EU politician Kaili wants to plead not guilty

Good morning dear readers,

the genre of the classical Greek saga is generally considered to have been closed for over 2000 years. But yesterday evening, a lawyer for the EU politician Eva Kaili, who is suspected of corruption, added an important oeuvre.

Michalis Dimitrakopoulos told the Greek TV channel Skai: The large amount of cash in Kaili’s Brussels apartment belonged neither to her nor to her partner, but to a third party. “Ms. Kaili asked her partner what the money was,” said lawyer Dimitrakopoulos. He replied that the money belonged to someone else. “Following this, Ms. Kaili said she did not allow funds belonging to anyone else to be kept in the shared apartment.”

For this reason, Kaili’s father took the bag with money and made his way to a hotel, where the unnamed recipient should have turned up. It is only logical that Kaili, according to her lawyer, wants to plead not guilty.

We should not lightly dismiss this story as implausible. With Odysseus, Greece has at least produced a seafarer who tried to explain his years of delay by fighting one-eyed giants and beguilingly singing sirens. And for all we know, he got away with it.

The decision was as expected, but the reaction to it was not: The US Federal Reserve hiked interest rates by 0.5 percentage points yesterday, slower than in previous months. But there was no joy in stock markets, with the tech-heavy Nasdaq index slipping 0.8 percent and the broader S&P 500 slipping 0.6 percent.

The economic forecast that the Fed also published yesterday is to blame: Overall, the central bankers are now assuming that the key interest rate will be up to 5.1 percent higher in the coming year than previously assumed, even if the rate hikes are now smaller. The forecasts are “disappointing for the markets,” said David Kelley, chief strategist at wealth manager JP Morgan Chase Asset Management.

We learn: The markets can obviously deal with disappointments just as badly as an overpaid young striker who surprisingly has to press the reserve bench.

Today, the European Central Bank (ECB) will follow suit and, according to most experts, will also switch to a somewhat less aggressive rate hike course. According to the forecasts, the euro central bankers will raise key rates by 0.5 percentage points. Very few economists expect another jumbo step of 0.75 percentage points, because inflation in the euro area had recently decreased slightly. It fell to 10 percent in November from 10.6 percent in October.

Are you still looking for a plot for the next James Bond film? How about this: Suddenly 300 tons of gold disappeared from the world market and no one knows where. The first indications point to Beijing, but the suspicion turns out to be wrong. Instead, the trail leads to a bellicose ruler in the east who wants to decouple himself from the western monetary system with gold.

Then come the chase, love night, showdown, love night again, done. And the best thing about the story: until the chase, it apparently has a true background.

Central banks bought almost 400 tons of gold in the third quarter, the last amount since 1967. Around 300 tons, or three quarters of these purchases, went to central banks that do not provide information about their gold reserves, or only do so on an irregular basis. This initially sparked speculation that China could be an anonymous buyer. But the Chinese central bank has now published data on its gold reserves – no large purchases.

Who else buys hundreds of tons of gold from the market? Many indications point to the Russian central bank, which in this way could protect the income from Russian oil exports from international sanctions – according to estimates, this amounted to 16.8 billion dollars in September alone. Henrik Marx, Head of Precious Metals Trading at Heraeus Precious Metals, also thinks it is “obvious that Russia is among the unknown buyers”. However, he can also imagine “50 other central banks” who could also be behind the anonymous purchases – because they may have an interest in using gold for diversification and “getting off the dollar”.

The central banks are apparently not driving up the price of gold with their massive gold purchases. Although central banks accounted for 33 percent of total gold demand in the third quarter of 2022, the gold price fell by around eight percent between the beginning of July and the end of September.

And then there is a court case over a case of embezzlement in the logistics department of Axel Springer Verlag, which brings to light amusing details from the inner workings of the group.

What I particularly liked as a passionate newspaper reader: In 2005, Springer boss Mathias Döpfner had the daily newspapers of his company (“Bild”, “Welt”, “Berliner Morgenpost” and others) delivered to him on vacation at a chateau in western France by corporate logistics. The Handelsblatt was able to understand the process based on internal documents. The transport via driver from Paris therefore cost 450 euros per day. The sheets should not be put down, but handed over (“please do not ring before 9 a.m.!!!!!”).

Which brings us to a decisive advantage of the Handelsblatt Morning Briefing: It doesn’t matter which chateau you’re spending the night at, you’ll already have our newsletter in your electronic mailbox at around 5 a.m. and you won’t be woken up by my ringing.

I wish you a day living like God in western France.

Best regards

Her

Christian Rickens

Editor-in-Chief Handelsblatt