Posted on 09/29/2009 2:28:37 PM PDT by h20skier66
As an almost revered subject, the question of whether central banks across the world will be buyers or sellers of gold is one usually left until after the event. Central Banks themselves are usually very unhappy to talk about their gold policy. When they do it is a once-in-several-years-event. As a result we watch the behavior patterns of the last decade to see what lies ahead.
We have been waiting so long for clarity on the policy the I.M.F. are to adopt with the sale of their 403.63 tonnes of gold. The IMF Executive Board has now approved the sale of 403.3 metric tons. The head of the I.M.F., Strauss-Kahn said, "These sales will be conducted in a responsible and transparent manner that avoids disruption of the gold market. Most importantly, the sales are strictly limited to 403.3 metric tonnes, which is one-eighth of the fund's total holdings, so the IMF will continue to hold a relatively large amount of its assets in gold."
Prior to selling the gold on the market, the I.M.F. is prepared to sell the gold directly to central banks or other official sector holders. These sales to official sector holders will be conducted at market prices and would shift official gold holdings without changing total official gold holdings.
Let's be clear on this, if the I.M.F. are to offer this gold to other central banks before offering the gold to the ‘open market' they are likely to receive bids that would certainly confirm that central banks [whether few or many is irrelevant] value gold in their reserves and are prepared to buy it in even at these prices! If all the 403 tonnes is sold this way, then that confirmation will elevate gold as a reserve asset and a measure of value.
(Excerpt) Read more at commoditynewscenter.com ...
OK, some questions -
How/where did the IMF get this gold?
Why are they only selling it to central banks?
How can this influx of gold NOT lower gold prices?
Why are they doing this now?
One word: Silver.
How did the IMF get this gold?- Lent by the central banks
Why sell only to cental banks?- No shipping costs, already there, supposedly.
How can this not lower gold prices?-Thats the objective.
Why do this now?-It can ONLY get more expensive.
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