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China Business Daily Reports China Is Considering Raising Gold Reserves
The country which has languished in 6th position in the world, with combined gold holdings of 1,054 tonnes (just behind the GLD ETF), may have finally awoken that it needs to buy about 7,000 tonnes of gold to catch up with the US, and its 8,133 tonnes (or even France with 2,435). China daily 21st Century Business Herald has just reported that: "China is considering raising its gold reserves, a move which would push
up gold prices in the future, a person providing consulting services to
the Chinese government said." Conveniently, China can now buy gold notably cheaper courtesy of a $100 dip in gold price as recorded over the past week, precipitated by... China inflation concerns. When next month the politburo reports below consensus inflation (as the number is imaginary to begin with), look for gold to surge, but not before China manages to load up at depressed prices.
From CBH:
The source told the 21st Century Business Herald China may gradually increase gold holdings as it is not possible for the country to buy large amounts of the metal within a short time.
China’s gold reserves have reached 1,064 tons, accounting for merely 1.6% of the value of its total foreign exchange reserves. That amount lags far behind the 8,133 tons held by the U.S., and China ranks 85th out of the 101 economies included in a survey conducted by the International Monetary Fund.
Chen Beilei, director of metals and mining at BOC International Holdings, said China may increase its gold reserves to diversify its foreign exchange reserves.
Publicly available data showed the price of gold has risen 14% from the beginning of this year, making the metal a safe bet favored by markets amid uncertainties in the prospects for the global economy.
Demand for gold may continue to rise due to inflationary risks brought by Washington’s recently announced quantitative easing program, high public debts and low economic growth in Europe, Chen said.
Meanwhile, the U.S, dollar has rebounded and gold prices have fallen, which has dampened central banks’ willingness to raise gold reserves.
Feng Rui, president of Silvercorp Metals, said the decline is an adjustment in the upward trend of the price of gold and the metal may rise by as much as 20% in the future.
As to where China may see gold headed in the near future:
Feng predicted the price of gold would peak at $1,600 per ounce in 2011.
BoC International estimated the metal would reach $1,195 per ounce in 2011 and $1,205 per ounce in 2012.
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http://www.youtube.com/watch?v=Yjr7NtntWeQ
The entire US gold reserves have the market cap of APPL. China's has the market cap of RIMM. We have a ways to go in this bull market.
That video is awesome! It is EXACTLY the conversation I've had with my Princeton PhD brother about gold. He even told me that I should "get a degree in economics from a well known university" so I can be "educated". He said Peter Schiff is not a well known economist, but praised Larry Summers and Paul Krugman because they have PhD's in economics. Oh this video is so spot on.
does your bro have dual citizenship in jusa and israhel too?
ROTFLMAO... now if it weren't for the taste of bitter frustration at the accuracy of the dude's attitude.
In other words, "Fuck you, Bernanke".
Ain't it amazing what your country can do when it runs a surplus?
How are they funding the purchase of or debt ? Maybe they own a printing press also ?
They are sitting on tons of debt at the local level. Must meet quota, must meet quota ....
Ain't it amazing when US citizens prefer to have bigger purchasing power by buying more cheaper stuff made in China, instead of working more to produce the same thing in the US but with less buying power?
truly mind-boggling indeud. I blame the practice of 'planned-obsolescence' by US manufacturers, though others argue it was Ralph Nader's fault because he couldn't keep his big trap shut about it; damn hippies.
If they say they are going to do it, it's already done. If they say they are not going to do it, they are doing it.
China's reserves are not controlled by a moron like Gordon Brown.
The west focuses on quarterly results, the Chinese are looking 20 years down the road. Albeit the Japanese were supposed to be doing this long term thing as well and the last two decades haven't worked out that well for them.
They were indeed looking decades into the future -- but like everyone else, they weren't very good at predicting what it'd be like.
Maybe they are trying to put in a bottom here.
