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The Flight to Safety Accelerates, Hungary Increases Gold Holdings Ten Fold

The Flight to Safety Accelerates, Hungary Increases Gold Holdings Ten Fold

We’ve talked at length about how the geopolitical climate around the globe has ratcheted up in temperature over the past few years. The times are growing more and more uncertain as trade wars erupt and as the old global powers are seemingly losing control with each passing day.

This has led to countries such as Russia, and China, both of which are unarguably out of the “old” power structure and desperately want to increase their ground in the international game of finance and control.

Undoubtedly they are doing this and asserting themselves in any possible way that they can, suffering blow-backs and setbacks from the old power structure for each stride that they make.

One such tactic that they are using, and one that I have often highlighted, is their continued move away from US dollars as their reserve currency of choice. In its place, they are buying precious metals, most notably gold, at a feverish pace, exponentially increasingly their holdings as rapidly as they can.

Despite this fact, gold has suffered under intense artificial suppression, as a fat finger is kept on its price. The “canary in the coal mine”, as gold is often called, has been kept quiet, but for how much longer?

Increasingly, as the times become ever more precarious, with global leaders on edge, we are seeing more countries join the ranks of Russia and China, taking what they believe to be prudent steps and moving some of their reserves into precious metals.

Two such countries that have just recently increased their holdings of gold bullion, are Poland and Hungary, the former of which has been steadily doing so over the summer months and the later of which has just done so, in a massive way.

…click on the above link to read the rest of the article…

Gold Is Becoming Cool Again

Gold Is Becoming Cool Again

The sentiment shift is still subtle, but it’s both real and widespread. After a few years of being ignored and/or dismissed as basically useless, gold is cool again, attracting positive press and increasing accumulation by big investors.

India, for instance, imported less gold than usual in the first part of this year but lately has ramped up its buying, with August imports more than double the year-earlier amount.

Indian gold imports gold is cool

Hungary just did something even more dramatic:

Hungary Boosts Gold Reserves 10-Fold, Citing Safety Concerns

Hungary’s central bank increased its gold reserves 10-fold, citing the need to improve its holdings’ safety, joining regional peers with relatively high ownership in the European Union’s east.

Following a similar move by Poland, the central bank in Budapest now holds 31.5 tons of the metal, taking the share among total reserves to 4.4 percent, in line with the average in the region, according to a statement published on its website Tuesday.

Hungary gold reserves gold is cool

Meanwhile, the long-dormant South African gold miners are seeing sudden interest:

Is the Canary in the Gold Mine Coming to Life Again?

Back in late 2015 and early 2016, we wrote about a leading indicator for gold stocks, namely the sub-sector of marginal – and hence highly leveraged to the gold price – South African gold stocks. Our example du jour at the time was Harmony Gold (HMY) (see “Marginal Producer Takes Off” and “The Canary in the Gold Mine” for the details).

As we write these words, something is cooking in South African gold stocks, that much is absolutely certain. Here is a chart of the JSE Gold Index in ZAR (South African rand) terms:

South African gold miners gold is cool

While we cannot be sure why investors have suddenly become enamored with the precious metals sector, it is probably a good guess that gold stocks are by now so cheap that they are considered a worthwhile target for rotation purposes.

…click on the above link to read the rest of the article…

Gold Reserves Surge 1,000% In Hungary As It Joins Poland, Russia, China and Other Central Banks Buying Gold

Gold Reserves Surge 1,000% In Hungary As It Joins Poland, Russia, China and Other Central Banks Buying Gold

News, Commentary, Charts and Special Podcast on Direct Access Gold

Here is our Friday digest of the important news, commentary, charts and videos we were informed by this week including our special podcast on Direct Access Gold.

From our perspective, the most important developments were the IMF’s financial warnings and the escalation in central bank gold buying with Hungary increasing its gold reserves by a whopping 1,000% due to increasing “safety concerns.”

For the first time since 1986, Hungary’s central bank is buying gold bullion – a lot of gold bullion.

