This page has been archived and commenting is disabled.
Bank Balances And Gold
Submitted by Alasdair Macleod via GoldMoney.com,
There has been a growing shift in favour of assets relative to bank deposits. This was initially encouraged by zero interest rates, but more recently there is little doubt that Cyprus’s bail-in has accelerated the trend. This explains the bull markets in bonds and equities, which conveniently underwrites the entire banking system. It is however too early to offer evidence of falling deposit balances held by non-banks and the general public because depositors as a whole have been remarkably complacent, but there is ample evidence that liquidity from monetary expansion is inflating financial assets faster than bank deposits.
This helps explain why, for example, Italian 10-year bonds are on a 4% yield. The reason, doubtless reaffirmed by the Cyprus bail-in, is that investors with cash balances think over-priced sovereign debt is less risky than adding to their euro deposits. However, the central banks are relaxed because weakness in deposits at any single bank is easily covered through the banking system, insulating individual banks from depositor-withdrawal systems. Presumably, banking counterparties are also complacent because they can be reasonably sure to be exempt from any bail-ins. They have the comfort of knowing the banking system is underwritten by all those complacent enough to leave money on deposit beyond the insured level.
However, some of depositors’ cash balances post-Cyprus will have gone into physical gold and silver, which explains why the bullion banks operating in the futures markets and the central banks behind them are so keen to dissuade us that gold and silver is a safe haven. I recently interviewed Ronnie Stoerferle, the Vienna-based analyst, who put his finger on it: since Cyprus, there has been a sharp rise in European demand for physical gold, with the pressure being felt by the bullion banks unable to deliver bullion.
At least one bank was recently reported to be only prepared to settle bullion liabilities in cash. Therefore the price knock-down in April was a logical response by the bullion banks, which had to defuse customer demand for physical delivery. But given that the driving factor was not speculation but a reluctance to add to deposits in the banking system, the jump in demand for bullion at lower prices was inevitable.
Where does this leave things? The crisis in bullion markets is worse than it was before. A good example of how little physical stock there is can be gained by tracking bullion deliveries on the Shanghai Gold Exchange. In the last few weeks they have dwindled to virtually nothing, having been a truncated 190 tonnes in April and 297 tonnes in March. Yet we know from reports that retail demand in China has taken off; so it is only a matter of time before prices are bid up on the Shanghai Gold Exchange enough to replace lost inventory.
It will be interesting to see how many more bullion banks are forced to admit the fiction behind their customer accounts in the coming weeks. For the moment the temporary solution amounts to rationing bullion supplies to the public.
»
- 15260 reads
- Printer-friendly version
- Send to friend
- advertisements -
Hmmm. This is a hard one.
I can put my money in a bank account at practically zero interest and be an unsecured creditor to the bank and potentially wiped out overnight?
Or, I can buy bullion and bet on future central bank and government incompetence?
I'm gonna have to scratch my head for a while on this one.
Don't forget that bet also covers central bank and government malfeasance...
With interest rates from the banks near 0%, there seems to be a better return vs. risk by just hiding CA$H FIAT$ at home.
Physical Au > CA$H FIAT$ > 0.01% money market account at the bank.
OT but, that chinese girl in the purple dress has a nice rack
How's her server??
History 101
HKMEX defaults and screws the contract holders with cash settlement.
At the price they dictate.
This is history, now, at this moment!
And if that, and the Cyprus bail-in, don't provide you with the blueprint of what is to come, then you aren't paying attention.
But the Bank gave me this lovely Spiderman towell free??
All I get is Crack Spackle T-shirt ads.
Brought to you by a modern miracle in structured undergarments and a high pain threshold.
Sofa King Confused
She just started showing up in my neighborhood as well...
still hard at it with the SEC, I see ...
Probably the single most distracting ad I've seen on ZH.
All my ads are for buying au/ag.
I want chinese racks!
What do i have to do so ZH gives me titties?
I better stop buying pm's and look at more porn or for an Asian wife?
nice racks are never OT...
Closer inspection of purple dress asian girl photo reveals significant bra inserts.
How close of an inspection, lol... + 1
.
How does she rate on the Jissbon scale?
'Home Banking' is indeed another option with lower risks and similar returns...
Of course you would have to forego the excitement of seeing your cash forceably converted into fiat crematorium shares.
Then again the regulators may just finally decide to prosecute the corrupt banking systems "enablers" (DEPOSITORS) under existing aiding and abetting laws...
I just wrote myself an IOU
put it in an envelope, inside a box full of empty envelopes
am selling shares of tranches of the box of envelopes
step forward
Great idea.