But I agree with above. Are the Chinese so benevolent that they want us all to front run them before they start massive purchases?
So much for them being the greatest poker players.
Already done, or known reserves in the ground yet to be mined.
speculative, at best
I'm sure they'll be happy to take all that Comex and LBMA can deliver at discount prices.
Careful with your use of the word 'deliver'.
It is a painful reminder to certain massive PM shorts.
that makes alot of sense. why buy when the price is down?
yeah, what am i missing here?
Well, let us not forget that these are the same central bankers who think rising prices in a recession is a good thing. They are in full retard 24/7.
Well, let us not forget that these are the same central bankers who think rising prices in a recession is a good thing.
That's because they think wage inflation and demand go along with it concealing the distortion.
"BoC International estimated the metal would reach $1,195 per ounce in 2011 and $1,205 per ounce in 2012."
Umm - someone needs to tell them that gold has already reached $1,195 and $1,205. Unless they're suggesting that it's going to go down. In which case why the hell would China be buying it now?
Priced in Euros?
"Feng predicted gold will peak at 1600 in 2011" trans: we're bidders under 1600 through 2011.
For my two peneth, I would say PM's are definitely going up long-term, but this short term correction may be being painted as a reverse H&S (we might now draw out the RH shoulder). I think that this is just interested parties attempting to paint, but be aware that we might now have a re-trace to $1387/oz followed by a pull back to $1260. From this point the rally will re-commence to new highs.
Trade (hold physical) accordingly.
I think if you wait for 1260 (or even 1299) you might be waiting for a long time.
Second that! Just keep buying as income permits... Physical only. Never sell.
Laughable. These guys have been and will continue to be the biggest buyers in the world.
interesting announcement but maybe just noise.
Either way if anyone sees any kind of return to BWish monetary standards, it would be wise to start stockpiling
I think that last few days was a computer generated raid....to much volume on no news....its not like the western world is better today than it was last Thursday....and we all know the Chinese have lots of computers and IT engineers to do it...
They raised margins on Gold and Silver (again!) yesterday. But silver didn't crash, which means this game will be over almost as quickly as it started.
Harvey Organ reports substantial OI with December expiry. This is about to become very interesting.
There are still two weeks to go before December. Next week we will see the option expiry day. Guess silver will be pummelled down hard in the coming two weeks.
Expiry is 11/30
http://www.heritagewestfutures.com/downloads/futures-options-calendar.pdf
Noted.
The only things I see expiring on 11/30 are lumber and Brazillian Reals. Isn't it 11/23?
A DECENT SILVER STASH! (not mine)
http://www.youtube.com/watch?v=Ygy6GBUZ-X0
Silver porn! Nice stash. He should be treating those Standing Liberties a little better. Should be in flips. The old, poured Englehard bars are nice. No 100 oz bars I see. That's good since they are harder to move when the time comes. Too much premium on the proof coins (Pandas, etc), however. The lead dispensing equipment is a nice complement to the hoard.
This is an act of desperation, nothing more. No country can long endure having one third of its economic output priced in non-domestic monies. No country can afford to have one third of its domestic economic activity completely superfluous to consumption and investment.
China will dollarize or crash...
Right, and this report - which is quite obviously bullish for Gold - doesn't make a dent in its price on the Comex.
Yeah, that's not fishy at all - especially not seeing how a horrible housing starts actually push the Dow futures into green.
Well, guess you have never read China Business Herald before. It is actually more like a tabloid and is always associated with rumours...
I've said it before. Perhaps China will introduce a gold backed currency, which might then become the global reserve currency.
How would this happen? By introducing gold-backed money, China would be strictly limiting the supply of its global currency. It could not provide any liquidity whatsoever for global commerce. Moreover, it would still be accumulating worthless dollars and euros.
You assume Gold would stay at a fixed price. And you assume other countries will not accept this metric.
