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Published on Gold Anti-Trust Action Committee (http://www.gata.org)

IMF will tell central banks to stop double-counting gold, Blanchard learns

By cpowell
Created 2007-01-22 19:43

Blanchard Lauds IMF
Central Bank Gold Lending
Accounting Change
As Industry Landmark

Precious Metals Economic Research Entity
Has Championed This Issue as Key to Adding
Even More Transparency, Price Growth to Gold Market

Company Press Release
via PRNewswire
Monday, January 22, 2007

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/0... [1]

NEW ORLEANS -- After months of inquiries and a hotly debated, in-depth position paper by its economic research unit, Blanchard and Co. 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.

"This is a huge step forward for the precious metals market and a major victory for the gold market investor," said Blanchard Chairman and CEO Donald W. Doyle, Jr. "Not since the Washington Agreement on gold in 1999 and the legalization of gold ownership for Chinese citizens in 2004 has there been such an important event in the advancement of the gold market."

Blanchard and Co. has long stated that the IMF's accounting guidelines have allowed central banks and bullion banks to inaccurately account for their gold loans, and 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, Doyle said.

"Transparency has always been a central issue in the gold market for investors and analysts alike, but this decision by the IMF will greatly redress that issue as these accounting changes are implemented," Doyle said. "It also only adds more credence to our analysis that the precious metals markets are now poised to make long-term, steady price growth."

On December 14, 2006, Blanchard published "Gold Market Lending" on its Web site at:

http://www.blanchardgold.com/beru [2]

The industry buzzed for days. The paper, written by Blanchard's director of economic research, Neal Ryan, provides exhaustive research analysis of how central bank transactions could affect the gold market if loan information was made in an accurate and timely fashion. While some misconstrued the information as research on market manipulation, the paper is instead specific to one issue -- IMF gold accounting procedures for central banks as being the most important component of gold market transparency.

"This is a wonderful development for the gold market because of the additional transparency that is created by the changes in IMF accounting regulations," Ryan said. "This is an issue that changes the entire landscape of the gold market for the betterment of all participants, because there is now data available that had never previously been published. A transparent market is a healthy market, and the gold market just got a lot healthier."

Ryan says it will take the IMF some time to institute the new accounting procedures, but the outlook for the gold market is a rosy one moving forward.

Blanchard and Co. Inc. is the largest and most respected retailer of American rare coins and precious metals in the United States, serving more than 350,000 people with expert consultation and assistance in the acquisition of American numismatic rarities and gold, silver, and platinum bullion. The Blanchard Economic Research Unit is a key source of precious metals market analysis and continues to be an important resource for financial and consumer media throughout the United States. Blanchard and its predecessor companies have called the New Orleans area home for more than 30 years. For more information about the company, visit:

http://www.BlanchardGold.com [3]

Or call the company toll free at 1-800-880-4653.

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Source URL:
http://www.gata.org/node/4728