JUst when gold got back on its feet the evil IMF stepped in

Okay maybe not evil but darn they spoiled the run.

http://www.google.com/hostednews/afp/article/ALeqM5hd-kESCr6kVFWIdGXsouA5p0UBYA

Theyre dumping 191 tonnes of gold on the market.
That defintely killed our latest run.

To the guys at the IMF
:headbang:

 

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I remember last year they sold the 400 tonnes to India. The article says they also sold 212 tonnes to India, Mauritius, and Sri Lanka to date. Now they are selling 192 more tonnes.....wouldn't that put them at the limit for this year already. Consider we have 10 months to go, and the cap has already been met. That could be good news.

Plus, I didn't read about a purchaser in the article.

 

I think this is already in the price. Besides, the IMF doesn't dump gold into the market for the US Mint or jewelers or investors to purchase. It just becomes an exchange between the IMF and a central bank of gold for reserves. But nothing really changes. The impact is psychological and has no real impact on supply and demand for gold.

 

Sounds alot like what the Japanese did a few years ago dumping millions
Of tons of copper on the market cutting the price down by 20%

 

Not exactly. The copper went into the copper market. The gold is an exchange between non-market entities.

 

200 tonnes to india

However the US gov't did swap 100 billion of paper currency for gold at $850 an ounce
So fiigure out the tonnes to that as well.
Its good news for the US though more hard assets in reserves.
However it did affect the market price, especially in the publics opinion since the IMF thought targeted price of gold was $850 per ounce. leading to fears that gold's spot was overpriced.

 

From Jon Nadler's commentary.

“The IMF news is disturbing for two reasons”, said Matthias Detremmerie, the founder of Belgium’s Goldessential.com. “First of all, as no one seems eager to buy more of the IMF gold. After the 200 tonnes purchase by the Indian Reserve Bank in 2009, everyone touted China as a big potential candidate to soak up the rest. It seemed almost as a sure thing that the gold would be sold back-to-back. The ‘revelation’ that no central banks are interested seems to question the investment case for gold. This was one of the main reasons why gold was boosted to over $1,100 an ounce in the first place”.

Mr. Detremmerie added that: “Secondly, the sale implies more supply on the open market. Although the IMF has reiterated sales would be phased, and framed in the CBGA – which limits official sales to 400 metric tons per year -, to limit market disruptions, it will certainly push the CBGA sales this year – currently estimated at less than two metric tons since September - higher”.
........
The Wall Street Journal’s Andrea Hotter sums up the surprise (which we warned might develop) and says that:

“Sales of gold by the International Monetary Fund have hit a serious stumbling block: There are no more official takers. It had all started so well. Having announced to great fanfare in September that the IMF’s Executive Board had approved gold sales totaling 403.3 metric tons — over 12 million troy ounces — there initially seemed to be no shortage of interest from the world’s central banks.

The Reserve Bank of India bought 200 tons in October, followed in November by the Bank of Mauritius with two tons and the Central Bank of Sri Lanka with 10 tons. But there have been no further IMF gold sales since then. Gold prices are at near historical highs above $1,100/oz, around $50/oz higher than when India bought gold and at similar, to slightly lower levels than when Mauritius and Sri Lanka bought.

And with 191.3 tons of gold left to sell, the IMF has been forced to eat humble pie. Late on Wednesday the IMF said: “Prior to any sales on the gold market, sales were first made exclusively to interested central banks, thus shifting gold within the official sector. Now the IMF will begin sales of the remaining gold on the market.”

 

"Gold down" sounds better when I have cash to buy some. For those buying right now, congratulations. If you are selling, then sorry...., but not because the price is not good.

 

I just wanted to give this thread a bump due to the rumors that China may purchase the IMF gold after all. Nobody knows yet if it is true. However, it may serve to show that folks like Nadler, Detremmerie, Hotter, and other "analysts" who follow this stuff for a living are either incompetent or intentionally deceptive when it comes to reporting on gold. Nadler in particular seems to frequently report news that is negative for the gold price. This is unusual for a person in his position, and suspicious because he is so frequently wrong.

We'll kee this thread going and see how the above forecasts turn out.

 

Never listen to jon nadler. He is just like yankee. Very very desperate. Everyday waiting gold to come down. So they can buy.

 

Bump.

 

Bump

 

I thought you'd have something more to add, then just bump. Is the gold still on the market? Did anyone offer to buy it? Is the gold going to be sold on the open market? Info, please.

