Germany to repatriate gold

Bullion Baron said:
Worth a read for those who succumb to the conspiracies surrounding the announcement: http://thefundamentalview.blogspot.in/2013/01/let-gold-conspiracy-regarding-germany.html
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That articular is just as bad as something written on KWN. He had no valid points just his own opinion, yet he criticises other sites for doing the same thing.

and this line;

I was raised and educated to follow facts, not speculation. Shame on anyone trying to spread the "gold isn't there meme" while completely turning a blind eye to the statements quoted in the NY Times
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is that meant to be a joke? so are we all meant to take whats written on NY times as 100% fact now? and believe people always tell truthful statements?


For me the 7 year time line smells fishy and with good reason. But if you think otherwise I'm not going to attack you and call you names like this crying child.
 
I have great respect for Jim Sinclair's perspectives:

www.jsmineset.com
As he points out it is a central banking issue, not a piggy bank issue
I respectfully disagree with most of the explanations given today on the why of German actions in gold. My understanding is that the causal event of this notification actually came from the actions of the US Exchange Stabilization Fund and the long term plans to strengthen the euro.

I have published a chart from Patrick showing the extreme change in the ratio of gold to fiat currency presently being held in reserve by Euroland.

First you need to understand what the Exchange Stabilization Fund is and is not. It is an account at a major gold bank in the name of the Exchange Stabilization Fund. This fund can legally trade in gold and does. The President of the USA and the Secretary of the US Treasury run this fund. Those two managers by law are permitted to designate another manager if they wish. The fund can trade long or short, borrow or lend anything. Basically this is a an account that can legally do anything it wants whenever it wants in secret as the year end statement can easily be brought to only benign activates by warehousing all the trades.

Their broker is quite an expert in that strategy to wash year-end positions for clients.

What occurred as I am told is an act in Germany in reaction to a parting shot from the retiring Secretary of the US Treasury via the Exchange Stabilization Fund.

When gold traded at $1918 it was setting up for a challenge of a very important round number, $2000. The sell off was a product of long liquidation in an anticipation of $2000 in a fast market. Gold did fall on its own weight into the $1800 area, however the body block at $1800, $1775 and $1750 was a product of the Exchange Stabilization Fund operating as an account of a major Gold Bank. Seeing that, this gold bank went to the short side for the account of its hedge funds and not wholly owned trading arm. This gold bank issued a public statement that the gold market was dead as a doornail, finished and completed.

On the level of central banking there are no secrets. The long term plan for the currency war between the euro and the dollar is a derivation of the Free Gold Thesis. That means a significant change in the percentage of fiat currency versus gold at market value held by Euroland as reserves. This thesis has a target for cooperating Asian central banks for gold holdings at no less than 15% at market value. I question some of the thesis of Free Gold thinkers, but much of it has been in my writing for more than a decade on what the end game recovery will look like.

I am told that the parting shot to break gold's back by the Exchange Stabilization Fund was considered a direct attack on the Euro strategy for what the end game recovery will look like. The Free Gold thesis requires significantly higher gold prices to work and to elevate the euro back in reserve by choice category.

The German reaction was not political but rather a direct warning that they could demand return of their gold just like DeGaulle of France did in the 60s by making a direct and immediate demand for conversion of the US dollar holdings into Gold.

A major central bank will not insult another major central bank unless it is an act of financial war. It has not come to that yet, but it is not that far away. It is 2015 to 2017 and not 2020.

The reason that gold is relatively firm after the media leak and release on the night of the 14th is that I am not the only person who knows the real story. The price of gold will go to and beyond $3500. Gold will be market to market by the majority, if not all, major central banks. This will balance the balance sheet of the many and major debtor nations and will provide the platform for recovery after unwinding.
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And by some weird act of God, Germany isn't the only country that is repatriating its gold from the States. Now, there are none that are sending more to "store". You tell me if that is a pattern.
 
What a joke, 2020? S will HTF well before then. I bet if Germany wanted 100% of it's gold out of London right away then London would agree to wave the 550k Euro they charge to store it for them.

Merklemark anyone?
 
Has anyone considered the logistics of actually counting out, transporting, counting in and then testing 674 tonnes of gold?

Assuming deliveries are evenly spread out, they'll be shifting 1.85 tonnes each and every week for seven years. If the gold is in the form of 400oz LBMA spec bars, each shipment will contain 148 bars.

At current prices, each weekly shipment will be worth about $100 million in assets which are completely untraceable after being melted down. That is an incredibly tempting target for anyone looking to acquire a large amount of gold without paying for it. It's the kind of target that attracts professionals with military training and experience in special operations.

Whoever is doing the transporting might well be uncomfortable moving more than $100 million at a time, or rushing delivery to the point where there is a very noticeable stream of armoured cars driving out of the Fed's vaults every day for months at a time. Whoever is insuring the shipments might feel similarly uncomfortable at the prospect of paying out to replace a lost delivery and wants to spread their risk out. The bigger the shipments, the more concentrated the risk.

