With the IMF’s remaining 203 tons of gold clearly set aside for sale to China, hopefully we will not be subjected to more “news” stories depicting that upcoming event as a “surprise”, as well. If there is any real “news” regarding these 403 tons of IMF gold, it’s that it comprises 20% of all the gold which will be sold under the “gold agreement” of Western, central banks over the next five years. The latest of these five-year agreements began as of October 1, 2009.
The IMF gold-sale was desperately patched-into this sales agreement —- despite the fact that the IMF is not a Western, central bank. The reason for this is that the anti-gold cabal has run out of gold which it can persuade these bankers to dump onto the market. During the last year of the previous five-year agreement, which called for a target/quota of 500 tons per year, Western central banks were only willing to sell less than 200 tons.
The new agreement has reduced the new target/quota to 400 tons per year. Yet, even with the inclusion of the IMF sale of gold into this deal (for no real reason of any kind), there is no chance of the manipulators being able to persuade its central banker allies into selling anywhere close to 400 tons per year.
What this really means to the gold market is that this gold-sale (and any/every future, official sale of gold) has absolutely no significance or news-value as a “cloud” or source of “anxiety” for the gold market. Instead, the only significance of such announcements is that it provides an opportunity for the many, national governments who are eager (if not desperate) to add to their gold reserves —- without immediately driving the price of gold higher.
The semi-knowledgeable journalists (and disingenuous serpents, like Nadler) who provide their own “explanations” of such events should simply be ignored. During the years when central banks were large, net sellers of gold, there was some bona fide news value in announcements of official gold sales.
Having entered a new era in the gold market, where central banks are now net-buyers of gold, the significance of such gold-sales dwindles considerably. Instead of being important market-movers, such future sales should be covered in much the same manner as Gordon Brown’s foolish decision to dump half of the United Kingdom’s gold — at only a tiny fraction of its value. In other words, such sales are not “threats” to the gold market, but rather examples of misguided politicians and bureaucrats squandering an invaluable asset.
(The writer is editor of bullionbullscanada.com. This is a condensed version of an article that appeared onwww.bullionbullscanada.com. Republished with permission of the author)
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