The Eastern-European country announced that it had boosted its gold reserves ten-fold, up to 31.5 tons. It not only dramatically increased its reserves but also repatriated the gold from the Bank of England to Budapest due to concerns about “financial stability”.

Central banks in Europe are diversifying into gold or moving to repatriate and take “possession in country.”

Hungary and Poland are the most recent central banks to do this but they follow in the footsteps of Austria, Netherlands and the powerful German Bundesbank all of which have been repatriating their gold from the Bank of England and the Federal Reserve in recent months and years.

Source: Bloomberg

“Gold is still considered to be one of the world’s safest assets,” in the words of the Hungarian central bank.

This view is shared by the President of the ECB Mario Draghi who in February 2013 spoke about how “gold is a reserve of safety” which “gives you a value-protection against fluctuations against the dollar.”

Central bank gold reserves remain very small versus the scale of their massive foreign exchange holdings and their significant exposure to the vulnerable dollar in particular but also the euro and other fiat reserve currencies.

…click on the above link to read the rest of the article…

Never Go Nuclear — The EU Goes After Hungary

Never Go Nuclear — The EU Goes After Hungary

If there is one thing people with power always do when confronted with intransigence it is they always go nuclear.

As a parent we’ve all been there.  That moment when your child calls your bluff on a particular thing you’ve been arguing over and you’re left with no other option than to go through with some terrible threat or back down.

Backing down is usually the right call, but the right course of action was to never get to that situation in the first place.

Because when you do go nuclear the damage from that is invariably far worse than whatever it was you were fighting about in the first place.  Because the nuclear option creates scars.  It builds layers of distrust which cannot be smoothed over with an apology later.

Well, now the EU has invoked their version of nuclear option against Hungary for refusing to accept migrants as part of the Soros/Merkel plan to import chaos and unrest into all corners of the European Union.

Hungarian President Viktor Orban has steadfastly refused to budge one inch on this issue.  He has politically gone after George Soros directly by passing a strong anti-NGO law that takes its structure from a similar one passed in Russia championed by President Vladimir Putin.

Orban’s refusal to accept one migrant is where the rubber of national sovereignty meets the road of globalism.  Orban knows exactly what he is doing.  And he knows the consequences of this course of action.

The EU’s response is a symptom of a much deeper problem that persists due to its fundamentally anti-democratic structure.  With the veneer of democracy here, calling for a vote to ratify a biased report on Hungary’s human rights abuses, 487 MEPs voted to pursue stripping Hungary of its voting rights within the EU, which is what the ultimate result of an Article 7 invocation would entail.

…click on the above link to read the rest of the article…

A League of Leagues of Their Own in Europe

A League of Leagues of Their Own in Europe

“There’s no crying in baseball!”
— A League of Their Own

The Great Realignment is coming to Europe next year.  All the writing is on the wall.

This summer saw German Chancellor Angela Merkel survive a leadership challenge by her coalition partner Horst Seehofer over her immigration policy.

She needs political wins to maintain her hold on power.  Standing firm against President Trump on the Nordstream 2 pipeline and having a cordial summit with Russian President Vladimir Putin is a good start.

Because most of Europe is tired of 1) Germany setting policy for the entire EU and 2) anti-Russian sanctions killing their trade.

But week-long protests in the Saxony town of Chemnitz over the stabbing of a local man are dogging her.  Germany’s polling numbers continue ebbing away from Merkel.

The more she is weakened the more emboldened her opposition becomes.

Cue Italian Deputy Prime Minister Matteo Salvini and Hungarian President Viktor Orban. They met to openly strategize over ending open migration into the EU.  On the surface Italy and Hungary seem at odds on this issue.

Italy wants its borders closed and its migrants distributed throughout Europe.

Hungary steadfastly refuses to take even one migrant.

This dichotomy is what the European media and politicians think will keep these two rising titans in conflict.

