India's IMF Gold Purchase Is One More Reminder of a Pending Comex Collapse
Gold has just broken another record and I'm pretty sure it broke my iGoogle too because my chart went bouncing off of the screen this morning - that might be a sign that something is terribly wrong or perhaps it means that something is terribly right, depending on how much of the stuff you've got by now.
U.S. gold futures scaled an all-time high $1,081.70 an ounce on Tuesday, surpassing the previous record set Oct. 14, boosted by technical buying and news of a gold sale by the International Monetary Fund (IMF) to India.
Yes, let's talk about that sale to India, shall we?
India, the world’s biggest gold consumer, bought 200 metric tons from the International Monetary Fund for $6.7 billion as central banks show increased interest in diversifying their holdings to protect against a slumping dollar.
The transaction, equivalent to 8 percent of world annual mine production, was the IMF’s first such sale in nine years and propels India to the ninth-biggest government owner globally, according to figures from London-based research company GFMS Ltd. The country previously held 358 tons, the data show. The news was a “surprise because everybody was talking about China being the buyer,” said James Moore, an analyst at TheBullionDesk.com.
“The fall in the U.S. dollar seems to be pushing all the central banks to strengthen their portfolio with gold,” said N.R. Bhanumurthy, professor at the National Institute of Public Finance and Policy in New Delhi. “Gold is a safe store of value compared to the U.S. dollar.”
Gold for immediate delivery rose 0.2 percent to $1,061.48 an ounce at 1:20 p.m. in London and was less than 1 percent below its record $1,070.80 an ounce reached Oct. 14. India purchased the gold at an average price of about $1,045 an ounce, according to an IMF official on a conference call.
The IMF sale accounts for almost half the 403.3 tons that the Washington-based lender in September agreed to sell as part of a plan to shore up its finances and lend at reduced rates to low-income countries. Asian nations, which have amassed stockpiles of foreign currency reserves since the 1998 financial crisis, have shown increased interest in diversifying out of U.S. assets as the dollar loses value against other currencies.
“The most important thing is that people want gold even at these prices,” said Ghee Peh, head of mining research, with UBS AG in Hong Kong. “There’s good support for prices for now” from the IMF’s disposal of bullion, he said.
The transaction involved daily sales from Oct. 19 to Oct. 30 at market prices and is in the process of being settled, the IMF said in a statement yesterday.
The purchase didn’t signify any loss of confidence in the dollar, nor did it show that the metal’s appeal was increasing, India’s Finance Minister Pranab Mukherjee said.
Sure, Pranab, and I'm sure the IMF also promised a pony and a million dollars to India at the completion of the transaction. This "strong dollar policy" of ours is really working out great for the rest of the world, isn't it?
Midas Letter on said "strong dollar" policy, which as most of us already know is little more than lip-flapping on the part of the same dollar demolition artists who have put us in this precarious position in the first place:
Any of these quotes ring a bell?
January 2009: In his confirmation hearing with the Senate Finance Committee, Treasury Secretary Nominee Tim Geithner said that a "strong dollar is in America's National Interest."
January 2009: "A strong dollar is clearly in our nation's interest," U.S. Treasury Secretary Henry Paulson repeated last Thursday at a White House briefing on the economic stimulus package.
October 2007: U.S. Treasury Secretary Henry Paulson said on Friday that he believes a strong dollar is in our nation's interest".
January 2005: US Treasury Secretary John Snow said on Friday that the US government remains committed to the so- called "strong dollar" policy.
December 2004: President Bush said Wednesday "The policy of my government is a strong dollar policy."
February 2001: Treasury Secretary Paul H. O'Neill insisted today that the Bush administration is committed to maintaining a strong dollar policy.
September 1999 (for historical context): In his speech yesterday and in a separate interview, Treasury Secretary Summers repeated word for word former Treasury Secretary Rubin's mantra that a strong dollar is in the interests of the United States.
Notwithstanding, the U.S. dollar index has fallen by roughly 35% during this period due to the seven aforementioned factors, not to mention government monetary and fiscal policies that easily challenge the most inflationary of recorded history (which are becoming more maniacal with each passing day).
As GATA, or the Gold Anti-Trust Action Committee, has detailed for a decade now, the "Strong Dollar Policy" is nothing more than a ruse aimed at maintaining confidence in an "emperor with no clothes", in other words the dollar. The linchpin of this "policy", of course, is to artificially suppress the price of gold, principally with paper positions in the futures and OTC derivatives markets, based on Larry Summers' interpretation of "Gibson's Paradox" a 1930s Keynesian doctrine essentially stating that inflation expectations move inversely to the gold price.
And wait, did India check the gold to make sure it's actually gold and not chocolate coins?
Anyhow, the IMF theoretically holds 3,217 tonnes of gold (103.4 million ounces), 88% of which (2,814 tonnes) was supposedly acquired more than 30 years ago, upon the IMF's creation, by pledges from its initial members. The remaining 12%, or 403 tonnes (13.0 million ounces), was supposedly acquired in "off-market gold transactions" in 1999-2000 to repay credit extended by the IMF.
