Calling All Gold Bulls: IMF Adopts New Gold Accounting Standards

Includes: DGL, GLD, IAU
by: Investing The Middle Way

With Gold prices rallying of late, there was a very interesting development the other day in case you missed it (full press release here).

Blanchard and Company has learned that the International Monetary Fund has adopted a landmark accounting change to the way Central Banks account for their gold loans, giving this sector of the commodities market more transparency than it has ever had, the precious metals market leader announced today... the newly adopted accounting change means that Central Banks will no longer include the amount of gold they have loaned and sold into the market as part of their reserve total assets.

The Gold Anti-Trust Action Committee [GATA] has long maintained that central banks have "leased" out much of their gold to short sellers; however, this information has been masked from the public because the central banks have been keeping leased gold and gold in the vault as a single line item. I don't know how many or how soon the central banks will adopt this new disclosure rule. But if they do and GATA turns out to be right, it will be unbelievably positive for gold prices.

AMEX Gold Bugs Index [HUI] 1-yr chart:

AMEX Gold Bugs Index [HUI] 1-yr chart