Home / Blogs Romania Wants Return of 93.4 tons as Gold Repatriation Ratchets

Romania Wants Return of 93.4 tons as Gold Repatriation Ratchets

 

 Romania wants its gold treasure back from Russia, a recent Bullion Street article says. It’s another signal of the accelerating trend of countries to repatriate their gold—and another indication that the tide is turning toward gold and silver.

Two railway carloads, or 93.4 tons of gold, were transferred to Russia as German troops began to threaten the region during World War I.  According to the article, “All the governments of Romania since World War I, regardless of their political colour, have tried unsuccessfully to negotiate a return of the gold.”
Of course, this is not the first time the Romanian people, or people of any region for that matter, have found their monetary metals tempting to foreign powers. Invaders sent by Roman Emperor Trajan found gold and silver in great quantities in the Western Carpathians, which run through what is now modern-day Romania. Resulting from this conquest, Trajan brought back to Rome over 165 tons of gold and 330 tons of silver.
It is interesting that considering this history independent auditors say Germany has stored its gold abroad since the Cold War in case of Soviet invasion. Additionally, the auditor’s report says the German gold stored in London has fallen "below 500 tons" due to recent sales and repatriation. Considering German gold stocks have remained the same, the sale of physical gold must have been offset by an acquisition of paper promising to pay gold from the Federal Reserve Bank or other entities needing a physical supply of gold.
One event that may have triggered a large-scale demand for physical delivery of gold was the repatriation of the 211 tons, or 17,000 standard 400-ounce bars, of Venezuelan gold.

“We’ve held 99 tons of gold at the Bank of England since 1980. I agree with bringing that home,” President Hugo Chavez said, “It’s a healthy decision.”

The obvious danger to having others hold your valuables is that they can simply deny your right to audit or access what they store for you. German lawmakers were turned away from viewing the 1,500 tons of German gold reportedly held at the New York branch of the privately held Federal Reserve Bank (Fed). This fact may have played a part in the recent German federal court ruling that mandates repatriation of 50 tons of the gold per annum. For more, see Germany Brings it Home – Gold Repatriation as Stocks Scare.
One reason Russia has refused to cooperate with Romania’s demand for its gold is assumed to be Romania’s cooperation with the U.S. missile “shield.” According to the Huffington Post, in 2011, U.S. Secretary of State Hillary Clinton signed the agreement with Romanian Foreign Minister Teodor Baconschi and said the United States expected to deploy interceptor missiles at a Romanian air force base in approximately four years.
Mr. Eugen Anca at the time of the following quote ran the European arm of the Institute for Foreign Economic Relations (VNIIVS), a governmental agency of the Russian Federation’s Ministry of Economic Development and Commerce. He comments on the Romanian “gold treasure”

The Treasure is privately owned. Specifically, it is the private property of the National Bank of Romania (BNR)! At least this is how it was defined and certified by Victor Antonescu himself, the minister for finances in 1916, who signed the Protocol with Kremlin. This document is public and it can be found by any interested reader in the Foreign Ministry Archive, fund 71/1914, E2, Part I, vol. 183, pages 50 – 53. And there are certified copies of this document held by the Ministry for Finances, BNR, the French and British embassies, and Kremlin.

For this reason the Russians wanted a private corporation to exchange the BNR’s gold with a private Romanian entity that could secure assistance in developing Siberian natural resources as a win-win situation that could offer an new option to offset the 300 million (274 tons of gold) owed Russia per the 1947 Paris peace treaty previously satisfied via confiscation of the BNR gold stored in Russia. This is crucial, the “Romanian gold” is not even owned by Romania, it is owned by a private bank acting as the central bank of Romania. Sounds familiar as Americans handed their gold over to the Federal Reserve in 1934, not their state or federal Treasuries.
One lesson here for international players is that “if you can’t hold it, you don’t own it!” According to Edel Tully, precious metals strategist at UBS, “There is a growing preference among many different communities in the gold market to have their physical gold at home.”
Over the years the Russians have returned to Romania 17 railroad car loads of archives and documents, including as many as 39,320 Romanian art works were returned in 1956, including paintings, drawings, engravings, icons, tapestry works, religious objects, gold coins, medals and the Pietroasele treasure (below).

https://wealthcycles.com/blog/2012/10/23/romania-wants-return-of-934-tons-as-gold-repatriation-ratchets-up

 

The Germans Are Coming for Their Gold

A German federal court has said that country’s central bank should conduct annual audits and physically inspect its gold reserves worldwide, including gold in the custody of the Federal Reserve Bank of New York. In addition to the FRBNY, Bundesbank gold is stored in London, Paris and Frankfurt.

