Countries asking for their US held gold - will it cause a problem?

Chaves did and got Venezuela's small store back (from London, I think) a few years ago. Germany asked for its 300 tons in January 2012 and has received none yet. Four of the air force's 223 C-17 could deliver all 300 tons back to Frankfurt in less than 12 hours. Why has none been returned?**

** Two good questions, as is: Why even Congressman Ron Paul, could not get any audit of US gold store by independent auditors (not the Fort Knox staff alone). Last audit that even had a few non US Treasury employees took place six decades ago.

Also cause for concern is fact that there are now 65 potential paper gold claims (can ask for physical delivery) on each ounce of gold at Comex! This has surged up nearly a factor of two in last month!

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"Registered" gold is ONLY type that can be delivered to holder of "long" contract, if he demands it. "Eligible" gold already has a owner. Note in only 11 days they have transferred nearly 2/3 of the gold that was held for delivery to their own privately owned "eligible gold" class.

SUMMARY: Not only Asian are hording physical gold, but the big US banks are too. This while telling their customers to sell their gold - price is going lower in 2014, etc. but for their own account, they are rapidly building how much physical gold they own! Can the S..T hits the fan moment be many months in coming? Not when the 92 traders with claim on each ounce of deliverable gold in the vault understand - See that 91 others are claim "their" gold. -Transfering as JPMorgan is doing to their private ownership leaving them hold a bag of IOUs, not gold.

BTW In case you think moneymorning.com is not accurately translating their quote of Der Spiegel, here is direct link to Der Spiegel's own English Language version of the full article: http://www.spiegel.de/international...-see-gold-in-us-federal-reserve-a-864068.html The next paragraph after the one quoted above is:
"I would like more transparency on the issue," says Bundesbank board member Thiele. The Americans are very sensitive, though, when it comes to security procedures in their gold storage facilities. In their second major depository, the legendary Fort Knox, practically no one in recent decades has been allowed to view the gold reserves.

 

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That is a long time frame I guess. But it can't be as simple as putting them on a plane. Although maybe it could be, I mean who would ever dare try to steal something like that. Either way there's probably hundreds of anal things they have to do before moving that much money. And besides they obviously want to discourage other countries from removing their gold. :shrug:

 

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The German gold is in the NYC vault (Deep, about 15 meters below sea level with the bed rock of Manhattan as its foundation) In less than a day probably between 3 & 5 AM it could be moved under heavy guard to any of the three NYC airports (one in NJ). Once airborn with fighter escorts, that may need to land and be replaced by others in Iceland's capital, Reykjavik, planes would land in Frankfurt, where Germany's central bank is with a large, very secure gold vault located there too.

On Christmas 2013 eve Germany did get back ~37 tons from the NYC vault. That may have been via a single C-17 loaded to slightly less than half its capacity, for extra safety. Nine more such trips would move all that Germany is asking for - they want to leave some (about 300 tons, I think,) in the NYC vault as sending some to another country is, so it is claimed, just moving it within the vault from one cage to another.

I suspect that it has taken almost a year for Germany to get any of its gold back as US Treasury's gold was already encumbered (leased to others or even some sold.) Furthermore, this could explain the very strange and rapid (possibly illegal?) transfer of Gold by JP Morgan to its own account See chart in the OP, but here is a summary:

On Monday, 9 December 13 JPM's own account had 547,503 oz of gold, but on Friday 20 December 13 JPM had 1,203,284 oz! A 220% increase in only 10 business days.
I. e. JPM may have made this move of customers gold to their own account so they could lend it (at profit of course) to the US Treasury. During the same period, the "registered" gold, which long customers can claim, fell from 233,854 oz to only 87,071, a decrease of 63% of an increase it the Leverage or by approximately a factor of 3! Much like they bailed the US Treasury and weak banks on the verge of collapse, out of a financial tight spot, 100+ years ago:

* it was very sever - triggered by many insurance companies failing after the San Francisco Earthquake / Fire of 1906.