Maybe we can all use taxpayer dollars to buy each other's IOU's, then bundle them and sell them to pension funds and municipalities at 30-1 leverage? Ah, the miracles of "modern" finanacial engineering!
"Modern" in quotes because of South Seas and Black Tulips.
EBS's - Envelope Backed Securities!
AAA?
+1 for using malfeasance.
May I add their repeated demonstrations of skullduggery and legerdemain?
Consistent, reliable, and perpetual undermining of responsible citizens while ignoring the rule-of-law.
Please do.
And often...
If I ever have a conversation with a police office, I am going to ask him: "What, in your opinion, are the most serious crimes being committed in society today?"
Because it is amazing to me that police don't view white collar crime as being in their jurisdiction!
To be fair, having 2 -> 10% of my wealth stolen in a year or having a drug addled Chav come at me with a machete have different levels of seriousness.
Right, it's easier to plead self defense after shooting the chav
Buying gold and silver and removing it from the banks removes their power over your account. Yes, they may be able to tax PM's in the future, but I'd rather have it in my control than let them do as they wish with my cash account.
PM's are the anti-establishment vote. If everyone removed savings and bought PM's, used cash for transactions instead of debit, the banks would be dead in a week.
The system is moving rapidly toward digital balances and transfers. Doing so allows the gov't and banks to keep track of purchases, tax you accordingly, or confiscate (called a "bail-in") your account to protect you. LMAO. The recent introduction of coin sorting machines in banks shows the move to remove hard currency from the world and keep it digital and in their control. Anyone used those coin machines? Can you withdraw the paper cash equivalent, or does the balance automatically get put into your account electronically?
I'm a penny sorter so I use the coin machines in my credit union regularly when I dump the zincolns. They will allow me to take the fiat without imposing a fee because I am a member of the CU. Or, I can just deposit the amount into my small account so I can buy more pennies and sort for more copper. Copper, it's the poor man's precious metal.
If you're interested see: www.realcent.org
If everyone removed savings and bought PM's, used cash for transactions instead of debit, the banks would be dead in a nanosecond.
Laundering cartel funds is still a plus for their balance sheets. Never underestimate the powers of the central bankster vatican mafia cartel. MOAR HOPIUM!
People would also have to not pay their credit cards.
Who gets your house if the bank who holds the note goes tits up?
Well first an organization like the Office of the Comptroller of the Currency will place the bank into receivership. The appointed receiver will hold the note. Might end up assumed by another bank, or remain in the hands of the FDIC.
Buying gold leaves you with an overpriced shiny lump. I would far rather own a piece of a fantastic American company paying dividends.
Or you could do both.
He could do both in one investment. Allow me to introduce to you The Next Big Thing®: the ABC Flying Unicorn Company, a Delaware corporation operating in Crabwell Corners, Maine.
ABC (American Bullion Crapping) Flying Unicorn specializes in the husbandry of Flying Unicorns which, depending on the variety, crap solid nuggets of gold or silver.
To get in on the ground floor of this amazing opportunity, send me all of your physical gold and/or silver, along with all of your available US dollars (cash only). I'll get back to you in a few days.
trillion, quadrillion, google, googleplex...
Howzabout: (9!)^(9!)^(9!)^(9!)
BDB
Soon you will get your chance to buy those companies. Wait for DOW:GOLD, 1:1.
Are you recommending any particular company? Or do you think they're all "fantastic"? Are you talking common shares, preferred shares, or corporate bonds? Just saying "gold sucks" and not offering any alternative investment ideas is just trolling, and that doesn't really add anything positive to anyone's life here.
Once you get the list, short the works. BDB is committed to being the guy holding the bag and buying all the way down.
Below looks OK, very OK. But prepare for the biggest clean up of all EU banks a la cyprus style.
* Quote from ArmstrongEconomics --- Glass-Steagall Germany *
Germany is drawing a bright line between proprietary trading in banks and customer deposits. They are not merely separating the two, but they imposed criminal sentences for directors of banks and insurance companies if they fail to fulfill their supervisory duties in risk management or contravene an array of banking supervision.
Germany will at least prosecute the bankers, unlike the United States. Obama’s green-light policy that has protected the New York bankers is starting to filter around in Washington and the bankers should be worried that they may not be able to buy off the prosecutors again after 2015.75.
The tide is starting to turn largely because the NY bankers have sent the entire world into chaos for their irresponsibility trading with other people’s money. When the economy turns down again, this time the heads may roll.
You or I can buy some gold coins to safeguard our assets. What about money managers with $10B to manage? How do they safeguard assets? They can't buy bullion. They'd never get delivery and would likely crash the COMEX and lose it all or lose loved ones to mercenary enforcers working for the banksters.
