This page has been archived and commenting is disabled.

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.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Fri, 11/15/2013 - 20:01 | 4159584 MeelionDollerBogus
MeelionDollerBogus's picture

no reason oil would go down from fracking.
Fracking produces too little. it also produces nothing that goes into a gas tank.
Also many furnaces are now nat-gas rather than heating-oil meaning they're competing not interchangable uses of fuel.
You can't shove heating oil into a gas furnace, nor vice versa, and it's not trivial (cheap) to switch.

http://scharts.co/1eWWgIW

Gold frequently does NOT follow Brent or WTIC or even natural gas, http://scharts.co/1e8QQHM , though some of the cyclic short-term noise has a similar pattern of ups & downs while diverging wildly over-all.

Sat, 11/02/2013 - 14:58 | 4115601 Yen Cross
Yen Cross's picture

    I suggested a week ago that gold was going lower before higher. Here's the chart. http://imageshack.com/scaled/1280x1024/585/0m8a.png

   It is has bounced off the the 50% Fibo of {1361.43 - 1251.26}  the 1305.00 area. http://imageshack.com/scaled/1280x1024/21/cb3o.png

    Here's where it gets tricky. I like the risk reward of buying it at these levels, with a stop at the 61.8% Fibi but there's some conflict with the daily chart that says it might go even lower.

    Looking at the DXY chart. The $ is coming up on some tough resistance @ 80.85 and the 81.00 barrier. It's run hard and fast. With that in mind, I'll wait until until Monday or Tuesday for more clarity. I'd rather get better entry above current levels then risk loosing $20 a toz if it heads lower.

Sat, 11/02/2013 - 16:31 | 4115789 RockyRacoon
RockyRacoon's picture

That paper shuffling and religious zealotry with TA will work for you... until it doesn't.

Analyzing graphs in managed markets is suicide.

Me?  I'll stick with the physical stuff.  Feels better than mere pixels.

Sat, 11/02/2013 - 16:54 | 4115846 Yen Cross
Yen Cross's picture

  I like physical silver Rocky. It's easier to spend and average into. I also own some physical gold. (getting ready to buy some more)  Physical is the way to go...

  If people had purchased physical a week ago, they would be negative almost $50 a toz. ( I gave you a greenie)

Fri, 11/15/2013 - 19:57 | 4159579 MeelionDollerBogus
MeelionDollerBogus's picture

actually it works for me: the graphs have to show the manipulation pattern.
Naturally I do the opposite of what Yen Cross does. no ma's, no elliot waves & certainly no fibonacci. They are invalid analysis tools for the task at hand.

Fri, 11/15/2013 - 19:56 | 4159576 MeelionDollerBogus
MeelionDollerBogus's picture

the DXY chart has no relation to the gold price.
The DXY chart is a poorly weighted correlated measure of fiat currencies only. Nothing compared to any tangible good or even interest rates.
Worthless.
http://flic.kr/p/9KeGPR

This time is not different.

Sat, 11/02/2013 - 15:01 | 4115616 Rimon
Rimon's picture

Russia accounts for 30% of gold demand since 2010 and it sold for the first time in a years this September.. it's safe to say that if EM currencies come under pressure again, anotehr leg lower in gold prices is in store

Sat, 11/02/2013 - 15:04 | 4115620 Carl Popper
Carl Popper's picture

Mr. Yellen can turn that gold hoard into huge losses for China at any time, but he will have to stop the QE and start selling off those 4 trillion in treasuries, or credibly threaten to do so.

This would hurt the USA economy of course. Deflation and unemplyment everywhere. But i dont want to be grossly overweighted in gold when they finally do it. Whoever knows when will get rich.

Sat, 11/02/2013 - 15:09 | 4115625 Pumpkin
Pumpkin's picture

I read somewhere that at the beggining of WWII, China shipped most of its gold to the US because the Japanese was invading them.  But instead of giving it back, they are buying it back.

Sat, 11/02/2013 - 15:18 | 4115639 The Heart
The Heart's picture

ALERT...ALERT!

That cat named Art is going to be on the radio again in about fifteen minutes at the link below. Listen in using your type of player for more revealing information about those evil babylonians who are behind this wickedness of population reduction, and world domination for the god, money.

Check it out now and wait for him to come on at the top of th hour.

http://republicbroadcasting.org/listen-live/

 

 

Fri, 11/15/2013 - 19:53 | 4159567 MeelionDollerBogus
MeelionDollerBogus's picture

There is no actual population reduction or even a plan for it.
The real plan is for quality of life to reduce, life span to reduce, population to rapidly INCREASE & debt along with it.
This creates the perfect slave population of sheeples & attack dogs for the elites.

