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China's Gold Hoarding Continues: Over 2,200 Tons Imported In Two Years

Tyler Durden's picture




 

Paper gold in the developed world may trade based on the whims of marginal momentum chasers, and of course, the daytrading mood of the BIS gold and FX trading desk, but when it comes to physical gold and China's appetite for it, one word explains it best: unstoppable.

After rising to a gross 131 tons imported from Hong Kong alone in August, which was the second highest ever monthly import tally, September saw a modest decline to "only" 116 tons: "only" because it is still 67% more than the amount imported a year earlier. 

The total gross imports since September 2011 is now a whopping 2232 tons. Why September? Because that is when we posted: "Wikileaks Discloses The Reason(s) Behind China's Shadow Gold Buying Spree." The chart below confirms precisely said reason.

The gross imports year to date are now over 1,113 tons, 91.3% more than the amount of gold imported through September of 2012.

Netting out exports to Hong Kong, September was virtually unchanged from August, at 109 metric tons vs 110 a month earlier. In other words, September was tied for the third highest net import month in Chinese history.

And yes, we realize that to western thinking buying more when the price is dropping in explicable: ironically even the vast majority of gold bugs are merely interested in a momentum conversion in and out of fiat, thus treating gold as an investable, fiat-denominated asset and not as a currency. China, on the other hand, continues to show that when one's only intention is to purchase as much gold as possible to preserve wealth and purchasing power and/or unleash the gold standard back on the world (either alone or jointly with Russia and/or Germany), dropping or plunging gold prices are merely the icing on the cake.

 

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Sat, 11/02/2013 - 13:10 | 4115400 Gringo Viejo
Gringo Viejo's picture

The West is but very fucked.

Sat, 11/02/2013 - 13:09 | 4115404 bania
bania's picture

conspiracy?

Sat, 11/02/2013 - 13:48 | 4115485 DoChenRollingBearing
DoChenRollingBearing's picture

 

 

The Central Bank of DoChenRollingBearing has a nearly unstoppable hunger to buy more gold as well, limited by its incoming funding of course.

Now that Fringe Blogger Bearing is back in the USSA, buying activity will commence soon.  Our central bank recommends to its investor friends:

Gold, fishez!

Sat, 11/02/2013 - 13:55 | 4115500 Pinto Currency
Pinto Currency's picture

 

This article is somewhat misleading as it equates imports from HK to China as China's gold imports.

The total gold bars delivered on the Shanghai Gold Exchange 2013 YTD is 1750 tonnes so we can be sure that total imports are far more than 2,200 tons in the last two years.

Sat, 11/02/2013 - 14:30 | 4115560 DoChenRollingBearing
DoChenRollingBearing's picture

And China is Number One in gold production, little of which ever leaves...

Sat, 11/02/2013 - 15:04 | 4115618 EscapeKey
EscapeKey's picture

No, you're wrong. The Federal Reserve and JP Morgan are the biggest producers of gold by a country mile.

Sat, 11/02/2013 - 15:24 | 4115654 DoChenRollingBearing
DoChenRollingBearing's picture

Until their reserves run out, smile,,,,

Sat, 11/02/2013 - 15:33 | 4115667 SRSrocco
SRSrocco's picture
TRICK OR TREAT: Fed Smashes Gold & Silver While 2,000 Gold Eagles Were Sold

On Halloween, the FED played a TRICK, while investors had a TREAT of 2,000 GOLD EAGLES sold in one day

Sat, 11/02/2013 - 15:46 | 4115690 Indian_Goldsmith
Indian_Goldsmith's picture

The chinks may have all that, but they haven't got me! ;)

Nor do they have the Gods (godless communists!)

http://indiatoday.intoday.in/gallery/10-richest-temples-of-india/1/5014....

 

Sat, 11/02/2013 - 15:58 | 4115717 markmotive
markmotive's picture

SO what happens to China's gold demand when the Chinese economy blows up?

Hinde Capital on China's Collapse and the Rise of Gold as Official Money

http://www.planbeconomics.com/2013/07/hinde-capital-on-chinas-collapse-a...

Sat, 11/02/2013 - 15:59 | 4115719 James_Cole
James_Cole's picture

WGC report looked fairly healthy, interesting for people who want to understand the mechanics of the price (though people always downvote and rant at me for posting it inexplicably):

http://www.gold.org/download/pub_archive/pdf/GDT_Q2_2013.pdf

Sat, 11/02/2013 - 16:53 | 4115844 Bay of Pigs
Bay of Pigs's picture

No James, there is an easy explanation and one you should be able to grasp.

The WGC is a useless outfit and quoting them on any anything having to do with "understanding the mechanics of the price" of gold is laughable.

Sat, 11/02/2013 - 17:12 | 4115890 Pinto Currency
Pinto Currency's picture

 

2013 gold bar delivery and withdrawal from Shanghai Gold Exchange vault:

 

http://koosjansen.blogspot.ca/2013/10/yearly-chart-shanghai-gold-exchange.html

Sat, 11/02/2013 - 17:27 | 4115918 putaipan
putaipan's picture

and according to the latest willie- they now have a very nice vault in downtown manhattan to store some of it.

Sat, 11/02/2013 - 18:49 | 4116057 ThirdWorldDude
ThirdWorldDude's picture

Willie's been reading ZH: "China's Largest Conglomerate Buys Building Housing JPMorgan's Gold Vault"

 

Welcome to Mrs. Chen's pawn shop at 1 Chase Manhattan Plaza.

Sat, 11/02/2013 - 19:11 | 4116087 ImReady
ImReady's picture

If I were China I certainly wouldn't be keeping my gold in the US. 

Sat, 11/02/2013 - 19:48 | 4116161 Squid-puppets a...
Squid-puppets a-go-go's picture

maybe they bought it as a goodwill gesture to germany - to do an 'audit' for them

Sat, 11/02/2013 - 19:47 | 4116162 Henry Hub
Henry Hub's picture

What do you mean? If China ever wants to take possession of its gold it only has to wait seven years like the Germans.

