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Russia Flips Petrodollar On Its Head By Exporting Crude, Buying Record Gold

Tyler Durden's picture




 

China has been a very active purchaser of gold for its reserves in the last few years, as we extensively covered here and here, but another nation has taken over the 'biggest buyer' role (for the same reasons as China).

 

Central banks around the world have printed money to escape the global financial crisis, and as Bloomberg reports, IMF data shows Russia added 570 metric tons in the past decade. Putin's fears that "the U.S. is endangering the global economy by abusing its dollar monopoly," are clearly being taken seriously as the world's largest oil producer turns black gold into hard assets. A lawmaker in Putin's party noted, "the more gold a country has, the more sovereignty it will have if there’s a cataclysm with the dollar, the euro, the pound or any other reserve currency."

Putin’s gold strategy fits in with his resource nationalism, statist agenda, as Bloomberg notes when Russia defaulted in 1998 it took 28 barrels of oil to buy one ounce of gold, was 11.5 barrels when Putin came to power and when in 2005 it had fallen to 6.5 barrels (less than half what it is now), he went all in, telling the central bank to buy.

Russia has gone through bouts of hoarding before - from 1867's Tsar Alexander II to Lenin, for now, with more than five years left in Putin’s term, Russia plans to keep on buying - "The pace will be determined by the market," First Deputy Chairman Alexei Ulyukayev said in an interview in Davos, Switzerland, on Jan. 25. "Whether to speed that up or slow it down is a market decision and I’m not going to discuss it."

 

 

Via Bloomberg,

Putin Turns Black Gold Into Bullion as Russia Out-Buys World

 

When Vladimir Putin says the U.S. is endangering the global economy by abusing its dollar monopoly, he’s not just talking. He’s betting on it.

 

Not only has Putin made Russia the world’s largest oil producer, he’s also made it the biggest gold buyer. His central bank has added 570 metric tons of the metal in the past decade, a quarter more than runner-up China, according to IMF data compiled by Bloomberg. The added gold is also almost triple the weight of the Statue of Liberty.

 

“The more gold a country has, the more sovereignty it will have if there’s a cataclysm with the dollar, the euro, the pound or any other reserve currency,” Evgeny Fedorov, a lawmaker for Putin’s United Russia party in the lower house of parliament, said in a telephone interview in Moscow.

 

...

 

In 1998, the year Russia defaulted on $40 billion of domestic debt, it took as many as 28 barrels of crude to buy an ounce of gold, Bloomberg data show. That ratio tumbled to 11.5 by the time Putin first came to power a year later and in 2005, after it touched 6.5 -- less than half what it is now -- the president told the central bank to buy.

 

During a tour that November of the Magadan region in the Far East, where Polyus Gold International Ltd. and Polymetal International Plc have operations, Putin told Bank Rossii not to “shy away” from the metal. “After all, they’re called gold and currency reserves for a reason,” Putin said, according to a Kremlin transcript.

 

Lucky Guy

 

At the time, gold was trading at an 18-year high of $495 an ounce and the Moscow-based central bank held 387 tons, or 2.2 percent of its $165 billion total reserves. The share reached 3.5 percent within a month, according to data compiled by Bloomberg.

 

An ounce of gold for immediate delivery traded at $1,670 as of 7:24 p.m. Moscow time on Feb. 8. It rose 7 percent last year, the 12th straight year of gains. Analysts expect the metal to advance again in 2013, to $1,825 by the end of the year, according to the median of 26 forecasts in a Bloomberg survey.

 

“Putin’s gold strategy fits in with his resource nationalism, statist agenda,” said Tim Ash, head of emerging- market research at Standard Bank Plc in London. “It’s kind of a defensive play, but it worked, right?” Ash said in an interview in Moscow. “You need luck in politics and business, and clearly the guy has it.”

 

Brown’s Bottom

 

Other world leaders haven’t been as lucky. Gordon Brown, as U.K. finance minister, sold almost 400 tons of gold in the 30 months to March 2002, when prices were at two-decade lows. London tabloids have referred to the period as Brown’s Bottom.

