It Begins: Bundesbank To Commence Repatriating Gold From New York Fed

Tyler Durden's picture

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, where just 31% of it is held as of this moment. And while it is one thing for a "crazy, lunatic" dictator such as Hugo Chavez to pull his gold out of the Bank of England, it is something entirely different, and far less dismissible, when the bank with the second most official gold reserves in the world proceeds to formally pull some of its gold from the bank with the most. In brief: 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.

Much more importantly, it is being telegraphed as such, with Buba fully aware of just what the consequences of this (first partial, and then full; and certainly full vis-a-vis the nouveau socialist regime of Francois Hollande which will soon hold zero German gold) repatriation will be in a global monetary arena, which is already scraping by on the last traces of faith in a monetary system that is slowly but surely dying but first diluting itself to oblivion. And in simple game theory terms, the first party to defect from the prisoner's dilemma of all the bulk of global gold being held by the Fed, defects best. Then the second. Then the third. Until, in this particular case, the last central bank to pull its gold from the NY Fed and the other 2 primary depositories of developed world gold, London and Paris, just happens to discover their gold was never there to begin with, and instead served as collateral to paper gold subsequently rehypothecated several hundred times, and whose ultimate ownership deed is long gone.

It would be very ironic, if the Bundesbank, which many had assumed had bent over backwards to accommodate Mario Draghi's Goldmanesque demands to allow implicit monetization of peripheral nations' debts has just "returned the favor" by launching the greatest physical gold scramble of all time.

From Handelsblatt:

Die Bundesbank hat ein neues Konzept ausgearbeitet, wo sie künftig ihre Goldreserven lagern will. Nach Informationen des Handelsblatts (Dienstausgabe) sieht dieses Konzept, das am kommenden Mittwoch bekanntgegeben werden soll, vor, den heimischen Standort aufzuwerten, in New York dafür weniger Gold zu lagern und überhaupt kein Gold mehr in Paris zu horten.


Derzeit lagert das Gold der Bundesbank ihren Angaben zufolge in New York, London, Paris und Frankfurt. In der amerikanischen Notenbank Fed lagern 45 Prozent der insgesamt 3.396 Tonnen Gold, in der Bank of England in London 13 Prozent, in der Banque de France in Paris elf Prozent und im Hauptsitz in Frankfurt 31 Prozent. Diese Verteilung soll sich nun ändern.

We present it in the original for fear of losing something in translation, but in broad English terms the above reads as follows:

The German Bundesbank is developing a new approach as to where its gold will be stored. According to exclusive information, to be fully announced on Wednesday, the bank will in the future hold less gold in the New York Fed, and no more hold in Paris (Banque de France). As a result, the distribution of German gold, of which 45% is held in New York, 13% in London, 11% in Paris and 31% in Frankfurt, is about to change.

There is no need to explain why this is huge news (for those who have not followed our series on the concerns and issue plaguing German gold can catch up here, here, here, here, and certainly here) . At least no need for us to explain. Instead we will let the Bundesbank do the explanation. The following section is the answer provided by the Bundesbank itself in late October in response to the question why it does not move the gold back to Germany:

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. During that entire period, we had nothing but the best of experiences with our partners in New York, London and Paris. There was never any doubt about the security of Germany’s gold. In future, we wish to continue to keep gold at international gold trading centres so that, when push comes to shove, we can have it available as a reserve asset as soon as possible. Gold stored in your home safe is not immediately available as collateral in case you need foreign currency. Take, for instance, the key role that the US dollar plays as a reserve currency in the global financial system. The gold held with the New York Fed can, in a crisis, be pledged with the Federal Reserve Bank as collateral against US dollar-denominated liquidity. Similar pound sterling liquidity could be obtained by pledging the gold that is held with the Bank of England.

And in case the above was not clear enough, below is the speech Buba's Andreas Dobret delivered to none other than NY Fed's Bill Dudley in early November:

Please let me also comment on the bizarre public discussion we are currently facing in Germany on the safety of our gold deposits outside Germany – a discussion which is driven by irrational fears.