Sun, 11/03/2013 - 17:19 | 4117722 KnightTakesKing
KnightTakesKing's picture

We think there is a tunnel between the JPM vault and the FRB of NY. I don't think China would have to wait too long for their gold. 

Fri, 11/15/2013 - 20:43 | 4159649 MeelionDollerBogus
MeelionDollerBogus's picture

so THAT's how you do it... not this...

Sat, 11/02/2013 - 21:50 | 4116392 StychoKiller
StychoKiller's picture

I'm bettin' it's just a collection point for shipments eastward...

Sat, 11/02/2013 - 19:16 | 4116088 James_Cole
James_Cole's picture

The WGC is a useless outfit and quoting them on any anything having to do with "understanding the mechanics of the price" of gold is laughable.

Except that all the 'gold experts' quoted by you (and others) have been approx. 100% wrong for the past year whereas the story presented by the WGC in 2012 was completely accurate. 

Anyone interested in seeing how you've been wrong about everything gold related for the past year can read our past exchanges. 

Cue you going off on some unrelated stupidity "James just doesn't 'get' us goldbugs, we want to averge down our prices by buying at...well whatever the fuck price it currently is, who gives a shit, high / low whatever, it all averages man!!"

So enjoy being a moron, whatever. Anyone with a brain + buying gold should read the WGC reports. 

Sat, 11/02/2013 - 15:39 | 4115680 nuinut
nuinut's picture

Let’s assume the existence of a Big Entity (BE), running a big surplus, and BE wants to accrue a large physical gold reserve commensurate with BE’s high and advancing global status. BE is expecting the future gold price to be much higher vis-a-vis the goods BE produces.

To avoid unduly running the price whilst accumulating, BE indirectly sells gold to those not demanding physical delivery.

If BE sells XAU/USD via an LBMA bullion bank (BB), won’t said BB need to hedge their exposure, by selling commensurate gold futures or other correlated instruments for example? This makes it the BB’s problem to find and if necessary “stimulate” unallocated demand in order to make a low-risk spread. This is what banks do, no? Match supply and demand?

Concurrently, BE could be buying allocated and physical gold from numerous other sources in an artificially depressed market, could they not?

Obviously BE are net overpaying for these reserves, but not necessarily if BE was projecting the future price to be enough multiples of the current price. Any “overpayment” is simply the cost of slowing the ascent of the price and affecting the mood of the market, regularly shaking out weak hands and stop-loss orders.

When the market at last runs away, BE has plenty of otherwise practically worthless T-Bills with which to fulfil contractual obligations to BB, which were accumulated as another leg of the gold accumulation strategy, instilling confidence in the dollar’s debt and thus also reducing gold demand and keeping this gold accumulation option open as long as possible.

There must be some potential future price of gold at which it would be worth the costs to BE to create such a supply, when compared with the crude strategy of just entering the gold market as a physical buyer and immediately running the price and/or bifurcating the paper/physical gold hybrid market.

It's just a matter of whether or not BE believes that potential future price will actually occur or not.

BB just looks like the “bad guy” to goldbugs, but is really a net-neutral tool making the market and collecting the spread.

Expensive gold acquisition from today’s perspective may turn out to be cheap by tomorrow’s, if BE is reading their tea leaves correctly. Just depends how important BE feels it is to acquire more gold reserves.

 

Entire strategy hedged in dollars at all times.

Just a thought.

Sat, 11/02/2013 - 15:46 | 4115692 nuinut
nuinut's picture

I'm not claiming this is happening, just saying it appears feasible.

 

Current movement of bulk physical will sooner or later be moderated by price.

Sat, 11/02/2013 - 16:34 | 4115807 disabledvet
disabledvet's picture

http://koosjansen.blogspot.com/2013/10/pm-trade-switzerland-2013-q3.html and http://seekingalpha.com/article/1776572-weekly-comex-gold-inventories-la... General Motors sales are soaring as a result of the truly staggering energy boom in the Central US. What has been THE feature of this recovery to me has been this: http://www.nacsonline.com/YourBusiness/FuelsReports/GasPrices_2013/Pages... the world runs on diesel fuel...save for the USA which runs on gasoline/ethanol "and dirt cheap cars." in other words this energy revolution has created a massive market for diesel fuel which remains very expensive in my view and will remain so for the forseeable future. In the meantime gasoline...which is basically a waste product...a very dangerous waste product i might add...is now in a massive glut. Why is Fed Ex stock going through the roof? you can run those vehicles on gasoline/flex fuel which right now is dirt cheap and probably about to go a lot lower in price (almost impossible to export (ethanol is highly corrosive)/only used as a transportation fuel.) Right now the Toyota Prius gets a solid 50 mpg's both City and Highway. This is not a small car. If that car becomes the New Normal AND becomes a flex fuel vehicle then the price of gasoline relative to diesel fuel could really "gap out." (4 bucks to a dollar? in effect diesel and "battery" consumers would be subsidizing flex fuel) and Toyota warranty's their batteries for a long time as well. Don't get me started on Tesla and Solar City. http://www.cnbc.com/id/100943620

Sat, 11/02/2013 - 19:06 | 4116079 phaedrus1952
phaedrus1952's picture

Good stuff, Vet.  I am still somewhat surprised that more people do not comprehend the emerging effects of the unfolding energy boom due to unconventional oil field development.

Eagle Ford and the Bakken will be only the seventh and eigth oil fields in history to surpass one million barrels per day output when the Bak hits it shortly. 

As far as transportation fuel goes, I am only now starting to appreciate the impact CNG is/will have on vehicles - esp. heavier, over the road rigs.  There have been several breakthroughs in lowering the costs and operability of CNG engines, as well as the micro-liquification capabilities companies such Dresser Rand are just now introducing to the market (LNGo).  As nat gas costs are bout 1/3 less than diesel - at CURRENT prices - to send a ship/truck/train on its way, I can forsee a continuing surge in this direction.

