IMF Rumored To Sell Gold Reserves

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fxfarms
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IMF Rumored To Sell Gold Reserves

It is rumored that the IMF (International Monetary Fund) is debating whether or not to sell a portion of their gold reserves. Currently, the IMF is the world's third largest holder of gold. (Their reserves are estimated at 103 million ounces, which has a current worth of nearly $94 billion.)

It is assumed that the IMF's partial gold "liquidation" is to sure up cash in order to cancel debts owed by emerging economies. The IMF spends more than $1 billion per year on loans to these economies, but only sees a return of about 60% on those loans. That bites.

This potential plan of action was brought before the G7, and the plan eluded to the fact that the IMF would sell just 13 million ounces of their gold reserves. According to my horrible math, that would generate roughly $18 billion in revenue with current gold pricing.

Apparently, lending to the developing world is not such a smart thing to do, according to the IMF's returns from that lending. However, it doesn't make sense to me why the IMF would sell their gold reserves only to flood the market with more gold thus decreasing not only the price of gold but the value of their own gold reserves.

If the IMF did, indeed, sell a portion of their gold reserves, I do not foresee the price of gold drastically changing with the declining production of the South African gold mines. But the price of gold would fall a bit giving speculators (and investors alike) one more opportunity to purchase gold for a discounted price.

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Farmer Brown
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Re: IMF Rumored To Sell Gold Reserves

According to various sources, the largest gold reserves are held by the US, then Germany, then the IMF, so if your source starts off by saying that the IMF has the largest reserves, I wouldn't lend much credence to anything else being said.

 

source 1: http://www.galmarley.com/framesets/fs_commodity_essentials_faqs.htm

 

Nations & institutions Reserves (Tonnes)
USA 8139
Germany 3469
IMF 3217
France 3025
Switzerland 2590
Italy 2452

 

