Friday, February 03, 2006
Back in September of 2005 I recommended taking a look at gold as a hedge against inflation. It is not too late by any means. Read on...
Credit Agricole's Brokerage Declares "Start Hoarding" Gold!
By Jon A. Nones02 Feb 2006 at 06:00 PM EST
St. LOUIS (ResourceInvestor.com) -- Cheuvreux, the equity brokerage house of the French bank Credit Agricole, distributed a 56-page report today endorsing the findings of the Gold Anti-Trust Action Committee (GATA) that the price of gold has been surreptitiously suppressed by Western central banks and that those banks do not have the gold they claim to have. The report, written by Cheuvreux's mining sector analyst in London, Paul Mylchreest, is titled "Remonetization of Gold: Start Hoarding." It repeatedly cites GATA by name and foresees an "unprecedented" rise in the gold price. But what is more, the report accuses central banks of “covert selling.”According to the report, Cheuvreux has raised its mid-cycle gold price estimate to $900/oz from $750/oz, and sees the possibility of a spike to $2,000/oz, or higher.
“Covert selling (via central bank lending) has artificially depressed the price for a decade,” wrote Mylchreest.
According to the IMF, the official figure for gold held by central banks in their vaults is 31,000 tonnes, but the reality is much lower, asserts Cheuvreux.“Central banks have 10,000-15,000 tonnes of gold less than their officially reported reserves of 31,000,” Mylchreest wrote.
This gold has been lent to bullion banks and their counterparties and has already been sold for jewellery, etc., according to the report.