Cali just signed off on not preventing fracking which may open up the Monterey Shale for development.  The Monterey may dwarf the  Bakken and EF in size.  (As an aside, turns out there have been couple of fracks PER DAY ocurring out here for years as the overseeing govt. peeps never considered it more than routine activity.)  Interesting times.

Sat, 11/02/2013 - 18:15 | 4116007 DoChenRollingBearing
DoChenRollingBearing's picture

@ nuinut

Good seeing you around these parts.

Sat, 11/02/2013 - 18:45 | 4116054 Hulk
Hulk's picture

You can see him ??? Shit, I must be doing sumpin wrong again...

Sat, 11/02/2013 - 19:54 | 4116175 Henry Hub
Henry Hub's picture

I though everyone knew that you had to down load the ZH optical app. to see everyone. Get with the program.

Sat, 11/02/2013 - 19:19 | 4116090 nuinut
nuinut's picture

.

Sat, 11/02/2013 - 19:33 | 4116133 DoChenRollingBearing
DoChenRollingBearing's picture

(well, barely...)

Sat, 11/02/2013 - 19:46 | 4116156 nuinut
nuinut's picture

Hey DoChen, I just changed my mind on something longer I posted there is all, and deleted it.

Nice to see you (if you know what I mean) too.

Sat, 11/02/2013 - 20:55 | 4116280 DoChenRollingBearing
DoChenRollingBearing's picture

.

 

 

;)

Sat, 11/02/2013 - 21:07 | 4116303 nuinut
nuinut's picture

Ohh yeah, this ZH optical app is good isn't it?

Pity you're not a little easier on the eye there, DoChen...

Sat, 11/02/2013 - 15:30 | 4115660 Bobbyrib
Bobbyrib's picture

Paper gold?

Sat, 11/02/2013 - 16:34 | 4115810 CPL
CPL's picture

Nope, real gold and real silver.  Paper will be outlawed.  Period.  Cash and carry from now on is my understanding.

Sat, 11/02/2013 - 19:26 | 4116114 bubblemania
bubblemania's picture

bullish

Sat, 11/02/2013 - 21:49 | 4116388 StychoKiller
StychoKiller's picture

Everybody "Wang Chung" tonight!

Sat, 11/02/2013 - 14:27 | 4115557 Wahooo
Wahooo's picture

Then it must be true in the new normal.

Sat, 11/02/2013 - 16:33 | 4115804 CPL
CPL's picture

Necessity to restore balance in the economic system because it's beyond insane now.

Sat, 11/02/2013 - 13:11 | 4115407 FieldingMellish
FieldingMellish's picture

East hoarding... West unhoarding. New world currency... imminent. 

Sat, 11/02/2013 - 13:39 | 4115471 Manthong
Manthong's picture

When China decides it wants to lob a hand grenade into the US’s and Western world’s mess kit, all it has to do is move a few percent of its reserves into the metals futures market and stand for delivery.

It will do so when it determines that its future growth strategy must be turned away from exports to the Chinese internal market and the nose-diving value of its dollar reserves are fully hedged by its huge gold stash.

Sat, 11/02/2013 - 13:53 | 4115496 Urban Redneck
Urban Redneck's picture

When China does that, they will no longer be able to buy gold at Uncle Ben's CRAZZZY Going Out of Business Sale prices, so it's in their interest to hold that card and keep this sale on going as long as possible...

Sat, 11/02/2013 - 21:49 | 4116387 tarsubil
tarsubil's picture

When China finally does pull the rug out, won't it be war? Won't owning physical gold (which will then be seen as the curse that is "destroying" America's economy) be an act of treason?

Deep down, don't we all know that this is not going to end well?

Sat, 11/02/2013 - 21:58 | 4116405 StychoKiller
StychoKiller's picture

Depends, think Blankfein and Dimon own any Au?  Remember what JP Morgan said:  "Gold is money, everything else is credit."

Sat, 11/02/2013 - 16:08 | 4115735 Being Free
Being Free's picture

China doesn't have to lob anything into our mess kit, O and the statists are doing it for them.  All they need to do is sit back, buy gold, and watch.

Sat, 11/02/2013 - 20:19 | 4116224 AllWorkedUp
AllWorkedUp's picture

and yet, gold cannot go up under any circumstance. Paper gold is plentiful and the criminals in the US own the price. Until that changes, it doesn't matter if China owns all the gold on the fucking planet.

Sat, 11/02/2013 - 14:22 | 4115539 Bokkenrijder
Bokkenrijder's picture

...and that's why I seriously doubt that The West is behind this manipulating down of the Gold price.

Just look at who's selling and who's buying, and then give me one reason why China WOULDN'T be manipulating the price downwards?

China buys 2200 tons in 2 years, and now look at what happened to the gold price during the last 2 years...

Sat, 11/02/2013 - 14:55 | 4115599 spinone
spinone's picture

Why would the USA trade gold for dollars.  It can print them at will for no cost.

Sat, 11/02/2013 - 15:33 | 4115670 Bobbyrib
Bobbyrib's picture

Gold breaking out is seen as dollar weakness. They must manipulate gold to make sure the dollar stays relevant..until they can't.

Sat, 11/02/2013 - 14:19 | 4115540 thisandthat
thisandthat's picture

The West is very buttfucked.

Sat, 11/02/2013 - 16:20 | 4115758 RockyRacoon
RockyRacoon's picture

That is as valid an observation as any herein.

I peeled off a few ounces from the disgorging of gold to China.

Got yours?

Sat, 11/02/2013 - 16:29 | 4115784 thisandthat
thisandthat's picture

Alas, I lost mine in an unfortunate diving accident...

Sat, 11/02/2013 - 14:21 | 4115546 SilverDoctors
SilverDoctors's picture

Indeed it is.  We fully expect when China finally updates its official gold reserves that the number will be in the 5-7,000 ton range at a minimum.  Imagine if they were to announce a new gold backed yuan and allow an open,  international inspection/audit of their reserves!

