Where is the German Gold?

Wed, Jan 8, 2014 - 1:48pm

Almost a year ago, the German government put in a formal request to reclaim (repatriate) a portion of their gold reserves held outside of Germany. Reports on the progress of this initiative have raised quite a few questions.

Here's the first report, from ZeroHedge and released on Christmas Eve: https://www.zerohedge.com/news/2013-12-24/year-later-bundesbank-has-repa...

At the time the plan was announced, many in the gold community made note that it would take over 8 years for Germany to reclaim this portion of its foreign reserves. Seven hundred metric tonnes...though a lot of gold...should simply be sitting in New York, London and Paris vaults, collecting dust. Why not just brush it off, certify that the bars numbers match up and then ship that shiny stuff back to Germany. No big deal and certainly not something that should take eight years to accomplish.

Now news comes that, in the first year of the plan, Germany only received back 37.5 metric tonnes of their gold. This is only 5% of the total repatriation amount. At this rate, it will take twenty years, not eight, to reclaim the gold.

Further muddying the waters are reports that this gold came exclusively from the vaults of the Federal Reserve Bank of New York (FRBNY). If that was the case, then the gold returned should have been a simple transfer. The Germans deposited the gold there decades ago. It is being shipped back to them now. Problem is, it wasn't a simple transfer!

Apparently, The Bundesbank took the unusual step of having "its" bars assayed, melted and recast into London Good Delivery form before taking delivery. Now, why would they do that? And why would they do this in the U.S. and not in Frankfurt? These bars should simply be the same bars that were deposited decades ago. Do they not trust the FRBNY? Are these not the same bars?

Perhaps, instead, there's another explanation. This idea was first spelled out on the GATA site earlier this week and I urge you to read through this post now: https://www.gata.org/node/13458

In summary, it goes like this:

  • The original German gold held in the U.S. is gone. Leased, sold and rehypothecated many times over.
  • Germany now wants its gold back. The U.S. balks and promises to only return roughly 40 mts/year for eight years. (By the way, why didn't France return any gold in 2013? Germany's looking for 374 metric tonnes from them and, in 2013, it got zilch, zero and nada.)
  • Pressed to come up with gold to ship back to Germany, the U.S. scours it's vaults.
  • The U.S. takes some of it's 1930s-confiscated "coin melt" gold, assayed at 90% purity, and recasts it into 99.5% purity London bars and ships them off to Frankfurt.
  • The Bundesbank books in these new bars, apparently date-stamped "2013", as a "return of German gold" and now awaits the other 95% of their "order".

Hmmm. OK, then. First year done. Whew! Now, from which vault will the U.S. find gold for Germany in 2014? And how about the reserves allegedly held in Paris? When will those be returned? You'd think they could just drive that over in a convoy of guarded trucks. From Paris to Frankfurt is only about a 500km drive. You could do that in under a day. What's the big deal?

(Could it be that there is no German gold in Paris? Coincidentally, it's almost the exact same distance from Paris to Basel, Switzerland. Hmmmm. Maybe the Germans should look for their gold there, instead??)

Anyway, this entire farce just keeps getting sillier by the day. Today, there are reports from Germany that indicate the Bundesbank is quickly backtracking and attempting to retract the "U.S. remelting of bars" story. (https://www.gata.org/node/13472) OK, right. Whatever you say. And don't forget about this fun chart, created for us last year by our pal, Ned Naylor-Leyland:

2014 is going to a consequential year in gold and silver. This German gold story only adds intrigue and fuel for the fire.


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Jan 8, 2014 - 5:44pm

German gold gone . . . no big deal . . .


I had an important moment in my journey wrt precious metals back when Germany first made the request and the goldbugs were the subject of ridicule in the media for finding anything wrong with the "7 years" detail.

Anyway I once again should have kept the article, but I read an editorial that made the following claims:

1) Gold isn't nearly as important to the monetary system as some like to imagine it is.

2) The Gold is definitely there. This is the freaken Fed we are talking about. To even doubt, only betrays ones lack of education

3) Lets say hypothetically, the gold wasnt there. Why the hell would we want to expose that with an audit? If people found out they couldnt trust the Fed the entire system would collapse and we would be in a hell that Goldbugs couldn't begin to imagine.

So for these reasons, he held the goldbugs should shut up.

What stuck with me was that when you condense the above it becomes, "your an idiot who deserves contempt and your also a dangerous revealer of truth who must be stopped because you lack the sense to stop."

There is no giving up the stack after realizing how the elites think.

Jan 8, 2014 - 5:35pm

The US Mint can't make enough

The US Mint can't make enough coins to satisfy demand and the price of silver falls. I wish I understood this logic, but sadly I don't. Typically, the answer would be higher silver prices to bring supply and demand into check. I, for one, use to buy 3 ASE's whenever I had an extra $100 in my pocket. Now I can buy 4 so I do. Price drops, I buy more, and oddly enough this leads to even lower prices. So, the logic is simple.... the MORE silver we buy the LOWER the price will go!

Jan 8, 2014 - 5:23pm

U.S. Mint and silver Eagles in 2014 . . .

Demand increases, so mint makes fewer coins to sell. Higher demand means lower prices. Alice in fricking Wonderland:

"The US Mint anticipates that they will have approximately 3.5 million coins to allocate on January 13, 2014. They have indicated that allocated quantities for the following week will be much lower. The initial amount of coins available will be lower compared to the prior year.

Last year, the US Mint recorded sales of nearly 4 million Silver Eagle bullion coins on the opening day of availability for the 2013-dated coins."


Jan 8, 2014 - 5:03pm

And recasting removes the

And recasting removes the possibility of some extra W coming along with the Au. Not that a Central Bank would ever do such a thing to the Bundesbank .... err ... again! Maybe the Buba were comparing notes with the PBOC. I understand they have both experienced a less than satisfactory delivery.

Jan 8, 2014 - 5:00pm
Jan 8, 2014 - 4:59pm

@pbreed re: paper gold for all . . .

"Its not WWII Jewish gold, its not Aztec gold, its not coin melt gold, its paper gold now and ALWAY has been."


Yes, i think you're right. The bankers took whatever gold they could, for themselves, through "paper magic" and left a whole lot of IOUs for everyone else.

It gets proven nearly everyday, that bankers are above any law for the rest of us.

Jan 8, 2014 - 4:54pm


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Jan 8, 2014 - 4:52pm

Missing the forrest....

My Theory

Ask where did Germany get this gold?

When it came time to settle trade surpluses before Nixon closed the gold window you

could get dollars or get gold... anything you wanted to buy other things with they used dollars,

What they wanted saved they just told the federal reserve I want that in gold...

So the federal reserve just added it to their "Tab" of gold they were holding.

Then France decided it was not ok to have the Federal reserve hold gold for it and it wanted physical on its shores...

the game was up and this caused Nixon to close the gold window...

This gold NEVER existed ANYWHERE except as an entry on a federal reserve ledger.

Germany NEVER HAD ANY GOLD at the Federal reserve all they ever had was a Federal reserve IOU slip.

The bars did not get shipped from Germany to NY.. they materialized into the Federal reserve system as part of the settlement process for international trading. This Ponzi is at least 60 yrs old if not 100...

Its not WWII Jewish gold, its not Aztec gold, its not coin melt gold, its paper gold now and ALWAY has been.

To me this is just proof that the powers that bee can keep the show running for a lot longer than we think...

Jan 8, 2014 - 4:34pm

OK I admit it...

I have the German gold. And I'm not giving it back. Bwahhahaha!

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