With the Associated Press report appended here, the German gold audit story has just exploded into the English-language press with some important revelations:
– The gold vaulted by the German central bank, the Bundesbank, with the Bank of England “has fallen ‘below 500 tons’ due to recent sales and repatriations. …” So despite the lack of official announcement, Germany lately has been selling gold from London — perhaps as part of the secret “strategic activities” grudgingly acknowledged two years ago by the Bundesbank to GATA’s friend, the German financial journalist Lars Schall:
The lack of announcement of the sale of the German gold in London suggests that the sale was actually part of a gold swap with another central bank — like the New York Fed. That is, the powerful implication here is that German gold in London was sold at the behest of the United States and in exchange Germany took title to United States gold vaulted in the United States — or title to gold supposedly vaulted in the United States. This way the Bundesbank could continue to claim ownership of the same amount of gold without lying, at least not technically.
As for the Federal Reserve and the U.S. Treasury Department, when you rig every market you can’t worry so much about lying.
Of course such gold swaps were the target of GATA’s federal freedom-of-information lawsuit against the Federal Reserve in U.S. District Court for the District of Columbia, a lawsuit concluded somewhat successfully last year, having pried from the Fed an admission that it has secret gold swap arrangements with foreign banks:
– The Bundesbank is resisting accountability and has censored part of the auditors’ report in the name of protecting secrets of the central banks storing the German gold. But why should there be any secrets about it? Nobody’s asking for the combination numbers to the vaults, and the combination wouldn’t do anyone any good anyway, as the vaults are guarded. Do these secrets involve gold loans and leases and other legerdemain? That seems to be the case.
– The campaign to repatriate the German gold has gotten noticed in a big way.
– The Bundesbank has been officially reprimanded by another German government agency for negligence in its custodianship of the national gold.