And The First Thing Ukraine Will Buy With IMF Money Is...

Tyler Durden's picture

A month ago, it was alleged, that Ukraine - under cover of night - loaded its gold reserves onto a plane and shipped them off (for safekeeping) in the US, as the potential price of 'liberation'. So how ironic that, given the massive gas debts that Ukraine owes to Russia (and prepayments pending), and sizable bond maturities pending, the first thing that Ukraine's National Bank governor will be buying with his freshly minted loan from the IMF is... buy a billion dollars of gold.

We presume Gazprom still gets its payment and bondholders get paid off - because that seriously impair 'investor confidence' which is, as they note below, is what is crucial to stabilize the nation's economy... but it seems the Central bank has other priorities...


As ITAR-TASS reports,

Kiev will use the first portion of the International Monetary Fund (IMF) loan for augmenting its gold and currency reserves in order to stabilize the financial situation in the country, National Bank Chairman Stepan Kubiv said on Monday, May 5.


Over $1 billion from the first portion of the loan will go into the gold and currency reserves of Ukraine, which will strengthen the financial system of the country. The remainder will go to the budget to stabilize the macroeconomic and financial situation in Ukraine,” he said.


Kubiv believes that the IMF loan “will send a positive signal to foreign investors and domestic entrepreneurs, improve the investment climate in the country and stabilize the hryvnia”.


On April 30, the IMF Board of Governors approved a two-year standby credit facility of $17 billion for Ukraine. The first portion will amount to around $3.2 billion.


What is odd is that Ukraine's gold reserves have been soaring in recent years - so it's hardly been a confidence-inspiring move for Ukrainian entrepreneurs and foreign investors so far?


So the big question we are left wondering is - whether all the IMF is doing is "giving" Ukraine money so it can buy gold as proxy for the NY Fed...
with that next batch of gold also set to be confiscated by the Fed and shipped off to Germany (and maybe even Switzerland) to cover their growing repatriation demands.

One wonders if this news has anything to do with the fact that since the approval of the IMF "loan" gold has had its best 2 days in 4 months...

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Xibalba's picture

Hopefully the Ukrainian people will see through this shitshow and fight back. 

Badabing's picture

Don't ship it by air! Gold makes airplanes disapare

old naughty's picture

You may be right...

If 2 tonnes made one disappeared, $1B buys 10 times.

Just saying... 

Badabing's picture


"disappear" i feel better now, i had my coffee

cifo's picture

No danger here. They will probably buy paper gold.

Atlas_shrugging's picture

augmenting its gold and currency reserves in order to stabilize the financial situation in the country =>  define "its" as "pockets of certain .00001% before they flee"

THX 1178's picture

A billion dollars of gold and a c-130 to somewhere

GetZeeGold's picture



Word is Germany is going to want to take a look at that gold.

Latina Lover's picture

Bet it will be ¨Gold¨held in custody by the FED.  The Ukraine will be punked on their gold holdings twice, LOL:

BaBaBouy's picture

MEANWHILE.. The GERMANS Are Still Waiting EMPTY-HANDED For The Return Of Their GOLD From The FEDerales...

Pladizow's picture

The IMF will sell them the gold. It will only be paper gold. So IMF gets back $1Bil and Ukraine pretends to have $1Bil of Gold.


espirit's picture

Putin should insist on the Shiny.

nope-1004's picture

Either no physical involved, or Putin is demanding payment in gold and the story has to be fed to the public on the down low.


SumTing Wong's picture

"We're all Ukrainians now!" (Or was that U-Keynesians now...)

If the IMF gave me a billion USD as a loan, I'd be buying shiny stuff too. 

strannick's picture

Now when the Russians invade they can send THAT gold to the NYFed too. Just like they did with their gold last month. Or like the Germans did in the cold war. At least there was only a chance of theft with the Russians. Withe the Americans, theft is guaranteed.

SoilMyselfRotten's picture

Buying a $1 billion in gold....and watch the price drop in Bizzroworld

J S Bach's picture

"And The First Thing Ukraine Will Buy With IMF Money Is..."


And the first thing the Vampire Squid International Bankers will steal when their puppets eventually take over will be...


