Given any thought to what might happen if IMF or other Governments decide to sell gold reserves to fund bailouts? Just a thought for all those gold bulls out there. I have no dog in this fight.
who would they be selling to? jewellers?
I just don’t see that any of the banks have the need to do this. The USD is still the dominant reserve currency and doesn’t have any sufficiently deep serious challengers. The Europeans don’t really need the Euro to be all that strong, since improved exports from a weaker Euro would probably be good for them, and they can import a lot of stuff from each other (the one big question is petroleum). Why would the IMF need to sell any reserves? Could Japan do this? Maybe, but the fact that they didn’t try to do this at any point during the last 20 years makes me think they probably wouldn’t do it now either. I’m less knowledgeable on Japan, so someone here might know something I don’t on that.
i don’t think the imf can sell gold - its the only thing that gives them any value
I always thought Gold was the collatreal for all their other stuff.
They don’t need to fund bailouts. They just need to print the money. Quantitative easing… The IMF I’m not too sure on the mechanism that they operate on but I thought they had capital commitments from the member countries and a reserve fund totally a pretty large amount - 500 billion? Plus they can draw more in emergencies I think. I think now a days, gold plays a small part in the mechanisms of monetary policy.
if anything, central banks who print money probably want to buy some gold to make sure they actually have something in reserve
I admit I haven’t really given it any deep thought. The idea just popped into my head. I guess it comes back to my unease that there really is only value in it because governments hoard it. If prices keep climbing, couldn’t governments decide to unload gold reserves as an alternative to issuing more debt?
AnotherLurker Wrote: ------------------------------------------------------- > > If prices keep climbing, couldn’t governments > decide to unload gold reserves as an alternative > to issuing more debt? That would be wiser than the UK selling its reserves at the low between 1999 and 2002.