(Read more: Republicans Eye Return to Gold Standard)

For decades, the Bundesbank has relied on written confirmation of its gold holdings in London, Paris and New York. According to the report from the German audit court, the last time Bundesbank officials physically inspected the central banks gold holdings was, well, never.

(It should be stated that the folks at FT Alphaville quote a report saying an inspection took place in 1979/1980.)  

Interestingly enough, the Bundesbank is apparently quite happy with taking the word of other central bankers about the existence, location and size of its gold reserves. It put out the word that it disagrees with the Audit Court, which only has advisory power and cannot force the Bundesbank to follow its recommendations, about the need for inspections. Nonetheless, the Bundesbank is actually going to follow the recommendation that it verify the gold stocks. It also has plans to ship some 150 tons of gold back to Germany for a more “thorough examination.”

The Bundesbank is, of course, quite right in its opinion of the value of the examinations. In reality, it does not matter one bit whether the Federal Reserve Bank of New York actually has the German central bank’s gold or whether the gold is pure. As long as the Fed says it is there, it is as good as there for all practical purposes to which it might be put. It can be sold, leased out, used as collateral, employed to extinguish liabilities and counted as bank capital just the same whether it exists or not.

(Read more: Why Some Call Return to Gold Standard ‘Ludicrous’)

The actual presence of the gold wouldn’t make a lick of difference unless, say, Germany’s central bank decided it wanted to start using the gold for some practical, non-monetary purpose like making watches.

But there’s long been a paranoia about central bank and government gold reserves. (Read more: GOP Appeased Me on Gold Standard: Rep. Ron Paul)

The gold of the United States government, which officials say is held in the United States Bullion Depository in Fort Knox, has been rumored—probably since the Depository’s founding in 1937—to have been looted and replaced with gold-painted tungsten, for instance. The government treats this as nonsense—which it most likely is—but nonetheless it does conduct regularly scheduled audits of the gold in Fort Knox, including doing purity tests on a small sample of the gold.

This paranoia is not entirely irrational, for one reason. As I mentioned above, for almost all imaginable operational purposes, the actual existence of the gold in Fort Knox or in the vault beneath the FRBNY’s Liberty Street headquarters is irrelevant. The bookkeeping is what really matters here. So long as the Fed says Bundesbank owns X tons of gold, the Bundesbank can act as if it did own the gold—even if the gold had somehow been swallowed into a gold-eating galactic worm hole. But the irrelevance of the facticity of the gold does quite easily lend itself to thinking: if the gold being there doesn’t matter, why would it be there?

(Read more: The Gold Standard and the Myth of Price Stability)

I’m sure the Bundesbank officials understand this quite well, even though the German Audit Court does not. There is nothing to be gained by inspecting the gold. If it is all there and pure, there is no difference from an undiscovered absence. But if the gold isn’t there, well, calamity could follow as trust in the central bank gold depositories evaporated instantly. 

In any event, it looks like Bundesbank officials will soon be visiting the Fed’s vault, which is located 80 feet below street level and 50 feet below sea level. The vault is accessible only by elevators controlled by an operator in a remote location. I’ve been told by a source that the elevator operator is actually not in New York City at all, although I can’t confirm this and the Fed won’t discuss this sort of thing.

Down in the vault there are 122 compartments assigned to depositing countries and international organizations. Smaller gold depositing countries get shelves in shared library compartments.

The compartments do not have labels reading “Germany’s gold” and so on. They are instead numbered, and only a few people at the Fed know what numbers correspond to which country. The Fed says it does this to protect the privacy of the depositors. But this also makes actual inspection less reliable. There’s no way for Germany to know that the gold it is being shown is Germany’s, as opposed to some other depositor’s. In an extreme case—which I have no reason to believe is true—miscreants at the Fed could just show everyone who came to visit the same pile of gold.