In this context, I wish to warn against voluntarily adding fuel to the general sense of uncertainty among the German public in times like these by conducting a “phantom debate” on the safety of our gold reserves.


The arguments raised are not really convincing. And I am glad that this is common sense for most Germans. Following the statement by the President of the Federal Court of Auditors in Germany, the discussion is now likely to come to an end – and it should do so before it causes harm to the excellent relationship between the Bundesbank and the US Fed.


Throughout these sixty years, we have never encountered the slightest problem, let alone had any doubts concerning the credibility of the Fed [ZH may, and likely will, soon provide a few historical facts which will cast some serious doubts on this claim. Very serious doubts]. And for this, Bill, I would like to thank you personally. I am also grateful for your uncomplicated cooperation in so many matters. 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.

Incidentally, what Zero Hedge did provide after this article, was factual evidence that the Buba's very much "trusted partner" had been skimming it on physical gold deliveries on at least one occasion, in "Exclusive: Bank Of England To The Fed: "No Indication Should, Of Course, Be Given To The Bundesbank..."

So we wonder: what changed in the three months between November and now, that has caused such a dramatic about face at the Bundesbank, and that in light of all of the above, will make is explicitly very unambigous that the act of gold repatriation, assuming of course that Handelsblatt did not mischaracterize what is happening and misreport the facts, means the "excellent relationship" between the Fed and Buba, not to mention Banque de France which will shortly hold precisely zero German gold, has just collapsed.

Also, if the Bundesbank is first, who is next?

Finally, once the scramble to satisfy physical gold deliverable claims manifests itself in the market, we can't help but wonder what will happen to the price of gold: both paper and physical?

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f16hoser's picture

'Bout fucking time. Expose the fed for what it really is. Counterfeiting Ring.

americanspirit's picture

Gold - you want gold. Oh, sorry, we thought you wanted geld. That's why we sent you those pallets of paper money. But since you took delivery, our obligations to you are satisfied. After all, our US geld is as good as gold. Sorry, bitchez.

Magnum's picture

Curious about all the cash 4 gold shops opening up around USA, is a buyer with a printing press and a quota for Deutschland behind the curtain?

Dr. Engali's picture

In a word... Yes. They allow the paper price to rise so they can get the low hanging fruit off the streets. Then once they have that they allow it to rise some more to attract new sellers. When they are ready to sell it back to the street they will allow gold to take off. Then they'll sell it back to John Q. Public for $10,000 an ounce in a mad dash.

U4 eee aaa's picture

So do they think the US is going to go all total state on them? They want to get it out of the country before there are tanks rolling down New York streets?

Westcoastliberal's picture

Paging Dr. Tungsten, paging Dr. Tungsten, gold courtesy phone...

Supernova Born's picture

Yeah, tungsten will fool the Germans.

The ability to check gold's authenticity is thousands of years old.

Now the Frenchies...?

The Frenchies not "playing along" helped close the gold window back in 1971. Seems the Germans are going to re-open it.

Bankster Bitchez, meet the usual troublemaker.

lolmao500's picture

Prepare to bend over...

The White House has identified 19 executive actions for President Barack Obama to move unilaterally on gun control, Vice President Joe Biden told a group of House Democrats on Monday, the administration’s first definitive statements about its response to last month’s mass shooting at Sandy Hook Elementary School.

Fucking traitors, all of them.
newengland's picture

Fucking dead traitors if they carry on like this, and their constituents get a hold of them.

Update on the Sandy Hook massacre:

The official story continues to disintegrate. The license plate on the car alleged to be owned by dead CIA agent Nancy Lanza, employed by a bank, and allegedly used by the lone shooter son Adam is registered to an owner in southern CT who was convicted of drug crimes.

Uncensored first report police audio and visual scanners  name  a maroon van occupied by fleeing suspects, some dressed as nuns, and the arrest of other people in the woods nearby.

The official version of events conflicts wildly with the limited audio and visual evidence shortly after the incident - and that evidence has been scrubbed from the internet in the last 48 hours.