Soon (In 1913) the Federal Reserve was created and has helped the big banks profit ever sense. Read good Washington Post's 100 year anniversary review here:
https://www.dailyherald.com/article/20131224/business/712249952/ It all started with bankers meeting in secrete on JP Moran's seaside estate. They only used their first names and referred to them selves and their to have the banks in control of the Fed (as they still are) as the "First Name Club."

 

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I have to wonder... IS there enough Gold to account for what is being requested...

 

If the US officials say anything, of course they will say there is. Any hint there is not would start a gold run, like run on the bank. Already many both in US and Germany (plus others?) have doubts US has their gold free of encumbrances to return. This nearly a year delay in giving any back to Germany has strengthened those rumors. The stead fast, refusal to allow any independent audit of the gold does too. It is IMHO, probable that highest German officials, know the US lacks the gold to promptly give back, so in their own self interest don't want that known - I.e. agreed to let the US have until 2020 to give it all back.

Even if the central banks can keep things under cover, the paper gold traders seem to be now smelling a rat. Note the 30% decline in "registered gold" at Comex in one week! "Registered" gold is ONLY type that can be delivered to holder of "long" contract, if he demands it. "Eligible" gold already has a owner. "Registered" gold fell from 600,984 oz to only 432,612 oz in one week! Those 168,282oz mostly and some more went into "has a definite owner eligible" stock pile, which increased by 334,658 oz in the same week. I.e. it is not only China and JP Morgan (See the data in the OP's table.) who is getting 100% ownership of more gold as fast as they can. The smarter traders are too as they don't want to end up with claim on gold that no longer exists at Comex.

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This "run on gold" (paper gold owners rushing to claim physical gold) has already started is clearly seen in the last black curve below. More that 65 "owners for each ounce."

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The leverage is accelerating upwards!
When end of December 2013 data is available I'm expecting nearly 100 claims on every ounce of physical gold at Comex will exist! Even 25 to 1 leverage is rarely stable!
95+% of the "owners" will get the "German Treatment" - A nice little letter telling they can get their gold in 2020.

More than six years ago, I predicted a run on the dollar on or before Halloween 2014 (with a + or - 7% tolerance error margin) and gave at least half dozen reasons why that was "inveitable," but lack of physical gold to fulfill contracts was not one of them, and is increasing looking like that may be the trigger. Wide spread defaulting on gold delivery contracts would be very hard on faith in the dollar and the US economy in general.

 

Here is link describing NY Fed's gold vault and gold storage services (for US Treasury and other Cnetral Banks) : http://www.newyorkfed.org/aboutthefed/goldvault.html
At link, read details and see photos of a few of the 122 numbered storage lockers (Fed does not tell what number holds whose gold - For example where Germany's gold is.)

 

It wouldn't surprise me if the USA were just being slow because they enjoy having all of that gold there,
as long as they have other country's gold in their vaults, they have monetair credibility(if that is a term).

 

When did Germany want the US to release its gold? Is there a date certain? Did Germany say they want all their gold released on 12/30/2013 or some other date? And did the US government say no, we won't do it or call back later? And why is it the US governments responsibility to transport Germany's gold from New York Germany? Isn't that Germany's job? I mean, it is after all their gold so why should the US pay and be responsible for moving it from point A to point B? It's just something to ponder. It seems to me if Germany wants its gold back it should be responsible for arranging the transport of its gold and not the US. Germany has planes, it has money. It's a rich country. Germany is quite capable of transporting its gold. The US taxpayer doesn't need to incur this cost or the risk. You know transporting large sums of gold across an ocean is not a riskless task.

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The agreement the US had with Germany was to store the gold, not to transport it around the globe.

And if you cannot answer those questions, how do you know the US is being slow?

 

This is just more baseless conspiracy nonsense.


