Estimated Chinese Gold Reserves Surpass 20,000t

BullionStar's picture

Submitted by Koos Jansen, BullionStar.com.

My best estimate as of June 2017 with respect to total above ground gold reserves within the Chinese domestic market is 20,193 tonnes. The majority of these reserves are held by the citizenry, an estimated 16,193 tonnes; the residual 4,000 tonnes, which is a speculative yet conservative estimate, is held by the Chinese central bank the People’s Bank of China.

I’m aware I’ve been absent from writing about the Chinese gold market for a long time, so for some of you it can be burdensome to pick up where we left a few months ago. It is not feasible for me to explain the entire structure of the Chinese gold market again; my suggestion would be to follow the links provided in the text for more background info. Most knowledge is covered in previous BullionStar posts, Mechanics Of The Chinese Domestic Gold MarketChinese Cross-Border Gold Trade Rules and Workings Of The Shanghai International Gold Exchange

To substantiate my estimates on above ground gold reserves in China mainland, we’ll first discuss private gold accumulation in China through the Shanghai Gold Exchange (SGE), after which we’ll address official purchases by the People’s Bank of China (PBOC) and its proxies that operate in the international over-the-counter market.

Chinese Private Gold Accumulation

A few days ago, you could read on the BullionStar Gold Market Charts page that withdrawals from the vaults of SGE in June accounted for 156 tonnes. Year to date SGE withdrawals have reached 984 tonnes, which is 16 % shy of the record year 2015 when 1178 tonnes were withdrawn by this time. Since 2013 gold demand in China has remained extremely elevated - don’t let the World Gold Council tell you anything different - which exposes spectacular years of physical gold accumulation by the Chinese.

Monthly Gold Withdrawn From Shanghai Gold Exchange Vaults vs Gold Price In Renminbi

Exhibit 1.

The amount of SGE withdrawals provides a fairly good proxy for Chinese wholesale gold demand, although not all gold passing through the SGE adds to above ground reserves. In China, most scrap supply and disinvestment flows through the Shanghai bourse as well, next to mine output and imports. Needless to say, recycling gold within China doesn’t change the volume of above ground reserves. So, simply using SGE withdrawals won’t fly for calculating above ground reserves. What we’re interested in are net imports and mine production in the Chinese domestic gold market.

Although gold exports from the Chinese domestic market are prohibited, exports from the Shanghai Free Trade Zone (SFTZ) where the Shanghai International Gold Exchange (SGEI) is located, are permitted. Before calculating Chinese net imports, let’s have a brief look at exports from the SFTZ - which reflects to what extent the SGEI is developing as a physical gold hub in Asia. As far as I can see, China’s gold bullion export from the SFTZ is still negligible. From the United Nations’ international merchandise trade statistics service COMTRADE, it shows the only countries that have imported tiny amounts from China in 2017 are the UK and India. But the amounts are so small, they carry little importance for our analysis.

There is one region that is importing significant amounts of gold from China, which is Hong Kong, though, this likely isn’t exported from the SFTZ but from the Shenzhen Free Trade Zone. The vast majority of China’s jewellery manufacturers are in Shenzhen, and for quite some years gold jewellery, ornaments, industrial and semi-manufactured parts are being exported from this Chinese fabrication base to Hong Kong. These events haven’t got anything to do with the SGEI in my opinion. Thereby, Hong Kong exports far more gold to China than vice versa.

For computing net gold export from Hong Kong to China we’ll subtract “imports into Hong Kong from China” from “exports and re-exports from Hong Kong to China” (as you know China doesn't disclose gold trade statistics itself). Imports into Hong Kong accounted for 23 tonnes, while exports and re-exports to China accounted for 333 tonnes. Accordingly, China net imported 311 tonnes from Hong Kong in the first five months of 2017.

Hong Kong - China gold trade monthly ccc

Exhibit 2. In 2016 rumours circulated Hong Kong’s elevated gold exports relative to gold re-exports possibly hinted at fallacious trade data. This year the numbers show no sign of such activities.

If we apply the same math to Switzerland’s customs data, it shows China net imported 172 tonnes from the Swiss in the first six months of this year.