 source 2: http://en.wikipedia.org/wiki/Official_gold_reserves


World official gold holding (September 2008)[6]
Rank Country/Organization Gold
(tonnes)
Gold's share
of total
forex reserves (%)[6]
1 Flag of the United States United States 8,133.5 77.3%
2 Flag of Germany Germany 3,413.1 66.4%
3 International Monetary Fund 3,217.3 -
4 Flag of France France 2,540.9 57.8%
5 Flag of Italy Italy 2,451.8 67.0%
6 Flag of Switzerland Switzerland 1,064.1 38.1%
- SPDR Gold Trust (a Gold exchange-traded fund) 1,024[7] -
7 Flag of Japan Japan 765.2 2.1%
8 Flag of the Netherlands Netherlands 621.4 59.9%
9 Flag of the People's Republic of China People's Republic of China 600.0 0.9%
10 European Central Bank 533.6 23.0%
11 Flag of Russia Russia 472.6 2.1%
12 Flag of the Republic of China Republic of China (Taiwan) 422.4 3.8%
13 Flag of Portugal Portugal 382.5 85.5%
14 Flag of India India 357.7 3.1%
15 Flag of Venezuela Venezuela 356.8 29.3%
16 Flag of the United Kingdom United Kingdom 310.3 15.4%
17 Flag of Lebanon Lebanon 286.8 33.5%
18 Flag of Spain Spain 281.6 39.0%
19 Flag of Austria Austria 280.0 40.4%
20 Flag of Belgium Belgium 227.6 37.3%
21 Flag of Algeria Algeria 173.6 3.4%
22 Flag of Libya Libya 143.8 4.2%
23 Flag of Sweden Sweden 143.2 11.7%
24 Flag of Saudi Arabia Saudi Arabia 143.0 10.0%
25 Flag of the Philippines Philippines 133.1 9.9%
26 Flag of Singapore Singapore 127.4 1.9%
27 Bank for International Settlements 125.0 -
28 Flag of South Africa South Africa 124.3 9.6%
29 Flag of Turkey Turkey 116.0 3.9%
30 Flag of Greece Greece 104.6 87.6%
31 Flag of Romania Romania 103.7 6.6%
32 Flag of Poland Poland 102.9 3.3%
33 Flag of Thailand Thailand 84.0 2.2%
34 Flag of Australia Australia 79.8 6.1%
35 Flag of Kuwait Kuwait 79.0 13.4%
36 Flag of Egypt Egypt 75.6 5.8%
37 Flag of Indonesia Indonesia 73.1 3.3%
38 Flag of Kazakhstan Kazakhstan 73.0 9.4%
- IAU Gold Trust (a Gold exchange-traded fund) 68.1 [8] -
39 Flag of Denmark Denmark 66.5 5.1%
40 Flag of Pakistan Pakistan 65.3 16.0%
41 Flag of Argentina Argentina 54.7 3.1%
42 Flag of Finland Finland 49.1 15.7%
43 Flag of Bulgaria Bulgaria 39.6 5.1%
44 West African Economic and Monetary Union 36.5 9.0%
45 Flag of Malaysia Malaysia 36.4 0.8%
46 Flag of Slovakia Slovakia 35.1 4.8%
47 Flag of Peru Peru 34.7 2.6%
48 Flag of Brazil Brazil 33.6 0.4%
- Central Fund of Canada (Closed End Mutual Fund - (AMEX:CEF)) 30.2[9] -
49 Flag of Bolivia Bolivia 28.3 10.3%
50 Flag of Ecuador Ecuador 26.3 11.6%
51 Flag of Ukraine Ukraine 26.2 2.0%
52 Flag of Syria Syria 25.9 -
53 Flag of Morocco Morocco 22.0 2.2%
54 Flag of Nigeria Nigeria 21.4 0.9%
55 Flag of Belarus Belarus 20.3 11.6%
- BullionVault 15.0[10] -
56 Flag of Jordan Jordan 14.8 5.2%
57 Flag of South Korea South Korea 14.3 0.1%
58 Flag of Cyprus Cyprus 13.9 29.7%
59 Flag of the Czech Republic Czech Republic 13.2 0.9%
60 Flag of the Netherlands Antilles Netherlands Antilles 13.1 31.4%
61 Flag of Cambodia Cambodia 12.4 12.9%
62 Flag of Qatar Qatar 12.4 2.6%
63 Flag of Serbia Serbia 12.2 2.3%
64 Flag of Laos Laos 8.1 23.1%
65 Flag of Latvia Latvia 7.7 3.3%
66 Flag of El Salvador El Salvador 7.3 8.2%
67 Economic and Monetary Community of Central Africa 7.1 -
68 Flag of Guatemala Guatemala 6.9 3.9%
69 Flag of Colombia Colombia 6.9 0.8%
70 Flag of the Republic of Macedonia Macedonia 6.8 7.6%
71 Flag of Tunisia Tunisia 6.8 2.1%
72 Flag of Lithuania Lithuania 5.8 2.3%
73 Flag of Ireland Ireland 5.5 16.3%
74 Flag of Sri Lanka Sri Lanka 5.3 3.8%
75 Flag of Mongolia Mongolia 5.2 10.9%
76 Flag of Bahrain Bahrain 4.7 -
77 Flag of Bangladesh Bangladesh 3.5 1.6%
78 Flag of Mexico Mexico 3.4 0.1%
79 Flag of Canada Canada 3.4 0.2%
80 Flag of Slovenia Slovenia 3.2 7.2%
81 Flag of Aruba Aruba 3.1 17.1%
82 Flag of Hungary Hungary 3.1 0.3%
83 Flag of Mozambique Mozambique 3.0 4.6%
84 Flag of Kyrgyzstan Kyrgyzstan 2.6 5.3%
85 Flag of Luxembourg Luxembourg 2.3 10.8%
86 Flag of Albania Albania 2.2 2.6%
87 Flag of Hong Kong Hong Kong 2.1 0.0%
88 Flag of Iceland Iceland 2.0 1.9%
89 Flag of Tajikistan Tajikistan 2.0 -
90 Flag of Papua New Guinea Papua New Guinea 2.0 2.1%
91 Flag of Mauritius Mauritius 1.9 2.4%
92 Flag of Trinidad and Tobago Trinidad and Tobago 1.9 0.6%
93 Flag of Yemen Yemen 1.6 0.5%
94 Flag of Suriname Suriname 1.4 7.0%
95 Flag of Cameroon Cameroon 0.9 -
96 Flag of Honduras Honduras 0.7 0.7%
97 Flag of Paraguay Paraguay 0.7 0.6%
98 Flag of the Dominican Republic Dominican Republic 0.6 0.7%
99 Flag of Gabon Gabon 0.4 -
100 Flag of the Republic of the Congo Republic of the Congo 0.3 -
101 Flag of Chad Chad 0.3 -
102 Flag of the Central African Republic Central African Republic 0.3 -
103 Flag of Uruguay Uruguay 0.3 0.1%
104 Flag of Estonia Estonia 0.2 0.1%
105 Flag of Chile Chile 0.2 0.0%
106 Flag of Malta Malta 0.2 0.8%
107 Flag of Costa Rica Costa Rica 0.1 0.0%