This is related to another mystery about gold reserves: why do they persist?

The central banks of the world's established economic powers do not actually do anything with their gold, apart from rare and occasional sales of gold limited by the Washington Agreement to no more than 400 tons per year. 

Some central banks lend out their gold to speculators and gold miners (who borrow the gold to finance mines—basically, a risk-free hedged loan since the borrowed gold can be repaid with newly mined gold, regardless of what happens to the price of gold on the market), which can be a somewhat profitable activity—especially when the alternative is just letting it sit around doing nothing but fluctuating in value with the market price. But, as far as we know, this isn’t something the Bundesbank or the Fed does.

When Congressman Ron Paul recently asked Fed chair Ben Bernanke about the rationale for central banks holding gold, Bernanke said it was the result of “long term tradition.” But that’s not really a satisfactory answer. The lack of a satisfactory answer actually contributes to the suspicion that the gold isn’t really there at all. If there’s no purpose for it, why would it be there?

So is the German Audit Court nuts? Not necessarily. For one thing, there probably is some value to putting to rest suspicions that the public is being deceived about central bank gold reserves—although I doubt an audit will really do very much in this regard. For another, there’s always the off-chance that someone has embezzled the gold, enriching himself unjustly. Might as well check if the gold is really there.

The Fed wouldn’t comment on the record about how it will handle a German request to inspect the gold. A source says they would likely work out a deal with the Germans permitting some sort of inspection.

But I like to imagine that the Fed officials would bring the Germans to the door of the a compartment labeled, say, No. 322, and then pose the question: “Are you absolutely sure you want to see what’s in here?”

- by CNBC Senior Editor John Carney

http://www.cnbc.com/id/49540593

 

Bundesbank Refuses Gold Control

22.10.2012

The Bundesbank, has refused to allow the German members of parliament Philipp Mißfelder and Marco Wanderwitz to view the German gold reserves stored in Paris and London. Reason: The central banks in Paris and London do not have suitable rooms for visits.

The German federal bank, the Bundesbank, has refused to allow the German members of parliament Philipp Mißfelder and Marco Wanderwitz to view the German gold reserves stored in Paris and London. As reported by the newspaper Bild-Zeitung (Monday edition, Germany's largest newspaper), Carl-Ludwig, a member of the Bundesbank’s Executive Board, wrote a letter to the two deputies saying that the central banks in Paris and London do not have suitable rooms for visits. Large portions of the German gold reserves (a total of 3,400 tons worth more than € 150 billion) are kept abroad, and only a fraction is held by the Bundesbank in Frankfurt.

Philipp Mißfelder, foreign affairs spokesman of the CDU/CSU coalition, wanted also to inspect the German gold reserves at the Federal Reserve Bank in New York in February - but didn't succeed. Now he wanted to do the same in London and Paris. This is related to intense criticism by accounting experts and the German Federal Audit Office concerning the storage of Germany’s gold reserves abroad.

http://www.mmnews.de/index.php/english-news/11126-bundesbank-refuses-gold-control

Perth Mint Gold and Silver Bullion Sales Surge

The Perth Mint of Australia has announced their latest sales figures for gold and silver sold as coins and minted products. During September 2012, sales for both metals surged to their highest levels since the start of monthly reporting. The higher sales were undoubtedly driven by the release of the new designs for popular series of gold and silver bullion coins.
Sales of silver coins and minted products rose to 1,251,580.06 troy ounces, up 269% from the prior month and more than doubling the previous highest reported monthly amount from March.
The sales for gold coins and minted products rose to 81,095.13 troy ounces, representing an increase of 118% from the prior month. This eclipsed the previous highest monthly reported amount from June.
Year ago comparisons are not available, since the Perth Mint only began reporting monthly sales levels in March of 2012.
2012 Perth Mint Bullion Sales in Troy Ounces

	Gold	Silver
March	35,957.28	590,636.15
April	17,575.64	207,109.91
May	30,387.88	437,759.34
June	44,619.05	523,663.46
July	34,026.23	452,692.79
August	37,196.86	338,945.22
Sept	81,095.13	1,251,580.06