Most definitely Australia has exported gold bullion directly to China in 2017 as well, but the Australian Bureau of Statistics (ABS) has changed its methodology regarding this data somewhere in 2016 and is reluctant to share the details with me. Using my old way to compute Australia’s export directly to China results in 23 tonnes (this number is provisional and will be amended).

The UK, a large gold exporter directly to China in 2014 and 2015, hasn’t shipped any gold directly to China year to date, according to Eurostat.

Largest Gold Exporters to China

Exhibit 3. Annualised Chinese gold import for 2017 stands at 1,159 tonnes.

What’s remarkable is that Chinese true gold demand is far greater than what the World Gold Council (WGC) and GFMS are reporting as “Chinese consumer gold demand”. This is due to incomplete metrics applied by the WGC and GFMS. The immense tonnages imported by China have been waived in previous years, by the aforementioned Western consultancy firms, with dishonest arguments. (If you like to study the details regarding gold demand metrics read this.) In reality, thousands of tonnes are being imported into China and this metal is not coming back in the foreseeable future; causing a bull run on steroids if institutional interest for gold rebounds in the West. Ascending above ground reserves within China imply declining above ground reserves in the rest of the world. And the more scarce the metal in the West, the higher price when demand revives. I’ve described this phenomenon in my previous post How The West Has Been Selling Gold Into A Black Hole. In a forthcoming posts I will add more texture to my analysis.

black-hole-3

Domestic mine production in China is not allowed to be exported, effectively all output can be added to above ground reserves. The China Gold Association (CGA) wrote on April 28, 2017, that Chinese domestic mine output in the first quarter accounted for 101 tonnes. Lacking the data for the second quarter, makes me estimate mine production from January until June by doubling 101, which is 202 tonnes. By the way, the CGA added:

Gold is a special product with the dual attribute of general commodity and currency. It is the cornerstone of important global strategic assets and the national financial reserve system. It plays an irreplaceable role in safeguarding national financial stability and economic security.

Based on data publicly available, in the first six months of 2017 China net imported at least 506 tonnes into the domestic market and mined 202 tonnes. An addition of 707 tonnes to Chinese private gold reserves.

Chinese Official Gold Purchases

I can be short on PBOC gold purchases: the Chinese central bank does not buy any gold through the SGE - its increments must be treated in addition to all visible flows - and it buys in secret not to disturb the global market. I’ve shared my analysis regarding the PBOC buying gold through proxies in the international over-the-counter (OTC) market for several years on these pages. Although, my reasoning has been confirmed countless times, it’s worth noting it was affirmed once more not long ago.

Early 2017 world renowned gold analyst Jim Rickards was in a meeting with the three heads of the precious metals trading desks of largest Chinese bullion banks. These gold dealers told Rickards that indeed the PBOC does not buy any gold through the SGE. Rickards stated in the Gold Chronicles podcast published January 17, 2017 (at 25:00) [brackets added by Koos Jansen]:

What I [J. Rickards] don’t know is about the Shanghai Gold Exchange sales, they’re pretty transparent, how much of that is private and how much of that is the government [PBOC]. And I was sort of guessing 50/50, 70/30, whatever. What they told me, and these guys are the dealers [the three heads of the precious metals trading desks], it’s 100 % private. Meaning, the government operates through completely separate channels. The government does not operate through the Shanghai Gold Exchange. … None of what’s going on on the Shanghai Gold Exchange is going to the People’s Bank Of China.

In fact, the PBOC uses Chinese banks as proxies to buy gold in countries like the UK, Switzerland and South-Africa after which the metal is transhipped to Beijing. Note, monetary gold shipments do not show up in customs reports of any country.

I haven’t come across any clues in the past months that have changed my estimate on the PBOC’s true official gold reserves. My best substantiated guess still is 4,000 tonnes (in contrast, the PBOC publicly discloses it holds about 1,840 tonnes). For more information on how and when the PBOC stacked up to 4,000 tonnes, continue reading at the BullionStar Gold University by clicking here.

Estimated Total Gold Reserves China 20,000 Tonnes

Let us put the pieces of the puzzle together. We know the PBOC doesn’t buy gold though the SGE, but prior to 2007 the Chinese gold market wasn’t fully liberalized and back then the PBOC was primary dealer in the domestic market. Any PBOC purchases prior to 2007 could have been from Chinese gold mines. What else do we know? China is said to be a gold importer since the 1990s, suggesting domestically mined gold was not exported after, say, 1994. In the next screen shot from the China Gold Market Report 2010 we can read “China has been a gold importer since the 1990s”.