"What about money managers with $10B to manage? How do they safeguard assets? They can't buy bullion."
Well, if they truly can't mimick the moves Soros et. al have been making lately regarding miners and GLD phys redemption, you could do worse than buying up productive land/assets and energy producers. They call oil "black gold" for a reason.
Bonds on miners, direct equity investment in miners, goldbonds... Buy a stake in coin dealers or an exchange... Buy royalties from a miner...
But really, providing project financing to a junior.
The difficult part is how many people (in finance) have the competence to evaluate these projects.
Don't worry, they have their bullion "safe" in "allocated" accounts.
Also, to dig further into EU banking reform, here's a quote from The Irish Times (8th of May 2013). Spooooooky!!!
Addressing a conference in Brussels yesterday, Jeroen Dijsselbloem said banks would undergo asset quality reviews before they come under the supervision of the European Central Bank next year.
“The outcome. . .we don’t know yet, but it might be worrying,” Mr Dijsselbloem said, stressing the need to have the instruments in place “to deal with the problems”. The European Central Bank is scheduled to take supervisory control of the region’s banks from the middle of next year. While the ECB will supervise the bloc’s larger and more troubled banks, it will have the power to intervene in smaller banks if needed, although they will remain under the supervision of national authorities.
Blah Blah Blah...
The last EU-wide stress tests were undertaken by the European Banking Authority in 2010, but were criticised for giving a clean bill of health to banks that later ran into difficulty.
Concern that asset reviews could reveal further bank weakness is likely to inform next week’s discussion in Brussels about the bank resolution regime. Finance ministers are due to discuss the issue of bank resolution, particularly the question of how creditors, including depositors, are “bailed-in” in the event of future bank collapses, at Tuesday’s meeting of finance ministers, which will be chaired by Michael Noonan.
Mr Dijsselbloem stressed yesterday that deposits under €100,000 would remain protected under the new rules, but uninsured deposits above that threshold would be included in any bail-in under a proposal formulated by the Irish presidency of the EU Council ahead of next week’s meeting.
Gold, bitchez!
Gold Bitchez!
bullion banks operating in the futures markets and the central banks behind them are so keen to dissuade us that gold and silver is a safe haven.
Yes, and that is why they're ALL dumping the barbarous relic/sarc
A small central bank that occasionally cuts Press Releases here at Zero Hedge ain't dumpin' nothin'!
Didn't the Shanghai Gold Exchange just default over the weekend? BULLISH!
oh, and by the way....GOLD, BITCHEZ!
Such anti-central bank language!
Here it comes!
The Hong Kong Mercantile Exchange (HKMEx) announces today it has decided to voluntarily surrender the authorisation to provide automated trading services () granted by the Securities and Futures Commission (“the SFC”). With immediate effect, no new orders may be placed and all open positions will be financially settled at the settlement price determined by HKMEx and its designated clearinghouse...
Wonder what happens if the price of gold goes up 10-15% on monday with all these people cash-settled and missing out on a big move?
And it did!
Just bought 60 more ounces of Silver this morning. It is hard to keep stacking...but I know it is the right thing to do. This is a super sale right now. FUCK YOU BERNANKE!!
Good for you. I slept through the dip. You snooze, you lose.
that's what the fuck im talking bout!!!
raise the middle finger and point it in the general direction of the bankers and their debt based paradigm...then spin that Silver round on the kitchen counter and revel in the sound that REAL MONEY makes....
carry on soldier....
You're lucky you can find so much. It's hard to find here in my neighborhood - the SE USA - and what there is - is going for a premium; but keep stackinng nontheless !
Wish I could have afforded to pick up some more, all I got was 11 at the LCS, and he only had 10 left lol
Yup.
I've got my accounts down to holding just enough for expenses. Savings I had thought to keep as credit for rainy days, now converted to gold. I'm not being paid enough by the bank to take that risk.
To my junker. MOAR INTEREST NEEDED!!!! Banks ain't getting my money till they offer 5% minimum.
There's trolls in these here hills...
Long phyzz!
I just noticed that too.
Troll: Reveal thyself!
Ruwanda paper is going for 7% I read here.
Knock yourself out. When American banks are paying 5%, the gig is up.
You'll be dead before that happens.
Cyprus was my canary in the coal mine for me....that should have knocked people on the head as to the end game of the bankers....its to steal your wealth..and now we have had two exchanges not paying out the gold.....that should show people where they have their gold and silver is important....or how they buy it..or think they are buying it....FAITH is the key word here...if its in your bedroom its much FAITHIER....than if its in JPM´s vault....