 

Quantitative easing by major economies to support financial asset prices is driving demand for gold in the emerging world, said Marcus Grubb, head of investment research at the World Gold Council. Before the crisis, central banks were net sellers of 400 to 500 tons a year. Now, led by Russia and China, they’re net buyers by about 450 tons,

 

...

 

While Putin is leading the gold rush in emerging markets, developed nations are liquidating. Switzerland unloaded the most in the past decade, 877 tons, an amount now worth about $48 billion, according to International Monetary Fund data through November. France was second with 589 tons, while Spain, the Netherlands and Portugal each sold more than 200 tons.

 

No Hoard

 

Communist secrecy regarding the country’s gold holdings fueled speculation that party elites had amassed a huge hoard of bullion that they spirited out of the country before the Soviet Union disintegrated in 1991.

 

...

 

“When people ask about the party’s gold, my answer is always: Are you an idiot or something?” Gerashchenko, 75, told Afisha magazine.

 

For now, with more than five years left in Putin’s term, Russia plans to keep on buying.

 

“The pace will be determined by the market,” First Deputy Chairman Alexei Ulyukayev said in an interview in Davos, Switzerland, on Jan. 25. “Whether to speed that up or slow it down is a market decision and I’m not going to discuss it.”

 

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Sun, 02/10/2013 - 21:25 | 3231806 TahoeBilly2012
TahoeBilly2012's picture

Geez open up Fort Knox all ready the suspense is killing me!

Sun, 02/10/2013 - 21:30 | 3231831 Dr.
Dr.'s picture

It sure will be an interesting situation. "we would now like to have access to our lent out tonnage of gold please and don't try settling in GLD" 

 

I guess the best the Russians could do is to actually "borrow" the asset directly from the Fort, have it deliverd to Moscow and safe-guard it there against deflationary pressures  /sarc off

Sun, 02/10/2013 - 21:40 | 3231858 MrX
MrX's picture

Richie Budd sums it all up nicely:

http://youtu.be/aXGt2XOeCJc

Sun, 02/10/2013 - 23:23 | 3232035 DoChenRollingBearing
DoChenRollingBearing's picture

A new magazine (American Hard Assets) has just hit the shelves (at Barnes & Noble anyway).  Because Barron's just cannot seem to get delivered to my town on the weekends, I reviewed this premier edition of "AHA".  LOTS of "gold porn" and good articles, I like the magazine and will probably subscribe.

"Review of American Hard Assets"

http://tinyurl.com/ac6atm2

Mon, 02/11/2013 - 00:33 | 3232257 ratso
ratso's picture

Right, we should take our guidance from Putin.  Pass the bong.

Mon, 02/11/2013 - 01:50 | 3232353 strannick
strannick's picture

No, take your monetary guidance from gold, like Putin. If you have dollars in a bank, then roll another one just like the other one.

Mon, 02/11/2013 - 07:08 | 3232507 malikai
malikai's picture

While we're on about Russia/China, what's up with Soybean? Does this have something to do with the Chinese New Year? I don't typically work with softs but wow anyway.

http://blog.quantsig.net/2013/02/11/soybean-2

Mon, 02/11/2013 - 09:55 | 3232822 FEDbuster
FEDbuster's picture

"American Hard Assets" magazine sounds like something you might find on a San Francisco, Key West, Fire Island or SEC office coffee table?

Mon, 02/11/2013 - 00:33 | 3232258 jeff montanye
jeff montanye's picture

speaking of brown's bottom and repatriation of gold, jesse had a good article from australia:

http://www.scribd.com/doc/124737694/Australians-Seek-Gold-Repatriation-B...

looks like the aussie central bank did brown a bit better.

Sun, 02/10/2013 - 21:58 | 3231897 Al Gorerhythm
Al Gorerhythm's picture

I'm not so much interested in their stash, I'm more interested in their book(s).

Sun, 02/10/2013 - 22:47 | 3232017 FL_Conservative
FL_Conservative's picture

Bernanke's axis of evil: gold, silver and Ron Paul.

Sun, 02/10/2013 - 21:23 | 3231812 vft2212
vft2212's picture

Total BS. This is just confirmation rasPutin will abscond with any gold that remains in Russia when he must leave as all others with USA policy have before him. The #USD hasn't made a new low in 4+ years & gold hasn't made a new high in 1 1/2 years. Oil for gold rather than oil for food in Russia.