 

Farmer Brown's picture
Farmer Brown
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Re: IMF Rumored To Sell Gold Reserves

woops - sorry!  I just noticed "third"!  Nevermind!

Brainless's picture
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Re: IMF Rumored To Sell Gold Reserves

If those numbers are true would killing the dollar not make the US the strongest and richest nation again. Now it is the poorest. Inflate your debt away by printing money as fast as possible and not too fast to make it obvious then go back to the gold standard and back in power.

 

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Farmer Brown
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Re: IMF Rumored To Sell Gold Reserves

Since you got me interested in what the IMF might do, I decided to visit their website.  Here is an article written by at least one very highly paid "economist", very likely more than one, working for what is one of the largest holders of wealth in the world, pontificating on what might have gone wrong and what might be done to fix it.  What follows is right on their homepage.  It is simply amazing to me that there is no discussion anywhere in this piece contemplating whether even some of the blame might be due to fiat money and central banks.  Not one mention!! 

Instead, it favors more regulation, oversight, "international cooperation" (whatever that means), more centralized control etc etc.   If they didn't see the perfect-storm sized bubble that's still hitting us, I don't hold out much hope for them seeing the next one by just adding layers of bureaucracy to the system.

I guess pigs don't know pigs stink.

Here's the article:

 IMFSurvey Magazine: Policy


LESSONS FROM THE CRISIS

IMF Urges Rethink Of How To Manage Global Systemic Risk

IMF Survey online

March 6, 2009

  • Market discipline, regulations failed to keep up with innovation, leverage buildup
  • Macroeconomic policies did not respond to increase in systemic risk
  • Leadership needed at international level to detect and respond to risks

In the first comprehensive study of its nature, the IMF takes stock of the initial lessons learnt from the global financial crisis and presses for a worldwide rethink of how to handle systemic risk management.

“To look past blame in this crisis, it is useful to ask why policymakers failed to heed the looming threat,” the report said. “If there is an underlying theme to the lessons here, it is of failing to come to grips with fragmentation.”

The IMF’s work, initially requested by its policy steering committee, the International Monetary and Financial Committee, will feed into the work of the Group of 20 (G-20) leading economies to come up with a blueprint for reforming the way financial markets are regulated and for making international financial institutions, such as the IMF and the World Bank, more effective. The G-20 leaders will meet in London on April 2, 2009. In its discussion of theanalysis, the IMF’s Executive Board stressed “the need for remedial actions across a broad front and at many levels, implying an ambitious agenda for policymakers and the need for coordinated action.”

Why the crisis happened

Understanding what went wrong is key to restoring stability to the global economy, which is suffering the worst recession since the Second World War. “A key failure during the boom was the inability to spot the big picture threat of a growing asset price bubble. Policymakers only focused on their own piece of the puzzle, overlooking the larger problem,” Reza Moghadam, head of the IMF’s Strategy, Policy and Review Department said.

