the risk of an asset bubble reckoning deserves continued attention from all market participants.

Spot gold was trading at $4,414.06 per ounce as of 10:31 Beijing time on September 10.