"I just came across this article (I wish I saw it the day it came out) but a few days late is better than never. While the conspiracy theorists are still having fun making a lot out of nothing regarding the repatriation of “some” of German’s gold, I prefer to let the facts speak for themselves as I wrote about the other day. In this piece, we hear from Carsten Fritsch of Commerzbank and again reference is made to Carl-Ludwig Thiele’s comments that I referred to in my earlier piece and which, not surprisingly, the gold conspiracy theorists out there failed (conveniently) to even make mention of. I will focus on the key points. You can read the full article HERE. [Emphasis Mine]


Dispelling conspiracy theories


During the height of the Cold War in the 1950s and 1960s, West Germany feared an invasion by the Soviet Union. In order to ensure that its gold would not fall into enemy hands, the West German government divided its reserves among the Allied powers. Some 374 tons of gold were deposited in Paris, 450 tons went to London, and 1,500 tons were sent to New York City.


There has been an ongoing discussion about how Germany's gold reserves should be stored, and whether or not they even exist at all. Fritsch said that the German Central Bank, “with its lack of transparency,” is partially responsible for the spread of these conspiracy theories. If the Central Bank had regularly done its own inventory of its gold reserves, then it would have been able to take the wind out of the sails of the conspiracy theorist, according to Fritsch.


“In this way, the partial repatriation of Germany's gold reserves will help cool down the debate,” he said.


Gold reserves safe and sound


Carl-Ludwig Thiele, who sits on the German Central Bank's board of directors, said that he was able to personally access Germany's gold reserves deposited abroad. He tried to assure the German public that the gold reserves are safe and accounted for.


“Everywhere we were welcomed with open arms,” Thiele told a press conference in Frankfurt. “We were shown the inventory lists and inspected individual gold bars, which were then crosschecked with those lists.”


Now that the Cold War is over, Germany no longer has to store its gold reserves abroad to ensure their safety in the event of a Soviet invasion. Nonetheless, depositing reserves abroad still serves two important purposes, according to Thiele.B


… he said that it remains important to keep some of Germany's gold reserves in countries that have strong foreign currencies like the pound and the dollar. That's why deposits will remain in London and New York City, although the Central Bank does plan to move 300 tons of gold from the US back to Germany.


And while on the subject of gold…I remain cognizant of the fact that the conspiracy groups out there were all pointing to central bank easing as the precursor to a rocket-shot for the price of gold. 3 or some will argue 5 rounds of QE for the United States, printing by the European Central Bank, currency devaluation in an escalating currency war and massive easing announced by Japan Sunday night and here we are with gold still sitting roughly $200.00 off its all-time highs and silver remains significantly off its all-time highs. But wait … it’s not time yet. As per the latest news making the rounds of the usual club, the moon-shot in the price of metals is right around the corner.


Buy and hold gold and silver as investments folks…I’m all for it and in fact I encourage and advocate that every portfolio should have some. But if the last 5 years of hearing the same nonsense from folks who stand to profit of rising gold and silver sales (most of the usual suspects have something to sell you) hasn’t shown you that they got it all wrong then don’t know what will. "

by Dan Dontrose - The Fundamental View
Published : January 23rd, 2013

http://www.24hgold.com/english/contributor.aspx?article=4198014472G10020&contributor=Dan Dontrose

http://www.dw.de/germany-begins-hauling-gold-reserves-back-home/a-16526925

If you listened to these conspiracy nuts, you would own gold you purchased at $1,900+ per ounce which you can now sell for $1.1K to $1.2K per ounce. And you would have lost out on a tripling of the stock markets. Now that is what I call profitable investing - NOT.

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During that period the S&P went from about 600 to 1.8+K. You guys have to be smart to lose so much money.

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The German gold sent to US in early 1950s was Hitler's gold, some collected from the teeth of those who were not “Arian” (Nearly 10 million as in addition to the Jews, Gypsies, physically deformed, and those with mental problems, social diseases etc. also were exterminated.) Most of that gold had a swastika stamped on it, and was metric, not London Good Delivery, LGD, dimensions and weight gold.

