Chinese Gold Imports Surge In September, YTD Total Surpasses Official Indian Holdings

Tyler Durden's picture




 

Anyone who may have been concerned by the slowdown in Chinese gold imports in August, when the country imported "only" 53.5 tons of gold from Hong Kong (down from 75.8 in July), can breathe a sigh of relief. According to the Hong Kong Census Bureau, in September Chinese gross imports soared by 30% reverting to the long-term trendline of 65 tons in gross imports per month, and rising to a total of 69.7 tons. Net imports were 40% less, although that excludes organic Chinese gold mining and recirculation, which is why for all intents and purposes the gross number is the apples to apples one. And using that, Year-To-Date China has now imported a whopping 582 tons of gold, more than the official holdings of India at 558 tons, and which through November has certainly surpassed the holdings of the Netherlands, and make China's gross imports in just 2012 nominally the equivalent of Top 10 largest sovereign holder of gold.

This way at least we know where China is recycling all that vast trade surplus, which incidentally in October just printed, goalseeked or not, at the highest level - $32 billion - since January of 2009. Too bad China no longer recycles all those excess reserves into US Treasury paper (as we showed previously here).

YTD China gross imports from Hong Kong:

Where does this put China:

And in historical perspective: the recent surge in demand for gold is quite unmistakeable:

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Sun, 11/11/2012 - 20:26 | 2971110 DCCynic
DCCynic's picture

I'd love to know how much we really have.  Perhaps not knowing is best.

Sun, 11/11/2012 - 20:27 | 2971112 lolmao500
lolmao500's picture

US gold reserves are like the Schrodinger cat.

Sun, 11/11/2012 - 20:41 | 2971142 Ness.
Ness.'s picture

Meow!!

Then we go boom.

 

Sun, 11/11/2012 - 22:39 | 2971443 markmotive
markmotive's picture

China is starting to recover...inflation is falling giving them room for their fiscal/monetary magic tricks.

Couple that with gold purchases and America's policy and we could see another pop in the next 12mths.

Peter Schiff on gold and the dollar:

http://www.planbeconomics.com/2012/11/09/obama-2-0-what-it-means-for-ame...

Mon, 11/12/2012 - 01:31 | 2971759 DoChenRollingBearing
DoChenRollingBearing's picture

FOFOA writes his new piece on MONEY (it's really just credit)...

fofoa.blogspot.com

Mon, 11/12/2012 - 06:14 | 2971919 fiftybagger
fiftybagger's picture

"Since I'm writing at length here, I thought I'd start out with a kind of abstract for those who can't stand long posts."

Great.  Now the guy is going to blabber on about blabbering on.  Get to the freakin' point.  NM, it's FOFOA afterall...

 

http://www.brotherjohnf.com/

http://www.thebitcoinchannel.com/

Sun, 11/11/2012 - 20:51 | 2971146 UnpatrioticHoarder
UnpatrioticHoarder's picture

Until China is confident in having larger (non-imaginary) reserves than Germany and the US, the policy will be BTFD. After that, BOOM.

Expressed in mathematical terms US gold reserves are say 1000 Tonnes + 7133i tonnes

Germany is something like 1000 tonnes + 2395i tonnes

China is something like 2000 tonnes

IMF reserves are all imaginary numbers.

Multiplying by the complex gold price ($10,000 - $8,300i) /oz, you can see the Western financial system is rooted.

Mon, 11/12/2012 - 03:52 | 2971867 merizobeach
merizobeach's picture

Right.  Does this put Timmy Geithner in line to win nobels in economics and math for pioneering "quantum gold"?  Or does he have to share with Dimon and Corzine for their calculations of "quantum silver"?

Sun, 11/11/2012 - 20:40 | 2971138 ACP
ACP's picture

You know, the saddest thing about that is most Americans don't know its importance and therefore wouldn't give a shit anyway.

Sun, 11/11/2012 - 20:53 | 2971177 willwork4food
willwork4food's picture

who gives a shit?

/s :)

Sun, 11/11/2012 - 22:17 | 2971364 CrockettAlmanac.com
CrockettAlmanac.com's picture

You each make a valid point.

Sun, 11/11/2012 - 20:56 | 2971187 willwork4food
willwork4food's picture

Unless China is outright lying,  vying for future reserve currency status.

Sun, 11/11/2012 - 22:20 | 2971374 CrockettAlmanac.com
CrockettAlmanac.com's picture

Always a possibility but why would they hold onto dollars?