Jim Willie addresses this in his latest:

The Game is Over. King Dollar is Dead! – Gold to $7,000 Silver to $250+!
Sat, 11/02/2013 - 14:55 | 4115594 DoChenRollingBearing
DoChenRollingBearing's picture

Thank you for the link, SilverDocs.  Jim Willie is always one of my favorite reads.  But, he is not always correct!  Bron Suchecki (a honcho at The Perth Mint) denied that China (or anyone in Asia) was paying HUNDREDS of dollars (per oz) over spot for kilo bars after Jim Willie wrote that they were.

I also find it a little hard to believe that his near-future international payment via a Gold Standard will happen.  I Googled this and other of his ideas a couple of months ago and found NO OTHER references to this and a couple of other ideas (other than his own articles).

Jim Willie is a great read, and has a great mind.  But, having a pinch of salt nearby is highly recommended.

***

Diclosure: gold at $7000 (Jim Willie) or "$55,000" (FOFOA) would be great for the Bearing Guy, our company's position in Peru would be much strengthened.

 

Sat, 11/02/2013 - 15:46 | 4115659 Bay of Pigs
Bay of Pigs's picture

Bron Suchecki, Australia's version of Jon Nadler. Great if you like MSM shills and apologists for the CRIMEX, LBMA and bankster frauds like GLD.

Give me a break.

Sat, 11/02/2013 - 16:20 | 4115759 ebear
ebear's picture

"Jim Willie is a great read, and has a great mind."

Yup.  Someone that great really needs his own theme song...

http://www.youtube.com/watch?v=bXUa6VVqq4c

Sat, 11/02/2013 - 16:25 | 4115774 DanDaley
DanDaley's picture

Here's a nice 45 min. interview with Jim Sinclair on the future of gold...and let's remember the obvious, it's the dollar that is going down, gold is as it ever was.

 

http://www.youtube.com/watch?v=8IQ_TBJHrcU#t=346

Sat, 11/02/2013 - 17:08 | 4115880 markar
markar's picture

I read Willie and don't recal him stating China was paying a $200 premium over spot. Why would they? They can soak up everything they want at/near spot--until the Comex/GLD run dry. That's when the real games begin.

Sat, 11/02/2013 - 14:58 | 4115603 Manthong
Manthong's picture

If and when they announce 7500 tons -  and they ramp the price$ 5K/ounce by crashing the paper market. that won’t matter because their 7500 tons will be worth $ 1.2 Trillion (their current USD reserves) and the dollar will be toast.

After that, and after recovering their sunk cost at the low prices of the last few years,  every dollar gold goes up in price is pure profit to them

Their only problem is political to the extent that they might not want to see world chaos and the west totally on its knees and economic to the extent that they need imported goods and the jobs supported by exports.

Sat, 11/02/2013 - 16:26 | 4115775 jerry_theking_lawler
jerry_theking_lawler's picture

why not?? western chaos would make any plight inside China seem minor...would be very nationalistics (eat more Chinese) plus the value of their currency could support internal consumption. all i know is that it is very exciting..!!..

Sat, 11/02/2013 - 16:32 | 4115798 DanDaley
DanDaley's picture

May you live in exciting times.  Old Chinese curse

Sat, 11/02/2013 - 17:32 | 4115931 post turtle saver
post turtle saver's picture

I wonder what US and EU G6 gold reserves will be worth when this happens... which together are over twice as large as China announcing 7500 tonnes in reserve (which is ludicrous, because as recently as June they announced 1500 tonnes reserve, no way in hell they've accumulated 6000 tonnes since then)...

if you clowns think the western world isn't hedged against these sort of shennanigans, you've got another think coming

Sat, 11/02/2013 - 17:48 | 4115965 Herd Redirectio...
Herd Redirection Committee's picture

"the western world"

The sovereign governments of the west have been used as bagholders by Organized Crime, basically.   Its called 'busting out the joint'.  So the criminal elite are hedged, yes, but the avg. person and the sovereign governments? No.  They are not hedged at all.

Sun, 11/03/2013 - 15:30 | 4117584 post turtle saver
post turtle saver's picture

nothing you posted addresses what I wrote, namely a) no way in hell China reports sovereign reserves in the 7500 tonne range on the next update, 2) as such, no way in hell they have any leverage over western economies that have reserves that are well over that, 3) not to mention that rising tides lift all boats and, if their gold reserves go up in value by whatever means, the western reserves do as well, so how in the hell does that accomplish anything?

and, as mentioned elsewhere, it's not like the US, Australia, etc. are slouches when it comes to gold mining production themselves... where is this great event that China can trigger that drops the floor out from underneath the west? and, when they do, who in the hell are they going to sell their stuff to? domestic consumption? seriously? HA

China and the west are in a judo match... all you guys see are the holds China has on the west, what you don't see or refuse to see are the holds that the west has on China... which, even now, are of _superior leverage_ to what China can muster... do not wait around for China taking over the world so you become wealthy on your gold holdings, you'll turn blue holding your breath in the process

Fri, 11/15/2013 - 20:31 | 4159632 MeelionDollerBogus
MeelionDollerBogus's picture

"western reserves" will be revealed to be zero. US will claim ownership of other nations' gold for "national security" and war will begin in earnest.

Sat, 11/02/2013 - 14:21 | 4115547 caShOnlY
caShOnlY's picture

The West is but very fucked.

The West is going to be very but fucked.

Sat, 11/02/2013 - 14:57 | 4115605 Pooper Popper
Pooper Popper's picture

Gold is Sexy!

Sat, 11/02/2013 - 13:09 | 4115403 ZeroPower
ZeroPower's picture

What's a few tons amongst friends?

Sat, 11/02/2013 - 13:11 | 4115409 fonzannoon
fonzannoon's picture

funny how the price does not have to rise to curb that insatiable demand. I remember Kyle bass saying 'price will solve everything". I thought he meant higher prices.

Sat, 11/02/2013 - 13:23 | 4115435 Tinky
Tinky's picture

Bass didn't say that. He was qouting the representative of the bullion bank from which he bought (and took delivery of) gold for a university. When he asked the representative what would happen if more than a small percentage of bullion "owners" demanded delivery simultaneously, the latter uttered your qoute.

