By Jon Nones
Julian D. W. Phillips, editor of GoldForecaster.com, has written another article about those much-discussed IMF gold sales entitled “Central Bank Sales over the Next 19 Months to Reduce by 400 Tonnes?” He begins the article by listing the steps necessary to get the sales of 400 tonnes accomplished.

The IMF must trim their staff, by 15%. This is not a quick action?
The U.S. must get the approval of Congress.
They must find another 68% of their members in favour to obtain 85%.
They must organize their sales as below.

But he notes that perhaps the most important statement coming from the IMF at the end of January meeting, was, “Secondly, the sale should take place within the existing Central Bank Gold Agreement, that is to say it would not be additional to sales already programmed by central banks, but would be accommodated by reductions in the amounts of gold that the central banks might sell under the Central Bank GoldAgreement.”

Right now, European Central banks have reported sales of just 124 tonnes in the fourth agreement year.

Official gold sales, reported and unreported, through mid-February may be closer to 135 tonnes. With just over seven months to go in the agreement year, this puts sales under 300 tonnes - well below the 500 tonne mark.

So even if the IMF gold sales are approved, the IMF gold would be offset by the shortfall in European gold sales. Interesting theory indeed.

By Arrangement with www.resourceinvestor.com

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