But, as Mike Shedlock pointed out recently at Townhall.com, these two men have bigger goals which they are in total agreement on — securing their borders to preserve their cultural and national identities.

That’s why Salvini is calling for “A League of Leagues” across Europe.  He will succeed.

This is the guy who successfully rebranded the secessionist Northern League into the MIGA party – Make Italy Great Again. 

Then he and Five Star Movement leader Luigi Di Maio navigated the Italian Swamp to form a government experts said couldn’t work, while simultaneously neutering establishment stalking horse Silvio Berlusconi.

…click on the above link to read the rest of the article…

Falcon in the storm #04 – Critical Mass Heaters

In our 4th guest post from Gergő Benedek, we look at rural energy issues across Hungary.

While Hungary is preparing to invest into the most ambitious energy project of its entire history – building a new nuclear power plant – the rural areas of the country are facing dire energy problems that very well could be solved with less effort and maybe even more benefit.

Apro’ Tech is an ingenious word game with Appropriate Technology, the movement of achieveing the best possible result with the resources at hand, and the word for ‘tiny’ in Hungarian, which happens to be ‘apró’. It represents the small scale of the energy solutions this team is aiming for, while hinting subtly at the scientific philosophical background of their operations.

‘I studied product design on the University of Sussex. I’ve been working at a local supermarket to cover my costs of living. I think that’s where my green thinking sprouted from, seeing all the wastefulness.’

Nóra Feldmár, a member of the Hungarian Transition Hub team.

Later I went to the Netherlands to study Industrial Ecology: a systems approach where the aim is to mimic natural cooperation to maximize efficiency. One thing I learned there is that I don’t want to work for big corporations and optimize their environmental impact. I wanted to utilize my skills elsewhere.’

Nóra took part in numerous local energy projects in extreme poverty areas of Hungary, before starting up Apro’ Tech. Her Industrial Ecology thesis work centered on a project in Told, one of the many forsaken little villages on the Eastern edges of the country. The population here is generally poor, with low education, possibilities for work are very limited.

…click on the above link to read the rest of the article…

Hungarian National Bank Decides to Bring Gold Reserves Back Home


The leadership of the Hungarian National Bank (MNB) has decided to bring back home Hungary’s gold reserves. Up to now, 100,000 ounces (3 tons) of the precious metal were stored in London, which is in total worth some 33 billion forint ($130 million) at current gold prices.

The decision seems to be in line with international trends as storage of gold reserves out of the country is now considered risky by more and more central banks. Austrian, German, and Dutch central banks are among those who have recently decided to repatriate their gold reserves. According to MNB, this may also further strengthen market confidence towards Hungary.

Photo: MNB.

MNB has been holding gold reserves since its foundation in 1924. Towards the end of World War II, it had been transported to Austria on the famous Gold Train, captured by the Americans, then repatriated in full in 1946. The highest amount Hungary has ever had was around 65-70 tons at the beginning of the 70s. At the end of the 1980s, however, a decision was made to decrease gold reserve to the lowest possible level and rather to invest in sovereign debts, which as a consequence of the collapse of the Bretton Woods system are considered safer, more liquid and potentially of higher yields. At the beginning of 2010 this tendency changed again and central banks started to accumulate gold as a potential response to the financial crisis.

The Largest gold reserves in the world belong to the US and Germany, while in comparison to other Central-European countries Hungary has one of the tiniest amounts of the precious metal; for instance, Romania and Poland both have 103 tons, and Serbia has 13 tons. Since 1992, Hungary’s activity has remained steady, as the MNB hasn’t bought or sold any of its gold reserves.

US State Department Admits Plans To Meddle In Hungary’s Democracy

US State Department Admits Plans To Meddle In Hungary’s Democracy

As we noted last week, hypocrisy may be the only consistent guiding principle of US foreign policy.

The Rex Tillerson State Department will pump $700,000 into Hungarian media to remove Viktor Orban.

