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Currency Wars ! Russia, Kazakhstan Buy Very Large 30 Tons Of Gold In August
Currency Wars ! Russia, Kazakhstan Buy Very Large 30 Tons Of Gold In August
Russia and ex Soviet States Kazakhstan, Kyrgyz Republic and Azerbaijan continued to accumulate significant gold reserves in August in a trend that we highlighted last month.
Latest official gold reserve data from the International Monetary Fund (IMF) shows that Russia again added to its gold reserves in August, with the Central bank of the Russian Federation purchasing 232,510 ozs (7.23 tonnes) and bringing its total gold reserves to 35.769 million ozs or 1,112.5 tonnes.
Likewise, the National Bank of Kazakhstan purchased a massive 795,213 ozs or 24.7 tonnes in August bringing its total gold reserves to 5.848 million ozs (181.9 tonnes).
Turkey was also a gold buyer in August and the Turkish central bank adding 96,783 ozs (3 tonnes) to bring its total official gold reserves to 16.45 million ozs (511.6 tonnes), which is the world's 12th largest official gold holding.
According to the IMF data, other countries which added to their gold reserves in August included the central banks of Azerbaijan and Ukraine.
With the ongoing conflict in Ukraine, its not clear where the official Ukrainian are now stored. There had been reports in March that the Ukrainian gold was flown out of Kiev to the Federal Reserve Bank of New York, but neither central bank would comment on this issue at the time.
Kazakhstan now has the world's 23rd largest holdings, just behind the Philippines which has 194.4 tonnes of gold reserves.
With 1,112.5 tonnes, Russia remains the world's 6th largest official gold holder, ahead of China (1,054.1 tonnes) and Switzerland (1,040 tonnes).
The Swiss National Bank (SNB) has not been a gold buyer recently but this may change if a Swiss gold referendum to be held in November goes through, which would force the SNB to maintain 20% of its reserves in gold and to repatriate all gold held abroad back to Switzerland.
It is widely believed that China's gold reserves are understated and as David Marsh of the Official Monetary and Financial Institutions Forum (OMFIF) said last week "over the past six or seven years the Chinese authorities probably have been adding to their holdings in different ways."
As we pointed out last month, as well as being a reserve diversification strategy, the ongoing gold accumulation trend by both Russia and Kazakhstan could be part of a coordinated monetary policy since the two countries are members of the Eurasian Customs Union along with Belarus.
Next year the three countries plan to turn this Eurasian Customs Union into a more formal Eurasian Economic Union. Coordinated accumulation of gold reserves would make sense in this context.
Russia, Kazakhstan and Belarus are also members of larger regional cooperation organisations, namely the Eurasian Economic Community and the Shanghai Cooperation Organisation (SCO). It will be interesting to see what a pooled gold holdings total for Russia, China, Kazakhstan, and other SCO members will look like when China finally does provide the world with an update on its official gold holdings.
UK Treasury plans to criminalise benchmark manipulation
Yesterday, the UK Treasury announced a consultation review into widening UK financial benchmark legislation and make manipulation of key currency, precious metals, and interest rate benchmarks a criminal offence. The only benchmark that is currently regulated is the interest rate LIBOR benchmark. HM Treasury plan to add a further seven key benchmarks to the legislation.
These benchmarks are the WM/Reuters 4pm London fix (currency), ISDAFix (interest rate), the London Gold Fixing benchmark, the new LBMA Silver Price benchmark, the ICE Brent futures contract (crude oil), and two index swap benchmarks called the Sterling Overnight Index Average (SONIA) and the Repurchase Overnight Index Average (RONIA).
The London Gold Fixing process is in disarray after multiple claims of manipulation and the prosecution of Barclays by the Financial Conduct Authority (FCA) last May for manipulating the gold price in the fixing auction. The London Gold Market Fixing Company (LGMFL) and the London Bullion Market Association (LBMA) are now attempting to 'circle the wagons' on regulatory compliance and investor litigation by moving to a new LBMA Gold Price process modelled on the recently introduced LBMA Silver Price.