Thus, the mystery as to why the Bundesbank makes no protest about getting it all back only in 2020 may be, as they admit, the Bundesbank asked the Fed to melt it down and re-cast as LGD gold, so they, not the Fed, could lease it out. The German people have not been told much if anything about their gold but recently learned their original bars no longer exist – Can not be returned.

A little more of Bernanke's “transparence” and honesty by the Bundesbank might have avoided a lot of ugly claims. Janet Yellen is a strong supporter of openness / transparence/ forward guidance. In fact in 2010 Ben asked her to lead the committee looking into how the Fed could improve its public communications / public disclosures, etc. Lets hope she can both extend that POV to Fed's storage of foreign gold and convince the Bundesbank that more open ness with the Germany people is to Germany's and the Bundesbank's advantage. Then the grown "Repatriate our Gold" movement and political pressure for reform of the Bundesbank may fade away.

{Billy T insert: Even the Bundesbank admits they will NEVER get their original gold bars back. Their “metric bars” were sent NYC Fed where the Fed melted them down to re-cast in LGD form. That certainly made it possible to lease them out for interest and there is no reason to do that if the bars were ONLY to be returned to Germany at some future date but the LGD form is required for leasing.}

Mr. Schall’s December 26, 2013 inquiry to the Deutsche Bundesbank:

Dear Ladies and Gentlemen:
I am an independent financial journalist. In connection with the transfer of 37 tons of Bundesbank gold from New York to Germany, I came across the news that the bars were a melted before the transfer. May I kindly ask you for the following information:
Why were the bars melted at all? And why couldn’t that wait until the bars arrived in Frankfurt?
Kind regards, Lars Schall

Bundesbank’s reply (dated 3 January 2014):
Dear Mr. Schall:
Thank you for your enquiry.

At a press conference on the topic of Germany’s gold reserves on 16 January 2013, Executive Board member Carl-Ludwig Thiele presented the Deutsche Bundesbank’s new storage concept. In addition to the relocation of gold bars, this concept includes, amongst other things, measures to ensure that the specifications of the London Good Delivery (LGD) standard are met. … You can find the specifications for the London Good Delivery (LGD) standard at the following address:
http://www.lbma.org.uk/pages/index.cfm?page_id=27

In cases where these specifications were not already met, the Bundesbank had these original gold bars melted down and recast in order to meet this standard. This was achieved without any difficulties.

Please understand that in order to ensure the security of the gold transports and our employees, the Bundesbank is unable to provide you with any further information.
Yours sincerely,
DEUTSCHE BUNDESBANK
Communication
Wilhelm-Epstein-Strasse 14
60431 Frankfurt am Main

Questions raised by Peter Boehringer, president of German Precious Metal Society and co-initiator of the*Repatriate our Gold campaign, to the opacity and oddities of the Bundesbank’s response:

– Who exactly melted the bars? Where exactly was this melting performed? Is there a smelter at the Federal Reserve Bank of New York?
– Who witnessed the melting and recasting of the bars?
– Are there any reports on this in writing with a valid signature? By whom?
– And especially: Why was it deemed necessary to perform this action in the United States as opposed to Frankfurt or nearby Hanau, where there are some of the best facilities in the world for metal probing, melting, and recasting?

The Bundesbank owes the public full transparency in all these gold matters. That is, physical audits,
independently verified storage reports, and a publication of the full bar lists of all its gold in all national or international vaults. Despite having now had the excellent opportunity of this partial repatriation, the Bundesbank has again failed to produce any proof or indication that at least 37 tonnes (out of 1,500 tonnes of German gold at the New York Fed) still existed through 2013 in their original 1950s-’60s bar form. Instead, Germany is now owner of almost 3,000 LGD-compliant standard bars

The initiators of the*Repatriate Our Gold campaign* are considering legal action based on freedom-of-information law against the Bundesbank and possibly also against its auditors, who have certified the Bundesbank’s balance sheet without having adequately considered the risks associated with a non-transparent gold hoard, which is the only asset of substance on the Bundesbank’s books.

