Swiss Bank Loses Client’s Gold
The comments below are an edited and abridged synopsis of an article by Egon von Greyerz
Don’t let your bank hold your gold; they might not be able to find it. A Swiss bank recently moved a client’s gold from the bank’s safe to its private vault in Zurich. The client was aware of the move. The gold was allocated, and the client had the bar numbers. The client eventually decided to store the gold with Von Greyerz’s company, and instructed the bank accordingly. The gold, however, could not be located. It was supposed to be segregated, but the bank had stored it in the collective vault. And the client’s allocated, numbered bars couldn’t be found anywhere.
Presumably, the bank will accept liability and buy new bars for the client. But this proves that it is not safe to keep your gold in a bank.
Up for discussion: When banks come under pressure, they will borrow clients’ gold; pay governments to take your money; put your money into a country that will never repay it (Portugal), or buy gold; the Vietnamese are buying condos with gold; buying a house in gold for 93% less; and three kinds of money (worthless, soon worthless, and eternal).
Gold has moved up by $130 in a short time and thereby decisively broken the 6-year Maginot Line at $1,350. Gold should reach $1,650 fairly quickly, and then later move to new highs.
Important changes will soon take place in markets, with the 2007-2009 crisis returning with a vengeance. The final phase up in US stocks could last a few weeks, and most likely not more than 2 months. Thereafter a secular bear market will start that will be devastating for the world economy, the financial system and paper money.