You are here
Yikes! Financial Times makes GATA's case comprehensively
Time to let gold go and move on to flying saucers or Bigfoot?
* * *
BuBa's New Era of Openness on its Gold
Other Countries Should Follow Germany's Lead
By Jack Farchy
Financial Times, London
Tuesday, January 29, 2013
The gold market barely shrugged when the Bundesbank announced it would move 674 tonnes of the stuff from Paris and New York to Frankfurt.
But the move is important: not for what it says about Germany's faith in French or American vaults; nor for the cost of shifting 674 tonnes of gold; but because it is a major victory for transparency in the gold market.
Central banks are notoriously secretive about their gold-trading activities.
Most report, on a monthly basis, their gold reserves to the International Monetary Fund. But these data fall a long way short of full transparency. They tell us nothing about derivative positions in the gold market -- for example, gold loans, agreements for future sales, or options transactions.
... Dispatch continues below ...
GoldMoney adds Singapore vaulting option
In addition to its precious metals storage facilities in Hong Kong, Switzerland, Toronto, and the United Kingdom, now with GoldMoney you can store gold and silver in Singapore in a high-security vault operated by Brink's Singapore Pte Limited. To celebrate the launch of this storage option, GoldMoney is offering a discount on buy and exchange fees at this vault for any orders above US$10,000 (or the equivalent) until January 31, 2013. Tthe gold buy rate is 0.98%, while the silver rate is 1.99%. Metal exchanges into Brink's Singapore will also be discounted for this period and will be charged at 0.78% for gold and 1.75% for silver. Simply place your order online and the above rates apply automatically until January 31, 2013, 15.00 UK time. To find out more about the new vault, please visit:
GoldMoney customers can take delivery of any number of gold, silver, platinum, and palladium bars from any GoldMoney vault, as well as personally collect their bars stored in the Hong Kong, Switzerland, and U.K. vaults.
It's easy to open an account, add funds, and liquidate your investment. For more information, visit:
And they are open to the whims of whether individual countries decide to classify a chunk of gold as belonging to their "international reserves" or being held by some other state entity (a sovereign wealth fund, for example). Thus Saudi Arabia announced abruptly in 2010 that its reserves had more than doubled as the result of an accounting shift. And China a year earlier revealed a 550-tonne increase in its gold reserves -- a buying programme that traders believe was carried out over several years, and has continued since.
In that context, it is not the Bundesbank's decision to move its gold, but its decision to be more open about where it is located and how it has traded it in the past, that is most welcome.
In one document published on its website earlier this month, the Bundesbank lists, for example, each one of its gold transactions since 1951:
In another, it details how much gold it has held in each of New York, London, Ottawa, Paris, Bern, Frankfurt, and Basel since 1951, and how much it was lending to the market at any one time.
This reveals the interesting titbit that the Bundesbank moved almost 1,000 tonnes from London in 2000 and 2001. It also shows that the German central bank halted all gold lending activity in 2008 when the financial crisis began -- presumably because of concerns about the credit risk of the banks it was lending to.
The historical lack of transparency among central banks is somewhat understandable.
With 29,500 tonnes between them (a decade of global mine supply) they have the ability to disrupt the market significantly if their trades are too public. See, for example, the reaction to the UK's announcement that it would sell a large part of its reserves in 1999.
But there is a difference between revealing your trading strategies to the world and disclosing simple facts about your reserves -- such as their quantity, where they are held, whether they have been lent or swapped, and so forth -- with a delay if need be.
That the Bundesbank has been nudged into this new-found transparency must be chalked up as a victory for the groups of investors -- most prominent among them, the Gold Anti-Trust Action Committee, or GATA -- that have for years been asking central banks to reveal their activities in the gold market.
If central banks wish to refute suggestions from such groups that their gold does not exist or that they are scheming to manipulate prices, they could do worse than to follow the Bundesbank's lead.
* * *
Join GATA here:
California Resource Investment Conference
Saturday-Sunday, February 23-24, 2013
Hyatt Regency Indian Wells Resort and Spa
Palm Desert, California
* * *
Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:
Or by purchasing a colorful GATA T-shirt:
Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:
Help keep GATA going
GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:
To contribute to GATA, please visit:
How to profit in the new year with silver --
and which stocks to buy now
Future Money Trends is offering a special 16-page silver report with our forecast for 2013 that includes profiles of nine companies and technical analysis of their stock performance. Six of the companies have market capitalizations of less than $800 million and one company has a market cap of only $30 million. The most exciting of these companies will begin production in a few weeks and has a market cap of just $150 million.
Half of all proceeds from the sale of this report will be donated to the Gold Anti-Trust Action Committee to support its efforts exposing manipulation and fraud in the gold and silver markets.
To learn about this report, please visit: