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May 5, 2010 – Much has been made over the gold
purportedly owned and controlled by the IMF. There are many unanswered
questions about this gold’s true status, and more to the point, whether
this gold is really nothing more than phantom bookkeeping entries.
Instead of owning gold, the IMF may just own claims
to the portion of the “Gold & Gold Receivables” that was
‘paid’ to the IMF as subscriptions for membership by the
countries that joined the IMF. In other words, through their central
banks, countries have given a claim to the IMF for the gold reserves they
have in their vault, if any, and the gold they have removed from the vault to
loan to bullion banks as a fundamental tool of the gold price suppression scheme so thoroughly and
painstakingly documented by GATA since its founding more than ten years ago.
So does the IMF really own gold? Or does is
only own claims to gold, some or all of which has been removed from central
bank vaults and loaned?
The IMF isn’t saying. It hopes to
continue following the standard practice of all central bankers to hide
behind closed doors to avoid any accountability to the public. In the
words of Chris Powell, GATA’s co-founder: “The protocol is that
the IMF never puts itself in a position that might disclose that it has no
gold at all, might disclose that the IMF has only the most tenuous claim on
the gold reserves of its members and that its supposed gold transactions are
really only bookkeeping entries whose primary purpose is indeed to spook the
gold market.”
So instead of straightforward answers from the IMF
to reveal the truth, we need to rely on bits and pieces of evidence that
become available, which we can then ponder in order to reach a logical
conclusion. In other words, even though the IMF may be loathe to admit it, 1+1 still equals 2.
It was therefore startling to read some important
anecdotal evidence about IMF accounting practices in today’s Wall
Street Journal. In an article entitled “Who's on the Hook for the
IMF's Greek Bailout?” the WSJ made some valuable and revealing comments
about the way IMF accounts for funds supposedly ‘given’ to it by
its members. Here is what the WSJ had to say:
“The IMF is akin to a global
credit union. Members kick in money. The institution's board lends it out.
Each member has a “quota”
- that is, a financial stake in the IMF, expressed
as a percentage - and contributes accordingly. The U.S. quota is 17.09%,
followed by Japan at 6.12%, Germany at 5.98% and France and Britain at 4.94%
each.
Does that mean that the U.S. is
responsible for 17% of the IMF's portion of the Greek package? Not exactly.
First, though all countries are
theoretically responsible for investing in the IMF's lending pool, not all of
them have currencies that potential borrowers can use. (Think of Zimbabwean
dollars or Venezuelan pesos.)
The IMF doesn't say that outright.
Instead, it uses the concept of “usable resources,” meaning it
uses money from countries that are considered financially sound. About 21% of
the quota contributions to the IMF were “non-usable,” according
to the IMF, as of January 2010.
Because the U.S., Japan and big
European countries are in the “usable” camp, they finance a
larger percentage of IMF funding than their quota would suggest. It
isn't possible now to pinpoint those percentages, for several reasons. The IMF draws on funds that are pledged to it but
that continue to be held in national central banks.” [emphasis added]
Now replace the word “funds” in the
above sentence with “gold”.
If countries don’t even transfer to the IMF
the national currencies these countries can create out of thin air with
bookkeeping entries, are they really going to transfer to the IMF the
physical gold they hold in reserve and simply pledged to the IMF?
I think we can therefore safely conclude why the IMF
flatly refused to answer some simple but pointed questions about the state of its gold holdings from reporter Vince Veneziani of Business Insider. The IMF
doesn’t have any gold.
So I say ignore the IMF’s bluster. It is
merely anti-gold propaganda from a paper tiger.
As a consequence, don’t get spooked into
selling your physical metal, and don’t let the IMF bluster stop you
from continuing to accumulate physical metal. As the sovereign debt
crisis continues to spin out of control to reveal the plight of the bankers
who desperately fear the huge losses they will incur on the worthless sovereign
paper they own, we need
gold now more than ever.
James Turk
Free Gold Money
Report
Article originally published by the Free
Gold Money Report.
James Turk is the
founder of the Free Gold Money Report and of GoldMoney.com. He is also the
co-author of The Coming Collapse of the Dollar (www.dollarcollapse.com).. Copyright
© by James Turk. All rights
reserved.
Copyright © 2008. All rights reserved.
Edited by James Turk
This material is prepared for general circulation and may not have
regard to the particular circumstances or needs of any specific person who reads
it. The information contained in this report has been compiled from sources
believed to be reliable, but no representations or warranty, express or
implied, is made as to its accuracy, completeness or correctness. All
opinions and estimates contained in this report reflect the writer's
judgement as of the date of this report, are subject to change without notice
and are provided in good faith but without legal responsibility.
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