The IMF’s analysis points to failures at three different levels:

• Financial regulators were not equipped to see the risk concentrations and flawed incentives behind the financial innovation boom. Neither market discipline nor regulation were able to contain the risks resulting from rapid innovation and increased leverage, which had been building for years.

• Policymakers failed to sufficiently take into account growing macroeconomic imbalances that contributed to the buildup of systemic risks in the financial system and in housing markets. Central banks focused mainly on inflation, not on risks associated with high asset prices and increased leverage. And financial supervisors were preoccupied with the formal banking sector, not with the risks building in the shadow financial system.

• International financial institutions were not successful in achieving forceful cooperation at the international level. This compounded the inability to spot growing vulnerabilities and cross-border links.

Light-touch regulation failed to spot risk

The IMF study on financial regulation notes how, over the past decade, the financial system expanded massively and created new instruments that appeared to offer higher rewards at lower risk. This was encouraged by a general belief in light-touch regulation based on the assumption that financial market discipline would root out reckless behavior and that financial innovation was spreading risk, not concentrating it.

"A key failure during the boom was the inability to spot the big picture threat of a growing asset price bubble. Policymakers only focused on their own piece of the puzzle, overlooking the larger problem."

 

Both these assumptions proved wrong, and the result was a massive asset price bubble, especially in housing, and an enormous buildup of risk both inside and outside the formal banking system. “What is clear from the crisis is that the perimeter of regulation must be expanded to encompass systemic institutions and markets that were operating below the radar of regulators and supervisors,” Jaime Caruana, head of the IMF’s Monetary and Capital Markets Department, said. “We are suggesting a two-tiered approach to expand regulation: extending disclosure to provide enough information for supervisors to determine which institutions are big or interconnected enough to create systemic risk, and intensified functional regulation and oversight.”

The study identifies five key weaknesses that need to be fixed:

• First, the regulatory perimeter, or scope of regulation, needs to be expanded to encompass all activities that pose economy-wide risks. Regulation should also remain flexible to keep up with innovation in financial markets, and it should focus on activities, not institutions. Risk concentrations should not be allowed to develop beyond the regulatory perimeter. Clarifying the mandate for oversight of systemic stability would be an important first step.

• Second, market discipline needs to be strengthened. The failures of credit rating agencies to adequately assess risk have been criticized by many, and initiatives to reduce their conflicts of interest and improve investor due diligence are underway. Other steps could include less reliance on ratings to meet prudential rules, and a differentiated scale introduced for structured products. Also, the resolution of systemic banks should include early triggers for intervention and more predictable arrangements for loss-sharing.

• Third, procyclicality in regulation and accounting should be minimized.Increasing the amount of capital required of banks during upswings would create a buffer on which banks can draw during a downturn. An international framework for provisioning is needed to reflect expected losses through-the-cycle rather than in the preceding period. Supervisors should also routinely assess compensation schemes to ensure they do not create incentives for excessive risk-taking. In addition, there is a strong case for improving accounting rules by acknowledging potential for mispricing in both good and bad times.

• Fourth, information gaps should be filled. Greater transparency in the valuation of complex financial instruments is needed. Improved information on off-market transactions and off-balance sheet exposure would allow regulators to aggregate and assess risks to the system as a whole. Such measures would also strengthen market discipline.

• Fifth, central banks should strengthen their frameworks for systemic liquidity provision. The infrastructure underlying key money markets should also be improved.

Macroeconomic policies did not target systemic risks

The crisis was preceded by a long period of robust global growth and low interest rates. This encouraged investors to seek higher returns, fueling demand for the riskier products generated by financial innovation. “At the root of the crisis was the optimism that was brought about by a long period of prosperity. This optimism led to risks in the global economy not being assessed as carefully as they should have been,” Olivier Blanchard, Economic Counsellor and Director of the IMF’s Research Department, said. “With large failures in regulation and supervision, this fuelled high leverage and build-up of risky assets.”

"What is clear from the crisis is that the perimeter of regulation must be expanded to encompass systemic institutions and markets that were operating below the radar of regulators and supervisors."

