Chart Of The Day: China’s $3.3 Trillion FX Reserves Could Buy All World’s Gold Twice
From GoldCore
China’s $3.3 Trillion FX Reserves Could Buy All World’s Gold Twice
Today’s AM fix was USD 1,578.00, EUR 1,214.13 and GBP 1,049.06 per ounce.
Friday’s AM fix was USD 1,570.00, EUR 1,203.99 and GBP 1,043.74 per ounce.
Silver is trading at $28.75/oz, €22.11/oz and £19.20/oz. Platinum is trading at $1,584.25/oz, palladium at $719.00/oz and rhodium at $1,200/oz.
Gold fell $4.80 or 0.,31%% on Friday in New York and closed at $1,575.60/oz. Silver surged to a high of $28.77 in early New York trade before it also fell back off, finishing with a gain of 0.28%. Gold was off 0.31% for the week while silver was down 0.66%.
Cross Currency Table – (Bloomberg)
Gold inched higher in all currencies today supported by physical buying in Asia.
Concerns about the global economy and the outlook for riskier assets have led to renewed physical buying interest in Asia, particularly in China. The increasingly popular gold forward contract on the Shanghai Gold Exchange stood at 320 yuan a gram by 0741 GMT according to Reuters, or $1,600/oz. This is a healthy premium of about $23 to spot gold.
Investors are waiting to see the impact of the spending cuts, known as the "sequester", although the $85 billion cuts are a tiny fraction of the U.S. government's total spending of $3.7 trillion and show the U.S. looks incapable of tacking its very precarious financial position.
Hedge funds and money managers increased their net long positions in gold in the week to February 26 from a more than four-year low hit a week earlier. Those lows are very bullish from a contrarian perspective and a gradual increase in speculative longs in the coming weeks seems very likely.
In contrast to a sharp decline in speculative interest in futures and options over the past month, sales of American Eagle gold coins rose sharply in February on the year, and silver coin sales in the form of one ounce Silver Eagles posted their strongest performance for the month since 1986.
Gold in Dollars (01/01/10 to Today) – (Bloomberg)
China’s foreign currency reserves have surged more than 700% since 2004 and are now enough to buy every central bank’s official gold supply -- twice.
The Bloomberg CHART OF THE DAY shows how China’s foreign reserves surpassed the value of all official bullion holdings in January 2004 and rose to $3.3 trillion at the end of 2012.
The price of gold has failed to keep pace with the surge in the value of Chinese and global foreign exchange holdings. Gold has increased just 263% from 2004 through to February 28, with the registered volume little changed, according to data based on International Monetary Fund and World Gold Council figures.
By comparison, China’s reserves rose 721% through 2012, while the combined total among Brazil, Russia and India rose about 400% to $1.1 trillion.
Continuing diversification into gold from the huge foreign exchange reserves by the People’s Bank of China and other central banks is a primary pillar which will support gold and should contribute to higher prices in the coming years.
Gold prices firm on Asia buying, upbeat US data weighs - Reuters
Gold Snaps Three-Day Decline as Data Signals Extended Stimulus - Bloomberg
Greek Central Bank Says Gold Reserves Worth 4.7 Billion Euros – Business Week
Rhodium Beating Platinum to Palladium on Car Sales - Bloomberg
Silver – Visualized in Bullion Bars – Demon Ocracy Info
Looming Gold Production Cliff That Will Drive Prices Higher – Money Morning
Hedging Funds And Physical Vs Paper Gold – Zero Hedge
No doubt at all that the price of gold is going to and through $3,500/oz – JS Mineset
(4 votes)
- advertisements -
»
- 38514 reads
- Printer-friendly version
- Send to friend
Similar Articles You Might Enjoy:
- Russia, Greece, Turkey, Other Central Banks Buy Gold; China’s PBOC Buying?
- Gold To Top $2,000 On Central Bank Buying: Bloomberg Chart Of The Day
- Asia Buys Gold After Massive Single Trade Sell Off During Bernanke’s Testimony
- Thomson Reuters GFMS Global Head: "Buy This Gold Dip" As $2,000/Oz Possible
- China Gold Demand Voracious - Chinese Yuan Gold Standard?
Chinese ghost cities were built with cash from investors. Very few ghost cities are burdened with the debt that currently plagues U.S. cities.
One good thing about the current corrupt courts system is that, when the time comes, they will perhaps re-set these public sector and corporate pensions without bothering with the law.
A bit of wishin' & hopin' I know.
Forget about China or India. Gold and silver are on their way to zero and all the goldbugs and silverbugs will be exterminated
The only thing headed to zero is the currency's that said gold and silver are valued in.
mmhhh... have you aquired a taste in trolling? if yes: LOL
but one caveat: gold and silver are for strong hands - if by "bugs" you mean overexposed and (over-)leveraged, than: yes, possible
If I read that right, he was speaking for hisself only.