Sat, 11/02/2013 - 15:20 | 4115642 doggis
doggis's picture

IF CHINA IS OVERTLY PURCHASING UP GOLD IN VOLUME - THROUGH HONG KONG AND OTHER MEANS...........

WHAT ABOUT THE COVERT PURCHASES? ANY GUESS ON THAT ONE.

.....AND MAYBE IT IS TIME TO RE-EXPLORE THAT CHINESE BUY OF JPM GOLD VAULT IN MANHATTAN - "THE LARGEST GOLD VAULT IN THE WORLD". 

ISN'T THE FED'S GOLD VAULT LOCATED ACROSS THE STREET?

IS THERE A COVERT MOVE OF US GOLD TO CHINA VIA THIS PURCHASE? AND IF SO, WHAT ARE THE POTENTIAL POLITICS AROUND THIS?

Sat, 11/02/2013 - 16:57 | 4115852 debtor of last ...
debtor of last resort's picture

The 'system' is working on a change in consumer/producer axis. The buying from the east, producing in the west. Jobs for 49 m EBT slaves turning into 'workers' for Asian consumers, assisted by robots. Big money/intrests doesn't care about nations or people.

China and India; it's a big market. With or without gold backing. I think with, to begin. After several years, games start over again.

Sat, 11/02/2013 - 15:40 | 4115683 Cacete de Ouro
Cacete de Ouro's picture

So Tylers, any info on the specific link to the censtatd.gov.hk gold import data?

Somewhere off of this link? I can't see it right now...

http://www.censtatd.gov.hk/showtablecust.jsp?charsetID=1&subjectID=&tabl...

Sat, 11/02/2013 - 15:52 | 4115693 Carl Popper
Carl Popper's picture

Those who think a commodity or gold based SDR is possible are mistaken. That would be a return to the gold standard.

Let's say gold has to be 10 percent of the SDR for arguments sake. The quantity of SDR's in circulation is thus limited to ten times the amount of gold available. Even though it is levered 10 to 1 it is the supply of gold (or whatever commodity) that determines how many SDR's are available.

The money supply is thus fixed in relationship to the amount of gold available, a gold standard is reborn.
Even a subtle attempt to return to a gold standard is a nonstarter at least without complete repudiation of fiat.

Sat, 11/02/2013 - 15:54 | 4115711 q99x2
q99x2's picture

Hoarding gold and launching nuclear armed submarines to keep any European Central Bankers from trying to get at it.

Sat, 11/02/2013 - 16:03 | 4115728 the 300000000th...
the 300000000th percent's picture

Here is a thought.... The powers in the US are doing 2 things. And maybe, just maybe they are doing a third thing.

1.) They are spreading propaganda on a daily level about the evils of holding or buying gold.

2.) They are manipulating the price of gold down.

 

3.) they could have brokered a deal with the central banking/planning powers in China to give a China a chance to load up on a discount while they scare everyone else out of their gold positions, all the while letting China in on the fact that at soem point they gonna let the price skyrocket. This could be part of the deal that forces China to hold our bonds just a little longer. 

I am still stunned that China isnt exiting the dollar more rapidly, maybe this is a possible theory??

Sat, 11/02/2013 - 16:36 | 4115816 jerry_theking_lawler
jerry_theking_lawler's picture

i like it. its fresh, its plausible, and somewhat original. keep it up!

Fri, 11/15/2013 - 19:24 | 4159497 MeelionDollerBogus
MeelionDollerBogus's picture

something else so constant we could almost forget about it:
the US government actually wants people thinking saving ANYTHING is nonsense.
Once that malaise / meme sets in then saving gold or silver is just a small subset of saving ANYTHING. Anyone who is saving appears to either be crazy or "too" rich or something to the sheeple that follow orders without question.

Sat, 11/02/2013 - 16:12 | 4115740 alfbell
alfbell's picture

 

 

China is amassing gold so that down the road, having a partially gold backed currency will make them eligible to be part of the basket mix of currencies to comprise the next world reserve currency. There strategy could be sabotaged if it works out that the IMF's SDRs become the next world reserve currency or just a major international trading currency. Harry Dent and Martin Armstrong have a more realistic viewpoint than heavily biased gold bugs as far as I'm concerned. Gold decoupled a long time ago as an inflationary hedge (look at the history, it doesn't rise and fall in correlation to inflation like it used to decades ago. It is just a store of wealth for protection from monetary or government collapse, which won't be happening for quite some time. It will be a long time before the majority of Americans lose faith in their government and currency causing the pendulum to swing from the public to the private sector.