TheDuran’s Alex Christoforou writes:

When another nation state uses media to communicate it’s point of view, its flagged as a foreign agent, a “bad actor”, and often declared as an “act of war (i.e. RT).

When the US government uses its petrodollar strength to insert its agenda into another country’s politics it’s branded “democracy and human rights programming”.

According to The Gateway Pundit, Rex Tillerson State Department is spending over $700,000 to defeat PM Orban in Hungary.

The deep state is vehemently opposed to Orban’s nation statism…his conservatism and his stance against open borders. For the neo-liberal cabal under the watchful eye of George Soros, Orban must go.

In his speech accepting his party’s endorsement, Orban said he was fighting against “globalist” views that threaten the EU’s Christian nations and their moral foundations, for which he blamed Soros.

“Some countries in Europe decided to transcend Christianity and their own national character,” he said. “They want to step into a post-Christian, post-national era.”

“To execute Soros’s plan they want to root out governments which represent national interests around Europe, and that includes us,” he said. “They act like Soviet agitprop agents once did. We old war-horses know them by their smell.”

Breitbart.com reports…

The U.S. State Department has courted controversy by announcing it will plough $700,000 into Hungarian media, angering the country’s anti-globalist, conservative government.

The funding was announced by U.S. Chargé d‘Affaires David Kostelancik, who has previously appeared to openly criticise the Trump administration by alluding to “apparent inconsistencies in [U.S.] foreign policy” and remarking that “not every criticism of the government is ‘fake news’.”

…click on the above link to read the rest of the article…

Hungarian Central Bank Hoards 200,000 Bullets, Hundreds Of Guns Due To “Security Risks”

Hungarian Central Bank Hoards 200,000 Bullets, Hundreds Of Guns Due To “Security Risks”

If we learned anything last September it’s that Janet Yellen’s reaction function now includes domestic and global financial markets.

Well that, and we learned that Hungarian PM Viktor Orban isn’t playing around when it comes to Europe’s worsening refugee crisis. While everyone else in Europe was busy trying to figure out how to accommodate the millions of asylum seekers fleeing the war-torn Mid-East, Orban simply built a razor wire border fence.

And then he built another one.

And then, when migrants tried to breach his barriers, he met them with water cannons and tear gas. This was the scene:

“Problem” solved.

So clearly, Hungary isn’t playing around when it comes to security, but as it turns out, migrant-be-gone fences and tear gas aren’t sufficient in today’s dangerous security environment and so, the Hungarian central bank is stockpiling guns and ammo.

No, really.

“Hungary’s central bank, already facing criticism for a spending spree ranging from real estate to fine art, is now beefing up its security force, citing Europe’s migrant crisis and potential bomb threats among the reasons,” Bloomberg writes. “The National Bank of Hungary bought 200,000 rounds of live ammunition and 112 handguns for its security company, according to documents posted on a website for public procurements.”

Why, you might fairly ask, does the central bank need 200,000 bullets and hundreds of guns? Because of “international security risks,” central bank Governor Gyorgy Matolcsy says.

As Bloomberg goes on to note, “the security measures added to public scrutiny of the running of the bank, which under Matolcsy – an Orban ally – earmarked 200 billion forint ($718 million) to set up foundations to teach alternatives to what he called ‘outdated neoliberal’ economics.”

Well, the central bank could be championing worse things. They could be teaching Keynes and stockpiling fiat money. Instead, they’re doing away with neoliberalism and hoarding guns and ammo.

…click on the above link to read the rest of the article…

Ukraine’s Looming “19 Fukushimas” Scenario

Ukraine’s Looming “19 Fukushimas” Scenario

 With all the action in Syria, the Ukraine is no longer a subject for discussion in the West. In Russia, where the Ukraine is still a major problem looming on the horizon, and where some 1.5 million Ukrainian refugees are settling in, with no intentions of going back to what’s left of the Ukraine, it is still actively discussed. But for the US, and for the EU, it is now yet another major foreign policy embarrassment, and the less said about it the better.