Sun, 02/10/2013 - 22:06 | 3231925 W74
W74's picture

Implying Russia doesn't grow anything.

Sun, 02/10/2013 - 22:44 | 3232011 vft2212
vft2212's picture

Hottest young ladies on the planet, if you include Ukraine

Mon, 02/11/2013 - 03:25 | 3232418 SilverRhino
SilverRhino's picture

And some of the most mercenary as well.   YMMV.   

 

Mon, 02/11/2013 - 03:45 | 3232431 Raymond Reason
Raymond Reason's picture

You're shopping in the jewish quarter. 

Mon, 02/11/2013 - 03:40 | 3232429 Raymond Reason
Raymond Reason's picture

Finest ballerinas too.  Long legs, perfect bone structure. 

Sun, 02/10/2013 - 21:23 | 3231814 Squid Vicious
Squid Vicious's picture

I'm pretty sure Putin will be a favorite candidate in 2013 for our 5 minutes of hate, via western MSM

Sun, 02/10/2013 - 21:30 | 3231832 magpie
magpie's picture

Yes, and throw your eagles and maples on the floor and stamp on them after the screening

Mon, 02/11/2013 - 05:16 | 3232464 Wile-E-Coyote
Wile-E-Coyote's picture

We have always been at war with Russia (two minutes of hate)

Sun, 02/10/2013 - 21:24 | 3231815 SDRII
SDRII's picture

Russian capital flight has the faint hint of the 80s cold war

http://www.reuters.com/article/2012/12/12/us-russia-putin-idUSBRE8BB1CD2...

From the Baker Institute

http://bakerinstitute.org/publications/EF-pub-GasOilCartels-012312.pdf

"Russia was clearly hurt by the oil wars waged by Saudi Arabia in the mid 80s"

Reset over

Sun, 02/10/2013 - 21:24 | 3231817 PUD
PUD's picture

That's as daft as every other gold demented nation. All vying to one up the other and come out superior in the end so they can inherit a world of ashes. Stupid fucks all. Besides, when it's 50 below zero outside which will serve you better? Gold or oil? All these articles serve to prove is how stupid human beings are. How greedy, selfish, cruel and ultimately self destructive they are. No one is proposing a new system, co-operation, mutual prosperity...nope, just beggar thy neighbor, prepare thy own bunker and reinforce their delusion that they will somehow come out on top when it all goes to shit. Pure insanity world wide now.

Sun, 02/10/2013 - 23:48 | 3231914 Al Gorerhythm
Al Gorerhythm's picture

WOW!

You still believe? !!!!!!

You sound like one of those guys who believe government has the right to tax you 100% of your wages and "gift" a portion back to you as a weekly alowance for working the plantation. You would, no dobt, be eternally grateful for their benevolence.

 

Mon, 02/11/2013 - 09:58 | 3232833 FEDbuster
FEDbuster's picture

As Peter Schiff recently said, "I would rather be a serf, they only had 25% of their labors taken by the lord and king." 

Sun, 02/10/2013 - 22:03 | 3231917 W74
W74's picture

"prepare thy own bunker and reinforce their delusion that they will somehow come out on top when it all goes to shit."

Alright, stand out in the open then. I promise I won't hop out of my bunker to save your screaming ass.

Sun, 02/10/2013 - 22:41 | 3231999 unrulian
unrulian's picture

since our scaley ancestors crawled out of the mud has there ever been a system of co-operation and mutual prosperity that didn't include insanity...ever? i suggest you start digging and get yourself a trusty AR

Sun, 02/10/2013 - 21:25 | 3231818 Orly
Orly's picture

Silly Russians.  We must be ready for the take-down in PMs.

Putin doesn't have to "abscond" with anything. He is by a mile the richest man on the planet.

Sun, 02/10/2013 - 21:34 | 3231845 toys for tits
toys for tits's picture

Plus Putin has a Super Bowl ring.

Sun, 02/10/2013 - 21:42 | 3231866 Orly
Orly's picture

Non sequitur much?

