The system…

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Richard Russell snippet
Dow Theory Letters
Mar 1, 2010

March 1, 2010 — The IMF is about to sell its remaining hoard of 191 tonnes of gold.
China has far less in gold reserves than it would like, and I wonder whether China has
not already negotiated to gobble up the whole IMF offering.

The US has 8000 metric tons of gold. Some like Jeremy Siegel of Penn’s Wharton’s
School, think we should sell our gold. But even the thought of the US selling its gold
would drive the price down. It would also be blaring signal of US weakness. The
president can authorize the Treasury to sell US gold but that hasn’t happened since
1979. But even if Obama authorized the sale of US gold, he couldn’t spend the money
on health care or defense or anything else. US law requires that any funds received
from the sale of gold must go to paying down the national debt. Another thought is
that even if all US gold was sold, it wouldn’t make a dent in the US’s intimidating
$12.3 trillion debt.

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