Screen Shot 2015-05-17 at 11.48.53 PM

Exhibit 4. Courtesy China Gold Market Report 2010.

For the sake of simplicity, we’ll calculate from 1994 onwards. Precious Metals Insights (PMI) has estimated that 2,500 tonnes of gold jewellery were held by the Chinese population in 1994. Furthermore, I have data on Chinese non-monetary gold import starting in 2001 - which started slowly but ramped up in 2010 (exhibit 2).

In 1994 PBOC official reserves accounted for 394 tonnes and Chinese domestic mine output accounted for 90 tonnes. So, our starting point in 1994 is:

2,500 (jewellery base) + 394 (official reserves) + 90 (mining) = 2,984 tonnes

From here, we can aggregate domestic mine output and net imports for every succeeding year. As stated above, my assumption is that the PBOC sourced its official gold from domestic mines prior to 2007, but shifted these acquisitions to the international market after 2007. The official gold increments in 2001 (105 tonnes) and 2003 (100 tonnes) I’ve subtracted from “aggregate domestic mine output”, the increments in 2009 (454 tonnes) and onwards I did not subtract from “aggregate domestic mine output”.

The previous calculation has resulted in the following chart:

Estimated Total Chinese Gold Reserves June 2017

Exhibit 5. Aggregate net import reflects non-monetary gold.

In the chart the green, blue and grey bars represent private gold reserves, and summed up account for an estimated 16,193 tonnes at the time of writing. The red bars reflect the PBOC's official gold reserves - I would like to stress this number is speculative - and currently account for 4,000 tonnes. My best estimate as of June 2017 for total above ground gold reserves within the Chinese domestic market is 20,193 tonnes.

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squid's picture

PMs will correct when the current tulip mania pops, it will correct with everything else.

Buy then.

The world will want to deflate but the central bankers won't let it and they will print-print-print...

You'll be in good shape then.

 

Squid

Silver Savior's picture

I was looking at 100 ounce silver bars on you tube last night but wouldn't they be a bitch to liquidate when silver gets super high in value? You would be limited to trading with institutions and the ultra wealthy. 

That's not so bad trying to find them but the ultra wealthy tend to be pricks. I guess it depends. Some people like Obama are pure.

Silver Savior's picture

I think gold will do the most when the elite revalue gold to a new currency.Thats why I don't care about dollar price. Dollar? What dollar? Only a fool would be looking at it for dollar worth.

The question is how high it will be worth in terms of the new currency they choose. It probably will be huge! Silver will get a good thrust too. Maybe even more than gold.

Latitude25's picture

Since the bottom at the end of 2015 the bull market has resumed.  It's not skyrocketing like gold bulls dream but upward IS the direction.  Buy on the major dips.  Just look at the price data since 2013 and it will be dead obvious when those major dips occur.

wattie's picture

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esum's picture

isnt this all part of the china/russia plan to dump the $USD

Saddam and Ghadaffy had similar aspirations.... 

Silver Savior's picture

Yep the plan is in full swing and I am happy about it.

Consuelo's picture

 

 

Sorry - I forgot, what were those nifty little missile and electronic warfare inventions the Libyans and Iraqis had, again...?  

Idaho potato head's picture

Heh there is of course a slight difference between Iraq and libya to China and Russia, oh and now we have the new snowflake army where every snowflake is special.

silverer's picture

Fort Knox says it will disclose its gold holdings as soon as China calls back.

bunnyswanson's picture

Operation Fort Knox Gold (Fairbanks, Alaska) is underway.

thebigunit's picture

Didn't some commie once describe gold as a "barbaric relic"?

Estimated Chinese Gold Reserves Surpass 20,000t

 

ReturnOfDaMac's picture

Yea, it was that two faced former Ayn Rander GreenSpin ...  Been dealing with shiny since the 80's. Won't make you rich but you will never be bust.  Funny thing 'bout shiny, no matter how many market shennanigans happen, boom, bust, etc it still seems to weigh the same.  Go figure ...