Mon, 02/11/2013 - 03:30 | 3232424 Bay of Pigs
Bay of Pigs's picture

You're still here bashing gold?

BTW, how's that Euro short working out for you?

Mon, 02/11/2013 - 06:05 | 3232485 Orly
Orly's picture

What Eurp short- one from eight months ago?  Do you have any idea how fast things change in 4X?

Get a grip.

I don't need to bash gold.  It's doing a fine enough job on its own.  Speaking of not changing...for what the past two years?  Y'all keep waiting.  I'll be here to ask you what you're waiting for.

:D

 

Mon, 02/11/2013 - 11:23 | 3233247 mvsjcl
mvsjcl's picture

Richest man on the planet? You know better, Orly. You must be pulling our leg.

Mon, 02/11/2013 - 00:02 | 3232204 Raymond Reason
Raymond Reason's picture

Tsar Nicholas II was the richest man in the world, measured in Gold, until he was executed and his gold transported to those who masterminded and financed it:  The Bank of England and New York Fed.  The Western banks propped up the Soviet Union all the way through the bullshit Cold War, even shipped them food, Bolsheviks were such complete incompetents, until native Russians seized power again.  Russians know their adversaries well, through patience and perseverance will undo them in the near future.  Of course you won't read this version of history in English very often. 

Mon, 02/11/2013 - 00:19 | 3232238 Orly
Orly's picture

It is also certain Putin is the King of all he surveys, over twelve time zones.

:)

Mon, 02/11/2013 - 00:53 | 3232284 cornflakesdisease
cornflakesdisease's picture

Didn't his daddy park the Russian navy in New York & San Fransisco Harbor and tell The Bank of England to but out and let them settle it?

Mon, 02/11/2013 - 00:53 | 3232285 cornflakesdisease
cornflakesdisease's picture

Didn't his daddy park the Russian navy in New York & San Fransisco Harbor and tell The Bank of England to but out and let them settle it?

Mon, 02/11/2013 - 02:55 | 3232398 Raymond Reason
Raymond Reason's picture

That's right, during the Am civil war, but it was also some kind of strategy with what was going on in europe with Poland. After Napoleon, Romanovs became the prime adversaries of Rothchilds, poisoning both Alexander and Nicholas I. 

Mon, 02/11/2013 - 04:33 | 3232454 RafterManFMJ
RafterManFMJ's picture

Which planet? Richer than the reptilian King of planet Nibiru? I somehow doubt it.

Sun, 02/10/2013 - 21:25 | 3231821 gwar5
gwar5's picture

Seems China is still in the official BRIC lead. Wonder if Putin also has more gold secrets in the real currency war.

 

 

Sun, 02/10/2013 - 21:25 | 3231822 GOSPLAN HERO
GOSPLAN HERO's picture

No gold at Fort Knox ... just bat shit.

Sun, 02/10/2013 - 21:28 | 3231828 Hulk
Hulk's picture

Damn, what is it with all these sovereigns, hoarding this barbaric relic , which ain't backed by nuthing ???

Mon, 02/11/2013 - 00:49 | 3232276 jeff montanye
jeff montanye's picture

most of the countries in both asia and opec have small percentages of their large foreign reserves in the form of gold.  most of it is said to be held by the u.s. and europe. 

wonder when the truth will out.

Sun, 02/10/2013 - 21:31 | 3231835 espirit
espirit's picture

Putin's ahead of the curve on this one, and the central banksters know it.

The losers are selling.

Sun, 02/10/2013 - 21:32 | 3231840 disabledvet
disabledvet's picture

Still no missile launch. What's the world waiting for? It sure isn't "the death of the dollar."

Sun, 02/10/2013 - 21:36 | 3231848 Whalley World
Whalley World's picture

Regarding China's reserves. they are most certainly different than IMF figures represent

Sun, 02/10/2013 - 21:41 | 3231861 Chupacabra-322
Chupacabra-322's picture

Russia and China are going to cripple the Fascist UNITED STATES without even fireing  a single shot.

B.R.I.C.S. are the next Global reserve currency. 

