• Tag Archives Bundesbank
  • “The Euro Crisis Is Not Over” Former ECB Chief Economist Urges “Greek Sabbatical From EU”

    Otmar Issing, former Chief Economist and Member of the Board of the European Central Bank and the German Bundesbank, brings back the specter of Grexit scenarios, demanding a Euro-sabbatical for Greece.
    ***
    KeepTalkingGreece.com reports that, uin an interview with business news magazine Wirtschaftswoche, Issing warned of a new flare-up of the euro crisis.
    ‘The euro crisis is not over yet,’ said the economist, one of the architects of the Euro.

    This post was published at Zero Hedge on Jul 31, 2017.


  • Have Bundesbank Agents Infiltrated the Fed?

    Germany’s central bank is the Bundesbank. Prior to the commencement of trading of the euro in January 1999, the Bundesbank conducted Germany’s monetary policy. The Bundesbank has a reputation for pursuing general price-level stability above all else. You might say that the Bundesbank has inflation phobia. The reason for this Bundesbank inflation phobia is the remembrance of the hyperinflation Germany experienced between World Wars I and II. Given the US central bank’s recent actions, it would almost seem that the Fed has developed inflation phobia too.
    Although the US does not have general price-level stability, the rate of change of the consumer price index (CPI), no matter how you slice or dice it, is absolutely low. This is illustrated in Chart 1. Plotted in Chart 1 are the 12-month percentages changes in monthly observations of various CPI measures – the CPI including all of its goods/services items, the CPI excluding its energy goods/services items and the Cleveland Fed’s 16% trimmed-mean CPI. The 16% trimmed-mean CPI eliminates components showing extreme monthly price changes. Eight percent of the weighted components with the highest and lowest one-month price changes are eliminated and the mean is calculated from the remaining components, making the 16% trimmed- mean CPI less volatile than either the CPI or the CPI excluding prices for energy goods/services. In the 12 months ended June 2017, the percentage changes in the CPI with all items, the CPI excluding energy items and the 16% trimmed-mean CPI were 1.6%, 1.6%, and 1.9%, respectively. Moreover, the 12-month percentage change in the CPI, no matter how you measure it, has been trending lower since the first two months of 2017.

    This post was published at FinancialSense on 07/17/2017.


  • Who Knew? German Central Bank Has Been Selling Gold For More Than A Decade

    Authored by Louis Cammarosano via Smaulgld.com,
    Deutsche Bundesbank gold reserves shrink 45 tons over the past ten years.
    German Central Bank holdings fall From 3,420.6 tons at the end of Q2 2007 to 3375.6 tons, a drop of 1,446,783 ounces. German gold reserves have decreased 1.3% over ten years.
    Bring the Gold Home & Sell Some Deutsche Bundesbank, the central bank of Germany, has gained a high profile for its insistence on repatriating a good portion of its gold from vaults at the New York Fed, the Bank of England of London and the Bank of France in Paris. We have been covering the German gold repatriation story since they made their request in 2013 here, here, here and here.
    The German repatriation requests aimed to rebalance the Deutsche Bundesbank’s gold holdings from nearly 70% held abroad to 50% held within Germany’s borders. The German Central Bank announced earlier this year that it has nearly completed its plan to repatriate its gold.


    This post was published at Zero Hedge on Jul 8, 2017.


  • The Fed Accelerates The Collapse Of The Economy, The Clock Is Ticking Down – Episode 1306a

    The following video was published by X22Report on Jun 14, 2017
    Time Inc is cutting 300 jobs, Toy R Us is in trouble as sales continue to decline. Retail sales numbers are out and sales in each sector has declined. The retail industry is imploding. GM extends shutdown of more plants as inventories build up. 2nd Quarter GDP has taken another hit as the economy rips itself apart. Bundesbank’s warns that they are now looking at the biggest asset bubble they have ever seen and cryptos might cause everything to crash. The US Gov/Central Banks are going after cryptos now. The Fed makes their move and they raise interest rates. They have now just accelerated the collapse of the economy. As BoA reports when the Fed tightens we end up with an event.


