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German Bundesbank To Repatriate Gold From New York Fed
Posted By yihan On January 15, 2013 @ 11:45 am In Economic Crisis,Featured Stories,Old Infowars Posts Style,Tile | Comments Disabled
“Trust in central banks by other central banks is ending”
Paul Joseph Watson
January 15, 2013
Despite previously characterizing the idea that it was planning on moving gold out of the New York Fed as an “irrational fear,” the German Bundesbank is set to announce a huge repatriation of its bullion this week, with France also being emptied of German gold in a sign that trust between central banks has hit rock bottom.
“In what could be a watershed moment for the price, provenance, and future of physical gold, not to mention the “stability” of the entire monetary regime based on rock solid, undisputed “faith and credit” in paper money, German Handelsblatt reports in an exclusive that the long suffering German gold, all official 3,396 tons of it, is about to be moved. Specifically, it is about to be partially moved out of the New York Fed, where the majority, or 45% of it is currently stored, as well as the entirety of the 11% of German gold held with the Banque de France, and repatriated back home to Buba in Frankfurt,” reports Zero Hedge.
The decision, which is set to be announced tomorrow, comes despite repeated assurances by Bundesbank officials that German gold would not be moved.
Back in November, Andreas Dobret, member of the Executive Board of the German Bundesbank, dismissed suggestions that the gold would be repatriated as “a discussion which is driven by irrational fears,” adding that, “The Bundesbank will remain the Fed’s trusted partner in future, and we will continue to take advantage of the Fed’s services by storing some of our currency reserves as gold in New York.”
Apparently, since a significant proportion of that gold is now being moved out of the New York Fed, are we to assume that this “trust” no longer exists?
A month prior to that statement, which was made directly to the NY Fed’s Bill Dudley, the Bundesbank stated that it would “continue to keep gold at international gold trading centres” because that gold could be “pledged with the Federal Reserve Bank as collateral against US dollar-denominated liquidity.”
When Venezuelan President Hugo Chavez ordered the repatriation of 85% of the country’s bullion reserves from European Banks, most of which was held with the Bank of England, the move was dismissed as “unnecessary and expensive,” with others accusing Chavez of acting out of paranoia.
The reaction to Germany’s decision to do almost precisely the same thing is likely to be more muted so as not to start a stampede of other countries seeking to mimic the Bundesbank’s actions. Germany is the second largest gold holder in the world.
Gold reacted to the news by jumping over 13 dollars per ounce at time of press.
“This is a momentous development, one which may signify that the regime of mutual assured and very much telegraphed – because if the central banks don’t have faith in one another, why should anyone else? – trust in central banks by other central banks is ending,” summarizes Zero Hedge.
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