After studying engineering at Oxford and doing an MBA at Harvard, he wanted a quick way to raise enough capital for a traditional metal-bashing business. The producing countries, possibly supported by those with large gold stocks of their own, should be able to block it.(Photograph omitted). That could trigger other bullion owners to rush to the market at the first sign of trouble, possibly before the fund even gets there.One big advantage of Mr Clarke's plan is that it would not cost rich countries anything That does not mean it is a free lunch. If the IMF's sales were timed so that the nominal price of gold remained stable for several years, speculators would have less reason to invest in it. The Clarke plan would restore much of that flow, neatly cancelling a significant upward pressure on gold prices.But the knock-on effect is potentially far more serious. That is more than a seventh of 1993's mine production and almost double the average annual increase in supply since 1984.

But in the second quarter of last year, the price started to recover. Prices fell from a high of dollars 499.75 an ounce to dollars 326.10 by 10 March 1993. At worst, it could spark a wave of panic selling and the return of a bear market.The gold market last turned bearish in December 1987 and mauled producers and speculators alike for more than five years. What is alarming is Mr Clarke's insistence that it would not 'significantly' depress the price of gold That is just voodoo economics. But Japan, South Korea and Taiwan have all pursued unashamedly interventionist industrial policies.The World Bank is none the less right in some of its prescriptions.