Sun, 02/10/2013 - 21:44 | 3231871 Orly
Orly's picture

What, no </sarc> tag?

Sun, 02/10/2013 - 22:00 | 3231905 W74
W74's picture

You included South Africa in that?  That's a joke right?

Mon, 02/11/2013 - 05:24 | 3232466 Wile-E-Coyote
Wile-E-Coyote's picture

Couldn't agree more. The USA is in terminal decline, now if anyone fires the first shot it will be the US.

Sun, 02/10/2013 - 21:42 | 3231863 Kastorsky
Kastorsky's picture

Putin is tougher than Chuck Norris

http://oi47.tinypic.com/37afn.jpg

Sun, 02/10/2013 - 21:47 | 3231878 besnook
besnook's picture

another reason the final defense of the dollar is imminent. smart money knows worthless dollars for gold is a sure bet. the usa knows the only thing supporting the dollar is the usa military and nato. the war from west africa to pakistan is about to get red hot all the way to the south china sea.

Sun, 02/10/2013 - 21:51 | 3231885 Börjesson
Börjesson's picture

Everybody has known for a long time that the dollar will go down in flames. In order for trade to work in the next system, everyone has to have some gold, and not just the West. The Europeans sold gold in the last decade precisely so that the BRICs could buy some.

Oh, except for Brown, of course. He sold to try to save the old system (which he did, for the time being), not to prepare for the new one.

Sun, 02/10/2013 - 21:59 | 3231896 devo
devo's picture

Black swan is fascism.

 

Mon, 02/11/2013 - 04:51 | 3231906 medium giraffe
medium giraffe's picture

Commies are deffo out to kill the Petrodollar this year.

"the more gold a country has, the more sovereignty it will have if there’s a cataclysm with the dollar"

Well, thanks Gordon Brown for selling off our Gold.  It's just as well the UK hasn't made any enemies and that a dollar cataclysm isn't likely, eh?

Sorry all, must run....

Sun, 02/10/2013 - 22:11 | 3231936 post turtle saver
post turtle saver's picture

And by "gold" he means "enriched uranium", which holds more sway and projects more power than any amount of gold could ever hope to.

Gold is not money. ENERGY is money. Energy allows one to project POWER. If you don't believe this, ask the Germans why they can't get all their gold back until we say it's ok for them to have it back. Here ends the lesson.

Mon, 02/11/2013 - 05:28 | 3232468 Wile-E-Coyote
Wile-E-Coyote's picture

No, Gold is a store of energy. That's why the Germans want their Gold back.

Mon, 02/11/2013 - 10:38 | 3233030 SmackDaddy
SmackDaddy's picture

I cant understand why so many here think gold and currency are so fundamentally different.  Coal and oil make this economy go 'round.  And the American military greases the wheel.

Tue, 02/12/2013 - 23:50 | 3239425 MeelionDollerBogus
MeelionDollerBogus's picture

idiot. Money is something you SAVE AND TRADE. Energy is something you CONSUME & trading happens only if BOTH PARTIES have energy, so that one who loses energy makes up for it in the trade. One one's willingly taking a net loss of food+water+chemical energy+nuclear energy. One may balance the trade off but if any of those factors drops to zero then the afflicted party is fucked & everyone knows it. Hence we TRADE MONEY (primarily gold & silver) and CURRENCY (promises of money and/or energy) to balance out the deltas we can tolerate - adjustments to the aforementioned matrix of food+water+chemical energy+nuclear energy - which do not lead to any of the items turning up at zero.

THIS is the lesson, YOUR lesson was shit.

The reason the Germans can't have their gold back is because it hasn't been their's for a long time. What is not in your hands IS SOMEONE ELSE'S & it will take many guns to undo that & Germany's lost TWICE doing that & will not dare again.

Sun, 02/10/2013 - 22:12 | 3231937 eddiebe
eddiebe's picture

"“When people ask about the party’s gold, my answer is always: Are you an idiot or something?” Gerashchenko, 75, told Afisha magazine.

I thought it was Greenspan that said that.

Sun, 02/10/2013 - 22:24 | 3231964 sullymandias
sullymandias's picture

That's pretty much my response to any question I get asked: "Are you and idiot or something?" Works like a charm. Every time.