Yes, you need to have strong hands with precious metals.
First of all, if you didn't assure that you have a source of food for your plate, you are doing it wrong. The landscape is littered with the corpses of PM savers that slowly sold all their stash to survive.
You need to pretend that your PMs do not exist. If you start to spend them, "just a little", sooner or later it will be all gone. Do not touch it. Do. Not. Touch. It.
Government can confiscate it? Yes. 90% selling taxes? Possible. You won't be able to cash it anonymously if digital currency is fully implemented? Who knows. Anyway, those things will pass. It can take decades, perhaps even centuries. Gold and silver coins became essentially worthless for hundreds of years in the West after the collapse of the Western Roman Empire.
Precious metals are generational savings. The kind of thing that gets passed for your descendants for many, many generations.
Even the Rothschilds. many years ago, began their fortune with one of them acquiring the first gold coin for the family.
Keep stacking, and good luck for all of you.
That hedge funds and money managers have increased their net long positions for the first time in four weeks is a good sign for a bottom here. It shows that those buyers see these prices as attractive.
Every asset is on its way to zero "on a long enough timeline". Fiat money will be long gone and forgotten when the last human on earth dies.
Put you money where you mouth is eigenvalue and sell some gold/silver calls. Better yet, I'll sell you all the zero puts you want to buy. How many would you like? I'll take as little as $0.01 each.
Chinas leaders are playing fiat games as much as our scum pigmen.
"China’s foreign currency reserves...are now enough to buy every central bank’s official gold supply -- twice." No they're not. Of course.
Let them try to buy it for a paltry $3.3 Trillion. They'll never be able to buy it all for that amount.
try:
they'll never be able to buy any for that amount....once it bacame obvious they were making a bid....
How do you say "shit for shine" in Mandarin?
BS, the price would skitter away like a drop of mercury in a salad bowl !
Food. China's problem is making sure that the Chinese not only have enough to eat, but that food is affordable. The Chinese government stockpiles gold for the same reason gold bugs do: a hedge against inflation. But the Chinese government is more concerned about food reserves than gold reserves.
I wonder how much of Chinese reserves are actually physical bullion marked to market.
Is there any report on the composition of Chinese reserves? How much is in euros, etc?
We don't even know how much gold the U.S. government actually possesses, so how would anybody know what the Chinese government has? It’s anybody’s guess.
Regarding "Looming Gold Production Cliff That Will Drive Prices Higher", recently we had an example of this. Bitcoins.
Mining difficulty for bitcoins increased recently. It is my personal opinion that the recent high prices were caused by lack of liquidity.
China was economically destroyed during Great Depression...they almost came through unscathed due to being on silver standard...they have seen this movie before...
I see history repeating itself...
SILVER PURCHASE ACT OF 1934
No problemo. The west has central banks that have proven their ability and willingness to sell the same gold a heck of a lot more than twice.
And ... would you like some silver with that?
Yeah, I'd say about 2-300 billion into it, the price may jump a little.
So, they (like the Fed) can afford to beat up on the price of paper-gold, and buy the real thing real cheap on the open market, to the extent that it's available, and JPM is forced to play the same game -- or take delivery via its tunnels to CB vaults (London, NY). Cute. Plan accordingly.
gold is dead, long live gold
Who is going to sell it to them? That is the question.
I would...but, alas, I lost it on a recent canoe outing.
Sung to the tune of "There's no business like show busines"...
There's no business like gold business like no business I know
Everything about it is appealing, everything that traffic will allow
Nowhere could you get that happy feeling when you are stealing that golden cow.
There's no people like gold people, they smile when gold prices are low
Even with tons bill-notes that you know will fold, you may be stranded out in the cold
Still you will change it for a sack of gold, let's go on with the show.
What would happen if China decided to buy gold on the market? 1980 is what would happen.
So how are they getting as (nearly as) much gold as GLD holds in one year?
The stock (the 170,000 tons) doesn't matter. It is only the flow (the amount that can be cut loose from those who aldreay hold it) that counts.
What happens when the last man with an ounce says...."ya know, I'm really not interested in selling at anywhere near this price.?
This article is pointless.
Well that is counting only the on-balance sheet debt. If you count unfunded liabilities, where are we?
Do NOT sell your Gold.
I posted this in the past, but will do so again...
In 300 years, when world history books are written in Mandarin, the war on the West will be textbook study for how to use an enemy's perceived strength against itself. It will also likely be mentioned that the writings of Sun Tzu were not heeded. They'll also mention the tell tale signs of social decadence and moral filth, which always precede the decline of an empire. Niall Ferguson may also get a footnote mention, as someone who was not heeded.
I always thought the history books would be written in Jamaican 300 years from now.
That last ounce is going to be reeeeeeeealy expensive. There is always one guy that sets his trade price at a trillion dollars
And one day China will buy JPM twice.
not a bad article, charts need to be higher resolution or larger, and extend further back in time