Sat, 11/02/2013 - 13:30 | 4115448 fonzannoon
fonzannoon's picture

good point. But it seems like a fair statement in a normal marketplace. But apparently we are on another planet now. 

Sat, 11/02/2013 - 13:37 | 4115465 Tinky
Tinky's picture

No question about it, and I actually find it to be increasingly dream-like.

Sat, 11/02/2013 - 15:19 | 4115636 Harbanger
Harbanger's picture

"price will solve everything" is true, Because there will only be cash settlement.  Everyone will be "paid".  Lets remember that the main thing that gives gold it's stability is it's limited physical supply.  Countries like China and Russia are hoarding gold to strengthen the value of their own future paper currencies.  It's a mathematical fact that Comex will be forced to settle in cash-only soon, no doubt about it, that's the day we begin to find the real price of physical.

Sat, 11/02/2013 - 15:22 | 4115646 DoChenRollingBearing
DoChenRollingBearing's picture

+ $55,000

And if it's all peaceful, we, the physical gold owners, will all win big.

Sat, 11/02/2013 - 16:45 | 4115831 Spigot
Spigot's picture

For a time, but consider that if gold is declared a "strategic" metal by the US.Gov and then if the Executive invokes Emergency Measure xxxxx (I can't recall the EO # right now, developed under Roosevelt) to take control of all such strategic metals in the country, well then you have a problem. Fact is that it is known that there is 8-9,000 metric tonnes of gold in private hands in the US. If the thugs with guns decide to make your gold their national treasure in order to re-stabilize the US trading position and currency, then 1) either you WILL give up your gold, or 2) you will find a way to leave the US (with it in hand somehow, maybe in your wooden leg).

 

I know, I know, you lost your gold in a boating accident.

Sat, 11/02/2013 - 17:02 | 4115869 markar
markar's picture

Really? How much of that 9000 alleged  tons in the US is in the form of jewelry? The govt shaking down rings, necklaces, bracelets, etc. is laughable

Sat, 11/02/2013 - 17:21 | 4115909 Spigot
Spigot's picture

I would suggest you do not know the depths of depravity which desperate men will descend to, if they feel the need. Mind you, they have a few long rifles to contend with and 10's of billions of rounds of ammo in the same hands that have the gold. You get the idea.

Sat, 11/02/2013 - 17:54 | 4115973 Herd Redirectio...
Herd Redirection Committee's picture

They would only get the low hanging fruit.  Its always a cost/benefit analysis, and if the costs exceed the benefits...

Fri, 11/15/2013 - 20:29 | 4159627 MeelionDollerBogus
MeelionDollerBogus's picture

They have nerve gas. They have drones. They now even have mini-drones.
Everyone is low-hanging fruit.

Sat, 11/02/2013 - 13:12 | 4115411 Bay of Pigs
Bay of Pigs's picture

Moar importantly, where is all this gold coming from?

Sat, 11/02/2013 - 13:14 | 4115420 fonzannoon
fonzannoon's picture

BOP how much longer is this going to go on for. I'm losing patience.

Sat, 11/02/2013 - 13:19 | 4115428 Bearwagon
Sat, 11/02/2013 - 13:22 | 4115433 Bay of Pigs
Bay of Pigs's picture

I don't get it either fonz. If these numbers are real (and I don't know if they are), someone's vault is being emptied at a pretty rapid pace.

How the gold price could drop nearly $600 an ounce the last two years with this kind of physical demand is simply bewildering.

Sat, 11/02/2013 - 13:25 | 4115436 Bearwagon
Bearwagon's picture

These numbers aren't just not real, they even aren't surreal. http://en.wikipedia.org/wiki/Surreal_number  :)

Sat, 11/02/2013 - 13:32 | 4115457 fonzannoon
fonzannoon's picture

maybe it is being sold at substantially higher prices behind the scenes, they just don't want people to know.

Still....it makes no sense. I can wake up every day and go buy gold. Plenty of places have plenty of inventory. I would think that would have dried up by now if a tsunami was coming. The fact that the little guy has such ample physical available to them make me think we are not at the place where everyone on here believes we are at. You know what I mean?

Sat, 11/02/2013 - 13:44 | 4115481 Bay of Pigs
Bay of Pigs's picture

That's certainly possible. It also appears they are importing gold behind the scenes and avoiding the exchanges. What that means is another question.

"This is verified from Shanghai Gold Exchange (SGE) physical deliveries and from Alex Stanzcyk, Chief Market Strategist at Anglo Far-East Bullion, who Jansen spoke with directly. Stanzcyk said, “China imports a lot that’s not going through Hong Kong (or through the SGE!)”.

In the interview Stanczyk explained how one of their partners had lunch recently with the head of the largest global operations company in security transport. He said there is a lot of gold that they’re moving into China that’s not going through exchanges. If the gold is for the government they don’t have to declare where it’s going. They don’t have to declare where it’s going in, or where it’s heading. If you look at the way the Chinese do things, why would they tell?"

http://www.silverdoctors.com/switzerlands-gold-exports-go-through-the-ro...

Sat, 11/02/2013 - 13:48 | 4115491 game theory
game theory's picture

China will eventually reach the point where they can't import any more gold...and then maybe they'll let their currency appreciate. Oh wait, no they won't. Hmm....I wonder what plan C is?  Maybe sand from the Sahara.

Sat, 11/02/2013 - 14:20 | 4115513 Winston Churchill
Winston Churchill's picture

They are not going to back the yuan with gold.

One day soon , the Arabs will only accept payment in gold for their oil.

Not a derivative like a gold backed yuan, but gold backed by gold.

Then the largest producer of gold in the world wins.

Who is that again ?

