NEW YORK (Commodity Online): There would be a run, by European countries, on the gold they have stored at the New York Fed, said Jim Sinclair in an interview with KWN.
When asked him if the IMF would be selling any gold:
“No. The role of gold has changed and gold is moving more toward the central bank then away from it. On top of that you have seen a significant amount of media attention towards, ‘Where is our gold?’ This is taking place in the European press.”
Jim Sinclair continued that, “(There is) surprise when they find out it’s in a cellar of the New York Fed, in Manhattan Island. There’s a desire for gold to have more of a national scent to it as it becomes the only performing asset for the central banks.” When asked about Europeans wanting their gold brought back to their respective countries, Sinclair responded,“You’re starting to see that, and you have also seen, from the figures, the central banks accumulating.
The Fed would have no legal basis, whatsoever, to refuse to deliver to Europe. Any refusal or even delay in delivering it would only cause requests for more. So I would say there would be a lot of back-channel arm-twisting not to ask for it. A run begins slow and historically, if this is a trend. Rather than decelerating it tends to accelerate.
I would say that when we go to QE3, in the US in 2012, that could accelerate the call for delivery on gold from the New York Fed. It’s exactly what will happen. You see it already in the European press.
Source: KWN