Then there is the testing that has to occur at the German end (because checking the gold is all there is half the reason for the exercise to begin with). These are allocated bars (i.e. with serial numbers) and they're Germans so they'll measure it down to the gram.

Assay and (re)manufacture takes time and effort and a lot of expertise which will probably be contracted out and whoever is doing it will basically be melting down ~150 x 400oz bars each and every week for 7 years, or roughly 30 per working day, or roughly one every 15 minutes. All of them has to be checked, perhaps individually, so that if any tungsten is found - or more likely just some regular, boring impurities - it can be traced bar to an individual bar and that bar's history can be investigated to find out when and where it entered the system and who owes who the difference in weight.

At current values, the gold in question is worth about $37 billion dollars. We're used to seeing that sort of figure tossed around in discussions about global finance but it's worth remembering that this isn't just fake 1s and 0s money, this is actual, physical real money and there are practical issues in handling it which is why people tend to just leave it sitting in vaults to begin with.
 
Big A.D. said:
Has anyone considered the logistics of actually counting out, transporting, counting in and then testing 674 tonnes of gold?

Assuming deliveries are evenly spread out, they'll be shifting 1.85 tonnes each and every week for seven years. If the gold is in the form of 400oz LBMA spec bars, each shipment will contain 148 bars.

At current prices, each weekly shipment will be worth about $100 million in assets which are completely untraceable after being melted down. That is an incredibly tempting target for anyone looking to acquire a large amount of gold without paying for it. It's the kind of target that attracts professionals with military training and experience in special operations.

Whoever is doing the transporting might well be uncomfortable moving more than $100 million at a time, or rushing delivery to the point where there is a very noticeable stream of armoured cars driving out of the Fed's vaults every day for months at a time. Whoever is insuring the shipments might feel similarly uncomfortable at the prospect of paying out to replace a lost delivery and wants to spread their risk out. The bigger the shipments, the more concentrated the risk.

Then there is the testing that has to occur at the German end (because checking the gold is all there is half the reason for the exercise to begin with). These are allocated bars (i.e. with serial numbers) and they're Germans so they'll measure it down to the gram.

Assay and (re)manufacture takes time and effort and a lot of expertise which will probably be contracted out and whoever is doing it will basically be melting down ~150 x 400oz bars each and every week for 7 years, or roughly 30 per working day, or roughly one every 15 minutes. All of them has to be checked, perhaps individually, so that if any tungsten is found - or more likely just some regular, boring impurities - it can be traced bar to an individual bar and that bar's history can be investigated to find out when and where it entered the system and who owes who the difference in weight.

At current values, the gold in question is worth about $37 billion dollars. We're used to seeing that sort of figure tossed around in discussions about global finance but it's worth remembering that this isn't just fake 1s and 0s money, this is actual, physical real money and there are practical issues in handling it which is why people tend to just leave it sitting in vaults to begin with.
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I wonder how they did it in the first place.

edit

I seem to recall the French sent a navy destroyer for theirs?
 
Big A.D. said:
Has anyone considered the logistics of actually counting out, transporting, counting in and then testing 674 tonnes of gold?

Assuming deliveries are evenly spread out, they'll be shifting 1.85 tonnes each and every week for seven years. If the gold is in the form of 400oz LBMA spec bars, each shipment will contain 148 bars.

At current prices, each weekly shipment will be worth about $100 million in assets which are completely untraceable after being melted down. That is an incredibly tempting target for anyone looking to acquire a large amount of gold without paying for it. It's the kind of target that attracts professionals with military training and experience in special operations.

Whoever is doing the transporting might well be uncomfortable moving more than $100 million at a time, or rushing delivery to the point where there is a very noticeable stream of armoured cars driving out of the Fed's vaults every day for months at a time. Whoever is insuring the shipments might feel similarly uncomfortable at the prospect of paying out to replace a lost delivery and wants to spread their risk out. The bigger the shipments, the more concentrated the risk.

Then there is the testing that has to occur at the German end (because checking the gold is all there is half the reason for the exercise to begin with). These are allocated bars (i.e. with serial numbers) and they're Germans so they'll measure it down to the gram.

Assay and (re)manufacture takes time and effort and a lot of expertise which will probably be contracted out and whoever is doing it will basically be melting down ~150 x 400oz bars each and every week for 7 years, or roughly 30 per working day, or roughly one every 15 minutes. All of them has to be checked, perhaps individually, so that if any tungsten is found - or more likely just some regular, boring impurities - it can be traced bar to an individual bar and that bar's history can be investigated to find out when and where it entered the system and who owes who the difference in weight.