Sat, 11/02/2013 - 17:09 | 4115883 disabledvet
disabledvet's picture

that should be this country: http://www.futurecurrencyforecast.com/pound-sterling-to-south-african-ra... i did see the spec's came out on the new "Zumwalt class destroyer." http://www.newstimes.com/news/slideshow/The-Navy-039-s-new-Zumwalt-class... http://www.jeffhead.com/usn21/ddg1000.htm six hundred feet long and displacing 14,500 tons seems kinda big for a destroyer. according to wiki "in fact bigger than a German pocket battleship."

Sat, 11/02/2013 - 17:43 | 4115955 post turtle saver
post turtle saver's picture

hey, maybe one day the US will only accept gold for all the energy the US exports... since the US is now the number one energy producer in the world... not to mention the top holder of gold reserves in the world...

so then, the US takes all of China's gold while they try to modernize a society of well over a billion people to western levels (good luck with that)... not to mention that the US keeps on producing gold at a clip of around 220-230 tonnes a year (which has been maintained since 2006 and shows no sign of letting up)...

so, who's sitting in the catbird seat now?

Sat, 11/02/2013 - 20:21 | 4116231 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Well the Persians are ahead of the curve aka Iran.

Fri, 11/15/2013 - 20:12 | 4159607 MeelionDollerBogus
MeelionDollerBogus's picture

one day soon the Arabs will be OUT OF oil and Russia will have more for sale.

Sat, 11/02/2013 - 18:12 | 4116001 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Can you say JPM.

Sat, 11/02/2013 - 16:24 | 4115767 ebear
ebear's picture

"BOP how much longer is this going to go on for. I'm losing patience.'

Longer than anyone betting against it can stay solvent would be my guess.

Sat, 11/02/2013 - 19:26 | 4116107 Hulk
Hulk's picture

3 more dayz fonz, three more dayz!!!

Sat, 11/02/2013 - 13:14 | 4115418 Wolferl
Wolferl's picture

China is one of the largest manufacturer of juwellery. Most of the gold they import gets exported as jewellery.

Sat, 11/02/2013 - 13:20 | 4115426 fonzannoon
fonzannoon's picture

exported through QVC to america to end up pawned and sent back to China like that south park episode?

Sun, 11/03/2013 - 06:15 | 4116928 Wolferl
Wolferl's picture

Spot on.

Sat, 11/02/2013 - 13:24 | 4115437 XenoFrog
XenoFrog's picture

Source?

Sat, 11/02/2013 - 15:01 | 4115614 Carl Popper
Carl Popper's picture

I missed you, you cute little zionist you.

Sat, 11/02/2013 - 15:16 | 4115638 DoChenRollingBearing
DoChenRollingBearing's picture

I see nothing wrong with XenoFrog's comment.  I too would like to see the source.

Sat, 11/02/2013 - 13:27 | 4115443 Bay of Pigs
Bay of Pigs's picture

That's hogwash.

Sat, 11/02/2013 - 23:42 | 4116607 DirkDiggler11
DirkDiggler11's picture

If you are talking gold plated tungsten then you sir are in fact correct. China leads the world in exports of fake shit.

Sun, 11/03/2013 - 06:18 | 4116930 Wolferl
Wolferl's picture

True, the gold percentage in cheap juwellery from China gets reduced more and more. But you still need gold for that, even if the stuff is just gold plated. It´s the overall quantity of cheap jewellery they export world wide that matters.

Sat, 11/02/2013 - 13:14 | 4115419 The Abstraction...
The Abstraction of Justice's picture

This is such a fecking crime. Banksters should hang for this alone.

Sat, 11/02/2013 - 13:16 | 4115423 Sufiy
Sufiy's picture

Now it is clear why The System is so worried

Capitol Account: GATA Chris Powell On Gold And Silver Manipulation

Why The System is so concerned now with its exposure of the Gold and Silver market manipulation? We continue to dig out the available information for your own conclusion. Chris Powell provides very simple explanation - these markets are manipulated by the Government agents themselves.
Infamous PPT comes to light in this conversation as well - under the law Exchange Stabilisation Fund is exempt from the Freedom Information Act and any market supervising at all.

http://sufiy.blogspot.co.uk/2013/11/capitol-account-gata-chris-powell-on...

Sat, 11/02/2013 - 13:19 | 4115427 ZH Snob
ZH Snob's picture

all of this suspicion.  maybe they just plan on making some jewelry to sell to tourists in Bejing.

Sat, 11/02/2013 - 15:50 | 4115696 ZH Snob
ZH Snob's picture

guess my down voters just don't get subtle sarcasm

Sat, 11/02/2013 - 13:21 | 4115432 Seize Mars
Seize Mars's picture

Yeah, but we've got SHITLOADS of pieces of paper with occult symbols on them.

Sat, 11/02/2013 - 13:26 | 4115438 Devotional
Devotional's picture

<---- this dude is also hoarding GOLD making him awesome.

Sat, 11/02/2013 - 13:48 | 4115487 therevolutionwas
therevolutionwas's picture

Hey!  That's Mogumbo Guru Talk (MGT).  You, like myself, must be a Mogumbo Guru Junior Ranger (MGJR).  This investing stuff is easy!

sarc

Sat, 11/02/2013 - 14:27 | 4115554 DoChenRollingBearing
DoChenRollingBearing's picture

Hey!  Don't you be dissin Mogambo Junior Rangers!

He helped me get into the Tinfoil Hat Brigade!

 

:)

Sat, 11/02/2013 - 15:43 | 4115684 Bearwagon
Bearwagon's picture

You know that you'd better get yourself a massive Rhenium-hat STAT, right? :)

Sat, 11/02/2013 - 18:25 | 4116025 DoChenRollingBearing
DoChenRollingBearing's picture

Rhenium is very heavy...  But tough too!

Sat, 11/02/2013 - 13:29 | 4115449 game theory
game theory's picture

China's domestic gold production is through the roof over the past few years so gold prices will be impacted by this for a long time.

Sat, 11/02/2013 - 13:32 | 4115453 AurorusBorealus
AurorusBorealus's picture

"China, on the other hand, continues to show that when one's only intention is to purchase as much gold as possible to preserve wealth and purchasing power and/or unleash the gold standard back on the world (either alone or jointly with Russia and/or Germany)"

Or preparing for the possibility of a commodity-backed SDR, which seems to grow toward the ever more likely outcome, as the only way to preserve order in what is quickly becoming a global crisis as the American empire unravels.  The real question is: what will become of the U.S. in this new world order?