++
The next day, oil is traded in gold-backed yuan. This is how China will end 300 years of Anglo-American banking hegemony.
I still suspect gold and silver are poised to dip again. Possibly silver will close below $25 and gold below $1320 in the coming days.
I'd love to see that.
The OI on Comex will be bigger than Ben Hur. Epic.
Me too. But hopefully JPM and HSBC will do as we wish.
Your suspicion of prices is based on .... what?
I use flea count, but others have more precise measuring methods.
Asia owns the physical, the west s in trouble.
"Feng predicted the price of gold would peak at $1,600 per ounce in 2011."
Riiiiiight. Top calling eh?
Feng predicted the price of gold would peak at $1,600 per ounce in 2011."
Nobody should be calling tops without checking with Cramer - the Oracle of of the fan.
Or with Soros, who says Gold is the ultimate bubble but then buys more.
He meant ultimate as in the LAST bubble not the biggest.
"being the last or concluding element of a series"
He meant "do as I say, not do as I do".
Soros was wrong. MANKIND is the ultimate (final) bubble. What will it look like when it bursts?
http://wilderdom.com/images/WorldPopulationGraph.jpg
flacon was wrong. FICTION is the ultimate (final) bubble, for it drives humans to complete, utter, total freaking insanity.
Although I was very bullish on Gold valued in Euros yesterday - it seems that the ECB is very serious about destroying the industrial capacity of the Euro periphery - if they succeed and do a Volcker on euro gold they may be able to artificially sustain the value of the euro against gold for a decade or more - watch this space.
Jim Rickards said in one of his interviews that he had recomended to China 6+ years ago they needed to increase their gold holdings, I guess they finally got his report translated?
i don't give a fuck up, down or sideways..you boys and girls keep top calling and bottom feeding..this shit hole global economy is fucked up..food for thought, you do the dishes..keep running on that treadmill (europe in trouble, no us, in trouble, no china in trouble..rinse, repeat), fucking worried about price levels..how can you price anything in this fucker, huh? fucking mark to fucking quidditch! thank the ben bernank and the rest of the global CB's for keeping this fucking farce alive long enough that you have time to GTFO.
I oscillate in an out of your current mood. It's not a constant state of disgust for me, just a passing nausea. Your sentiments are understood and appreciated. I hope the passion is at it's nadir at this moment since I'd like to hear your views when you are in a better mood. All the same, I concur with your outlook.
Now that I want JPM and HSBC to take down gold and silver they wont. :[
They'll pull a Saudi and suddenly claim they have 3000 tonnes of gold.
"...a person providing consulting services to the Chinese Government said"
Hmmmmmm ?
Ahhh sooooo ... now China is into behavioral economics as well (or maybe that is where it originated?!?). One would think that if they wanted to raise their gold reserves, then they would just do it quietly at the lowest price possible rather than publicize it.
Once they publicize it, that gives the manipulators the cover to raise gold prices.
So, we can assume that an announcement to buy is really an announcement to raise price, n'est-ce pas?
Or is that simply the old double-double cross?
Perhaps Eric King should put down his gloom and doom hat, forget about rocketing commodity prices, and start interviewing the CEO's of some restaurant stocks....
Panera making fresh, new highs today, totally unfazed by "inflation/deflation" issues...
Yes, let's forget about input prices.
And when, praytell, would you have him look at input prices again? When they are limit up every trading day for a year? Two? Five? Or should we just never look at it? That sounds par for the course. One loaf of bread will be worth more than the market cap of Panera Bread, and you'll still be screaming "BUY BUY BUY!"
A 3 billion dollar market cap company, very not worthy! Or perhaps you were being sarcastic.
Robo,
Perhaps you should look at a chart of gold since 1971 since the BW agreement was squashed. If you owned gold then vs dollars, your USD is 98% less in value...
Get a clue dude and stop being so negative on gold/silver.
My two cents... or rather my two silver eagles...