  • Bundesbank’s Weidmann: Digital Currencies Will Make The Next Crisis Worse

    When global financial markets crash, it won’t be just “Trump’s fault” (and perhaps the quants and HFTs who switch from BTFD to STFR ) to keep the heat away from the Fed and central banks for blowing the biggest asset bubble in history: according to the head of the German central bank, Jens Weidmann, another “pre-crash” culprit emerged after he warned that digital currencies such as bitcoin would worsen the next financial crisis.
    As the FT reports, speaking in Frankfurt on Wednesday the Bundesbank’s president acknowledged the creation of an official digital currency by a central bank would assure the public that their money was safe. However, he warned that this could come at the expense of private banks’ ability to survive bank runs and financial panics.
    As Citigroup’s Hans Lorenzen showed yesterday, as a result of the global liquidity glut, which has pushed conventional assets to all time highs, a tangent has been a scramble for “alternatives” and resulted in the creation and dramatic rise of countless digital currencies such as Bitcoin and Ethereum. Citi effectively blamed the central banks for the cryptocoin phenomenon.

    This post was published at Zero Hedge on Jun 14, 2017.


  • Germany Continues to Bring Its Gold Home

    Germany continues to bring its gold home.
    In early 2013, the Bundesbank announced a plan to repatriate massive amounts of its physical gold reserves back into Germany. The goal is to have half of its gold back within the country’s borders by 2020. At nearly 3,400 tons, Germany’s gold reserves currently rank as the second-largest in the world.
    According to Handelsblatt Global, a scare in 2012 led to the decision to bring the gold home. The sovereign debt crisis in the eurozone that year led many analysts to question the safety of the country’s reserves. In fact, financial controllers said they weren’t even sure all of Germany’s overseas gold holdings existed. The Federal Audit Office demanded the central bank make regular spot checks to ensure its gold reserves abroad were ‘physically counted and their authenticity and weight’ confirmed.
    Germany began aggressively ramping up its repatriation program in 2014. The German central bank brought home 120 tons of gold that year. In 2015, Germany’s Bundesbank transferred more than 210 tons of gold back into the country from vaults in Paris and New York. According to the Financial Times, with the 2015 transfers, Frankfurt became the largest storage location for the country’s reserves after New York. The repatriation continued in 2016, with more than 100 additional tons of gold coming back into the country.

    This post was published at Schiffgold on JUNE 12, 2017.


  • The ECB Has Almost Run Out Of German Bonds To Buy

    One month ago, when looking at the sudden change in ECB bond purchasing patterns, especially of German Bunds, we reported that the central bank may have as little as 4 months of space left in its PSPP program when it comes to German bond purchases. The first thing that caught our eye was that based on calculations from ABN Amro’s Kim Liu, the ECB bought roughly 400 million fewer bonds in Germany in April than its rules allow, suggesting a severe scarcity of eligible bonds.
    “It was by far the largest deviation, at least for Germany, and for me suggests that on top of the political stress and smoothing of purchases, there are scarcity constraints for the Bundesbank,” said Pictet’s senior economist Frederik Ducrozet. “What it means is that the ECB has to be very cautious with its exit and if they don’t taper within less than six months (of ending the programme) something might have to give.”
    In addition to the sharp drop in nominal purchases, the ECB data also revealed that in just six months the average maturity of monthly German debt purchases by the ECB has dropped to under five years from more than 10.

    This post was published at Zero Hedge on Jun 6, 2017.