Sat, 11/02/2013 - 13:33 | 4115456 ciscokid
ciscokid's picture

Something just does not seem right!!! Is the west that stupid to allow China to buy all this gold???????

Sat, 11/02/2013 - 13:50 | 4115495 game theory
game theory's picture

what's wrong with that? we weren't using it.

Sat, 11/02/2013 - 16:56 | 4115849 e-recep
e-recep's picture

it's a barbaric relic, anyway.

Sat, 11/02/2013 - 19:26 | 4116116 Hulk
Hulk's picture

and backed by nutin...

Sat, 11/02/2013 - 17:10 | 4115884 CHX
CHX's picture

true, but we'll be missing it.

Sat, 11/02/2013 - 16:07 | 4115732 ZH Snob
ZH Snob's picture

it is not the west, as in any particular nation, it is the traitorous individuals who conduct business in those countries, own the politicians in those countries and see themselves as perfectly entitled to raid the wealth of those countries.

Sat, 11/02/2013 - 17:45 | 4115959 LoneCapitalist
LoneCapitalist's picture

China, holding all those treasuries and dollar reserves, has considerable leverage I think.

Sat, 11/02/2013 - 13:36 | 4115464 Racer
Racer's picture

China is absolutely delighted with central bwanksters manipulation of paper gold prices, all the more they can  swop for their toilet roll US dollars... they are grinning like Cheshire Cats 

Sat, 11/02/2013 - 13:38 | 4115472 Diablo
Diablo's picture

"Wondering why gold at $1850 is cheap..."  buahahaha

2011: china buying gold....its gotta go up

2013: china buying gold...its gotta go up.

guess no one here sees theres not much correlation between the two eh?

Sat, 11/02/2013 - 13:41 | 4115477 fonzannoon
fonzannoon's picture

it's bwahahaha

the w is key.

Sat, 11/02/2013 - 14:53 | 4115593 Seeking Aphids
Seeking Aphids's picture

What we see is that there is no correlation between the paper price of gold and its value to most of the planet......the Chinese and others are unloading their worth-less $$'s and buying physical assets including gold....the $US cannot remain high if currency debasement continues.....once it becomes clear that the E in QE stands for eternity there will be a massive move out of the $US.........

Sat, 11/02/2013 - 15:52 | 4115703 Al Huxley
Al Huxley's picture

Good point Diablo.  Since the dawn of recorded history America has been the leader of the world, and the USD has been its reserve currency.  It's never been otherwise, and never will be.  And since China is America's friend, their hoarding of gold and dishoarding of treasuries is of no consequence, and most likely a vote in favor of the (inevitable, unstoppable, unalterable) continuation of debt-fueled US dominance funded by the hard work of Chinese peasants.  You are quite the analyst.

Fri, 11/15/2013 - 20:07 | 4159599 MeelionDollerBogus
MeelionDollerBogus's picture

ah, the 'american' spelling of anal-cyst. My spell-checker needs to be updated for 'american' to have the mattering words.

Sat, 11/02/2013 - 13:42 | 4115478 I am Jobe
I am Jobe's picture

While  in Amerika, sheeples collect APPS , IPHONES, and Obamaphones to show off. 

Sat, 11/02/2013 - 13:42 | 4115479 Goldilocks
Goldilocks's picture

Weapons of Mass Instruction John Gatto
http://www.youtube.com/watch?v=qbhQ7aepvkg (1:09:50)

Sat, 11/02/2013 - 13:47 | 4115489 olto
olto's picture

goldbugs

Sat, 11/02/2013 - 13:49 | 4115493 Iam Yue2
Iam Yue2's picture

It is all part of backing the yuan with gold when they move to turn it into a global reserve currency.

Sat, 11/02/2013 - 13:56 | 4115501 thewayitis
thewayitis's picture

 

 

   Yessa .....Give me the gold.....

 

 

Sat, 11/02/2013 - 14:02 | 4115502 falak pema
falak pema's picture

The west has one advantage over the East : it has Fiatflashgordon and Krugmanite; superhero and his WMD, made out of thin air.

Pure concentration of photonic energy that the sun provides the Shaman when he utters the magic formula to extract from each dying SUpernova of the galaxy its twilight gleam of godly breath in one megaHadron collider moment.

You can hear Whitney's ghost singing up in the clouds : "one moment in time", as each Supernova flash says celestial adieu; the energy flowing in laser fulgurance into Krugmanite stonemountain, stored forever as microwave energy that has zero pollution. Krugmanite mountain sings "shake rattle and roll" like Miley pole dancing, when Supernova death enhances its golden treasure. Stored in deep chill like champagne on ice;  to then be released to the Tesla mega consumer supply chain and universal power grid at a price defying fiat devaluation. "The more you drive the more you thrive on sunlight."

"Take that you Carbon Demon" says New Frontiersman "O", as he watches each Supernova render its last breath of awesome photonic energy into the hands of Shamanista charm.

"We have conquered FossilMordor. We now have unlimited photonic energy for each supernova that dies." Shouts Fiatflashgordon to the heavens. "I am king of the Universe and fiatfartharmony now reigns on the Earth."

Next installment of this thrilla in the Milky galaxy of wet dreams will relate the inexorable reply of Carbon Demon when he spews fire and brimstone and unleashes the tsunami of Kraken on Fuku's teetering, toxic Strontium bleeding coastline.

WHat will Fiatflashgordon do when faced with this awesome challenge from the darkest depths of nasty ANtimatter gone global blanket?

As it will destroy the world and make the universal Twerk the new circle jerk of young Millennials drowning by millions in ecological armageddon.

Read MOAR soon; only on ZH loony tunes.