The "solution" for Cyprus was determined, in part, at least, by the IMF. The IMF is run, in part, at least, by unelected Americans. Imagine that, unelected Americans deciding that the poor saps in Cyprus need to have less money in their accounts. If those same unelected Americans decide to do the same thing in the US, who's gonna stop 'em?
No a couple phone calls and a couple quarts of oil should crack this case.
Cyprus was a test-run. A trial balloon. They guage these things in order to see how to best 'sell' it to the people. The right newspaper headline, the right spin.
You don't want people to be outraged over the bail-in, the loss of depositor funds, frozen funds, etc. You want them to say "Oh, the gov't is being responsible and not bailing out the banks any more."
That is the perspective they are pushing. Don't ask questions like "Why not let the banks go bankrupt, and protect the depositors?"
Cracking the whip to close on some arable land, Cyprus showed the way indeed. Fuck deposits. As Crash says, buy calories.
Hmm back at ya! It may be a wise move to change Gold and Silver into Platinum or Palladium at some point. I guess they'd be less likely to be confiscated?
Yet another good reason for precious metals diversification. I too would think Pt and Pd would not be confiscated (but I think that in the end that Au and Ag will not either).
If there is one casualty for every 10 ounces of gold confiscated, I don't think they will be confiscating too much. What was it that Solzhenitsyn said?
Maybe not the quote you had in mind but --
"... (T)he bitter doesn't last forever,
and the sweet never fills the cup to overflowing."
2/21/39 Jews had to turn in ALL precious metals and precious stones and pearls in Germany. Not just gold and silver.
Platinum was explicitly mentioned, palladium not.
Needless to say all their assets were for grabs by the
financial authorities (Finanzamt = IRS) and carried out in
the very same ways of today's tax collectors. Orderly process, inherently evil.
Ben PM'ed me to write a counter to this article for post on goldisnotmoney.fed
Exactly.
Bre'r Rabbit: "Whatever you do, don't throw me in that briar patch!"
MORE BREAKING NEWS FROM AROUND THE WORLD,
"Entire Populations From As Far Afield As Greenland To Australia Lose Confidence In Centrally Planned Utopian Banking"
REPORTED,
"Whole Swathes Of Populations Tell The Banksters And Politicians To Fuck Off"
MORE AS IT COMES IN.......
damn i wish i got that channel...
keep us posted homeskillet....
Whne is Rick Perry opening Texas' Bullion Bank? That's when I move to The Lone Star State.
+ $55,000
I'll be right behind you.
I'm sure he'll hold yours in allocated form for ya :)
Best to play the ratios of all four major precious metals and hope you end up holding something 'beneath the radar' when push comes to shove.
Totally agree. Overweight in Ag (and Ni and Cu) right now.
Pt and Pd definitely have been a good hedge lately.
Premiums are crazy, but I have 1 LCS that will trade bars for 90% and back for a cut.
Ah the rationing....putting the communist in Comex...
They are finally figuring out that they got to get out of (paper) Gold because the population is catching on to the fact that they have solad more (paper) than there is physical. Damn relic! Can't just print more.....
1666 has got to hold !!!
Thats right I called it - nailed it - when can i go to work for da fed ?
Hong Kong Mercantile Exchange fails amid dearth of gold futures trading
20 May 2013, Eric Ng and Enoch Yiu (South China Morning Post)
http://www.scmp.com/business/banking-finance/article/1241466/hong-kong-mercantile-exchange-fails-amid-dearth-gold
Canadians cleaning the store, it seems they know something !!
Scotiabank Silver Bar (100 oz) SOLD OUT
Valcami 1 Kg Silver bar SOLD OUT
Silver Canada Cougar Coin ( 1 oz) SOLD OUt
https://www.scotiamocatta-estore.scotiabank.com/stores/scotiamocatta/cat...
Can anyone explain what happens if most of a deposit account over 100000 euros is not cash but consists of mutual funds and other third-party investments, i.e. it is a fiduciary account. Example: Say, a 500000 euro deposit account in Cyprus Laiki Bank, which is now bankrupt, or any other bankrupt bank, consists of 150000 in cash and 350000 in third-party international mutual funds. What will be confiscated and what will be returned to the depositor? Can they confiscate mutual funds such as Barclay’s, Pimco’s, Templeton's etc? How can they liquidate them without the owner’s permission or authorisation? So, I would guess that 100000 are guaranteed and saved, being the maximum of insured deposits, or whatever the insured maximum is in other countries, 50000 are confiscated, and the mutual funds are returned to their owner, i.e. the depositor. Is this correct?
Pls let me know when and where I can read your answer.