  • War on Cash Puts ECB, EU on Collision Course with Germany

    Bundesbank: It’s a war on personal freedom and choice.
    By Don Quijones, Spain & Mexico, editor at WOLF STREET.
    Relations between Germany, and the ECB have curdled in recent times over a key issue: the role of cash. Germans have a soft spot for physical lucre while the ECB and Europe’s executive branch, the European Commission, have openly expressed their desire to suppress, or even punish, its use.
    For Germany’s central bank, the Bundesbank, the war on cash is a war on personal freedom and choice, in the name of saving a financial system and its absurd negative interest rates. Last year Bundesbank president Jens Weidmann warned that it would be ‘disastrous’ if people started to believe cash would be abolished – an oblique reference to the risk of negative interest rates and the escalating war on cash triggering a run on cash.
    In Germany, trust in Europe’s financial institutions is already at a historic low, with only one in three Germans saying they have confidence in the ECB. That was before ECB president Mario Draghi gave an infamous speech in May last year laying much of the blame for the Eurozone’s weak economy on Germans’ proclivity to save, rather than splash out on foreign imports or invest in the stock market.

    This post was published at Wolf Street by Don Quijones ‘ Apr 7, 2017.


  • Are Germans About to Be Made to Pay for Their Love of Cash?

    The ECB would do so at its own peril. Germany loves physical money. According to a Bundesbank study, approximately 80% of payments in Germany are made in cash. Even among millennials, two-thirds say they prefer paying in cash to electronic means, a much higher level than in almost any other advanced economy with the exception of Japan.
    This is a big problem for a European establishment that is desperate to consign physical money to the scrap heap. Some countries, including France and Spain, have already set maximum cash limits of 1,000. Greece has dropped its cap for cash transactions from 1,500 to 500.
    In January the European Commission telegraphed its intention to implement a mandatory continent-wide limit by 2018, even if it violates the ‘non-fundamental’ rights of over 500 million EU citizens to privacy, anonymity, and personal freedom. The Commission’s plans are likely to meet strong resistance from certain quarters, in particular Germans.

    This post was published at Wolf Street on Mar 12, 2017.


  • BIS Admits TARGET2 Is A Stealth Bailout Of Europe’s Periphery

    While debates over the significance of the Eurosystem’s TARGET2 imbalances may have faded into the background now that sovereign yields in the Eurozone remains broadly backstopped by the ECB’s debt monetization generosity, and fears about an imminent European breakdown fall along the lines of populist votes more than concerns about lack of funding, the BIS has finally chimed in with the truth about what the TARGET2 number really showed.
    As a reminder, in mid 2012, financial pundits “discovered” the gaping imbalances building up within the Eurozone, as a result of a huge increase in TARGET2 claims at the Bundesbank, offset by a matched surge in liabilities across the European periphery, most notably Italy and Spain.
    At the time, most conventional economists and analysts, especially those based in Europe, and certainly the ECB, said to ignore the divergence as it was irrelevant. Others, such as Hans Werner Sinn, and this site, warned that TARGET2 is a “less than thinly veiled bailout for Europe’s periphery” as the stealth fund flow amounted to a financing of peripheral obligations, illegal under European rules.
    Then, at the end of January, it was none other than Mario Draghi who, almost 5 years later, made the first tacit admission that the skeptics were right when he explained to Italian lawmakers that a country could leave the euro zone but only first it would need to settle its debts with the bloc’s TARGET2 (T2) payments system.

    This post was published at Zero Hedge on Mar 6, 2017.