Sat, 11/02/2013 - 14:00 | 4115505 Seasmoke
Seasmoke's picture

wait, they have the physical gold AND the US fiat ..............Houston, WE HAVE A PROBLEM !!!!!!!!

Sat, 11/02/2013 - 14:00 | 4115507 GrinandBearit
GrinandBearit's picture

China is setting the example... people had better wake the fuck up. 

Sat, 11/02/2013 - 14:10 | 4115517 29.5 hours
29.5 hours's picture

 

Idiots Chinese. Snookered again. Wait 'til they find out you can't eat the stuff and it does not pay interest.

In return, they gave us the formula for gun powder.

Pity the poor fools...

 

 

Sat, 11/02/2013 - 14:16 | 4115534 Pareto
Pareto's picture

How does one pity oneself?

Sat, 11/02/2013 - 14:24 | 4115552 therevolutionwas
therevolutionwas's picture

Yeah, we showed'em!

Sat, 11/02/2013 - 14:28 | 4115556 dizzyfingers
dizzyfingers's picture

http://www.mybudget360.com/federal-reserve-balance-sheet-federal-reserve-accounting/

What is the Federal Reserve’s end goal? Follow the money and you will find no intention of tapering, out of control public debt, and financial steroids for stocks. Fed balance sheet up $55 billion in one week.

The Federal Reserve is known for producing convoluted and purposely hard to decipher messages.  The media is driven by what the Federal Reserve says but fails to analyze what is truly happening.  The Fed is driving in a car with no brakes.  This is clear given that the Fed balance sheet increased by $55 billion in one week (or a rate of $220 billion in one month).  Not only is the Fed not tapering but it appears to be accelerating Quantitative Easing.  Follow the money and you are led down a path of no return.  The Fed is juicing the stock markets and is perfectly fine with Wall Street creating another real estate bubble.  Many poor and working class Americans are still deep in what appears to be a recession.  Those with the ability to access the digital capital of the Fed are given an opportunity to gamble and speculate while low wage capitalism engulfs the middle class.  What is the end goal for the Federal Reserve?

 

Fed balance sheet up $55 billion in one week

The Fed’s balance sheet is now up to $3.9 trillion:

I thought it was going to take longer before breaching the $4 trillion mark but we are not far from hitting this.  The housing market is already showing signs of massive overheating.  The main drive of QE is to provide artificially low rates in the market but all this has done is recreated mass speculation.  It is hard to see how this is actually improving the underlying economy.

The increase of $55 billion came from:

Increase of $21 billion in bank reserves

Increase of $32 billion in other Fed liabilities

The bulk of the other liabilities are largely from QE.  The Fed is betting on the law of large numbers.  People will simply glaze over when they hear $4 trillion.  In fact, on the other side of the aisle, we have our public debt that completely blasted through the $17 trillion mark without skipping a beat:

The US has no way of avoiding a soft default via a slow and methodical inflation.  The costs of the bailout and the current artificial market are being supported by the working and middle class while a very small portion of the population continues to extract wealth from the real economy.  If you needed any more proof that the current recovery is facing challenges US manufacturing had its first real contraction going back to 2009:

This is not a positive sign.  The Fed has made it appear, at least in their statements that the current end game involved slowly moving away from QE.  Yet the exact opposite is happening.  So what does this mean for you?  The dollar is going to have pressure on the downside.  Look at the cost of housing, cars, college, and healthcare and ask yourself if things are really getting cheaper.  Wages are stagnant so you see how this rebalancing is going to play out.  The Fed is favoring stocks and banks at all costs.  Yet this isn’t necessarily a winning strategy for the overall economy.  In other words, massive risk is rampant in the current economy.

We will never payback that $17 trillion in public debt.  In fact, shifting to the Fed balance sheet it is unlikely that $4 trillion in liabilities will ever be unwound.  Where will the liabilities flow to?  The entire reason QE is in place is because the natural market has absolutely no desire for long-term debt with absurdly low rates.  The Fed doesn’t have an end game that includes helping the working and middle class.  This is basically a debt spiral and a game of confidence.  If we truly follow the money we can put our money on a few things:

-The Fed is not going to taper anytime soon (i.e., the Fed Balance sheet will continue to grow)

-Public debt will never be paid back.  In fact there is legislation pending that tries to avoid any debt cap

-The Fed is looking out for banks, not the public

It was stunning to see the Fed balance sheet jump up by $55 billion in one week.  At this rate, we’ll be over $4 trillion before Christmas.  Taper?  Yeah right.

Sat, 11/02/2013 - 19:38 | 4116145 emersonreturn
emersonreturn's picture

+1 dizzyfingers, you make my head spin.

Sat, 11/02/2013 - 14:40 | 4115576 if
if's picture

Central planning at its best, China is building ghost cities and piles of yellow metal.

Sat, 11/02/2013 - 14:45 | 4115581 therevolutionwas
therevolutionwas's picture

Yellow brick roads?

Sat, 11/02/2013 - 14:47 | 4115584 Joenobody12
Joenobody12's picture

How many tonne of gold can you buy with US$ 1 trillion - the amount we owe the Chinese ?

Sat, 11/02/2013 - 15:41 | 4115681 I Write Code
I Write Code's picture

If Excel ain't lying to me it takes about 25,000 tons of gold at $1,300/ounce to soak up a trillion dollars.  OTOH China probably bought a third or more at higher prices. 

If gold prices follow oil and oil goes down because of fracking then there may be no big win in owning gold anywhere in the next 20 to 100 years.  Unless the Bernanke/Yellen axis manages to set off the hyperinflation bomb.  And China must have another trillion dollars in non-US debt instruments as well.  So 2,200 tons plus whatever they had earlier is maybe a 5% hedge on things?

Sat, 11/02/2013 - 16:32 | 4115799 jerry_theking_lawler
jerry_theking_lawler's picture

.fed is going to continue increasing money supply (aka diluting your bennie bucks)....if there is less and less gold inside the country, then what does that tell you (econ 101)??

oh yeah, prices have a 'floor' with fracing...below a certain price is is not practical, so pricing will not drop forever (again econ 101).

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