Mon, 02/11/2013 - 00:02 | 3232199 WmMcK
WmMcK's picture

That and "It depends".

Sun, 02/10/2013 - 22:19 | 3231946 eddiebe
eddiebe's picture

Turtle saver.. Well yes and no. the problem with energy is how do you store say $50'000. worth of gasoline or firewood or Nat gas or Palm oil for that matter, and what do you and I do with enriched uranium.

As with so many things, this is not an either or issue. Energy and gold both have their place and so does the (not so almighty anymore) Dollar, at least for now.

Mon, 02/11/2013 - 00:19 | 3232237 post turtle saver
post turtle saver's picture

It's called a salt dome.

The USA leads the world in logistics technology. No one does it better. No one. There's no country in the history of mankind that's been better at this. Not even ancient Rome. "The right power in the right place at the right time". That's how the US rolls. Moving physical gold around in an advanced logistics scenario is plain stupid. It's the ancient Phoenician equivalent of rolling up shapes into clay balls as representing the items of exchange in a contract, then writing on the outside what was wrapped inside the clay ball. There's no point to it, just exchange the writing.

Mon, 02/11/2013 - 12:07 | 3233478 Panafrican Funk...
Panafrican Funktron Robot's picture

That's why there is a plan to merely move to a gold-backed, non-fractional reserve currency.

http://www.imf.org/external/pubs/ft/wp/2012/wp12202.pdf

http://en.wikipedia.org/wiki/Irving_Fisher

Whether we actually move to this plan is another thing entirely, but it would be a hell of a lot more stable.  And the absence of a currency with stable value is the reason we have such an incredibly inefficient global economic system, something that your studies regarding logicstics should have taught you.  Of course, you were also incorrect regarding logistics, we learned virtually everything in modern logistics from the Japanese (including "just in time").  

Tue, 02/12/2013 - 23:47 | 3239413 MeelionDollerBogus
MeelionDollerBogus's picture

moving physical gold, silver, copper, lumber around etc., ensures that whoever needs it has it, because it has a non-trade use. Your description is only of a bizarre system in which the claim of a good has more value than the good itself, primarily for trade.

Generally we call this fraud. A little more politely one can call it fiction. The paper/writing and/or containers have no value if delivery is too delayed, especially if delayed means "never"

Sun, 02/10/2013 - 22:22 | 3231959 geewhiz190
geewhiz190's picture

russia's buying gold, china is loading up, india can't stop etc etc....everybody's buying.. so who's selling?  oh, i know, the price is being "manipulated" which means-what?

Mon, 02/11/2013 - 04:45 | 3232459 are we there yet
are we there yet's picture

The FED gold is unaudited for a reason. If Ron Paul and a bussload of congressmen showed up at Fort Knox they would not be allowed to look inside.

Sun, 02/10/2013 - 22:23 | 3231963 adeptish
adeptish's picture

The first chart shows that China imported 835 T from Hong Kong in 2012 alone.

The author then says "IMF data shows Russia added 570 metric tons in the past decade, a quarter more than runner-up China".

Did anyone read this before commenting or am I missing something?

So just how has Russia taken over the 'biggest buyer" role.

 

Mon, 02/11/2013 - 10:11 | 3232894 FEDbuster
FEDbuster's picture

Fuzzy math?  I wondered the same thing.  Plus, both China and most likely Russia are buying up all their domestic production, too.  China is supposed to be the world's largest producer, and Russia isn't to far behind.  The true numbers will never be known, plus the US FED won't allow an audit of our remaining gold reserves.  I don't think we will ever get a clear picture when it comes to gold reserves.

Sun, 02/10/2013 - 22:32 | 3231980 RhoneGSM
RhoneGSM's picture

paging Jim Ricards

Sun, 02/10/2013 - 23:34 | 3232141 ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

He and Tyler don't seem to get along.

Tue, 02/12/2013 - 23:40 | 3239387 MeelionDollerBogus
MeelionDollerBogus's picture

well of course. It's one thing to agree on how / why gold will be of great value to individuals & the world moving forwards ... it's another thing entirely for one to be an agent of the state (Omnis Security, Rickards) whereas Tyler Durdens pretty much are loathe to do / be such a thing.