Sun, 11/11/2012 - 22:33 | 2971423 NewThor
NewThor's picture

$1 dollar bills have those cool Pyramids with eyes on the back.

Have you seen them?

I think they are good luck or something.

Sun, 11/11/2012 - 23:19 | 2971555 CrockettAlmanac.com
CrockettAlmanac.com's picture

Maybe it's a Pink Floyd thing. The Fed is cooler than I thought.

Sun, 11/11/2012 - 21:39 | 2971275 philipat
philipat's picture

China must be very grateful to the Fed for capping the price of Gold whilst it accumulates Gold instead of more Green Fiat. These data do NOT even include domestic production in China. I'm sure China will return the favour in a few years after it's economic transition is complete and havig by then amassed perhaps 5K, or even 10K tons of Gold, by re-launching the RMB as a fully convertible currency backed by Gold. Petro dollars anyone??

Sun, 11/11/2012 - 21:48 | 2971296 a growing concern
a growing concern's picture

That would certainly seem to be the smart play by them.  Use all those FRNs we so readily send their way to build up their reserves, and, when the time is ready, thrust their dagger straight into the heart of the US financial system and consign us to the dustbin of history once and for all.  That's what I'd do if I was them.  So we'd better keep stackin'.

Sun, 11/11/2012 - 22:21 | 2971378 CrockettAlmanac.com
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Like DeGaulle, but far more inscrutable.

Mon, 11/12/2012 - 03:57 | 2971870 merizobeach
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As I recall, the gov of China buys the country's domestic production at the RMB equivalent of USD1000/oz.  Mine it or don't, but that's the price, so I heard.

Mon, 11/12/2012 - 06:19 | 2971922 Urban Redneck
Urban Redneck's picture

The Chinese aren't stupid enough to seek a convertible reserve currency backed by their own gold holdings, when no on else's currency is convertible.  Triffen presents a paradox, not a dilema to which there is a solution.

Mon, 11/12/2012 - 12:08 | 2972621 juliawong
juliawong's picture

I certainly hope you are right. But, I hear the newly phased in management are talking about "dramatic" "faster than most thought possible" change in the financial system and/or currency policy. I fear it would be one of those "progressive" changes like floating your currency in the international market.  They already have set up a RMB futures market, and greatly enlarged the quota/scale of foreign investment (i.e. USD) into the equities market.

Mon, 11/12/2012 - 09:38 | 2972086 LawsofPhysics
LawsofPhysics's picture

Having the RMB fully convertiable will mean an end to printing.  Don't be stupid, China is printing like mad and they do not want to stop (yet).  Hold your own gold if you are so concerned,  Duh!

Sun, 11/11/2012 - 22:02 | 2971327 San Diego Gold Bug
San Diego Gold Bug's picture

I have more Gold than the US/Fed does!

SD Gold Bug 50 oz's

United States/Fed 0 oz's

PS  In the global financial game, China is plaing Chess while the US goverment is playing Checkers!!!

Mon, 11/12/2012 - 01:35 | 2971767 DoChenRollingBearing
DoChenRollingBearing's picture

Then you are doing MUCH better than the average American!

+ $55,000

Here's my take on Americans owning physical gold.  Very roughly there are some 6 billion oz of gold, making the ratio of gold oz per capita (worldwide) about 1:1.  But, Americans are richer, by far, than the world average, let's 10 times so (I am just painting a Thought Experiment, OK?).  So, by DoChen's infantile reasoning, each American should own 10 oz of gold.  Each family (call it three people) should then have 30 oz.

Bravo: San Diego Gold Bug!

Mon, 11/12/2012 - 02:02 | 2971790 akak
akak's picture

 

Very roughly there are some 6 billion oz of gold, making the ratio of gold oz per capita (worldwide) about 1:1.

DoChen, it may interest you (and others) to know that that approximately 1:1 ratio of gold oz. per capita has held for hundreds of years, at least --- giving the lie to the claims of the idiotic naysayers that there is "not enough gold" to re-establish the gold standard (whatever one thinks of the advisability of doing that); if there was "enough" to do so in the past, which there was, there certainly is just as much, proportionately, today.

Mon, 11/12/2012 - 07:35 | 2971952 Ctrl_P
Ctrl_P's picture

I had a think about this a while ago.

