<p>On the subject of the IMF's pending gold sale: If you don't mind reading something written by Jim Sinclair, a notorious gold bug, below is taken from his site <a href="http://www.jsmineset.com">www.jsmineset.com</a> . One could easily disagree with some of his views, but he dose provide some good information.</p>
<p><em>The following is the history of the IMF and their gold shares.</em></p>
<p><em>It is important to note that their sales all have taken place at times when major bull markets were either just beginning or, as in 1976-1980, at the start of the major parabolic move to then all time highs.</em></p>
<p><em>Now you know why I said our friends from 2002 Chung Phat and Dr, No are high-fiving at the news that the biggest dopes in gold are about to prove their status beyond any doubt once again.</em></p>
<p><strong><em>How and when the IMF used gold:</em></strong></p>
<p><em>Outflows of gold from the IMF's holdings occurred under the original Articles of Agreement through sales of gold for currency, and via payments of remuneration and interest. Since the Second Amendment of the Articles of Agreement, outflows of gold can only occur through outright sales. Key gold transactions included:</em></p>
<em>Sales for replenishment (1957–70). The IMF sold gold on several occasions during this period to replenish its holdings of currencies. </em>
<em>South African gold (1970–71). The IMF sold gold to members in amounts roughly corresponding to those purchased in these years from South Africa. </em>
<em>Investment in U.S. government securities (1956–72). In order to generate income to offset operational deficits, some IMF gold was sold to the United States and the proceeds invested in U.S. government securities. Subsequently, a significant buildup of IMF reserves prompted the IMF to reacquire this gold from the U.S. government. </em>
<em>Auctions and " restitution" sales (1976–80). The IMF sold approximately one third (50 million ounces) of its then-existing gold holdings following an agreement by its members to reduce the role of gold in the international monetary system. Half of this amount was sold in restitution to members at the then-official price of SDR 35 per ounce; the other half was auctioned to the market to finance the Trust Fund, which supported concessional lending by the IMF to low-income countries. </em>
<em>Off-market transactions in gold (1999–2000). In December 1999, the Executive Board authorized off-market transactions in gold of up to 14 million ounces to help finance IMF participation in the Heavily Indebted Poor Countries (HIPC) Initiative. Between December 1999 and April 2000, separate but closely linked transactions involving a total of 12.9 million ounces of gold were carried out between the IMF and two members (Brazil and Mexico) that had financial obligations falling due to the IMF. In the first step, the IMF sold gold to the member at the prevailing market price and the profits were placed in a special account invested for the benefit of the HIPC Initiative. In the second step, the IMF immediately accepted back, at the same market price, the same amount of gold from the member in settlement of that member's financial obligations. The net effect of these transactions was to leave the balance of the IMF's holdings of physical gold unchanged.</em>
>
<p><a target="_blank" href="http://www.imf.org/external/index.htm"><em>More…</em></a><em> </em></p>
<p><em> </em></p>
<p><em>Should they sell in April of 2008 then gold is going to the next Angel above $1650. </em></p>
<p><em>That is the only implication IMF sales have to the price of gold. It has been the most powerfully bullish event every time they have done it, and will be again.</em></p>
<p><em>If any newcomer to gold sees the IMF news as a reason to sell gold these newcomers are as DOPEY as the IMF has proved to be every time, time and time again.</em></p>
<p><em>Respectfully,
Jim</em></p>
