There was a lot of noise made about this repatriation. Why? As we now know from [1] and [2], the Bundesbank shipped about 950 tonnes from London to Frankfurt around 2000/2001 and did not tell anyone for a decade.
This time it is about 50 tonnes per year for a couple of years, and there is a big noise. So the point is the noise rather than the amount of gold moved, isn't it?
What are they saying here?
* we consider gold an important reserve
* we hold only physical gold now (as opposed to swaps, unallocated gold, gold leased, as we did in the past)
* everyone is invited to see that we have only fully allocated (=physical) gold right now, something on which we never commented before
* the gold reserve of the U.S. is not credible (I do believe the gold is indeed there, but since it belongs to the government as opposed to the Fed, it will not be available to defend the dollar).
The following is paraphrasing MF at FOFOA's: The Bundesbank is asking only for 50 tonnes a year. This is polite and diplomatic. Asking for all 1500 tonnes would be rude and openly signal distrust in the U.S. which is something you don't do as a professional diplomat. But asking for 50 tonnes a year is perfectly measured. It invites a lot of speculation, however, and creates a lot of talk.
So their move is the worst conceivable diplomatic attack on the credibility of the U.S. treasury that an ally such as Germany could possibly launch, still maintaining all diplomatic customs and not getting into the line of fire themselves.
If you'd like to understand the different role of gold played in the U.S. as opposed to the Euro zone, I suggest you take a careful look at the consolidated financial statement of the Eurosystem of central banks and at the corresponding balance sheet of the Federal Reserve System of the U.S. The answer is there, open, for everyone to inspect.
Hint: It is in Assets, Item 1, and Liabilities/Capital under "Revaluation Accounts" for the Eurosystem.
Sincerely,
Victor
[1] http://www.bundesbank.de/Redaktion/DE/Downloads/Bundesbank/Wissenswert/…
[2] http://www.bundesbank.de/Redaktion/DE/Downloads/Bundesbank/Wissenswert/…