 

While monetary and fiscal policies did not play a major role in the run up to the crisis, the crisis still holds a number of lessons for policymakers on the macroeconomic level.

• First, monetary policy should respond to the buildup of systemic risk.Policymakers should focus on macro-financial stability and pay greater attention to the buildup of systemic risk. Of course, how to identify and then to react to an inflating bubble is difficult. Typically, monetary policy will be too blunt an instrument to deal with asset price and credit booms: the response has to be found mainly in prudential regulation. But that first line of defense has failed in the past, and did so again recently. So there is a case for expanding the mandate of monetary policy to explicitly include macro-financial stability, not just price stability.

• Second, fiscal policy should be put on a stronger footing in good times.Fiscal policy did not play a major role in the run up to the crisis, but many countries failed to pay down public debt and reduce deficits during good times. As a result, these countries now find themselves limited in their ability to stimulate their way out of the crisis. Tax policy also encouraged debt financing in recent years. Such tax rules could usefully be changed. The IMF has developed detailed analysis of available fiscal space in key countries, how to design effective stimulus packages, and how to ensure fiscal solvency over the medium term, in light of the increase of debt and contingent liabilities.

• Third, while international capital flows are on the whole beneficial,global imbalances have to be addressed. Policymakers should use macroeconomic and structural policies to rebalance savings and investment in their own economies. They should also use regulation to help reduce systemic risk stemming from capital flows, for example by imposing constraints on the foreign exchange exposure of domestic financial institutions and other borrowers.

Failures of international cooperation

Despite the growing threat, the IMF and other institutions failed to send a strong wakeup call to policymakers and achieve a collaborative policy response. To be fair, some warnings were issued. For example, the IMF and others warned about risk concentrations in the financial sector and the prospects of disorderly adjustment from global imbalances. But what warnings were given fell on deaf ears, partly reflecting their lack of urgency and specificity.

There was also a lack of commitment on the part of policymakers for coordinated policy action in response to global threats. For instance, as the crisis unfolded, the initial policy response was a rush to protect local banks, at the risk of causing runs elsewhere.

"At the root of the crisis was the optimism that was brought about by a long period of prosperity. This optimism led to risks in the global economy not being assessed as carefully as they should have been."

 

The national deposit insurance schemes are just one example of the many unintended consequences of countries undertaking unilateral policy actions, which then cause problems for other countries, magnifying the impact of the problem.

The bottom-line is that the crisis has underlined the need for clearer policy messages and for more, not less, international cooperation across a range of economic and financial issues. According to the IMF’s analysis, action is needed in four areas.

• Policy warnings should be more focused and specific. The IMF is working with the Financial Stability Forum (FSF) on a new early warning exercise that will bring together scattered macro-financial expertise and drill down on key threats. More generally, the IMF’s challenge will be to piece together macroeconomic and financial sector developments into a big picture scenario that also takes into account cross-country spillover effects.

• Leadership is needed in responding to systemic global risks. A range of organizations can claim a leadership role, including the IMF, the G-7 and G-20, the FSF, and the OECD, but none has been effective. The IMF has the mandate, near universal membership, and a blend of macroeconomic and financial expertise that makes it particularly well-suited to assume leadership on global risks, but its bureaucratic ways and rigid power structures has shifted the policy debate towards smaller, more flexible groups, including to the G-20 and the FSF. Yet these smaller groups have their own problems of legitimacy and capacity for follow-up. A satisfactory global solution would bring together expertise, legitimacy, and effectiveness, and provide a forum for engagement among high-level policy makers. The IMF can be this solution, but this will require a further rebalancing of voice and representation among its members, to make its decision-making more accurately reflect today’s global economic landscape.

• Rules for cross-border financial sector resolution are needed to encourage collaboration rather than solutions that minimize the burden on the local taxpayer with potential beggar-thy-neighbor effects.

