They store at the southern tip of Manhattan, 25 meters underground. Behind the vault doors are the shiny bars in long rows, including those of the Deutsche Bundesbank. Here the Federal Reserve Bank in New York keeps the world’s big gold reserves. But the question is how long.
Because since Donald Trump has ruled, the concern for the safety of the German gold bars in the New York cellar has grown. Associations as well as Union politicians are demanding to bring German gold reserves back to Germany. In contrast, investors have been pushing the precious metal over the entire globe for a long time – but partly in the opposite direction.
Bring gold home: “Trump is unpredictable”
“Trump is unpredictable, and one cannot rule out that he develops creative ideas for dealing with foreign gold reserves,” said CSU members of MEP Markus Ferber of the news agency “Reuters” recently. The US government is no longer the reliable partner who was once that the Bundesbank had to react to the new geopolitical realities. “Diversification is crucial for the gold reserves,” said Ferber. “It is never advisable to have all the eggs in too few baskets.”
At the end of March, Michael Jäger, President of the European Taxpayer Association, campaigned for a return campaign. “Our demand: get our gold home,” Jäger told the “ZDF” at the time. According to “Reuters”, the association sent corresponding letters to the Bundesbank and the Ministry of Finance.
After the United States, Germany has the second largest gold treasure in the world. According to the annual report, the Bundesbank has 3352 tons of gold stocks. Around half of them are located in the safe of the German Central Bank in Frankfurt, another 37 percent in the Fed basement in New York. The remaining 405 tons are stored by the Bank of England in London. It was different a few years ago: In 2013, the Bundesbank revised its storage concept and brought in part of the reserves from the USA and all from France.
There are historical reasons that German gold is being stored abroad. After the Second World War, Germany initially had no gold reserves at all. It was only when the performance surplus of the young Federal Republic grew that the gold was partially used as a payment. However, these gold bars were not delivered to Germany, but simply placed in the Bundesbank from the subject of the American central bank.
Bundesbank reassures: Gold at the Fed safe
The fact that some are now calling for a return of the gold bars is due to the uncertainty that Donald Trump and his US government are spreading. Trump’s attacks on the head of the US Federal Reserve Jerome Powell feed the doubts as to whether the Fed can preserve its independence. If Trump would get control of the Fed, he would ultimately have control over the German gold reserves, the fear.
The Bundesbank writes on a capital request that nothing has changed in its storage concept. The goals of security and tradability are decisive for the weighting of the gold reserves in order to sell gold or exchange gold if necessary – the storage agencies would be checked regularly based on these criteria. “The New York Fed is and remains an important storage point for our gold in this context,” said a spokesman. Even at the annual press conference in February, Bundesbank President Joachim Nagel won: “Of course, I followed this discussion: I don’t give me any sleepless nights,” said Nagel. “I have full confidence in our colleagues at the American central bank.”
Investors made gold to New York
Not only at the central banks Donald Trump’s politics ensures increasing brooding over gold. Since the precious metal has the call as a safe harbor in uncertain times, private investors increasingly bought gold – and thus ensured record values for the gold course.
Physical gold is usually traded in London. But after the presidential election in November, investors began to transport tons of gold to the camp of the New York Börse Comex – probably to advance import duties. The stocks in New York are said to have doubled compared to October. This ensured increasing prices and pressure on the banks to also make gold to the USA in order to sell it more expensive there. The stocks have dropped again since the beginning of April, but are still at a high level.
In the meantime, however, this trend also seems to turn back slowly. According to a report by the US television broadcaster “CNBC”, super-rich in the United States are increasingly creating their gold bars out of the country to protect it from the uncertain political circumstances. The target country is primarily Singapore, which consider investors to be politically stable and see as an important transit hub.
Capital is a partner brand of the star. You can use your selected content with your star+ See the subscription. You can find more from Capital at www.stern.de/capital.