There is no way that a 20 year old lone gunman, alleged to be mentally ill and drugged, could carry an armful of guns into the school and strike  a near 100% kill rate in less than 10 minutes - something only multiple assassins could do.

And the other cars with bullet holes in the car park tell their own silent forensic the trajectory from a roof top.


Hysterical CNN coverage by Vanderbilt brat Anderson Cooper who served two summers as an intern at the CIA in his youth.

Terminus C's picture

Here is something I have been thinking about for a while...  Did the shooting even happen or, is this a "Wag the Dog" event?

samsara's picture


"During a discussion covering numerous discrepancies and bizarre accounts in the movie theatre shooting in Aurora, Colorado, and the Sandy Hook school massacre in Newtown, Connecticut, Darrin McBreen asked the author: “Do you think they are barbaric enough to kill innocent children as an excuse to attack our 2nd Amendment?”

“Yes,” said Cottrell."

newengland's picture

Post WWII, Nazis were brought to the USA to continue their experiments, assisted by the CIA. The CIA has continued to refine methods of mind control, using hypnosis, drugs and technology (most recently, computers). The aim is to create remote control assassins who have no memory of their deeds, and will over ride any moral impulse they may have had due to their upbringing.

Unfortunately, Connecticut was a major site of these experiments. For example, JD Salinger of Russian Jewish descent and famed author of 'Catcher in the Rye' worked for the U.S. security services witht the specific job of guiding Nazi scientists into their new role at research centres in the U.S. - primarily colleges, and Fairfield University in particular ... which is within the Diocese of Bridgeport in CT whose catholic regime was shamed by prosecution for paedophile priests.

Senator Richard Blumenthal, former CT Attorney General, unleashed a prosecution to get rid of organised crime against children, and upset the status quo.

It has been the policy of the CIA to use and abuse children in pursuit of its Nazi agenda of experimentation, and training remote control killers. Fact.

The CIA name for this program is MKULTRA, and Salinger used some of its code words in his 'great American literature', Catcher in the Rye. He should know, and I'm glad he is dead. Pity he lived so long.

And by the way, here's another discrepancy: Newtown is predominantly jewish, yet photos in the aftermath of the shootings show two or three 'nuns' in the kind of garb that has not been used by the catholic church for a long time, like something out of a Hollywood 'B' movie. Convenient for hiding anything beneath the cloth, though. Like guns, perhaps.

Who would suspect a 'nun' mingling with the crowds? That would be paranoid, right? But this: no local church recognises those 'nuns' or their 'habit'. Just as the first official  account of Nancy Lanza as a school teacher was found to be a lie when the local school board said they never heard of her.

The CIA has a habit of letting things 'play out'; official policy.


newengland's picture

I don't know, but I know this: the official version of events is a pack of lies. Why and who dunnit? I don't know.


Flatchestynerdette's picture

And they relocated 22(?) children, held funerals for them and everything else as a staged event???? Where are the kids now? The "other" side of Gitmo? For heaven's sake:Their families are still in Sandy Hook.

ok. Time to go to sleep.


Until I hear of a large group of children showing up in a town with no parents along with a teacher/principal - call me.

Flatchestynerdette's picture

You've certainly presented some serious and interesting theories/accusations.

But I'm sorry, it sounds too much like a conspiracy theory and I'm not buying it at this time.

However, its just my opinion so don't be bothered, its s about as worthless as the kibble I put out for the neighborhood homeless cat.


chaartist's picture

this is again extremely disturbing and my gut feeling tells me from the first moment that it is unbelievable story for a reason and more strnghtened by the fast action afterward we see in the past few days in news.

AgAu_man's picture

Article says ...“I think everybody acknowledges that the assault weapons ban is a challenge, but other things — like the size of the magazines, the background checks, straw purchases — are all things that have a good chance of passing”

These look like Exec Order items.  Ok, that's 3 of 19.  What are the other 16?

chump666's picture

Peg it to the soon-to-be new D-Mark.  Good move.

Obama is pegged to Japan and China, all three are printing to war.