The burst of sales can be attributed to the release of new 2013-dated gold and silver bullion coins on September 3, 2012. On that date, the 2013 Year of the Snake coins went on sale with gold bullion coins available in sizes ranging from 1/20 ounce to 1 kilo and silver bullion coins available in sizes ranging from 1/2 ounce to 1 kilo. For both metals, a 10 kilo sized coin will be available at a later date. Sales also began for the 2013 Australian Kookaburra silver bullion coins available in 1 kilo, 10 ounce, and 1 ounce sizes.

http://news.coinupdate.com/perth-mint-gold-and-silver-bullion-sales-surge-1646/

http://precious-metal-investment.blogspot.co.uk/

 

Three Scenarios For Gold

Three Scenarios For Gold

Even though we have presented comparable scenarios looking at the coverage of the US money base in gold terms previously, aka "gold coverage" ratio, including once from Dylan Grice, and once from David Rosenberg, now that we have drifted into a new, previously unchartered and very much open-ended liquidity tsunami, it is time to revisit the topic. Luckily, Guggenheim's Scott Minerd has done just that. Not only that, but he presents three distinct gold pricing scenario, attempting to forecast a low, medium and high price range for the yellow metal.
To wit: "The U.S. gold coverage ratio, which measures the amount of gold on deposit at the Federal Reserve against the total money supply, is currently at an all-time low of 17%. This ratio tends to move dramatically and falls during periods of disinflation or relative price stability. The historical average for the gold coverage ratio is roughly 40%, meaning that the current price of gold would have to more than double to reach the average. The gold coverage ratio has risen above 100% twice during the twentieth century. Were this to happen today, the value of an ounce of gold would exceed $12,000.”

Keep in mind, the $12,000 price is based on the current monetary base. When this number rises by $2 trillion (at least) through the end of 2014, the upside case of gold will be orders of magnitude higher.
And now you know why bickering over a few hundred dollars here and there is largely irrelevant, and in fact one should be delighted if gold can be purchased at as low a price as possible. Why? Because one thing is absolutely certain: in order to keep the ponzi going, with every other sector at peak leverage, including household, corporate and financial, and real assets already massively encumbered by debt, the only real indirect buyer of gold will be the world's central banks, by means of diluting the existing paper supply. And whether or not the New York Fed, or some gold cartel, are actively pushing the price of gold lower, this is very much irrelevant, and in fact continues to be a welcome diversion, one which allows for the artificially low entry prices into gold. Because one day, gold will revert to its fair value, and so often happen, that is when its will go back to 100% "coverage" as faith in fiat evaporates. At that point whether one bought gold at $1000, $1500 or even $2200 will be absolutely irrelevant.