While I support your point of  "giving the lie to the claims of the idiotic naysayers that there is "not enough gold" to re-establish the gold standard"

Some of the various accounting processes suggest closer to 5.5 billion ounces of gold above the surface of the planet. And there is now a tickover 7 billion people scratching a iving here. Throughout history we have increased this gold store at about 2 percent a year. We have also been increasing the population at, coincidently, 2 percent per year. World GDP? I guess it might be close to 2 percent as well. Well until the industrial revolution and then we went a little out of balance. If I use my trusty calculator for the ratio, it comes up with 0.78 ounces of gold per person, that is quite a bit less than the 1:1 ratio in history. Possibly one reason that the feeling of 'not enough gold' or the collary of 'too many people' is gaining traction.

I was intereseted to find out what the generally accepted methd of reducing the population by nearly 1.5 billion people would be. My pick is the first of the 4 horsemen of the apocalypse.  Or do we wait for the asteroid lottery to deliver the extra 2 billion ounces the we need?

Mon, 11/12/2012 - 06:17 | 2971921 lakecity55
lakecity55's picture

I have a knowledgeable numismatist advisor who is going long on silver although he does not turn down gold.

He thinks silver will go up faster and is easier to acquire at today's prices.

I just ordered another Silvertowne bar.

Keep stackin.

I got out of all equities xcept some silver miners.

Mon, 11/12/2012 - 08:41 | 2972000 new game
new game's picture

some quick calculations as follows-

S and W mod 19 and 66 up 300 percent

since gold was 600/oz

same with all these handy devices; mod 10, 586. 686 ect.

same for propellant and delivery metal.

Therefor I suggest a combo of G, S. S & W and Lead...

PS, one insures ownership of the other and ultimate protection of civil liberties-so fucking old school.

Sun, 11/11/2012 - 20:26 | 2971111 lolmao500
lolmao500's picture

While Xi Jinping will take over the Chinese military this week instead of around early 2014...

http://www.scmp.com/news/china/article/1080270/exclusive-hu-jintao-set-s...

Exclusive: Hu Jintao set to step down as military chief

Outgoing leader decides to retire and clear way for Xi Jinping, breaking from the unpopular precedent set by his predecessor Jiang Zemin

http://www.asianewsnet.net/home/news.php?id=38441&sec=1

Xi Jinping: Hawk, dove or in between?

"His few public utterances put him closest to the hawkish end of the spectrum," argued columnist Philip Stephens in the Financial Times last month.

A year later, when Beijing marked the 60th anniversary of China's entry into the Korean War, he called it "a great and just war for safeguarding peace and resisting aggression". North Korea had invaded South Korea but his comments turned it around, angering Seoul.

 

Japan better get ready...

Sun, 11/11/2012 - 20:28 | 2971113 JustPrintMoreDuh
JustPrintMoreDuh's picture

It's a good thing that China's government is not hiding how much gold its been acquiring ... otherwise there might be a need for concern. 

Sun, 11/11/2012 - 20:29 | 2971114 lolmao500
lolmao500's picture

While Japan..

http://www.bloomberg.com/news/2012-11-11/japan-s-economy-shrinks-at-fast...

Japanese Economy Contracts at Fastest Pace Since Earthquake

Time for QE... what is it now... QE 15??

Sun, 11/11/2012 - 20:37 | 2971129 ziggy59
ziggy59's picture

QE..EQ...same result...

Sun, 11/11/2012 - 20:32 | 2971122 surf0766
surf0766's picture

RESET

Sun, 11/11/2012 - 20:36 | 2971126 HurricaneSeason
HurricaneSeason's picture

Evil barbarians, we begin bombing in 5 minutes.

Sun, 11/11/2012 - 20:36 | 2971127 ziggy59
ziggy59's picture

..and they're not letting the deceptive BSing west hold it for them?

They must know something or can't be threatened into "trusting" and entrusting some lying POS central banker.

Maybe China should offer the other smaller countries that supposedly have their gold dispersed like a fart in a hurricane, storage for their hard assets

Sun, 11/11/2012 - 20:38 | 2971132 The Continental
The Continental's picture

China knows that gold is the foundation of a world reserve currency. The dollar has been bluffing the world since 1972. China will call the dollar's bluff - it is a matter of time. Otherwise, China's feverish accumulation of gold would be pointless. Americans and other westerners take note: if you don't hold the bulk of your liquid wealth in physical gold (and silver) you will at best see your standard of living decline inexorably and at worst you will be financially wiped out.