Our objective remains to achieve the publication of all gold bar lists and full transparency involving Germany’s gold. The German people are entitled to have all information about their golden property. And the American people have a right to know as well. After all, it is the U.S. Federal Reserve System and the U.S. Treasury Department that have been obscuring their gold holdings and foreign gold holdings since the last proper audit in 1953.

 

I never said i *knew* the USA were being slow, i said it wouldn't surprise me.

 

Good info

 

More on Germany getting gold back from US:

 

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3019-1371= 1,648 more tons of supply or about 1,150 tons for increased non-central banks in 2014 to hoard, invest, use filling teeth, in electronics and especially making jewelry so upper middle class India girls can marry, etc.

Table 1: 2013 gold demand overview (2014 data soon)
Tonnes .......... 2012 ......... 2013* ....5-year average
Jewellery ........1,896.1 .... 2,209.5 ....1,983.3 This increase was mainly Chinese people buying as Real estate losts it shine and gold accounts were created by banks.
Technology ...... 407.5 ....... 404.8 ....... 427.8
Investment .....1,568.1 ........773.3 ..... 1,410.5 This decrease was Fed's doing - pumped up stocks a better investment.
Total bar and coin
demand .........1,289.0 ..... 1,654.1 .....1,292.8
ETFs and simila
products ...........279.1 ........-880.8 ........117.7 ETFs like GLD, the biggest had big out flow, also in part to buy stocks.
Central bank
net purchases .. 544.1 .........368.6 ........ 282.6
Au demand ...4,415.8 ...... 3,756.1 .......4,104.3 An increasing amount of Au went into India by smuggling - not recorded.
Non Central
Bank demand .3,871.7 ..... 3,387.5 ....... 3,821.7:
*Provisional. Source: LBMA, Thomson Reuters GFMS, World Gold Council

Billy T's POV for 2015: With India government in new hands and now realizing that high import duties mainly lower revenues and greatly increased smuggling they have cut them back. With the 3.3 billion Chinese gaining income at double digit rates in purchasing power, Chinese gold demand should surge in 2015.
A troubled and uncertain world is always a source of gold demand. Thus by end of 2015 I expect price of gold could rise to 1520/ oz, just to flip the numbers around, but who knows? The Fed would like to see it be 1205/oz as then gold does not compete well for US treasury bonds as an investment, especially if their interest rate are rising.

 

You guys are obsessed regarding gold. Gold isn't the answer to anything.

 

They were obsessed when gold traded north of 1,900 dollars and they will be obsessed when it trades at $800. They will always be obsessed.

 

Federal reserve bank, is not really a"Federal government" bank. http://www.stlouisfed.org/inplainenglish/whoownsreservebanks.cfm

 

Except it is, damn minor details again. But it isn't like you really care about truthfulness.

Who owns the Federal Reserve?
The Federal Reserve System fulfills its public mission as an independent entity within government. It is not "owned" by anyone and is not a private, profit-making institution.
As the nation's central bank, the Federal Reserve derives its authority from the Congress of the United States. It is considered an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding appropriated by the Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms.

However, the Federal Reserve is subject to oversight by the Congress, which often reviews the Federal Reserve's activities and can alter its responsibilities by statute. Therefore, the Federal Reserve can be more accurately described as "independent within the government" rather than "independent of government."

The 12 regional Federal Reserve Banks, which were established by the Congress as the operating arms of the nation's central banking system, are organized similarly to private corporations--possibly leading to some confusion about "ownership." For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year. http://www.federalreserve.gov/faqs/about_14986.htm

 

Isn't this illegal ,& a monopoly? http://www.healthfreedom.info/Federal_Reserve_Fraud.htm
& how do we hold them to standard? What would the damages be like ?

Made from my cell phone sorry for any issues..

 

Article 1, Section 10 pertains to states, not the federal government...oops. And has been documented many times before, inflation has been more moderate with the Federal Reserve, recessions have been fewer and of shorter duration, and periods of prosperity have been longer and more frequent.