  • Germany’s Gold remains a Mystery as Mainstream Media cheer leads

    On 9 February 2017, the Deutsche Bundesbank issued an update on its extremely long-drawn-out gold repatriation program, an update in which it claimed to have transferred 111 tonnes of gold from the Federal Reserve Bank of New York to Germany during 2016, while also transferring an additional 105 tonnes of gold from the Banque de France in Paris to Germany during the same time-period.
    Following these assumed gold bar movements, the Bundesbank now claims to have achieved its early 2013 goal of repatriating 300 tonnes of gold from New York to Frankfurt, but after 4 years it is still 91 tonnes short of its planned transfer of 374 tonnes of gold from Paris to Frankfurt. In essence, over an entire 4-year period (i.e. 208 weeks), the Bundesbank has only been able to transfer 583 tonnes of gold back from New York and Paris to Germany. And the Bundesbank still claims to have 1236 tonnes of gold remaining in storage with the New York Fed.
    Predictably, instead of prompting the mainstream financial media into asking why these supposed gold bar movements have taken so long, the Bundesbank press release threw the mainstream media into a frenzy of immediately back-slapping the Bundesbank while regurgitating its press release with articles such as ‘Germany brings its gold stash home sooner than planned’ from Reuters , ‘Germany Gets Its Gold Back Faster With Job Seen Done in 2017′ from Bloomberg, and ‘Germans Sent Gold Away to Keep It From the Soviets. Now Much of It Is Back’ from the New York Times.

    This post was published at Bullion Star on 3 Mar 2017.


  • A Truth Bomb Just Went Off & It Annihilated The Fantasy Of A Strong Economy – Episode 1212a

    The following video was published by X22Report on Feb 23, 2017
    The EU is getting worried about the debt problem. The tax payers in Dallas are going to bailout the pensions. The everyday American is pumping up the real estate market. Fed’s national index drops signalling we are in a recession. Bundesbank prepares for record losses. UBS warns of credit crisis coming soon. Steve Mnunchin dropped a truth bomb, the economy is going to take more than 2 years to grow.


  • Bundesbank Prepares For Record Losses Once ECB Starts Hiking Rates

    Germany’s central bank reported its smallest profit in more than a decade in 2016 after setting aside a record amount of provisions against future losses on the bonds it is buying as part of the ECB’s stimulus program, its annual report showed on Thursday. “It is fair to ask … when we can take our foot off the monetary policy pedal,” Bundesbank President Jens Weidmann said while presenting the report.
    The Bundesbank recorded a net profit of 399 million euros (337 million), the lowest since 2004 and far below the the 3.2 billion profit it booked in 2015. The fall was largely due to higher provisions against paper bought as part of the ECB’s asset buying, which since June includes corporate bonds, and against cheap loans extended to banks.
    More troubling for holders of European bonds, the Bundesbank increased its provisions for bond losses to 21.9 billion from 19.6 billion a year earlier, a harbinger of what is to come once the ECB starts pulling its foot off the pedal.
    So far, however, the bank is making profits on its bond holdings. Ironically, the profit is mainly thanks to bonds from troubled countries such as Greece, bought at very high yields and against the opinion of Germany’s own representative on the ECB’s board, during the 2010-12 debt crisis. Of course, should Greece be forced to restructure its debt, all of the phantom, paper gains will be promptly wiped out as Greece bonds are repriced to reality.

    This post was published at Zero Hedge on Feb 23, 2017.


  • Is 50% of Western Central Bank Gold gone?

    We have recently had some significant news about the sovereign gold market that makes the unclarity even more unclear. Central banks and the BIS in Basel go to great length to tell the world absolutely nothing about their gold dealings. All transactions are carried out covertly and no central bank ever has an official audit of their gold holdings. The last US audit was during Eisenhower’s days in the 1950’s. Ron Paul has been pushing for an audit but to no avail. Will Trump instigate an audit? Well, he might have the intention but when he finds out that a major part of the US 8,000 tons of gold is not there, it will all go quiet. There have been pressures for audits in France and Germany in later years but this has had no effect. No country wants to reveal that the gold isn’t there.
    Germany takes 5 years to repatriate 647 tons of gold
    Germany has recently pretended that they are totally open about their gold dealings, but what have they actually told the world?
    In 2013 Germany announced a plan to repatriate 674 tons of gold from the US and France. In the first year, they only received 37 tons back and were told that they would have the rest in 2020. We have now been informed that the programme has been accelerated. Out of the 3,381 tons that Germany owns, 51% or 1,713 tons will be in Germany by the end of 2017. Over 49% of the German gold will remain abroad with 1,236 tons still in New York and 432 tons in London.
    You wonder why it needs to take five years to repatriate 674 tons. Listening to interviews with the chiefs of the Deutsche Bundesbank, they explained what a major logistical exercise it has been. According to the Bundesbank, they have had major problems with transport, insurance, security etc. If we take Switzerland as an example, we both receive and export over 2,000 tons of gold annually. And that excludes major transfers between banks and to private vaults. The same happens in countries like the UK, China, India and the US. So around the world, many 1,000s of tons of gold are shipped annually without any logistical problem. You wonder then why the normally very efficient Germans have problems to ship 674 tons over five years?