 

This kind of activity in the market just shows how little control we have over predicting PM values on what is happening in the real world. All this time we spend on speculation, and we still have no idea what will happen next week, next month, or next year. Good thing for beer!!!

 

The gold is still on the market. No announcement of a buyer has been made, but it is safe to say there have no doubt been inquiries. It will be sold, but it is highly unlikely that it will be an open market transactions. It will probably go to a central bank or sovereign wealth fund.

Analysts get away with making absurd statements because by the time they are proven wrong, people forget they said it. Things rarely happen as fast as the news cycle. This is more like selling real estate than selling a stock. I'll keep this thread going for awhile and we'll see what develops.

 

My guess is that nobody wants to buy it for the current price of $1132 an ounce. India bought the last haul for, IIRC, $1040 an ounce, and they weren't too happy to have paid that price. Earlier in 2009, the price of gold was bouncing between $930 and $980, and the sale of gold in India was way down, because people there thought it was too expensive. Then they bought the IMF sale for about $100 an ounce more. I think most central banks and sovereign funds are waiting for the price to drop.......but all these past few weeks, it just keeps going up.

What do you think about the forecasts that gold will go up in price until 2012, and then in 2013 will drop to $700 an ounce? Do you think there is truth in this....or just wishful thinking by banks?

Since I believe inflation takes 5-7 years to have an effect on prices, I think if the price drops to $700 an ounce, that would be an optimal time to buy. As the money supply really ramped up in 2009, which would make the price increase sometime around 2015-2017. So, price drop in 2013 would be good, at least for me.

 

The purpose of keeping this thread going is to test the widespread "analysis" that was spread that central banks don't want the IMF gold because the price is too high. The conclusion was reached that because nobody stepped up and purchased it in the first 48 hours after the announced sale, there were no buyers. Let's give it some time and see what happens.

I didn't hear anything about a forecast of $700 gold in 2013. Where did it come from? I know of no analytical technique in finance or technical analysis that would enable someone to forecast a price move and reversal in that manner. What I would encourage people to do is to stop listening to these people. Just because they seem to have credentials, and can write and speak well doesn't mean they can predict the future.

Also, it doesn't take 7 years for inflation to effect prices. The timing is more like 9 to 18 months. What can't be predicted is where the price increase will hit the economy. If it hits food prices, everyone is unhappy. If it hits stock, bond or real estate prices, everyone is happy. But you can be assured that the money will go someplace and it won't take 7 years.

Although I can't offer any analysis to "prove" it, I don't think it is likely that anybody alive today will see $700 gold again in their life. You might as well wait for the return of 29 cents per gallon gas prices and $40 per ounce gold price that existed when I was in high school. People expect gold prices to be cyclical, but the present move seems to be part of the long term secular trend upward.

 

I really dont expect to make money on gold... possibly on silver, but not really on gold. Just a hedge. In 15 years or so, it'll be a piece of the retirement nest egg.

 

I don't believe in the 2 year time for price increases anymore. The factor that is making it take longer and longer is the larger and larger discrepancy of the distribution of the wealth. If rich people get a lot more money, they make up a smaller percentage of people to distribute that wealth. If the money that was created was given to everyone in the U.S. equally, it would have resulted in a much quicker rate of inflation than if a few people sit on it. But, what good is money unless it is to be spent. Unemployment is still very high, and yet prices haven't come down much. What happens when the economy improves and that money which is being hoarded start to circulate into more and more people's hands. And more and more people start to be able to afford more things. Prices are sure to go up. But, how long will it take for the unemployment rate to go down. According to your 9 to 18 month idea, people should already be getting new jobs, and the unemployment rate should be going down. It has been 18 months since Oct, 2008. If unemployment continues this way for 2 more years, inflation still wouldn't have taken affect. It's the recovery that will fuel the price increases, as more money chases after fewer goods. I think it is more in line with 5-7 years now. This isn't the 1970's anymore.

As for the price of gold going to $700 an ounce in 2013, that came from ABARE.

 

I made no comment about jobs or unemployment. You are trying to put words in my mouth, or else didn't read my post carefully. The government is borrowing $1+ trillion per year now, and interest rates are ultra low. There's your inflation, as explained above. It's mostly in the bond market right now. You just can't see it because it isn't where you are looking, but that doesn't mean it doesn't exist. Where it will move next is not known. You are correct that this isn't the 70s anymore, so stop expecting inflation to manifest itself in a 1970s manner.