In the meantime, the Ukraine is in full-blown collapse – all five glorious stages of it – setting the stage for a Ukrainian Nightmare Before Christmas, or shortly after.

Phase 1. Financially, the Ukrainian government is in sovereign default as of a couple of days ago. The IMF was forced to break its own rules in order to keep it on life support even though it is clearly a deadbeat. In the process, the IMF stiffed Russia, which happens to be one of its major shareholders; what gives?

Phase 2. Industry and commerce are approaching a standstill and the country is rapidly deindustrializing. Formerly, most of the trade was with Russia; this is now over. The Ukraine does not make anything that the EU might want, except maybe prostitutes. Recently, the Ukraine has been selling off its dirt. This is illegal, but, given what’s been happening there, the term “illegal” has become the stuff of comedy.

Phase 3. Politically, the Ukrainian government is a total farce. Much of it has been turned over to fly-by-night foreigners, such as the former Georgian president Saakashvili, who is a wanted criminal in his own country, which has recently stripped him of his citizenship. The parliament is stocked with criminals who bought their seat to gain immunity from prosecution, and who spend their time brawling with each other.

…click on the above link to read the rest of the article…

The European Union Is Disintegrating: Austria Builds New Fence; Germany, Sweden Resume Border Checks

The European Union Is Disintegrating: Austria Builds New Fence; Germany, Sweden Resume Border Checks

It was just two days ago when we reported that Slovenia had begun to construct its own version of Viktor Orban’s now infamous razor wire, anti-migrant fences. As The New York times noted, more than 170,000 refugees from the war-torn Mid-East have crossed into Slovenia from Croatia in the last month alone. To get an idea of just how dramatic that is, relatively speaking, consider that Slovenia is a nation of just two million.

Slovenian prime minister, Miro Cerar, is concerned that with winter right around the corner, his country will not have the resources to house the migrants even if it wanted to, setting up the possibility that a severe humanitarian crisis could unfold. In short, Slovenia was able to cope with the flows from Croatia as long as a roughly equal number of migrants were exiting to Austria, but if anything slowed the migrants’ progress into Austria and Germany (like border controls for instance), then tiny Slovenia would be in a tough spot.

And so, Slovenia built a razor wire fence on its border with Croatia. Croatia dubbed the project “a waste of time.”

Now, as Reuters reports“The European Commission has formally authorized the temporary reimposition of border controls by Sweden and Germany’s extension of frontier checks.” Here’s more:

Sweden, long a haven for people fleeing war and persecution, was the latest EU state to re-establish checks at its borders to stem a tide of migrants coming from Denmark.

Germany reimposed border controls on Sept. 13 and decided to extend them beyond an initial limit of two months foreseen by Schengen rules, using a clause that permits stretching checks to a maximum of six months.

…click on the above link to read the rest of the article…


Refugee Crises At Dangerous Tipping Point As Hungary Makes Arrests, Germany Loses Patience

Refugee Crises At Dangerous Tipping Point As Hungary Makes Arrests, Germany Loses Patience

“I’m not happy. I had to leave Syria — I love Syria, but so much killing there.”

That’s from 17-year old Mohammed Al-Hamdan who made it across the Hungarian border with Serbia at a railroad crossing near the village of Roszke before it was closed on Tuesday. As NBC reports, “just before Hungarian police closed the railroad crossing, a Syrian family ran down the tracks trying to make it through, the patriarch screaming to his wife and small children, ‘Yallah, yallah!’ — Arabic for ‘Let’s go!’” Before closing the “popular” passage, Hungary had reportedly begun hauling migrants on to trains and shipping them straight to the Austrian border. “The situation is that after crossing the border these people have arrived at the collection point in Roszke, where there is no official procedure, people are just being collected. Earlier these people were being taken to the registration points … this is not happening now, but rather, buses are taking people from the collection point to the Roszke train station according to our information,” a UNHCR spokesman told Reuters.