 http://www.zerohedge.com/news/2012-10-17/three-scenarios-gold

GOLD BULLION COINS SPECIFICATIONS - TEST YOUR COINS

http://www.onlygold.com/TutorialPages/Coin_specsFulScreenVersion.htm

Country	Coin	Face value	Gold oz	Wt oz	Wt grams	Dia  mm	Thickness mm	Gold fineness
Australia	Lunar Series 1 oz	A$ 100	1.0000	1	31.1030	32. 10.	2.65.	999.9
Australia	Lunar Series 1/2 oz	A$ 50	0.5000	0.5	15.5515	25.10	2.20	999.9
Australia	Lunar Series 1/4 oz	A$ 25	0.2500	0.25	7.7758	20.10.	1.80	999.9
Australia	Lunar Series 1/10 oz	A$ 15	0.1000	0.1	3.1103	16. 10.	1.30.	999.9
Australia	Lunar Series 1/20 oz	A$ 5	0.0500	0.05	1.5552	14.10.	1.40	999.9
Australia	1 oz. Kangaroo	A$ 100	1.0000	1	31.1030	32. 10	2.65	999.9
Australia	1/2 oz. Kangaroo	A$ 50	05000	05	15.5515	25.10	2.20	999.9
Australia	1/4 oz. Kangaroo	A$ 25	02500	025	7.7758	2010	1.80	999.9
Australia	1/10 oz. Kangaroo	A$ 15	01000	01	3.1103	16. 10	1.30	999.9
Australia	1/20 oz. Kangaroo	A$ 5	00500	005	1.5552	14.10	1.40	999.9
Austria	1 oz Philharmonic	OS 2000	1.0000	1	31.1030	37.0	2.0	999.9
Austria	1/2 oz Philharmonic	OS 1000	05000	05	15.5515	28.0	1.6	999.9
Austria	1/4 oz Philharmonic	OS 500	02500	025	7.7758	22.0	1.2	999.9
Austria	1/10 oz Philharmonic	OS 200	01000	01	3.1103	16.0	1.2	999.9
Belgium	20 Francs		01867	02074	6.4508	21.00	1.30	900
Canada	1 oz. Maple Leaf	C$ 50	1 .0000	1	31.1030	3000	2.80	999.9
Canada	1/2 oz. Maple Leaf	C$ 20	05000	05	15.5515	25.00	2.23	999.9
Canada	1/4 oz. Maple Leaf	C$ 10	02500	025	7.7758	2000	1.70	999.9
Canada	1/10 oz. Maple Leaf	C$ 5	01000	01	3.1103	16.00	1.22	999.9
Canada	1/15 oz Maple Leaf	C$ 2	00666	00666	2.099	15.0	098	999.9
Canada	1/20 oz Maple Leaf	C$ 1	00500	00500	1.581	14.1	092	999.9
Country	Coin	Face value	Gold oz	Wt oz	Wt grams	Dia  mm	Thickness mm	Gold fineness
Chile	100 Pesos		05885	06539	203383	31.2.	2.50	900
China	1 oz. Panda	100 Yuan	1.0000	1	31.1030	32.05	2.70	999
China	1/2 oz. Panda	50 Yuan	05000	05	15.5515	27.00	1.85	999
China	1/4 oz. Panda	25 Yuan	02500	025	7.7758	21.95.	1.53	999
China	1 / 10 oz. Panda	10 Yuan	01000	01	3.1103	17.95.	1.05	999
China	1/20 oz. Panda	5 Yuan	00500	005	1.5552	13.92.	083	999
Colombia	5 Pesos		02354	02568	7.9873	22.00	1.50	916.7
France	20 Francs (3 Types)		01867	02074	6.4508	21.00	1.40	900
Germany	20 Mark		02305	02561	7.9655	22.50	1.40	900
Great Britain	I oz. Britannia	Lb 100	1 .0000	1.0909.	33.9303	32.60	2.79.	916
Great Britain	1/2 oz. Britannia	Lb 50	05000	05454	16.9636	27.00	2.08	916
Great Britain	1/4 oz. Britannia	Lb 25	02500	02727.	8.4818	22.00	1.63	916
Great Britain	I Sovereign		02354	02568	7.9873	22.05.	1.52	916
Great Britain	1/2 Sovereign		01177	01284	3.9936	19.22	099	916
Great Britain	I /10 oz Britannia	Lb 10	01000	01091	3.3933	16.50	1. 17	916
Country	Coin	Face value	Gold oz	Wt oz	Wt grams	Dia  mm	Thickness mm	Gold fineness
Hungary	100 Korona		09802	1.0891	33.8743	37.08.	2.29	900
Hungary	20 Korona		01960	02178	6.7742	21.00	1.00	900
Isle of Man	1 oz. Angel	1 Angel	1.0000	1.0000	33.9303	32.70	2.83	999.9