SoilMyselfRotten's picture

Maybe you haven't heard of the Wests' undermining the elected govt? The puppets ARE in place.

Soul Glow's picture

This just in - Gartman, currently blabbing on cnbc, says gold will crumble.  Time to buy!

fonestar's picture

The Ukrainians and the mental rejects on this site are going to wish they had bought BTC instead.

Quus Ant's picture

I don't own any gold or bitcoin.  One glorious day when you are all lords and masters please be so kindly as to look down with mercy on a poor, hapless childe.

adonisdemilo's picture


I we have to be mental rejects to buy BTC then it certainly answers the question "who the fuck is fonestar"?

The Longest Call's picture

Damn good point nope-1004, that's exactly what's going down.  Putin says pay up with the shiny, and here's a story so you can paint the BS, and btw-  you won't be delivering by plane...

Sidenote- are Mellenials waking up?:

youngman's picture

I bet they get a nice framed picture of some gold held in a vault somewhere for the piece of paper they get..politicians need something to show the sheeple...

Manthong's picture

Or maybe a tap dance in front of a green screen with 20 year old vault chroma-key.

Papasmurf's picture

The transaction will suppress the price of physical, so win-win for the global banksters.

Manthong's picture

Beat me to it.  :-)

It is all likely balance sheet bullshit.

Paper gold or at best tungsten facsimiles.



BigJim's picture

 Over $1 billion from the first portion of the loan will go into the gold and currency reserves of Ukraine...

Gold... AND currency reserves, people. Most of that $1B will probably be USD and Yen.

And if a western-oriented central bank buys gold that's bad news, because they'll lease it out to the bullion banks who will use it to short each and every ounce 20 times, at least.


Flux's picture

 Over $1 billion from the first portion of the loan will go into the gold and currency reserves of Ukraine...


Not Apple?

Drifter's picture

Paper, phys, whatever, hope it keeps 'em warm this winter with no gas.

I'm confident oligarchs will stay warm, lots of hooker body warmth at night and blow during the day.

People, not so much.

toady's picture

Yep. It'll probably be paper against the actual physical they shipped out! 

Tabarnaque's picture

The question is how long will this freshly purchased gold be stored in Kiev? Or will it ever be at all?

First, the IMF loan has been made in SDR so that Kiev won't get a free meal when the USD drops in value. Second, they are using SDR to buy gold, which is likely to end up being stored in London's vaults and we all know what happens to gold stored in London. So all the countries of the world are funding the IMF so that the Western Power That Be can lease and sell the freshly bought Ukrainian gold? Or are they smart enough  to use gold to hedge their SDR loan?

Can someone else shed some more light here? This story is getting crazier every day.

Confused's picture

Question: If the IMF can just give out loans, and the Fed can just print money, and there is a lack of gold to meet repatriation needs, why wouldn't the players just secretly print paper money to purchase gold directly, 'off the record.' 


Not saying they are not using the Ukraine as a proxy, but it would seem this is overly complicated and brings with it substantial wildcards. 


Like Belgium, couldn't they find a silent partner through which they can accomplish this? 

Ski12568's picture

I believe China is filling that role and they are really good at keeping that a secret. They don't even have to print money, the Chinese could use dollars they don't want somehow

BanksterSlayer's picture

If Ukraine wants to buy gold so badly, then why did they have all their bullion reserves airlifted out of the country back on March 07 at the start of the Nazi coup? GATA still keeps that news story on file, however the Russian-language news site from whence it originated is mysteriously down right now, ahem!


* * *

From Iskra News
Zaporozhye, Ukraine
Friday, March 7, 2014

At 2 a.m. this morning an unmarked transport plane was on the runway at Borispol Airport. According to airport staff, before the plane came to the airport, four trucks and two Volkswagen minibuses arrived, all the truck license plates missing.

Fifteen people in black uniforms, masks, and body armor stepped out, some armed with machine guns. They loaded the plane with more than 40 heavy boxes.

After that a mysterious men arrived and entered the plane.

All loading was done in a hurry.

The plane took off on an emergency basis.