Sun, 11/11/2012 - 20:49 | 2971157 akak
akak's picture

 

if you don't hold the bulk of your liquid wealth in physical gold (and silver) you will at best see your standard of living decline inexorably and at worst you will be financially wiped out.

Continental, although I agree with your comments here, I feel compelled to point out that unless one is living purely on savings (all held in gold and/or silver), then everyone's standard of living is going to inexorably decline in the years ahead, as their incomes fail to keep pace with rising costs due to fiat currency depreciation.  Holding gold and silver will only ameliorate that decline, but not entirely shield one from it.

Sun, 11/11/2012 - 21:15 | 2971229 tmosley
tmosley's picture

Depends on how much gold and silver are held.  Those with a large portion of their savings in silver will likely see a major increase in their purchasing power far in excess of any lost wages.  Probably the same with gold, just to a lesser extent.

Sun, 11/11/2012 - 21:31 | 2971265 akak
akak's picture

Quite possibly, tmosley --- I guess I was arguing from the conservative case in which gold and silver more or less hold their (current) value in the face of "inflation" (fiat currency depreciation).

Sun, 11/11/2012 - 21:34 | 2971269 fonzannoon
fonzannoon's picture

Thats the big question Akak. I wonder about that a lot.

Mon, 11/12/2012 - 00:10 | 2971643 centipede
centipede's picture

Not quite true. Prices of gold and silver rise faster than CPI. The reason is that nominal GDP and/or monetary base rise much faster and gold/silver relative "depreciation" by increased mine production is very slow. Based on monetary base the gold price should be about 2500 comparing to the values in 1914 (beginning of the legalized counterfeiting). Based on CPI barely 500.

Mon, 11/12/2012 - 01:04 | 2971660 Al Gorerhythm
Al Gorerhythm's picture

Now, factor in a complete loss of confidence https://www.youtube.com/watch?v=cTC7ZH54pZM calculate the probabilities of it happening, choose a timeframe........ kaboom.

"Gold today should be $4606." Paul Tustain. (6 month old calculation)

 

Mon, 11/12/2012 - 10:20 | 2972223 QQQBall
QQQBall's picture

Bullocks. Gold has gone up 500% since i started buying... My cost of living has not gone up that much in the past 10+ years.

Mon, 11/12/2012 - 10:45 | 2972295 earnulf
earnulf's picture

Of course when one compares the value of physical with the value of fiat and the potential directions of either given a loss of Reserve Currency Status, then the physical wins hands down.    A silver dime or a wheelbarrow full of fiat (if they could find one nowdays) for a loaf of bread?    Bet the dime would even buy the wheelbarrow....

Sun, 11/11/2012 - 20:38 | 2971133 tony bonn
tony bonn's picture

to repeat an adage i have not uttered in many a moon, he who owns the gold makes the rules....anyone who thinks that gold is not money or has artificial value is a fucktard - unless he believes that its value is artificially low....

jim willie reports 6000 tons left london for peking and other eastern destinations earlier this year, a further sign of the collapse of the western banking powers....it feels like the sacking of rome in 451 or even earlier forays into the once sacred city....

in any event, all of the blather about barbarous relics is for public consumption by the legendarily fucktarded american....most of fort knox's gold has found its way into the personal coffers of banksters and plutocrats on wall street....barbarous indeed....

it is very very unlikely that any german gold went to china this year - it is long gone.

Sun, 11/11/2012 - 22:27 | 2971397 CrockettAlmanac.com
CrockettAlmanac.com's picture

The good news is that skeletal excavations have shown that those who lived after the fall of Rome lived longer and healthier lives than those who lived in the waning days of empire. Ironically, that means that Americans will be less fat (in a good way) than they were before. And there won't be that annoying "do you like Romney or Obama" thing going on.

Mon, 11/12/2012 - 06:09 | 2971915 lakecity55
lakecity55's picture

So, someone needs to call Bundesbank and tell them to query China for a look-see at their stuff?

Sun, 11/11/2012 - 20:38 | 2971134 fasTTcar
fasTTcar's picture

Of course they are.

What else are they going to pay Iran with for its oil?

Sun, 11/11/2012 - 20:39 | 2971135 JustObserving
JustObserving's picture

Indian consumers hold at least 18,000 tons of gold.  The official Indian holdings are puny.

Sun, 11/11/2012 - 20:43 | 2971148 cossack55
cossack55's picture

you forgot the word "temporarily".

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