HARRY DENT GOLD PROJECTIONS Wednesday, October 23, 2013
Why Gold Has Lost Its Luster: ?Sell on Rallies Ahead ?Gold was supposed to be the crisis and inflation hedge.
The ultimate protection for investors during bad times.
And it was those things in the 1970s when inflation went to heights not seen in centuries.
But gold is also supposed to go up as more countries print more money and debase their currencies.
That we haven't seen this time around...
The U.S. upped the ante in mid- to late 2012 with its third quantitative easing program – QE3 – followed immediately by QE3 extended.
Then Japan unleashed the greatest QE yet... 2.5 times what we did, when you adjust for the size of its economy.
And China has been off the charts in its easing efforts and debt creation in 2013 as well.
But…
Inflation rates have fallen from 2% to near 1% in the U.S. They continue to be closer to 1% in Europe with its recessionary economy. Only in Japan is inflation rising a little after the strongest peace-time money printing ever.
And gold fell accordingly.
So what gives here?
I believe what gives is that the markets have finally grasped the truth in our long-time arguments that gold was in a bubble and that all the money printing, stimulus and quantitative easing around the world would not result in high or even hyper-inflation.
Why not?
Because private debt, which is much larger than public debt, keeps deleveraging in most countries, albeit not as fast as it would without this unprecedented stimulus and money printing.
And debt deleveraging causes deflation, not inflation, as history proves clearly.
Major deflation periods followed major debt and financial bubbles after they peaked in 1835, 1873, 1929… and again in 2007.
If governments are printing money to fight debt deleveraging and deflation – which is exactly what they're doing – then that is the trend… and gold is an inflation hedge, not a deflation hedge.
That is why gold has been falling for most of 2013.
The chart below shows how gold peaked in September of 2011 at $1,934 and then went into a long trading range between $1,525 and $1,800. Normally such a massive rise and such a trading range would suggest a final break to new highs before peaking. But that didn't happen. Instead gold fell below $1,525 and then crashed to $1,179 into late June.

The truth is that gold has been mortally wounded.
Do you remember how oil went up to $147 in 2008 and then collapsed down to $32 in just four months? That was thanks to highly-leveraged hedge funds and financial institutions speculating on the price of oil and then suddenly having to meet margin calls when the music stopped.
Now, the same thing is happening to gold, only to a lesser degree.
Many funds had to sell to meet margin calls between April and June 2013. Even after that wash out, every time gold rallies, it falls back again as more funds and investors cover their losses and leveraged bets.
So where to next for gold?
The next strong support in gold doesn't come until around $700 or $740. The ultimate support is around $250 per ounce, the 1998 to 2000 lows before the bubble began.
In this long period of off-an-on-again deflation, gold will just get weaker and weaker. It may go up in the anticipation of a financial crisis in 2014, just like it did into June 2008. But when the crisis actually hits, debt starts deleveraging and deflation sets in (again like in late 2008), gold will continue its painful meltdown.
Since gold has become oversold and I see another financial crisis building, my advice is simple: Sell what gold you have left on significant rallies ahead, especially into early 2014.
We'll look to better gauge that in our Boom & Bust newsletter, where we focus more on identifying major reversals in key markets to help you protect your assets and allow you to prosper, even in bad times.

 

MARTIN ARMSTRONG:

Gold is in a bearish trend. Despite everything the gold promoters have told you, gold just is not responding the way they have been predicting or should I say promoting. They do not take your economic survivability seriously. It is just like the Bible says – there is a time and place for everything. Mining delivered a lead article - Horror story for gold investors continues Friday.

We are preparing a very important gold report. As you can see from the cover, gold has NEVER exceeded the 1980 high. It has been the WORST hedge against inflation possible. That does not mean it will never really rally. If the Mexican share market doubled, but the peso fell by 80%, an American will lose money. Gold is no different. Those who are already penning hate mail will most likely lose the farm on gold and the wife will take what’s left. If you want to make money, it is important to understand the TRUTH. You cannot invest and survive on a pack of lies. A fool is always easily separated from his money.

It is time to stop the bullshit. It is time to open your eyes or you will miss the REAL rally in gold and you will not believe the rally because you lost your shirt on the previous fake rally. It is time to stop being the Pawn of Finance - lied to from every angle be it government, banks, or promoters with conflicts of interest. To survive your OWN financial decisions it takes a clear mind and shedding all bias and prejudice.

Sat, 11/02/2013 - 17:16 | 4115898 Bay of Pigs
Bay of Pigs's picture

It appears Marty has lost his mind on gold. He wants us to "understand the TRUTH?" That's pretty rich.