• A credible global liquidity framework is needed. Access to large-scale financing or insurance remains an issue for most emerging market countries. The IMF is reviewing its lending framework to make sure it is well-suited to members’ needs. If the Fund cannot provide the needed insurance, countries may in future seek to rely on self-insurance through surpluses and reserve accumulation, which could distort global trade for years to come.

The way forward

Implementing the recommendations summarized here will be difficult both politically and technically. However, the sheer scale of today’s crisis provides clear evidence of the importance of learning from past mistakes. One also should not underestimate the momentum today toward decisive action and lasting solutions. The summit of G-20 leaders on April 2, 2009 will be the first opportunity to make real progress.

“The reform agenda is huge, and people come to it with sometimes very different perspectives, but we see a genuine desire to find common solutions. We hope that the IMF’s analysis will be helpful in helping build consensus on how to tackle these shared problems,” Moghadam said.

Comments on this article should be sent to [email protected] 

Farmer Brown's picture
Farmer Brown
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Re: IMF Rumored To Sell Gold Reserves
Quote:

Re: IMF Rumored To Sell Gold Reserves

If those numbers are true would killing the dollar not make the US the strongest and richest nation again. Now it is the poorest. Inflate your debt away by printing money as fast as possible and not too fast to make it obvious then go back to the gold standard and back in power.

 When a country deflates its currency in order to make it easier to pay off debt, it automatically makes imports all the more expensive, and makes its people work harder for the same amount of pay.  Say you work for a company that makes widgets, those widgets sell for $20 and the dollar is worth 100 yen.  So, 2,000 yen buys you a widget.  Now your country devalues its currency and the $ is worth only 50 yen.  Now 1 widget costs 1,000 yen.  Your company receives the 1,000 yen, coverts it to $20.  Sounds like you made out the same right?  Wrong.  Because those $20 now buy you half the goods coming from Japan that it previously could have bought, while you worked just as hard (or you and your company did) for those $20.

This doesn't mean the US won't try that, even though its failed when its been tried before, but its a no-win situation.  If you want to get out of debt, you have to pay it off, either the ugly way, or the really ugly way.  Unfortunately, politics encourages the real ugly way because that's the next candidate's problem.

 

strabes's picture
strabes
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Re: IMF Rumored To Sell Gold Reserves
Patrick wrote:

Since you got me interested in what the IMF might do, I decided to visit their website.  Here is an article written by at least one very highly paid "economist", very likely more than one, working for what is one of the largest holders of wealth in the world, pontificating on what might have gone wrong and what might be done to fix it.  What follows is right on their homepage.  It is simply amazing to me that there is no discussion anywhere in this piece contemplating whether even some of the blame might be due to fiat money and central banks.  Not one mention!!

That's because the IMF is playing the same game as the Fed...centralized control of economies via debt.  They are one of the big interests behind a one-world monetary system.  Why would they expose their own raisson d'etre as being the problem? The IMF is a creation of the same power brokers that created the Fed.  The IMF and World Bank have routinely bankrupted nations (Argentina...).  They are a BS institution created under the guise of responsible government that really operates to siphon wealth out of those within its grasp.  

Looking to their economists for a solution is like looking to smooth well-spoken lawyer Tom Hayden (congisliere for the Corleone family) for a solution to mafia crime in New York City.  Surprised  (for those who haven't seen the Godfather, sorry for the meaningless metaphor)

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Re: IMF Rumored To Sell Gold Reserves

 

Has there been any suggestions about how our political system could work better though?  A 3-4 year term seems fair, and a 20 year term would be disastrous if a maniac got in.  If our politicians do the best for the long term plan, at the expense of the present, they would be out of office.  So what IS the answer then ? 

Remember they will be voted in by the mindless, brainwashed masses, and everything in the media.

Patrick, can't the US sell the gold they have stored to other countries to pay off debt ?

strabes's picture
strabes
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Re: IMF Rumored To Sell Gold Reserves
Amanda wrote:

So what IS the answer then ?