I junked your raggedy ass because your post is OFF TOPIC.
is Tungsten traded on the commodity exchange? need to buy some Tungsten ETF's quickly..
I think this announcement is more about the dollar than gold, i.e., China is not nicely telegraphing to traders to facilitate front-running. Instead they are saying to the world (again), it's time to dethrone the dollar from the reserve currency perch.
Just in case you live in a cave, have a look at the Shanghai market . . . China is down 11% in about . . . oh, 6 days.
Why would BOC publish this? If it has any effect it would be to push AU up. Why would the BOC want that if China is buying? I think this is a bearish signal, not because of what was said, but because it is discussed at all. I would have expected Chinese gold reserves to go up very quietly. Noise about it makes me believe it's not happening.
I'll repeat a point I've made before, and as we all know, forgetting Gold for a moment, hasn't China been the Big Buyer of Commodities of All kinds for many years now. We've all heard or read about the huge percentage of commodities that China has been scouring the globe for AND Buying.
We have been hammering the table for the Exchange Rate to move to 4 to $1.
No, they don't spell out 4 to 1, they [TPTB/West, especially US] all say 40% is the minimim required for China to Raise the Yuan by. So just do the Math and you'll arrive at 4 Yuan = $1.00. Prior to mid-2005 the hard-Peg was 8.23 to $1.00, needing 8,230 Yuan for each $1,000 USD
I don't see why China doesn't move to a 4 to 1 Exchange Rate and then Buy all the Gold they want---and lets not forget Silver, since China has been outright advocating, like an AD Campaign, for their citizens to Buy Silver too---that began just over a year ago and those who bought then have already more than Doubled their investment.
I wouldn't be surprised to see not only China ReValue largely vs the USD, but also see a host of countries make that move in unison with China. At the very least I would expect the ASEAN 3+10 make the move, and a group of S.American countries to join in the move. There's been little to no mention about the IMF SDR's expiration date loming just weeks away. And its the current component countries that make up the SDR who have been all QE'ing both overtly and covertly.
Isn't it the countries who have had a strong currency who have experienced the best 5-10 years, and of course their People have enjoyed a huge increase in their Standard of Living.
One more mention; its really Purchasing Power the counts, not what the Pay Rate is when converted to USD's in countries like China, India, etc...
OK, Example; to Buy $5,000 worth of a combination of Gold & Silver right now in China it would take about 33,200 Yuan. We're asking them to be able to pay just 20,000 Yuan. of course you can apply this to Cotton, Copper, Rubber, Cement, Soybeans, etc., etc., ...you get the picture.....so what's the Catch....is it something to do with those who call the US home but have the ability to buy "stuff" in China using Yuan
[[[ I had two events marked to watch for, for a long time. One of them is the ReValuation of China's Yuan. The other is to see Japan shed its WestBloc Team member's uniform and put on an EastBloc PLayer uniform. We might be very near seeing both. The fact that there's been Silence RE: the status quo of the SDR's and the clock running out, I think means there's something major very near. ]]]
Why should they use their own currency at all, when they are sitting on a mountain of surplus dollars that they need to swap for something useful?
By contrast, Oracle of Kypseli and others have rightly pointed out, that for a country such as Japan who needs to weaken their currency, instead of making pointless raids in the FX markets, should just print money & buy gold & commodities at a huge discount, till the FX market gets the message.
Yes, and they run a surplus with lower total tax rates than the U.S. How do they do that?
Nice to see an article state the following fact:
... gold is currently at depressed prices ...
Someday JPM and the other scam artists fronting for the FederalReserve (and other central banks) will realize how much real money they could make by liquidating all their gold and silver short positions AND simultaneously buying ten times as many gold and silver long positions. That would simultaneously secure ownership of astronomical quantities of physical gold and silver at never-to-be-seen-again super-low prices AND cause those prices to skyrocket into outer space. That day shall come... when is the only question.