And Dent is a complete fucking wing nut.

Fri, 11/15/2013 - 18:59 | 4159446 MeelionDollerBogus
MeelionDollerBogus's picture

only one way to be sure.
I better check up with extreme gold experts Karl Denninger and Dennis Gartman.
:-)

Sat, 11/02/2013 - 17:20 | 4115906 debtor of last ...
debtor of last resort's picture

What a load of crap. Derivative planet is about to burn in the atmosphere, way to much paper promises in a deflationary environment blows up everything.

Sun, 11/03/2013 - 15:49 | 4117605 auric1234
auric1234's picture

it doesn't rise and fall in correlation to inflation like it used to decades ago

Really? OK. Please, I'd like to buy some gold for $35 per ounce. Would you sell it to me at that price?

 

Sat, 11/02/2013 - 17:56 | 4115977 10044
10044's picture

The cme boyz must be on high margin alert

Sat, 11/02/2013 - 18:20 | 4116013 Michigander
Michigander's picture

Everyone looks for guidance to confirm their actions or inactions. Me, I look to China. I dont admire them, but I repsect them. They are the only nation on earth taking the long view. They know whats coming and are preparing. Dent and Armstrong are right...today, but even a stopped clock is right twice a day. One day, they are going to be SOOOOOO wrong and it wil be the next time China announces their official gold reserves, and its gonna knock our socks off!

Sat, 11/02/2013 - 19:31 | 4116130 Darth Mul
Darth Mul's picture

If/when this Iran war gets going (I think the "diplomacy" is either just to make the claim later that 'diplomacy failed due to Iranian intransigence' but in the alternative, if genuine, will simply be torpedoed, perhaps literally, by the usual suspects) what affect would there be on the price of gold - and if there would be an affect, would it really matter as to physical gold's value as a store or protector of wealth?

Sat, 11/02/2013 - 20:12 | 4116209 Magnum
Magnum's picture

Take a look at the price of gold and it seems that the gold promoters may not be so correct. Bear market! Don't kill the messenger.  The market price has been tanking for over a year, in the face of mines closing due to the steep drop in price.  It may help you to be a skeptic on gold right now.  The trend is not favorable.  Just saying.  

A new global currency will not likely be "backed by gold" either.

 

 

Sun, 11/03/2013 - 06:09 | 4116927 auric1234
auric1234's picture

Bear market? I'm not in it for the paper profits. Keep earning fake money you silly paperbug. When the music stops, I'll be sitting on top of real money without counterparty risk, and you'll be sitting on a pile of defaulted debt.

You think the mines are closing? Good. There's nothing more bullish than that. If the mines are really closing, it becomes impossible to defend the price. Which means the Fed is finally broke.

 

Fri, 11/15/2013 - 18:54 | 4159432 MeelionDollerBogus
MeelionDollerBogus's picture

after the price action of being up for a solid 10 years gold needs to drop FIVE years in a row MORE than 20% loss every year  to be a bear market.
Anything upward of that is a correction in a continuing BULL market.

AND what you'll see very soon is a rise to 3500/oz USD gold within 18 months, not declines.

Sat, 11/02/2013 - 20:32 | 4116248 Dr. Gonzo
Dr. Gonzo's picture

No more gold for me. I thought about getting a few oz yesterday but instead ordered 160 A.S.E.'s. I just like being part of the massive pool of Silver Eagle buyers. Growing bigger and bigger and bigger every day. I like the sentiment that money is what men agree upon... Nothing else. 

Sat, 11/02/2013 - 21:15 | 4116316 national treasure
national treasure's picture

A note to goldbug newbies - ask yourselves why you hear so much about  "paper gold" & never hear about "paper oil" or "paper wheat" or paper any other commodity.

Then think about consequences of China or Russia creating Gold based currencies & how the hell they are going to survive that?

Does not mean that the precious metals don't have upside, just don't let endless gold propaganda drive you into a poor house.

Sat, 11/02/2013 - 22:23 | 4116463 therevolutionwas
therevolutionwas's picture

What!!?

Sun, 11/03/2013 - 12:37 | 4117282 Amagnonx
Amagnonx's picture

The difference between gold and other 'commodities' - is that gold is money.  It is not consumed.  If people are speculating in oil, at some point someone gets the oil delivered - and its gone - it is completely removed from the system.

 

Gold can just cycle around and around, so the proliferation of paper - especially due to those who don't take delivery (or store it themselves) has vastly more impact on the price than on commodities that are consumed.

Fri, 11/15/2013 - 18:52 | 4159423 MeelionDollerBogus
MeelionDollerBogus's picture

PLENTY of people do talk about "paper oil" and "paper wheat" but those commodities are consumed faster than gold is on a physical basis, with much greater urgency.

