Medinah Minerals (MDMN)

[rayfer22]

Hey Round: this from email I received. Doesn't it make sense that while the price of gold is moving up JJ and the rest would get this done.
While profligate governments and large institutional investors – like Rogers and Paulson – are bolstering the price of gold, the real gains in gold will come when central banks step up their purchases to diversify their foreign exchange reserves.

The total value of the world's gold is around $6 trillion at today's prices, versus about $200 trillion in global financial assets. India already bought 200 metric tonnes in November. Russia, Mauritius, and Sri Lanka also bought gold.

The U.S., the world's largest gold owner, holds 8,133 metric tonnes, around 77% of its total foreign exchange reserves. The Bank of France holds 71% of its reserves. The Bank of Italy, 67%.

Compare that to Asia... China, the world's sixth-largest owner of gold with more than 1,000 metric tonnes, has less than 2% of total reserves in gold (at $1,100 an ounce). Japan holds only 2.7%. India holds 7.5% (including the recent purchase). Russia, 4.9%. Hong Kong holds nearly zero.

So what happens when these countries decide to boost their gold reserves? Look at these numbers from Ian McCulley of Grant's Interest Rate Observer. (Also, thanks to Grant's for the numbers on foreign central banks' gold holdings):

If the nine [foreign exchange reserve holders in the world that are currently "underweight" gold] got it into their heads to boost their gold holdings to 10% of their reserves, they would have to acquire 11,174 metric tons, to 25%, they would need 33,254 metric tons.

For perspective, existing official holdings currently sum to 29,634 metric tons, or 20% of the aforementioned 150,000 metric tons of aboveground gold.

In other words, gold will soar.