Those who saw this mysterious special operation immediately notified the airport officials, who told the callers not to meddle in other people's affairs.

Later a returned call from a senior official of the former Ministry of Income and Fees reported that tonight, on the orders of one of the new leaders of Ukraine, the United States had taken custody of all the gold reserves in Ukraine.

Dewey Cheatum Howe's picture

You are not asking the right questions.

Who are the Ukrainians buying the gold from with that IMF funny money?

Next question once you know that, are they buying physical or paper shares?

Eternal Complainer's picture

March 7
Then the very next day march 8 Malaysian 370 goes missing.

All these dots? WTHIGO?
(What the hell is going on?)

chapaev's ghost's picture

Kiev Central Banker: Hi there, I would like a loan.

IMF: So, tell us, what are the chances we'll get repaid?

KCB: Well, we're in the middle of a civil war, with half of our nation breaking away and backed by a superpower. Our government is a corrupt putsch, and even among the members of the putsch there are serious political and ideological divisions. There is a good chance the two part civil war could disintegrate into a Lebanon-style free for all. Then there is the fact that our nation is bankrupt, our civil institutions are infected with systemic corruption, we have an on-going nuclear crisis, and we owe Russia lots of money for gas. So, based on those facts, I'd say there is a very small chance you'll be repaid at all.

IMF: So tell us a little it about yourself: Personally, where is your domicile?

KCB: I have dual citizenship.

IMF: How interesting! So do we! Tell you what. If you buy a billion dollars worth of gold with the money we lend you, and then kick back that gold to us, we'll lend you the rest. After all, the IMF uses other people's money, and those people don't have dual citizenship. Deal?

KCB. Deal

DIgnified's picture

Is gold the new theory?  Thought Trident Group did NBC escorting. 


That doesnt seem worth it, does it?  I guess every bit counts, but we owe so much.  Its like owing thousands of dollars and stealing from the take-a-penny thing at gas stations. 

Dr. Engali's picture

I don't believe for an instant that there was 2 tons of gold on that plane. That's a mere $93 million dollars. That's not worth the effort of disappearing  a 300 million dollar plane along with it's crew and passengers. There is more to the plane story than two tons of gold.

Confused's picture

$93 million at market price. 


I'm not disagreeing. I'm just saying we don't (nor will we ever) have enough info to know what is really up. 

Dr. Engali's picture

Whoever disappeared this plane had tremendous resources at their disposal. The acquisition of gold, IMHO was not their objective.

Confused's picture

Agreed. And I can't pretend to know anything more. 


So to your point, either something very valuable was on the plane. 


Or, there are some monetary plans behind the scenes which might revalue gold. (admittedly less likely) Especially when this quantity can be purchased. 


Badabing's picture

Let’s "pretend" that physical gold is fractionally reserved at 100 to 1 with paper contracts.

How much would it be worth to a CB then?

Kirk2NCC1701's picture

$1B buys 25 tons of gold.  Isn't that what ZH reported when MH370 first went missing?

knukles's picture

OK, so the West loans money to "The" Ukraine to pay overdue gas bills from Russia or else "The" Ukraine freezes to death in the dark this winter, along with Western Europe. 

But instead Ukraine buys gold.

Having already shipped the country's reserves to the NYFRB for "safekeeping" I wonder where this gold will be sent?
NYFRB, which in turn will be sent back to Germany.....
In fact, why do I even say, "Sent"
Said gold will just be delivered to NYFRB...

Oh, fuck delivery, it will just be moved from one pile to another.
One imaginary pile to another
In fact there will be no gold involved
The money will just make its way to a bankers pocket.

Mystery solved.

Jump you fuckers

How do you misspell rehypothecation, Bitchez?

TahoeBilly2012's picture

"Borrow" money to "buy" gold and currencies? Loan me a few Billion, I want to "stabilize" my finances....what a joke.

Xibalba's picture

open a 18month 0%APR and go to town on Apmex.....same thing basically.

old naughty's picture

"Having already shipped the country's reserves to the NYFRB for "safekeeping"..."

Safekeeping. Why NYFRB? What about Fort Knox? Do you have a problem with the South?