Governments and the ruling elite are starting to turn on each other. They have taken their debt created fantasy world to its limits. The pressure is getting to them. They are bickering. The Germans are starting to assert their independence. Once one domino falls, the rest will follow, and then all hell will break loose. The gold isn’t in the Federal Reserve vaults.
Bundesbank slashed London gold holdings in mystery move
Germany withdrew two thirds of its vast holdings of gold from Bank of England vaults shortly after the launch of the euro more than a decade ago, according to a confidential report by German auditors.
By Ambrose Evans-Pritchard, International business editor
8:24PM BST 24 Oct 2012
The revelation came as Germany’s budget watchdog demanded an on-site probe of the country’s remaining gold reserves in London, Paris, and New York to verify whether the metal really exists.
The country has 3,396 tons of gold worth €143bn (£116bn), the world’s second-largest holding after the US. Nearly all of it was shifted to vaults abroad during the Cold War in case of a Soviet attack.
Roughly 66pc is held at the New York Federal Reserve, 21pc at the Bank of England, and 8pc at the Bank of France. The German Court of Auditors told legislators in a redacted report that the gold had “never been verified physically” and ordered the Bundesbank to secure access to the storage sites.
It called for repatriation of 150 tons over the next three years to test the quality and weight of the gold bars. It said Frankfurt has no register of numbered gold bars.
The report also claimed that the Bundesbank had slashed its holdings in London from 1,440 tons to 500 tons in 2000 and 2001, allegedly because storage costs were too high. The metal was flown to Frankfurt by air freight.
The revelation has baffled gold veterans. The shift came as the euro was at its weakest, slumping to $0.84 against the dollar. But it also came as the Bank of England was selling off most of Britain’s gold reserves – at market lows – on orders from Gordon Brown.
Peter Hambro, chair of the UK-listed gold miner Petropavlovsk, said the Bundesbank may have withdrawn its bullion in self-protection since it did not, apparently, have its own specifically allocated bars in London. “They may have decided that the Bank of England had lent out too much gold, and decided it was safer to bring theirs home. This is about the identification. Can you identify your own allocated gold, or are you just a general creditor with a metal account?”
The watchdog report follows claims by the German civic campaign group “Bring Back our Gold” and its US allies in the Gold Anti-Trust Committee that official data cannot be trusted. They allege central banks have loaned out or “sold short” much of their gold.
The refrain has been picked up by German legislators. “All the gold must come home: it is precisely in this crisis that we need certainty over our gold reserves,” said Heinz-Peter Haustein from the Free Democrats (FDP).
The Bundesbank said it had full trust in the “integrity and independence” of its custodians, and is given detailed accounts each year. Yet it hinted at further steps to secure its reserves. “This could also involve relocating part of the holdings,” it said.
Davos says:
Everything is rehypothecated.
This shit is sooooooooooooo totally fucked, no one has any fucking idea of how bad it’ll be. No one.
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28th October 2012 at 7:18 pm
Leobeer says:
James Turk from 2001 article (very long): The Entire German Gold Hoard is Gone.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/10/25_James_Turk_-_The_Entire_German_Gold_Hoard_Is_Gone.html
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28th October 2012 at 8:32 pm
Davos says:
Leobeer: It’s not the first. They’re given their redemption’s. It’s the later who get fucked. The question Turk should be asking is who is the later, for it is us.
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28th October 2012 at 8:35 pm
Eddie says:
98% of the gold at the New York Fed belongs to foreign coutries. The system under which it is identified and segregated is known only to the Fed. There is really no way for the depositors to know whose gold belongs to whom….the problem comes in when/if everyone suddenly wants their gold repatriated. That could be interesting.
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28th October 2012 at 8:49 am
Administrator says:
A Comedy Of Golden Bundesbank Errors
Submitted by Tyler Durden on 10/29/2012 11:54 -0400
Follow this simple chronology of events:
October 24, 2012 (source: Bundesbank pre-revision; courtesy of Google Cache)
“The reasons for storing gold reserves with foreign partner central banks are historical since, at the time, gold at these trading centres was transferred to the Bundesbank. To be more specific: in October 1951 the Bank deutscher Länder, the Bundesbank’s predecessor, purchased its first gold for DM 2.5 million; that was 529 kilograms at the time. By 1956, the gold reserves had risen to DM 6.2 billion, or 1,328 tonnes; upon its foundation in 1957, the Bundesbank took over these reserves. No further gold was added until the 1970s.”
October 28, 2012 (source: “Some Follow-Up Questions For The Bundesbank, And Its Gold” courtesy of Zero Hedge)
1. Thiele says:
“By 1956, the gold reserves had risen to DM 6.2 billion, or 1,328 tonnes; upon its foundation in 1957, the Bundesbank took over these reserves. No further gold was added until the 1970s”
This is factually incorrect. From a documented source such as Timothy Green’s gold reserves report from 1999 (source), we find that German gold reserves were 1,328 tonnes in 1956 and contined to rise every year until 1969 when they hit 4034 tonnes, an increase of 200% since 1956! Offical German gold in 1970 was 3,537 tonnes and declined to 2,963 by 1979. Since then it has increased by just 400 tonnes.
October 29, 2012 (source: Bundesbank post-revision)
“The reasons for storing gold reserves with foreign partner central banks are historical since, at the time, gold at these trading centres was transferred to the Bundesbank. To be more specific: in October 1951 the Bank deutscher Länder, the Bundesbank’s predecessor, purchased its first gold for DM 2.5 million; that was 529 kilograms at the time. By 1956, the gold reserves had risen to DM 6.2 billion, or 1,328 tonnes; upon its foundation in 1957, the Bundesbank took over these reserves. Further gold was added until the 1970s.”
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28th October 2012 at 1:58 pm