Ben Bernanke and the rest of the US Federal Reserve bet the farm that they could engage in countless monetary interventions, keep interest rates at zero, and print over $2 trillion in new money without damaging the US’s credibility.
They were wrong. Indeed, Germany just fired a major warning shot to the US Federal Reserve.
On Monday, Germany announced that it will be moving a significant portion of its Gold reserves out of storage with the New York Fed and moving them back to Germany.
A few background details.
- Germany has the second largest Gold reserves in the world behind the US.
- Since the early ‘80s, Germany has stored the largest portion of its Gold reserves with the New York Fed (45% vs. 13% in London, 11% in Paris and the remaining 31% in Frankfurt).
- In the fall of last year, German officials began raising the issue of auditing its reserves at the NY Fed.
Why would Germany suddenly decide that it wants to change a policy it has had in place for over 30 years?
More importantly, how did it go from wanting to audit its reserves to actually removing them from the NY Fed’s care?
In simple terms, Germany has just announced that it doesn’t trust the US Fed.
The world’s Central Banks have been staging a global currency way for several years now. Germany, China, Japan, and the US all want to keep their currencies weak to improve exports and minimize their debt loads.
In the case of Germany, it’s the second largest exporter of goods in the world behind China. More than anyone in the EU, Germany wants a weak Euro. However, every time the Fed announces a new policy, the US Dollar falls, the Euro rallies and German exports fall off a cliff.
Germany is now openly telling the Fed that it is done playing around. This will have severe consequences in the financial system.
Remember, the only thing holding the financial system together is belief in the Central Banks. If the Central Banks (it was Germany’s Bundesbank that is behind the Gold move) stop trusting one another or grow openly antagonistic, then things will get very bad very quickly.
For months now we’ve been asserting that the “improvements” in the global economy and financial system were a mirage. Germany’s move has confirmed this. If the financial system was in fact safe and the global economy was improving, Germany would not feel the need to repatriate its Gold.
Which begs the question, what exactly do German Central Bankers know that we don’t?
This is precisely the sort of “unquantifiable” investment analysis we specialize in with our Private Wealth Advisory newsletter.
With most of the markets dominated by computer programs and Wall Street sharks, the only way to make serious money is by focusing on the opportunities and risks that no computer or group-think Wall Streeter can come up with. If you can do this, you can still making a killing in the markets.
We’re speaking from experience here.
By focusing on investment ideas and portfolio risks that are “unquantifiable” we’ve shown Private Wealth Advisory a success rate of OVER 80% on our investments.
Put another way, we’ve made money on more than eight out of ten investments. This includes a 74 trade-winning streak (from July 2011-July 2012 we didn’t close a single losing trade).
And this is not some flash in the pan either: we’re currently beating the market handily with out closed trades in 2013. In fact, we just closed another winner this morning.
Indeed, I’m so confident in this newsletter that it comes with a 30-day refund period. If you’re not totally satisfied with Private Wealth Advisory in the first month, simply drop us a line and we’ll refund every cent of your subscription.
You’ll have full access to the Private Wealth Advisory archives in that time. You’ll also receive two new hot off the press issues and very likely several trade signals (it’s getting close to time to close out our 7th and 8th straight winners).
To find out more about Private Wealth Advisory and how it can help you beat Wall Street and the market…
Phoenix Capital Research