At current values, the gold in question is worth about $37 billion dollars. We're used to seeing that sort of figure tossed around in discussions about global finance but it's worth remembering that this isn't just fake 1s and 0s money, this is actual, physical real money and there are practical issues in handling it which is why people tend to just leave it sitting in vaults to begin with.
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Good post but a few points:

1) Are they transporting it evenly? Nobody knows. It's not clear if it's a 6 year wait with 1 year of transporting or if they are transporting constantly from now until 2020.
2) As someone else mentioned, the navy would likely transport the gold. I don't think they are going to get ship-jacked.
3) For what it's worth, the Germans are moving 300T of their reserve, not 674T but your points still stand anyway.

To continue your admirable tone of actual analysis and facts (which should be applauded since it is sometimes absent in these communities) we should ask whether there have been large transfers of gold reserves in the past, and how long they have taken. Then we have something to compare against. Someone already mentioned the French, are there any other cases?
 
Logik said:
Don't they know that gold is for barbarians and real gentlemen stuff their vaults with bits of paper?
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lol - funny how the descendants of the Germanic Barbarians now want their 'barbaric relic from the past" back ... :lol:
 
Henry Wartooth said:
I think the more pressing info is that they want all of their gold back from France -which you think they'd be less worried about since it's right next door.
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yeh but France is also the most socialist state in Europe, and would have no scruples about selling the gold to pay for their parasites.
 
Logik said:
Big A.D. said:
...
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Good post but a few points:

1) Are they transporting it evenly? Nobody knows. It's not clear if it's a 6 year wait with 1 year of transporting or if they are transporting constantly from now until 2020.
2) As someone else mentioned, the navy would likely transport the gold. I don't think they are going to get ship-jacked.
3) For what it's worth, the Germans are moving 300T of their reserve, not 674T but your points still stand anyway.

To continue your admirable tone of actual analysis and facts (which should be applauded since it is sometimes absent in these communities) we should ask whether there have been large transfers of gold reserves in the past, and how long they have taken. Then we have something to compare against. Someone already mentioned the French, are there any other cases?
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They're pulling 300 tonnes from the Fed and another 374 tonnes from France, which will reduce their French holdings to zero, for a total of 674 tonnes.

Obviously the distance between France and Germany is shorter than from the U.S. to Germany, but that doesn't necessarily mean it's easier or safer. There are a lot of very experienced criminals in Europe and they can cross borders and hijack armoured cars very easily (and they do).

I also don't think that the Germans trying to freak anyone out and start a run on gold or they'd be repatriating all of theirs, not just some of it. The time frame makes the whole thing very boring. A flotilla of German warships sailing into New York Harbour on the other hand isn't boring at all. That was one of the things that pissed off the Americans when the French did it. They made a big, bold statement about how it was so important and so valuable and how they were not keeping it in America any more. The "gold window" closed shortly after.

Basically, I think the time frame has less to do with giving the Americans time to come up with the gold and more to do with the logistical issues of moving that much valuable stuff around the world securely.
 
Big A.D. said:
Has anyone considered the logistics of actually counting out, transporting, counting in and then testing 674 tonnes of gold?
.
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Good point's.

Now why would Germany go to all this effort for some old fashion metal that has a small market value of only 37 billion dollars? That's the big question??

- If there is no trust issues, then keep it where it is and save yourself the hassle.
- If gold has no role today and is only worth 37 billion, then just keep it there.
- if you need extra money, then just do what everyone else is doing and print more and again SAVE YOURSELF THE HASSLE!
 
leo25 said:
Big A.D. said:
Has anyone considered the logistics of actually counting out, transporting, counting in and then testing 674 tonnes of gold?
.
Click to expand...

Good point's.

Now why would Germany go to all this effort for some old fashion metal that has a small market value of only 37 billion dollars? That's the big question??

- If there is no trust issues, then keep it where it is and save yourself the hassle.
- If gold has no role today and is only worth 37 billion, then just keep it there.
- if you need extra money, then just do what everyone else is doing and print more and again SAVE YOURSELF THE HASSLE!
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Well to be fair if there wasn't pressure from the people I doubt the bundesbank would bother. Having said that I'm not sure a whole lot of small moves is a safer way to do it. They just want it to be more of a non-event, I suspect, than it otherwise would be.
 
Here is another view. Make what you want from it.
[youtube]http://www.youtube.com/watch?v=I6obTic-XKU[/youtube]
 
Silverthorn said:
Well to be fair if there wasn't pressure from the people I doubt the bundesbank would bother.
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and whens the last time a Central bank did what the people asked?

The US people have been just asking to LOOK at their gold, yet i dont see them budging.
 
Big A.D. said:
Basically, I think the time frame has less to do with giving the Americans time to come up with the gold and more to do with the logistical issues of moving that much valuable stuff around the world securely.
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I respectfully disagree
 
"Zeese bars contain Wolfram! Zey are not pure!"

"They were fine when we sent them, problem must be at your end buddy".
 
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