    This post was published at GoldSwitzerland on February 18, 2017.


  • Russia notes that German gold in U.S. was just a mirage

    Saturday’s report from Sputnik News, a division of the Russian government’s international information agency, shows just how closely that government is watching not just the gold market but also, it seems, GATA’s work. That is, the report addresses suspicions raised by GATA’s friends in Germany’s “Repatriate Our Gold” movement and reported almost exclusively by GATA that Germany’s gold reserves vaulted with the United States were never more than gold credits until the Bundesbank sought to repatriate the gold in recent years.
    Russia’s special interest in gold and GATA’s work appears to date from June 2004, when the deputy chairman of Russia’s central bank, Oleg Mozhaiskov, spoke to the summer meeting of the London Bullion Market Association at the Baltschug Kempinsky Hotel in Moscow and used only four English words in his address: “Gold Anti-Trust Action Committee“.
    While surreptitious intervention in the gold market remains a prohibited subject in the government-controlled Western financial news media, it is a subject of great interest in the government-controlled Russian news media, and GATA will continue its efforts to make the issue of interest everywhere.

    This post was published at Sputnik News


  • Bundesbank Has Completed Gold Repatriation From New York Fed, Three Years Ahead Of Schedule

    In January of 2016, the Bundesbank announced that three years after commencing the transfer of some of its offshore-held gold from vaults located at the Banque de France in Paris and the NY Fed in New York, it had repatriated a total of 366.3 tonnes, bringing the German central bank’s gold reserves held in Frankfurt to 1,402 tonnes, or 41.5% of Germany’s total gold of 3,381 tonnes, for the first time greater than the 1.347 thousand tonnes located at the New York Fed, which as of January 27, 2016 held 39.9% of Germany’s official gold.
    “With approximately 1,403 tonnes of gold, Frankfurt has been our largest storage location, ahead of New York, since the end of last year,” said Carl-Ludwig Thiele, Member of the Executive Board of the Deutsche Bundesbank. “The transfers are proceeding smoothly. We have succeeded in once again significantly increasing the transport volume compared with 2014. This means that operations are running very much according to schedule,” added Thiele last January.
    As a reminder, according to its gold storage plan, unveiled in January 2013, the Bundesbank would store half of Germany’s gold reserves in its own vaults in Frankfurt am Main by 2020 which would necessitate a transfer to Frankfurt of 300 tonnes of gold from New York and all 374 tonnes of gold from Paris. It also meant that as of January, another 111 tonnes of gold from the NY Fed and 196.4 tonnes of gold from Paris remained to be transfered.
    The “politically correct” motives for the transfer, as well as the logistics and the mechanics behind it were explained in a March 2015 video released by the Bundesbank…


    This post was published at Zero Hedge on Feb 9, 2017.