Sat, 11/02/2013 - 23:01 | 4116532 saulysw
saulysw's picture

I figure china has to import gold to export it again as plating on $1 HDMI cables. Seriously, even at a few molecules thick, they ship millions of those things.

Sat, 11/02/2013 - 23:20 | 4116563 rustymason
rustymason's picture

In the West, where leftism now rules, saving is called hoarding.

Sun, 11/03/2013 - 01:36 | 4116770 chindit13
chindit13's picture

Their name was Thomas Stolper.

I've been hesitant to spill the beans, but there is an inverse correlation between the number of gold-promoting articles on Zerohedge and the subsequent price movement in PMs.  None of the PM gurus have been right for years, yet their pronouncements are followed as a Papal Decree.  Someone actually top-ticked the PM markets when he started a website to preach to the converted.  And people make fun of Stolper?  Humility all around might be better.

Up moves are always "a breakout" and "real buying", while all declines are "manipulation".  "Nobody would sell like that" (hitting 2% price worth of bids), but supposedly 'wise' holders sit and watch a 30-60% decline over two plus years, or practice a banker-style form of mark-to-market, where current price is only used (vs. purchase price) if it works to one's ego advantage.  Otherwise it's "well, I bought way down there, so this 60% evisceration is of no concern".  Loss of real purchasing power is of no concern?  Have folks forgotten the tagline of Zerohedge?  It seems lost on the hold and hopers that virtually all of the big (called stupid) sellers are now looking at prices well below where they sold.  They are much better off for having sold, even if their selling moved the market 2%.  And where did these large sellers originally buy?  Many were part of the troop that started the whole PM bull market back in 1999.  They got their blood out of a rock, and have moved on to other asset classes.  If and when gold drops below $1000, they might come back, but the last two years' price action indicates neither turbo-printing nor debtflation convinced them to hang around.

A thirty-three year, 1600% increase in US Federal Debt (supposedly one of the driving forces behind gold) has seen a nominal 57% increase in the price of gold but a 1600% increase in the price of US equity indices.  Every dog has its day, but no dog reigns supreme in perpetuity.  Ecclesiastes had it pretty right a long time ago.

Martin Armstrong, who takes all sorts of heat for being a PM heretic, has been uncannily accurate regarding PMs.  On this website, the member who goes by "Orly" has also been quite prescient.

I guess Tom Stolper should just tell his readers that he's "early", and any second now....

Sun, 11/03/2013 - 08:37 | 4117012 fijisailor
fijisailor's picture

I buy it cost averaged to preserve wealth. It has been money for thousands of years.  I started when it was at $300 so I'm doing pretty well.  I just refuse to let a bunch of dishonest bankers have control over the fruits of my labor and have it all go to zero.  I'm an Engineer not a speculator.  I build things for a living and am in great demand these days yet speculator salaries far exceed my own.  The financial system is sick and dying and I don't know how fast but my wealth will not die with it.  I don't care what price movements correlate with who's opinion.  Go ahead lemming and BTFATH in equities if you want and crow about it.  My emphasis is quality and stability.

Sun, 11/03/2013 - 08:31 | 4117007 B.J. Worthy
B.J. Worthy's picture

High-activity September? I seem to recall something else happening around that time. What was it?

Oh yeah...

http://www.zerohedge.com/news/2013-10-01/bart-chilton-commodities-trader...

Sun, 11/03/2013 - 09:55 | 4117096 Sufiy
Sufiy's picture

And here is what is happening with COMEX now:


Gold Catalyst: COMEX Deliverable Gold Falls to 658,443 Ounces, Claims Per Deliverable Ounce at 55


 Jesse reports the COMEX deliverable Gold inventory which goes on fumes now. Maybe this will the Catalyst Jim Puplava is looking for the Gold? The Game of Musical Chairs in the Gold Fractional Reserve System is getting more dangerous for its participants by the day now.   As ZeroHedge has put it with the chart above: "when it comes to physical gold and China's appetite for it, one word explains it best:unstoppable." http://sufiy.blogspot.co.uk/2013/11/gold-catalyst-comex-deliverable-gold.html#

Sun, 11/03/2013 - 10:04 | 4117106 Himself
Himself's picture

I brought up China's interest in Gold to a coworker (builds armor in his spear time. Note: is expanding into fetish armor) as one of the warning signs of the USD waining. His response was that they want it for industrial purposes. He believes that we have proven we can come to general consensus concerning currencies...

Do NOT follow this link or you will be banned from the site!