ISEEIT's picture

I just keep getting this..................

"Possesion is 9/10th of the law and so this extremist demand must not be bargained with".

Enter the true sellout ..uhhh, cough , cough ( fuck me so horney: Now me so embarassed..OMG!)

Barack motherfucking obama?

What a fucking tool.

Even real Nigga's see he is shit.

Just a sellout, punk ass nigger.

Poser, fake, punk, bitch.

He sure as hell ain't no man, let alone a Black one.


ebworthen's picture

Good for Germany.

Gold is real money.

Fiat is toilet paper, especially the U.S. Dollar thanks to Ben Bernanke, Hank Paulson, Timothy Geithner, CONgress, and all the other criminal cronies in Washington and Wall Street who think the average person is not paying attention.

I am paying attention you FUCK WADS.

lolmao500's picture

While Cuomo and the other traitors in NY are doing their treasonous deed during the night...

Cuomo said lawmakers now have a gun proposal negotiated with legislative leaders. The Senate and Assembly could vote on the law Monday night. Cuomo has issued an order dispensing with a three-day waiting period for all legislation.

ebworthen's picture

But of course...

Tyrants are happy to dispose of due process and laws to build their power and hegemony.

Fuck Cuomo and other statist rabble that think We The People aren't paying attention.

Go ahead, try to take my firearms, FROM MY COLD DEAD HANDS.

lolmao500's picture

New York Gov. Andrew Cuomo detailed his proposal to bolster New York's gun laws Monday night, with a full ban on assault weapons slated to take effect as soon as it is passed.

Both the Senate and Assembly are expected to vote on the proposal late Monday night.

Assault weapons -- defined as any rifle with a "military style" feature, such as a bayonet or a telescoping stock -- that are currently owned would be grandfathered and would have to be registered with the state. Magazines with a capacity of more than 10 rounds and manufactured before 1994, which are currently legal, would have to be turned over to authorities or sold out of state within one year. If a magazine has a capacity between eight and 10, it would have to be retrofitted to only hold seven rounds.

Under Cuomo's plan, the state would have one year to set up an instant background check system for all ammunition purchases. Law enforcement would be alerted to large purchases of ammunition.

Fucking scum...

Supernova Born's picture

IMO, anyone who has stayed in NY during the ass-raping of the Second Amendment for DECADES deserves no sympathy.

IMO, The so-called home of the black rifle is a POS honey pot whose #1 most prolific poster doesn't seem to give a fuck AR's have been effectively banned and has already lubed up his own a-hole.

IMO, the reason they don't have up and down arrows is to convince the sheep to "just go along with the ass-raping of the Constitution" BS and so mods and "site (ass) staffs'" totally reprehensible un-American bullshit isn't exposed.

Holy fuck, Goebbels is fapping furiously in HELL imagining the full on tidal wave of bullshit he could have unleashed if he had had access to an "Internet".

joego1's picture

Ben, the U boat is here, did you find any gold yet in that pile of securities?

q99x2's picture

I guess my signing of the petition to Audit the US Gold Reserves doesn't help matters.

FU ChairSatan. May your golden calf melt and God be called down upon you.

Which reminds remember January 20th is the day of mass prayer to have God intervene and bring the banksters to justice. Ooooo I hope they don't explode in public. Maybe it will just be another salt thing.

hairball48's picture

Seriously though...since I'm one of the least sophisticated and educated of the ZHers....Germany's wanting their gold back is a good sign for gold. It's going to be fun seeing who's next in line at the NYFed. And beyond that it will be interesting to hear what the talking heads in the MSM say, if anything, about the  "ancient relic" which has no real value.

I mean if gold is a "relic" why are the most powerful banks in the world scrambling to get as much as they can? China has upped what it's been buying as have lots of Asian countries. Do these media idiots not ever wonder "why" every central bank ('cept maybe the BOE) :) has been increasing gold reserves, especially the last few years? I mean if gold is such a dumb investment (Warren Buffoon Buffett) why do CB's want to hold all that gold they've been buying?