The LBMA Silver Price auction has not really evolved in any way since being introduced on August 15, and its current 'phase 2' stage, by design, only allows bullion banks and brokers to participate due to the lack of a central clearing counterparty and limitations on bi-lateral credit lines for auction participants.
However, this has not stopped the LBMA ploughing ahead with a similar plan for the gold fixing process which still has the CME Group and Thomson Reuters as the leading contender.
Following up today on the news of the Treasury's benchmark consultation, Bloomberg contacted the four London Gold Fixing banks and the LBMA seeking comment, but reported this morning that "Representatives of the banks that contribute to the London gold fixing declined to comment or didn't immediately return calls and emails seeking comment. The LBMA wasn't immediately available."
With the London gold fixing process being so central to the determination of the world gold price, any moves by the UK authorities to criminalise manipulation of the gold fixing price are welcome.
MARKET UPDATE
Today’s AM fix was USD 1,210.50, EUR 950.61 and GBP 742.05 per ounce.
Yesterday’s AM fix was USD 1,224.00, EUR 952.87 and GBP 746.11 per ounce.
Gold fell $5.70 or 0.47% to $1,217.20 per ounce and silver slipped $0.10 or 0.56% to $17.70 per ounce yesterday.
Spot bullion in Singapore slipped 0.3% to $1,213.60 an ounce by 0043 GMT, after losing 0.5% in the earlier session. Gold is close to an 8 1/2 month low of $1,208.36 reached earlier in the week.
U.S. Mint September American Eagle gold coin sales are almost 50,000 ounces, nearly twice its sales in August, with heightened geopolitical risk and a cheaper bullion price contributing to the interest from investors.
If further bullish U.S. economic data comes out this week it will strengthen the U.S. dollar and weaken gold’s appeal, as investors think the U.S. Fed will react with an earlier than expected interest rate hike.
by Ronan Manly , Edited by Mark O’Byrne
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Glitter isn't everything , it is the only thing .
Be careful what you wish for . You might get it .
See https://www.academia.edu/8507311/Drowning_in_Gold
Damn, Russia and China have more gold that ALL
Zerohedgers combined. But, on a brighter note, We ZHers seem to be doing better than the national average of Americans, collectively,
By a factor of 100s
I just got a coupon from eBay 10% rebate off purchase of 200 or more , combine that with a Swiss 20 gold franc and that's a gold coin for spot ...
Stargate SG1 has all the anwsers.
So everyone goes to the dollar for "safety" and then anyone who trades in dollars is screwed the fed panics and starts printing to "fix" the dollar problem everyone bails on the dollar- gold is up nicely.
I am agnostic about 'understatement ' of Chinese or Russian Gold Reserves.
But I am cautious. Public political figures in these countries can directly do things that can only be done secretly through intermediaries in the US.
You should never underestimate the ability of the oligarchs in countries to loot the national wealth either before or after it reaches the Treasury.
The US Oligarchs do this through intermediaries at the Fed, the Banks, gold 'leasing', etc. They can't simply drive a truck to the gold depository and pick up a few tons to distribute to their friends. But in a country where the Leader can directly write a check on the backs of tax-payers to reimburse his friends whose overseas assets have been seized, the Leader or his proxies could do exactly that.
Just because Russia and China produce significant amounts of Gold, just because that Gold is not exported, does not mean that it is available to back the currency, or otherwise for any national purpose.
According to Martin Armstrong, the USA, although having 17 trillion dollars of debt, also has about 30 trillion dollars of reserves, so how does this square with all the doom and gloom about the demise of the USA.? Are there any 'insiders' who know any different.?
Forget gold, stawks are the real deal.. Bullish
You're likely right. The stock market could well rise way higher - but with a dollar collapse (against physical gold) all that "wealth" will buy you an apple or so when it's all said and done. Courage FL, forward, for Zimbamerica.
maybe the non-believers will wake up when the swiss try to repatraite their gold, and suddenly they'll have an isis problem and to have targeted bombings.
Which currency did Russia use to buy the gold. Looking at Charts, U.S. dollar?
Not enough info on who sold the 30 tons.
Conspiracy –
‘China's gold reserves are understated ‘
Obama has a pair of solid gold Nikes (Hi-tops).