  • Eurozone ‘destruction‘ necessary if countries are to thrive again, warns former ECB hawk

    The eurozone must break up if its members are to thrive again, according to a former European Central Bank official.
    Jrgen Stark, who served on the ECB’s executive board during the financial crisis, said it was time to ‘think the unthinkable’ and work towards a ‘reset’ of Europe that pulled power away from Brussels.
    The former vice-president of Germany’s Bundesbank said the creation of a two-speed eurozone, with France and Germany at its core, would help to ensure the smaller bloc’s survival.
    ‘We have to think the unthinkable. And it is already unthinkable to think about the restart of Europe, which means we have to be creative. But in order to be creative, you have to destruct something.’
    Mr. Stark said countries such as Italy, which has seen its economy stagnate since the crisis, would be better off outside the single currency area. ‘Italy was accustomed to this ongoing devaluation of the lira from the mid-Seventies until the late Nineties. Maybe they need devaluation and their own currency in order to become more competitive again,’ he said.

    This post was published at The Telegraph


  • Why 2017 Could See the Collapse of the Euro

    2017 could be the year that the euro collapses according to Joseph Stiglitz writing in Fortune magazine and these concerns were echoed over the weekend by former Bundesbank vice-president and senior European Central Bank official, Jrgen Stark, when he said that the ‘destruction’ of the Eurozone may be necessary if countries are to thrive again.
    Stark and Stiglitz are too of many respected commentators, from both the so called right and the so called left, who are warning that the common currency and the Eurozone itself will not survive the financial and political turmoil already besetting the European monetary union and set to deepen in the coming months and years.

    This post was published at Gold Core on January 30, 2017.


  • The Bank of England and the ECB Have a Credibility Problem

    Mainstream media are worried about 2017 shocks. So they should be. If you had gambled a pound (or euro) this time last year on a triple accumulator; Leicester City to be English football champions, Brexit, and then Trump, you would have redeemed your betting slip for a million. Bookmakers are not offering odds anywhere like that on a ‘quad’ bet now popular; i) Geert Wilders (Netherlands, March 15th), presently polling at 20%, ii) Marine Le Pen, (France, April 23rd), 25%; iii) Frauke Petry and Jorg Meuthen (Germany, August 27th), 13.5%; iv) Beppe Grillo of 5 Star (Italy, date uncertain, perhaps October), 28%.
    For the ECB and Bank of England, already struggling with separate credibility problems discussed below, any such shocks might prove rather welcome. How so, you may ask, given that they lobbied for ‘Remain’ and obviously would have been delighted with Clinton?
    Since quelling Bundesbank objections to QE at end 2014, the ECB has had a free run to apply whatever monetary policies it likes. However, unemployment levels (although declining for several quarters) are still worrying, and sections of Europe’s banking system do not feel particularly safe. However, many hedge funds and other highly leveraged investors have had another decent year making fairly obvious bets on the increasingly predictable policy responses to various events (Brexit and Trump, perhaps not Leicester City). The ECB has always had one eye on protecting its reputation.

    This post was published at Ludwig von Mises Institute on January 23, 2017.


  • Who Owns the World’s Largest Gold Hoards? – Not the Central Banks!

    It’s a common misconception that the world’s major central banks and monetary authorities own large quantities of gold bars. Most of them do not. Instead, this gold is owned by the sovereign states that have entrusted it to the respective nation’s central bank, and the central banks are merely acting as guardians of the gold. Tracing the ownership question a step further, what are sovereign states? A sovereign state is an entity with legal personality that is represented by one government. And with each government representing the people of that sovereign state, in essence, the large gold hordes managed by the central banks are in fact pools of gold owned by the state for the benefit of its citizens.
    Owned by the State
    When ownership of gold reserves resides with the associated sovereign state, the central bank or monetary authority is officially appointed to act on behalf of the state in holding and managing that state’s gold reserves.
    For example, the Deutsche Bundesbank has stated that:
    ‘The Deutsche Bundesbank holds and manages the national foreign reserves of the Federal Republic of Germany’
    Likewise, as per its Statutes, the Banque de France highlights that it:
    ‘shall hold and manage the State’s gold and currency reserves and shall enter them on the asset side of its balance sheet pursuant to the terms and conditions of an agreement it enters into with the State.’

    This post was published at Bullion Star on 9 Jan 2017.