Sun, 02/10/2013 - 23:22 | 3232105 silverdragon
silverdragon's picture

Russians are buying Gold, so are the Chinese and Indians, the Jews and Arabs also love gold. Add to that the non retarded people of the western world.

Can't wait until they learn about Silver.

Mon, 02/11/2013 - 01:21 | 3232315 silverdragon
silverdragon's picture

The real question is how much Gold do the Chinese have. We know they supposedly had 1,000 tonne ages ago. We know they love to underdeclare stats like this to mess with western minds and maybe also as its a national security thing.

They are importing from HK plus digging it out of the ground themselves and buying worldwide under the table plus importing via all its other borders add to that the odd couple of thousand diplomatic trunks full of the stuff.

China declaring they have 10,000 tonne will rock the world as it irrefutably stamps world reserve currency on the Renminbi. My bet is they are socking away 1-2,000 tonne of Gold per year on top of the couple of tonne they started with. My bet is on them declaring they have 20,000 tonne available for audit in the not to distant future.

The 20,000 tonne of Gold becomes an economic weapon of mass desrtruction. Japan with its disproportionnate amount of old and disfunctional young and only actually having a couple of dozen militarily competent citizens puts the dunce hat back on and sits back in its corner. Then maybe, just maybe, China starts buying its stuff again.

The US only has one card to play and as we know it hasn't had much luck with wars Vietnam, Iraq and Afganistan to mention a few. All they have left is to sell munitions, guns, bombs, planes, tanks etc which they are great at with over half of worldwide munition sales and munitions being the largest industry on the planet. So the US selling dangerous stuff to anyone with enough Renminbi in their pocket make the world a very dangerous place indeed.

Mon, 02/11/2013 - 03:29 | 3232422 SilverRhino
SilverRhino's picture

>> China declaring they have 10,000 tonne will rock the world as it irrefutably stamps world reserve currency on the Renminbi. My bet is they are socking away 1-2,000 tonne of Gold per year on top of the couple of tonne they started with. My bet is on them declaring they have 20,000 tonne available for audit in the not to distant future.

 

That would certainly do it.   And completely fuck the US at the same time.  

That is unless the US has more tucked away and just waiting for the day that a trump card needs to be played.   (I know, completely unrealistic)

 

Mon, 02/11/2013 - 05:19 | 3232465 Uskatex
Uskatex's picture

Does somebody know whether the huge amount of gold imported by China in these years (and the gold locally mined) went to some government caveau, or was at least partially sold to Chinese people, who we know have a strong appetite for gold investments?

The difference is substantial, because the gold hoarded by the people cannot be used to support a currency.

Mon, 02/11/2013 - 09:00 | 3232685 eddiebe
eddiebe's picture

Silver dragon, you forget: Grains and financial weapons of mass destruction.

Mon, 02/11/2013 - 04:39 | 3232456 fredquimby
fredquimby's picture

"Gordon Brown, as U.K. finance minister, sold almost 400 tons of gold in the 30 months to March 2002, when prices were at two-decade lows. London tabloids have referred to the period as Brown’s Bottom."

He ensured that the price was at it's lowest and was sinking by pre-announcing these auctions. He of course sold it to Goldman Sachs, which is where (allegedly) his wife also worked at the time.

That Gordon Brown hasn't been arrested (or hung, drawn and quartered) for this heinously treasonous act, is a simply a travesty of justice. He went against all manner of advice from B of E governers and others advising AGINST selling the natuional treasure.

Unfortunately, I think the "Browns Bottom" moniker tends to lead people to make light of this event rather than be outraged and demand his ïmmediate arrest.

 

 

 

Mon, 02/11/2013 - 09:14 | 3232718 Orly
Orly's picture

He was just following orders.

Mon, 02/11/2013 - 04:45 | 3232457 silverdragon
silverdragon's picture

Silver Rhino,

The best shot at the US playing a trumph card is Matsushitas Gold, the Gold that US spooks nicked from the Philipines. That is if "arguably the worlds leading investigative journalist" Stearling Seagrave is to be believed. 

