Comments from Philipp Bagus, Dimitri Speck and Stephan Bogner

Since our last newsletter, negative interest rates have become established in the private market. As Spiegel Online reported on April 10, more than 300 banks are already charging penalty interest to their savers. You can find out how our experts classify this topic in the following statements:

Prof. Dr. Philipp Bagus (Chairman of the Board at Elementum International AG)

The Eurozone is over-indebted. Households, companies and states are overloaded with debt. Households, zombie companies and states would have problems with higher interest rates. In fact, the ECB has introduced negative interest rates to make member states´ debts more bearable. Interest rates on most German government securities are negative. So when the German state goes into debt, it has to pay back less. This exceptional situation is artificial, because the natural interest rate in a free market is always positive. It is the central banks that have forced this negative interest rate and grant it in their transactions with the commercial banks. If now some market participants profit from this artificial arrangement and pay negative interest rates, then conversely other market participants are harmed. These are mainly the savers who receive less interest on their savings. With negative interest rates, savings even melt away. In the end, negative interest rates are an instrument to use the savings of the population to finance the national budgets in Europe.

Dimitri Speck (Board Member at Elementum International AG)

In recent years, the major central banks have manipulated the interest rate down to negative territory - and thus lower than ever before in the history of interest rates, which goes back several thousand years. Why? In 1960, the total global debt, i.e. that of all states, companies and private households, was still 100% in relation to global economic output. Now it is over 270%. In view of this over-indebtedness, the downwardly manipulated interest rates relieve the debtors, and the reduced interest burden ensures the survival of the debtor states. As global over-indebtedness persists, central banks will continue to push down interest rates. However, interest rates below the inflation rate and a desolate financial system are traditionally price drivers for precious metals. Accordingly, the price outlook for gold and silver is positive for several years to come.

Full size / Global debt in relation to global GDP)

Stephan Bogner (CEO at Elementum International AG)

We have been hearing for many years about the introduction and enforcement of negative interest rates at banks. But now things are really starting to move. During the first three months of the year, the number of banks in Germany charging their customers a deposit fee rose to over 300, an increase of two thirds. The pandemic is acting as a fire accelerator here, because many people prefer to put their money in their bank accounts in times of crisis like these instead of spending it. However, the increased savings rate has become a problem for banks. Saving is no longer desirable, while customers are looking for security. If money houses no longer want money from their customers, what is the money worth? And what will the money still be worth in a few years? Instead of investing in stock markets, bonds or real estate as recommended by banks, physical precious metals in particular offer a meaningful alternative to park one´s money and have the chance to increase it. It’s because precious metals are known to be scarce and always have a value - exactly the opposite of paper money. 

Purchasing, storing and selling physical precious metals

Elementum Deutschland GmbH, based in Leimen, Germany, is specialized in precious metal trading. Only those customers who have purchased physical precious metals from Elementum Deutschland GmbH (or from another national Elementum company in meanwhile 5 other countries in Europe) may also store them in the St. Gotthard high-security vaulting facility in Switzerland.

You can also take delivery of the precious metals you bought at Elementum Deutschland GmbH (or any other Elementum company in the EU) and have them shipped immediately to your personal address. However, the advantage of storing at the St. Gotthard facility is that you do not have to pay VAT (19% in Germany) on the purchase and sale of silver, as it is a so-called open duty-free warehouse.

You can also sell your precious metals back to Elementum Deutschland GmbH (or any other Elementum company in the EU) at any time, as long as you have stored them in the St. Gotthard vaults. In this case, there is also no VAT, because the goods are traded within the duty-freezone.

You only have to pay VAT if you personally pick up your stored silver from the facility (possible at any time by appointment) or in case you want us to deliver your silver to your address.

By storing your silver in the St. Gotthard high-security storage facility, you can buy silver for 19% more (in Germany) and thus participate significantly more in a silver price upswings.

More information & exclusive offer:

Disclaimer: The comments herein do not constitute a recommendation to buy or sell. The author, Stephan Bogner, is the CEO of Elementum International AG; a Swiss company specializing exclusively in the storage of physical precious metals in the high security vault facility in the St. Gotthard mountain range in central Switzerland. Elementum International´s Board of Directors and its Management have been selected solely on the basis of their professional skills and many years of experience in relation to precious metals markets. As these persons may have other professional activities in addition to their activities at Elementum International AG, the company has no influence on their activities and respects the general freedom of opinion in this context as well. Therefore, the opinions expressed by persons working for Elementum AG do not automatically reflect the opinions of Elementum International AG. Investments in the field of precious metals are subject to high risks. In addition to general investment risks, they are also subject to certain risks emanating from the structure of this market. Therefore, we ask you to read our risk information carefully. For investments, respective contractual documents and risk notices contained therein are authoritative. Neither the author nor the companies Elementum International AG and Elementum Deutschland GmbH assume any liability for the consequences of actions taken on the basis of the information contained in the electronic publications or on the websites of the companies or elsewhere. Investments are always associated with various forms of risk. Past profits are no guarantee of future profits. It is recommended that you always seek the assistance of trained and legally registered financial advisors when making investments or seek individual advice according to your personal financial background. Before investing, it is recommended that you determine exactly what your financial goals are, rank them in order of relevance, and then determine what level of risk you are willing to take so that a complete financial plan can then be prepared by a registered financial advisor. Please be sure to consult such a financial advisor before investing and carefully read the full disclaimers on the websites of Elementum International AG and Elementum Deutschland GmbH.


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