“UK Treasury plans to criminalise benchmark manipulation”
Nobody is arresting the Queen, forget it.
Russia produces 200 to Gold a year, so most of the increase is from local production. I don't believe that they pay this in USD :-)
It is in Russia's interest to sell USD and buy gold from outside the country. If comments here are correct.
If you held lots of US dollars, you would not be dumping them for something more tangible?
I know I am.
Russia bought Pabst Blue Ribbon including Colt 45.
“Russia produces 200 to Gold a year”
Then 30 tons is a non-event.
It's 30 tons less in the Western CB and LBMA vaults. No big deal, I'm sure.
She should be arrested, she likes to pass gas and then fluff the sheets...
Russia bought a little Gold 'off the sidelines'.
Add in China and India and there is demand for maybe upwards of 100 tons a month.
The vaults of the West are empty - where will they get that gold?
From the vaults of others of course - they snaffled the 30 tons of Ukrainian gold about 10 minutes after their puppet government was installed.
So...............
Look down the list of countries that have gold and decide which of them can be pressured (politically or militarily) into giving up their gold to Goldman Sachs (the main agents of the U.S govt in this respect) to "look after".
It will be FUNNY when the USSA actually has to show just how much Gold is in Fort Knox and the New York Fed.
I have a stange feeling that there will be much CHAOS in the USSA before that day ever arrives.
No, they will bust before they allow the absence of the Gold to be made public, because it was stolen covertly.
But this indicates nothing about Russia or China being superior. The nature of humanity, combined with even more ample opportunity compared to the US, would tend to indicate that expectations of domestically produced Russian and Chinese Gold being available to the nation, rather than pocketed by politicians with direct unencumbered access and their 'friends', is rather naive.
The motive is obvious. The means in these places is more direct than in the US where they used the complicated Fed scheme to do the same thing. And the opportunity is virtually unlimited because there is no public accounting at all.
It is human nature. And you already have a precedent with one of these leaders.
How did Putin go from low-paid public functionary to Billiionaire in seven years, 1991-1998? This is a feat that no industrial or other business giant has ever accomplished in the history of history. And we don't have any idea where the money came from? It came from the treasury. It is gangster money.
So, if Don Corleone was in charge in Russia, rather than Putin... what would you expect to have happened to the Gold?
This is not a statement against Russia or China. This is a statement that it is in the Nature of powerful men to steal, whether by complicated scheme - such as the US - or by other more direct means.
Expectations that powerful men are privately Saints, are not supportable in history, and so are insane when projected onto current and future politicians.
tungsten bricks a plenty in ft Knox I am sure. now look in the safes of our politicians there it is. all crooks in my book
Doesn't the increasing frequency of tungsten filled "gold" bars obviate the validity of Gresham's law...?
Or, does it actually obviate the fact that in the presence of whatever value happens to be, that people will gravitate toward committing fraud, as opposed to actually earning something?
a rhetorical question to be sure...
There is zero chance that the U.S. gold holding will be assayed and audited in any way that is transparent. The West's clear decision to allow gold reserves to move East has me completely bewildered. What rational reason could they give for standing by and watching this happen???
If they are thinking to provoke a war and slink away during the chaos, then they might consider that once the East has ample gold reserves to stabilize themselves and establish a new finanacial paradigm, then they have no real resaon to go to war. If the West has no one to fight, then the war option is off the table and they will have to come up with some other solution. Nothing appealing to the West pops into my head at the moment.
I expect it's going to get really ugly for everybody and we should be looking for rumors of an annoiuncement out of China at some point. I believe they want the reserve currency status taken away from the United States and I believe they will accomplish this within the next two years.
There, I said it.
When the US government and the FED and the member Banksters all essentially act as one entity, do they ever really need to say here is the gold and here is the amount that is unencumbered?
All funny books between members of the same entity.
Why do they have to show anyone? Believe us or we will bomb your ass. And in the meantime.....we'll just fly into your country(UK etc) and conveniently take your gold. For safe keeping lol. Ask Germany how that worked out. It's like giving a drug addict a loan.