It should be no surprise that the IMF is also charged with creating the 'official rules' of Central Bank gold reserve accounting, creating an outlet for the upper echelon of U.S. bankers and politicians to stack the deck, and ultimately foster the aforementioned "strong dollar policy" ruse.
The exact details of the IMF's gold accounting policies, for both its own (supposed) reserves and those of member countries, have not surprisingly been murky. However, it is crystal clear that such rules have allowed Central Bank reserves to be double-counted, creating an illusion of supply not much different than NASDAQ stock trading volume, which counts two transactions for each share traded, one for the buyer and one for the seller. Not to mention, despite numerous admissions of Central Bank gold sales over the years, most of the major gold holders (notably, the U.S.), never report declines in their gold holdings.
I see the IMF uses the Federal Reserve "WTF" accounting manual in practice, that's awfully reassuring. Speaking of which, have we decided when we are going to storm the Fed and demand an audit of the gold they are nice enough to supposedly squat on on our behalf?
Now why would the IMF sell its only 403 tonnes of gold available for sale? I can only speak for myself but I can't believe they actually went through with it - threats are part of their manifesto and when they first made the announcement in April it felt as though we were merely being strung along yet again. But the fuckers actually did it.
Forgive me for being horribly conspiratorial here but I think I know exactly what is going on. Fuck, it couldn't be much more transparent, these are kindergarten manipulators we're dealing with here.
We have seen this before and December futures are frightening - read, absolutely fucking frightening - making March look like a day in the park.
Did the ECB Save COMEX from Gold Default?
On Tuesday, March 31st, Deutsche Bank (DB) amazed everyone even more, by delivering a massive 850,000 ounces, or 8500 contracts worth of the yellow metal. By the close of business, even after this massive delivery, about 15,050 April contracts, or 1.5 million ounces, still remained to be delivered. Most of these, of course, are unlikely to be the obligations of Deutsche Bank. But, the fact that this particular bank turned out to be one of the biggest short sellers of gold, is a surprise. Most people presumed that the big COMEX gold short sellers are HSBC (HBC) and/or JP Morgan Chase (JPM). That may be true. However, it is abundantly clear that they are not the only game in town.
Closely connected institutions, it seems, do not have to worry about acting irresponsibly, in taking on more obligations than they can fulfill. Mysteriously, on the very same day that gold was due to be delivered to COMEX long buyers, at almost the very same moment that Deutsche Bank was giving notice of its deliveries, the ECB happened to have “sold” 35.5 tons, or a total of 1,141,351 ounces of gold, on March 31, 2009. Convenient, isn’t it? Deutsche Bank had to deliver 850,000 ounces of physical gold on that day, and miraculously, the gold appeared out of nowhere.
The announcement of the ECB sale was made, as usual, dryly, without further comment. There was little more than a notation of a sale, as if it were a meaningless blip in the daily activity of the central bank. But, it was anything but meaningless. It may have saved a major clearing member of the COMEX futures exchange from defaulting on a huge derivatives position. We don’t know who the buyer(s) was, but we don’t leave our common sense at home. The ECB simply states that 35.5 tons were sold, and doesn’t name any names. Common sense, logic and reason tells us that the buyer was Deutsche Bank, and that the European Central Bank probably saved the bank and COMEX from a huge problem. What about the balance, above 850,000 ounces? What will happen to that? I am willing to bet that Deutsche Bank will use it, in June, to close out remaining short positions, or that it will be sold into the market, at an opportune time, if it hasn’t already been sold on Tuesday, to try to control the inevitable rise of the price of gold.
Expect a stampede. And do give me credit when it happens so I can be like that douche Roubini taking Facebook shots with butterface bitches at snooty NY scene parties.
"Evil twins" LMFAO
It's actually not big news that the Evil Twins have been buying gold at the Comex. "Officially" Goldman Sachs became a "bull" again a few weeks ago (lol). What is big news is that they are taking delivery (i.e. converting their Comex "paper" to REAL gold, and TAKING IT with them).
There are only TWO possibilities here. Either the Evil Twins are now telling their clients to buy REAL gold, and not the phony paper of bullion-ETF's or they are accumulating real gold themselves.
Strap in, stupid, Tim Geithner can't save you now!! Woooo!!
Silly kids, didn't you know paper was just paper? I guess you're going to find out, aren't you?
So, in summation: India isn't too dumb after all (especially if they paid the IMF in dollars - they said "hard currency" and not SDRs were involved but I couldn't get specifics on that, anyone know?), COMEX is about to go bust, central banks are up to major shenanigans, manipulation is rampant, oh and the shit is certainly about to hit the fan.
The massive cover-up at work for decades is about to be exposed and you can bet your sweet ass that central banks around the world are worried about covering their own before they stop to think about yours.