Date 13 Jan 2020
In the run up to the end of the year during December, a remarkable sight emerged across Germany – long lines of customers queuing up outside the country’s precious metals shops and gold dealer showrooms.
Was it seasonal gift buying by Germany’s citizens, a population well-known for its love of physical precious metals? Or perhaps the onset of panic about negative interest rates in Europe’s largest economy?
As it turns out, panic it was, but of a different type, with the long lines triggered by the realization that from 1 January 2020, new national legislation was to take effect that would dramatically reduce the threshold on anonymous buying of precious metals from the existing €10,000 limit to a far lower limit of €2000, all under the guise of money laundering prevention.... [it was €15,000 in 2017]
Kerstin Botschek, Branch Manager at Degussa in Cologne, explained the situation to German newspaper Die Welt in its 23 December “Legislative change creates queues in front of gold trading houses“:
“These long lines are are based on the lowering of the cash limit. 98.5 percent of customers want to buy gold for less than 10,000 euros without registering. Few are buying jewelry any other gift.”
The situation was similar at Pro Aurum in Munich which it documented on its website:
“Many Pro Aurum employees in Munich cannot believe their eyes…the line of waiting customers extends to the on the sidewalk in front of the building. In the freezing cold, people persevere to buy physical precious metals. You take everything that is still available with you – but the product range is shrinking day by day, because the demand is simply overwhelming.”