Isle of Man	I oz. Cat	1 Crown	1.0000	1	31.1030	32.70	2.60	999.9
Isle of Man	1/2 oz. Angel	1/2Angel	05000	05000	16.9636	27.00	2.16	999.9
Isle of Man	1/2 oz. Cat	1/2 Crown	05000	05	15.5515	3000	1.90	916
Isle of Man	1/4 oz. Angel	1/4 Angel	02500	02500	8.4818	22.00	1.79	999.9
Isle of Man	1/5 oz. Cat	1/5 Crown	02000	02	6.2206	22.00	1.40	916
Isle of Man	1/ 10 oz. Angel	1/10 Angel	01000	01000	3.3933	16.50	1.20	916
Isle of Man	1/ 10 oz. Cat	1/10 Crown	01000	01	3.1103	17.95	1.00	999.9
Isle of Man	1/25 oz. Cat	1/25 Crown	00400	004	1.2441	13.92	070	91
Italy	20 Lire		02074	01867	5.8069	21.00	1.20	900
Country	Coin	Face value	Gold oz	Wt oz	Wt grams	Dia  mm	Thickness mm	Gold fineness
Mexico	50 Pesos		1.2057	1.3396	37.5009	37.08.	2.69	900
Mexico	I Onza		1.0000	1.1111	34.5585	34.54	2.55	90
Mexico	1/2 Onza		05000	05555	17.2777	29.00	2.03	900
Mexico	20 Pesos		04823	05358	16.6650	27.50	2.03	900
Mexico	1/4 Onza		02500	02777	8.6373	23.00	1.68	900
Mexico	10 Pesos		02411	02679	8.3325	22.50	1.40	900
Mexico	5 Pesos		01205	01339	4.1647	19.00	1.14	900
Mexico	2 1/2 Pesos		00602	00669	2.0808	15.50	086	900
Mexico	2 Pesos		00482.	00535	1.6640	13.00	1.02	900
Netherlands	10 Guilders		01947	02163	6.7276	22.50	1.31	900
Peru	I Libra		02354	02568	7.9873	22.00	1.52	916.7
Country	Coin	Face value	Gold oz	Wt oz	Wt grams	Dia  mm	Thickness mm	Gold fineness
South Africa	I oz, Krugerrand	None	1.0000	1.0909	33.9303	32.60	2.75	916
South Africa	1/2 oz. Krugerrand	None	05000	05454	16.9636	27.00	2.24	916
South Africa	1/4 oz. Krugerrand	None	02500	02727	8.4818	22.02.	1.52	916
South Africa	1 Rand	None	01177	01284	3.9936	19.43	1.09	916.7
South Africa	1 / 10 oz, Krugerrand	None	01000	01091	3.3933	16.46.	1.19	916
South Africa	2 Rand	None	02354	0,2568	7.9873	22.00	1.83	916.7
Switzerland	20 Francs		01867	02074	6.4508	21.00	1.20	900
U.S.A.	1 oz. American Eagle	US$ 50	1.0000	1.0909.	33.930	32.70	2.87	916.7
U.S.A.	1/2 oz. American Eagle	US$ 25	05000	05454	16.9636	27.69.	2.15	916.7
U.S.A.	1/4 oz. American Eagle	US$ 10	02500	02727	8.4818	22.00	1.78	916.7
U.S.A.	1/ 10 oz. American Eagle	US$ 5	01000	01091	3.3933	16.50	1.26	916.7
Country	Coin	Face value	Gold oz	Wt oz	Wt grams	Dia  mm	Thickness mm	Gold fineness
U.S.A.	1 oz. A.Arts Medallion		1.0000	1.1111	34.5585	34.30	2.41	900
U.S.A.	$20.00 Liberty Type		09675	1.075	33.4357	32.70	2.83	900
U.S.A.	$20.00 Saint-Gaudens		09675	1.075	33.4357	32.25.	2.79	900
U.S.A.	1/2 oz. A.Arts Medallion		05000	05555	17.2777	27.00	2.16	900
U.S.A.	$10.00 Indian Head Type		04838	05375	16.7179	27.00	2.03	900
U.S.A.	$10.00 Liberty Type		04838	05375	16.7179	27.00	2.03	900
U.S.A.	$5.00 Liberty Type		02419	02688	8.3605	21.60	1.59	900
U.S.A.	$5.00 Indian Head Type		02419	02688	8.3605	21.60	1.40	900
U.S.A.	$2.50 Liberty Type		01209	01343	4.1771	18.00	1.27	900
U.S.A.	$2.50 Indian Head Type		01209	01343	4.1771	18.00	1.14	900
U.S.A.	$1.00 Indian Head Type		00484	00538	1.6733	13.00	1.02	900
U.S.A.	$1.00 Liberty Type		00484	00538	1.6733	15.00	076	90
USSR	10 Roubles		02490	02767	8.6062	22.60	1.70	900