I have no faith in your US govt or Fort Knox gold but your spooks are not as dumb as they are portrayed or appear.

I bet if we moved to currencies being backed by gold you might find that the US actually has tens of thousands of tonnes tucked away for a rainy day. It may even materialize as "a new find".

 

Mon, 02/11/2013 - 06:34 | 3232495 Quinvarius
Quinvarius's picture

If the US ever had that gold, they already sold it, or gave it away to the Bush family.  But it isn't real.

Mon, 02/11/2013 - 08:06 | 3232580 Zwelgje
Zwelgje's picture

Yeah, it sounds in a way like sHitler's 'Wunderwaffen' that would change the course of WW2.

Mon, 02/11/2013 - 05:31 | 3232470 Wile-E-Coyote
Wile-E-Coyote's picture

Whatever happened to Hitlers Gold?

Mon, 02/11/2013 - 06:38 | 3232497 Quinvarius
Quinvarius's picture

It went to the USA after WW2 to build the Bretton Woods system.  Then the US sold it all or gave it to the Bush family.

Mon, 02/11/2013 - 06:20 | 3232490 silverdragon
silverdragon's picture

It is hard to believe supposedly intelligent people still do not understand Gold or Silver.

Mon, 02/11/2013 - 06:48 | 3232500 silverdragon
silverdragon's picture

If the US doesn't even have any Yamashita Gold then the future isn't lookin very good at all.

Mon, 02/11/2013 - 07:55 | 3232552 jubber
jubber's picture

...and Gold smashed down another $10 this morning...

Tue, 02/12/2013 - 23:37 | 3239377 MeelionDollerBogus
MeelionDollerBogus's picture

Gold moves up or down that don't exceed $150/oz are of little consequence

goldpricemodel 2013 projection

2013 goldpricemodel 277 week ROC 04 price mapping

Mon, 02/11/2013 - 08:47 | 3232663 Woodrox
Woodrox's picture

2207 * 570 * $1650= 2 billion... does this realy matter??

Mon, 02/11/2013 - 09:08 | 3232695 falak pema
falak pema's picture

watch out for the BRIC axis in the making; all against the petrodollar hegemony, especially as the currency war hottens up...

Venezuela is now looking like a linch pin on Oli/currency battlefield. 

Brasil has already told France it finds its military position as US surrogate in Mali unacceptable, as it hottens the arms race and will heighten the ME cauldron divide  by igniting the islamo "black bannered fascist" clique's insurgent hold on MEna countries and in Sudan/Sahel.

'You are pouring oil on the north south fracture line and we BRICs do not agree,' is the ominous message.

Lady Rousseff could be a tough adversary in the years to come to Petrodollar supremacy.

All of LAtin America now is being sucked into the currency/financial war; from Argentina to Venezuela. Watch out Chile! 

Mon, 02/11/2013 - 09:24 | 3232741 jubber
jubber's picture

down $20 now on this news, crazy

Mon, 02/11/2013 - 09:43 | 3232786 richard007
richard007's picture

China and Russia are preparing to remove the US$ from being the World Reserve Currency. Are you ready? This was prophesied in Habbakkuk 2:7 concerning, End Time Babylon, the USA!

Mon, 02/11/2013 - 10:41 | 3233046 mendolover
mendolover's picture

Maybe the US Gov is gunnng up for when the sheep wake up and find out how fucked we are thanks to the bastard clepto/chrony capitalist puppet politicians and corporate elites.  It should be easy to find the ones that stay stateside.  Most of them will probably be in southwest Florida.  The really arrogant ones who still think it's safe to show their face.

Mon, 02/11/2013 - 12:00 | 3233401 earleflorida
earleflorida's picture

"Copper Mining in Russia"... [Gold, Platinum, Nickel, et.el.]    http://www.copperinvestingnews.com/5638-copper-mining-in-russia.html'

"Russian Reveals Enormous Diamond Supply, Could Shake Up Spectacular Rigged Market For Shiny Rocks" ... [DeBeers, RioTinto, et.el.[ all Rothschild's subsidiaries]

http://www.geekosystem.com/?s=russia+diamonds

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