I dunno. Maybe I'm just old and fucked up and confused. I don't see what is so hard to "get" about gold being "real money".


Dr. Engali's picture

Your first mistake was believing we have a media. What we have is a propaganda machine and its job is to maintain the sheeple's confidence in paper. The "media idiots" aren't paid to ask questions... They are paid to push the government's agenda and to keep us distracted.

hairball48's picture

Thanks and not too worry. I haven't had TV since 2011. Virtually all my news, other than local paper, is from the internet.  

Dr. Engali's picture

I hear you ... I stopped wafching mine in 08. I turn it on every once in a while for about five minutes if agony then I always ask myself what the fuck I did that for.

Miffed Microbiologist's picture

Delete "us distracted " insert " the sheeple distracted". Ahhhh much better.if I ever find myself distracted by the the lame brain media of this country I'll commit myself. Once you turn it off for good just five minutes of reexposure will cause projectile vomiting. I don't know how some here can stand watching it even for entertainment. They must have heartier stomachs than I. But Dr. E I know what you meant.


are we there yet's picture

Single question. Who is selling? Where is the gold flowing from if everyone is buying?

are we there yet's picture

Scrap gold is not enough to account for the difference.

Stuntgirl's picture

Spain is a net exporter of Gold.

Cash for gold is getting really out of hand in certain countries, what with people not eating enough.

I haven't checked if the rest of the PIIGS are net exportes as well, but i'd bet.

are we there yet's picture

Stuntgirl agree for Spain exporting scrap gold, but it is tiny compared to the central banks, china, Russia, etc all buying far in excess of production and change in scrap gold purchase.

Terminus C's picture

These central banks are buying but are they taking delivery on all that buying?  Much of their purchases could be hypothocated, leased or otherwise "paper" gold.  I know they say they are buying physical gold... but who can believe what a central bank says... whether they are Russian, Chinese, American, British or otherwise.  This goes for the Bundesbank too... who the fuck knows what they will or will not re-patriate.  They just say they did... the Fed says they did... then... they did, even if they didn't...

A fucked up world in which we live...

Supernova Born's picture

"Scrap" gold is the most oxymoronic phrase in the universe.

Gold is simply GOLD, BITCHEZ.

formadesika3's picture

"Single question. Who is selling? Where is the gold flowing from if everyone is buying?"

Cash for gold shops is a clue to making a generalization. What's happening is gold is flowing from weak to strong hands.

rqb1's picture

Would not be suprised if this is the beginning of a steep decline in the paper price of au. Don't get me wrong, long term au is a sure thing, short term think twice before buying on margin.

AgAu_man's picture

Pls explain your rationale.  Supply, demand...

Stuntgirl's picture

I agree with him.

The gold price is manipulated to allow CB hoarding. If anything, what this will do short term is intensify the downward manipulation. Of course, the doubled efforts draw the end nearer than if this hadn't happened.

Last time Germany said anything about their gold, it looked like and end scenario, and then we got the watered-down version which did nothing to the price. I bet this is the same.

I am continuously amazed at the ability of TPTB to bypass normal market forces and extend the unextendable to infinity.


sitenine's picture

I agree with you in part, but I don't think that happens for a while. Of course the paper rips apart from the phyz completely and forever at some point, but not sure where that is. Germany asking for gold is no joke, so we'll probably find out sooner rather than later ;)

you enjoy myself's picture

it may take a while, but the greatest perfect hedge of a lifetime might be long au/ag (or the miners) and short gld/slv.

Acidtest Dummy's picture

Just take your money and leave the casino. It is not complicated.

sitenine's picture

Thank you Tylers. This is basically what we've been expecting thanks, in large part, to your incredible reporting over the years. Even Venezuela caused quite a shit-storm - I'm sure Chavez is laughing his ass off btw. This is the big time now. Germany is a very powerful AAA rated nation. They hold up the entire Euro FFS. Some humans may believe we are above history for whatever reason, but we are most assuredly not.  Gold is the end game. Always has been, and no matter how many iGadgets you have, it always will be.