Germany To Bring Home Gold Stored In US, France
"Overall it must be said that the transport over land is the riskiest part. Flying is safer than driving, and an airport is already a heavily secured area."
Zorica Obrovac, of the German company SG Security GmbH, which moves precious cargo in armored cars with armed protection, said: "If it were such a high-value cargo as tons of gold, I would obviously split it in several shipments. And the key is not to tell anyone, the fewest people possible in the company that orders the shipment."
During the Cold War, Germany kept most of its gold abroad for fear it could fall into the hands of the Soviet Union if the country were invaded. Another reason was to have the precious metal close to the foreign currency markets in London, Paris and New York, where gold is traded.
Since France, like Germany, switched to the euro more than a decade ago, storing gold for foreign currency swaps in Paris is no longer necessary, the Bundesbank said.Once the shipment is complete, Frankfurt will hold half of Germany's 3,400 tons of reserve gold â¿¿ currently worth about $183 billion â¿¿ with New York retaining 37 percent and London 13 percent. The decision to bring some of the gold back home also follows criticism last year from Germany's independent Federal Auditors' Office, which concluded that the central bank failed to properly oversee its reserves. The auditor suggested the bank carry out regular inspections of gold stored abroad. The auditors' report stunned Germany, where the Bundesbank routinely tops polls of the nation's most trusted institutions, and politicians pushed for the gold to come home. The central bank defended itself by saying, "There is no doubt about the integrity of the foreign storage sites." The New York Federal Reserve's gold vault, for example, is about 80 feet below street level in lower Manhattan, its only entry protected by a 90-ton steel cylinder 9 feet high. The New York Fed imposes a handling fee when gold enters or leaves the vault but does not otherwise charge account holders for storing their gold.
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