The “barbarous relic,” as Keynes called gold, seems to be popular again and gaining by the day. After years of Central Bank selling, we see a reversal of this trend. India bought a large amount within the last couple of weeks. China is increasing their holdings. Now Mauritius is doing the same.
Mauritius is a small island nation located off the coast of Africa. It is acknowledged to be the home of the dodo bird. As described by the Canadian Museum of Nature: “First seen by Europeans in 1598, the Dodo was extinct shortly after 1640. Mauritius, an island in the Indian Ocean, was its only home. Human activity is to blame for its extinction.” Today, the term “dodo” is often used to refer to someone stupid.
Because gold is “useless,” and all countries are in need of capital to support their economies, it would seem “stupid” to tie up usable funds in an inert metal. While that might be a way to rationalize Mauritius’s recent purchase, it cannot explain away the behavior of China, India and the other Central Banks that are adding to their gold stock. The dodo never lived in any of these countries.
Perhaps even the dodo is capable of seeing the impending international currency collapse or the death of fiat currency.
Tyler Durden’s report on this event is below:
Tiny Mauritius Tells US To Shove Its Dollar, Buys 2 Metric Tons Of Gold From IMF At $1,115 An Ounce
Submitted by Tyler Durden on 11/16/2009 20:07 -0500
The latest development in the gold bubble saga, and one which will likely cause the precious metal’s price to spike even higher, comes from the tiny island of Mauritius which according to Dow Jones has purchased 2 metric tons of Gold from the IMF for $71.7 million. The price works out to approximately $1,115 per ounce. More as we get it. (and yes, this is a picture of Mauritius not some CNBC anchor hangout).
Some more from Dow Jones:
The International Monetary Fund announced Monday it has sold two tons of gold to the central bank of the Indian Ocean island of Mauritius for nearly $72 million.
The sale came as gold prices surged Monday to an all-time high of $1,136.72 per ounce.
The sale to Mauritius “was conducted on the basis of market prices prevailing on November 11, 2009 with proceeds equivalent to U.S. 71.7 million dollars,” the IMF said in a statement.
It was the second such sale by the fund since September, when its executive board authorized the sale of 403.3 tons of gold from its holdings to bolster its finances amid the global economic crisis.
On Nov. 2 it sold 200 tons of gold to the central bank of India for $6.7 billion.
The IMF said it would sell gold directly to central banks and other official holders for an initial period before selling the remaining amount on the open markets “in a phased manner over time.”
The Washington-based IMF, which currently holds just over 3,000 tons of gold, is the third-largest official holder of the precious metal after the U.S. and Germany