Gold is more valuable than ever - now is the gold treasure of the Bundesbank in danger?

the current value of The gold reserves of the Bundesbank is pretty much exactly what the Federal government debt for the Corona-related economy has planned pack

Gold is more valuable than ever - now is the gold treasure of the Bundesbank in danger?

the current value of The gold reserves of the Bundesbank is pretty much exactly what the Federal government debt for the Corona-related economy has planned package: 130 billion euros, the official, around 40 billion of that will come, if the expenditure over the year 2021 also be taken into account.

On the other side of the German gold treasure that the Bundesbank managed weighs, almost exactly 3.366.500 kilograms. Its value is increased because of the skyrocketing gold price is strong and is at market prices at more than 170 billion euros.

In the past few days there has been again a small increase on paper, because the price of gold has reached around 1650 euros per Troy ounce, a record level. In theory, therefore, could decide the Bundesbank to sell its Gold, which is now stored in Frankfurt, London and Washington, and the profit to the state to distribute.

The "black Zero" in the budget would be saved. The Generation of those who still goes to school, but later, for the expenditure of the present day have to pay, would have no more Gold, but also no Corona debt. Gold price (Spot) 1.949,06 USD +6,51 (+0,34%), except over-the-counter

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in keeping with the theme: Gold price Ticker - price of gold continues record hunting is the next milestone was already assessed in the visor

Bundesbank Gold only once in a year

that's the theory. The practice is that this bold idea, no-one wants to know. While in 2004, the then Bundesbank President Ernst Welteke stocks a sale of up to 20 percent of the gold as a "harmless" had called and offered to promote education and research, is beyond the Bundesbank today, the discussion.

she refers to your Form of the Balance sheet. Thereafter, the Gold of the Germans, which is mounted in Frankfurt and in the vaults of the British and the American Central Bank is evaluated only once in the year, on 31. December.

Because of the long-term upward climb in the price of gold are pretty increases, too: 22 percent between 2018 and 2019. However, this increase in value does not end up as profit in the balance sheet of the Bundesbank and awakens, perhaps greed, but he finds himself under the Item "net settlement position" in the annual report.

This is partly due to the fact that the Gold would not be just to sell the value, with which it is currently traded to Any major sell-off would put the price under pressure.

The market prices are in fact only a moment recording. The Bundesbank wants to hold on to that gold ownership: Germany and the United States, Russia, and Switzerland, the countries with the largest gold reserves. Chief financial officer - Live will-Online-conference on 3. August!

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Economists and politicians warn

Economists have warned the gold treasure of the Bundesbank and only to touch. Stefan Kooths, for example, head of the forecasting center at the Kiel Institute for the world economy in Kiel, holds such speculation for almost negligently, because the confidence in the Euro area continued to be held.

If Germany is determined to sell Gold, this is also a Signal to other Euro countries. "The consequences of over-Indebtedness, in addition to can be best if you hesitate, thus, the problems are only bigger, not smaller. If the gold reserves are up for grabs, is the end of the flag pole in sight,“ says Kooths. He expects, moreover, that the bottom line is that a gold sale would be a zero-sum game. Liabilities or assets to reduce the do in the balance sheet, no difference. Bernecker exchange - compass orientation for your Depot. Clear. Compact. Competent. (Partner offer) Now for 30 days completely free trial!

Michael Hüther, Director of the Institute of the German economy in Cologne recalls that "in 2009, the sale of the gold reserves for the financing of the former recovery plan was proposed." Instead, the Federal government have issued at the time, bonds and the debt ratio could be reduced in the following years successfully. This could also be the way.

"Because the interest rate environment will be around for a long time-effectively, will succeed in the necessary reduction of the debt ratio in connection to the Corona-crisis as well as in the years after 2009," says Hüther.

the policy of holding back so far. During the financial crisis in 2009, politicians such as the then CDU budget expert, and later state Secretary for Finance Steffen Kampeter, a sale of part of its gold holdings had requested, the current reactions. "A sale of the 'Golden' panel silver, I think this is wrong," says the Hamburg CDU Bundestag deputies Christoph Ploß. His justification: "Currently the money is spent with full hands – and a sale of gold would boost this mentality might still be."

The scepticism against a raising of the standard of the gold reserves is shared by the left party. "It would be downright stupid to destabilize the situation in the most severe economic crisis after the Second world war, the situation with gold sales," says Sevim Dagdelen, a former Vice-Chairman. Unlike Ploß Dagdelen control calls increases: "We need instead is a tax on the super-rich and a wealth tax."

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*The post "Gold is more valuable than ever - the state now, according to the gold treasure of the Bundesbank?" is published by economy courier. Contact with the executives here.

Updated Date: 28 July 2020, 14:27

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