Don't let private interests control our monetary system.  As long as that's the case, politicians will regularly jump in bed with them regardless of how/when/why they're elected.  Eliminate the debt-based monetary world controlled by the Fed, et al, and the issue of government-created debt hanging over the heads of future generations goes away.  Debt-based money is the means by which governments can engage in ever-increasing meddling in our lives and spending money at exponential growth rates with no limits and no accountability. Without the Fed, the Treasury never could have gotten us in the trouble we're in.  

There will always be an elite, but they should not have control over our money...the Constitution forbids it...all the founders preached against it...yet that's the system we have.

 

Michael Höhne's picture
Michael Höhne
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Re: IMF Rumored To Sell Gold Reserves

Hi Amanda,

Has there been any suggestions about how our political system could work better though?

My personal wish is the following:

  • Politicians (parliament, congress, senate, president) both on state level and the federal government get a monthly payment of say 10,000.
  • They get a yearly bonus, which is calculated based on grades and these grades are given by the people (us). Just like school.
  • The maximum bonus should be much higher than the fixed payment, maybe 3 times or even 5 times.
  • Politicians are not allowed to be in the board of directors of any company and they are not allowed to accept payments or other contributions (bribery) from lobbyists. Any violation will instantly terminate their political career.
  • Income statements of politicians will be made available to the public. If there are any signs of corruption, a commission is appointed by the people for investigation. Such commissions are not to be appointed by the politicians themselves.
  • Politicians have to pay for their retirement like anyone else and they have to pay the same amount of taxes like anyone else. There is no reason for any exception. They should feel the same consequences as we do and if we fear about our savings, they should do so as well.

Cities, districts, counties, states and united states (U.S. or the EU for instance) can be treated as corporations and therefore the same set of rules must apply. Any executive has regulations in his contract stating that it is not allowed to do any kind of business that may have a negative impact on his primary job. Having a fixed payment and a bonus also is common sense in any company, so there is a good reason to use the same model in U.S. Corp., EU Ltd. and Germany GmbH. I also do not think that the above violates any constitution.  Quite contrary it would be much closer to what the founding fathers thought, because they knew about the risks of unlimited government.

Just my 2 cents.

Michael

Farmer Brown's picture
Farmer Brown
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Re: IMF Rumored To Sell Gold Reserves

from http://blogofbile.com/factsstats/:

Quote:

Prior to 1933 the US dollar was pegged to gold such that 1 troy oz = $20.67. According to the True Money Supply
there are 5,295,100,000,000 US dollars immediately available for
exchange in the world. The US government supposedly owns 8133.5 tonnes
of gold. At 32,150 troy ounces per tonne we then get 261,492,025 troy
ounces. If the federal government were to go back to the gold standard
pegging the dollar to gold using the current reserves:
$5,295,100,000,000 / 261,492,025 troy oz AU = $20,249.57 / troy oz AU.

I don't know if the money supply figure referenced above is correct, but the gold figure does match other sources.   The money supply figure seems very low, since it's less than half US current debt.  The US does have a *&^%load of gold though, that's for sure.

DrKrbyLuv's picture
DrKrbyLuv
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Re: IMF Rumored To Sell Gold Reserves

The United States is listed as having over 8,000 tonnes of gold but that is not the case.  That was a total amount of gold held some years ago between the private Federal Reserve and the United States Treasury.  The gold held by the Federal Reserve is theirs - not ours.  And, some of the gold that had been attributed to the United States Treasury was taken the Federal Reserve as collateral on our national debt.

So how much gold does the United States actually hold?  That's a good question and one that the Treasury refuses to answer - they will not allow a thorough audit of Fort Knox and the other repositories.  Many have speculated that Fort Knox is basically empty.

Larry

Farmer Brown's picture
Farmer Brown
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Re: IMF Rumored To Sell Gold Reserves
Quote:

Many have speculated that Fort Knox is basically empty.

 

It probably has just a two-drawer filing cabinet with T-bills in it, just like the social security trust fund.  In case you missed that one, here's our former President next to the awesome lockbox:

 

http://www.ssa.gov/history/pics/20050405-1_w9w7072jpg-316v.jpg

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