Of course even for the migrants who were “lucky” enough to be rounded up and shipped to Austria as opposed to being stranded behind Hungary’s new migrant-be-gone fence, their fate is far from certain. As The New York Timesnoted on Monday, Austrian officials have now sent “2,200 soldiers to help reinforce the eastern border.”

The rush to get into the Hungary came as the country largely completed a four meter, razor wire fence meant to cut off the flow of refugees and channel them to official registration centers where they can apply for asylum. “If their applications are refused,” BBC says“they will now be returned to Serbia rather than being given passage through Hungary.”

…click on the above link to read the rest of the article…




Superpower Blunders: Czechoslovakia in 1938

Superpower Blunders: Czechoslovakia in 1938

The Czechoslovakia crisis of 1938 marked a pivotal shift in the balance of power in Central Europe, putting the major world superpowers in a collision course. The policies of one superpower in particular made inevitable what was to come less than a year later – World War II.

This episode provides important historical insights on geopolitics, appeasement strategies, buffer zones, ethnic tensions – and unintended consequences.


Czechoslovakia was formed as a sovereign state in October 1918, and eventually became one of the most democratic, prosperous and best administered of all the nations that emerged out of the collapse of the Habsburg Empire after World War I.

In 1930, the country had a population of 15 million, consisting of 6 million Czechs (40% of total), 4 million Slovaks (27%), 3.2 million Germans (21%), and the balance (12%) split between Hungarians, Polish, Ruthenians and foreigners. The large number of minorities arose from the need to give Czechoslovakia defensible and viable frontiers. This was a sensitive issue for the sizeable German speaking population, which had previously attempted to unite with German Austria.

There were four main regions in the country (listed from west to east): Bohemia, Moravia, Slovakia and Ruthenia. The western regions were wealthier. The border districts of Bohemia and Moravia and the domestic portion of Silesia were inhabited primarily by German speakers, a region known as the Sudetenland (a name derived from the Sudetes Mountains, which run along the northern border).

…click on the above link to read the rest of the article…


1000s rally in Hungary, accuse govt of drifting away from EU (PHOTOS, VIDEO)

1000s rally in Hungary, accuse govt of drifting away from EU (PHOTOS, VIDEO)

Thousands of people have flooded on to the streets of Budapest to protest against the government of Prime Minister Viktor Orban. Protesters accused him of drifting away from the EU and strengthening ties with Russia.

The protesters carried banners, saying “Game Over” and “Delete Viktor [Orban]”. According to AFP estimates, the demonstration gathered about 5,000 people in front of the Budapest opera house.

“We condemn the parties of the last 25 years… We cannot expect the state to think for us,” one of the organizers of the demonstration, Zsolt Varady, said in a speech at the rally.

“I think it is important for people to demonstrate,” Varady said. “The politicians have gone far away from reality. They don’t seem to represent the public’s views.”

…click on the above link to read the rest of the article…


Hungarian Premier Orban Scraps Internet Tax Amid Protests – Bloomberg

Hungarian Premier Orban Scraps Internet Tax Amid Protests – Bloomberg.

Hungarian Prime Minister Viktor Orban scrapped plans to introduce the world’s first Internet tax, bowing to pressure after tens of thousands of people protested at rallies across the eastern European Union member.

“Whatever the government’s intention was, this tax simply can’t be introduced,” Orban said in a state radio interview today in his first public comments since the demonstrations. “We want to govern with the people.”

The Internet tax plan sparked two of the biggest rallies against Orban’s administration since he returned to power in 2010. The rallies widened into anti-government protests, with demonstrators criticizing perceived state corruption and centralization of power.

Magyar Telekom Nyrt., the Hungarian unit of Deutsche Telekom AG, jumped 5 percent to 339 forint by 10 a.m. It competes with the local unit of Liberty Global Plc (LBTYA) and Digi Kft. for broadband customers and subsidiaries of Telenor ASA (TEL) andVodafone Group Plc (VOD) in the mobile phone market.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
In progress...

Olduvai II: Exodus
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