Azannoth's picture

Meanwhile in Europe all you see are "We are buying Gold" signs and nobody but the 0.1% are buying anything except wedding rings - you can cleary see who's in decline and who is on the rise.

Herdee's picture

My estimation on the numbers to do with the confidence barrier in the American dollar and gold are 72 for DXY and 1765 for Gold. That's when all the countries around the globe will wake up finally to the continual devaluation of their U.S. Treasury debt and start dumping the dollars a junk. It'll cause a flood of dollars to return home because nobody wants to hold them. Hyperinflation returns and the U.S. appears to everyone to be high risk.

Son of Captain Nemo's picture

And guess who wants some of it with "the great armada of ships" on the North Korean horizon?...

If Xi Jingping should decide to capitulate he's been promised an endless supply of "beautiful chocolate cake" in return for all the Au those American aircraft carriers can hall back to San Diego!

el buitre's picture

the residual 4,000 tonnes, which is a speculative yet conservative estimate, is held by the Chinese central bank the People’s Bank of China.

 

Jim Willie's "speculative yet conservative estimate" of gold bullion held by the Chinese government is 25,000 MT.  His speculative yet liberal estimate of the quantity held in Fort Knox is two 55 gallon steel drums filled with gold rounds.  The remaining storage there is poison gas reserves.

Jannn's picture

The point is, Jim never shows any eveidence. 

gdpetti's picture

USofA is said to have had ~2300 tons a few months ago.... not sure how different China is now compared to India, which has temples full of gold statues, donations etc... which is why the govt is trying to get their hands on it with no easy way of doing so as of late... not sure on China after that whole 'Spring' period, but lately, they are definitely accumulating as much as they quietly can... foreign reserves are worthless fiat in the end, and the PMs are endgame plays. China was noted as having over 3200 tons a few months ago as well... but that is publicly, not private, and China, like India, is heavy on the private accumulation, moreso as the economic 'pump and dump' markets have been created in western style 'financialization'.... which is always the mark of this endgame.

Latitude25's picture

The GATA web site is down.  Someone must be getting desperate to hide the truth.

ReturnOfDaMac's picture

Good idea to have a tiny bit of shiny but not much more. Shiny buys time while things get back to normal.  Newsletter hustlers and rock dealers have nothing to market but fear. There will be no Venezuela here, way too many people, way too many guns. There will be a crash, as sure as the sun will rise tomorrow. Just can't know when. And when it happens, what do you sell to cover your margin calls? Things that went up (paper shiny), and THAT puts a lid on its appreciation. Then a few months later, panic subsides, the monkey hammer comes out, and the markets rise again. Wash, rinse, repeat. Will never get rich with pet rocks. 

I figure the best way to rob a bank is to buy one so, maybe own some Morgue, Govt Sacks, Wells Fraud-go, etc. Betting on war probably works too. Defense stocks still have plenty of room to run.

GRDguy's picture

16,193 tonnes = 520,617,046 troy ounces / 1,400,000,000 people = 0.37 ounce per person.

Ummm, that's not much to get by on these days.

bluskyes's picture

RCM is punching out 1gram "coins"

NukeChinaNow's picture

Correct me if I'm wrong but didn't the Canuck Govt sell virtually all their gold stores?

bluskyes's picture

Yup, they like to signal the bottom of the market to their citizens.

They're always digging more out of the ground up here, and the queen gets a cut. She's getting old, and wants to leave her ugly mug on everything of value that she can - before she shuffles back to hell, and her inbred offspring climb up on Satan's chair.

Conax's picture

American banksters, chinese gov't officials, the Brits, everyone is totally secretive and or lying about their gold holdings. In the case of the west they have been lying their asses off for decades.

Nobody on the outside has the slightest clue how much is held by whom. We do know they lie like a persian rug.

Go on, take another guess.

DisorderlyConduct's picture

A guy gets a job at a museum at the T-Rex exhibit. He asks his boss "how old is that thing?" To which the boss replies "20,000,011 years old".

The new guy, incredulous, asks "how could you possibly know that to such a level of precision?"  Well, when I started here 11 years ago it was 20 million years old...

This article purports to know to the ton what the Chinese people and the PBOC hold, but I bet that noone knows to the nearest 1k tons or more what they hold. It's not that it really matters in terms of tons, but it shows a novice error - calling the whole analysis into question.

tenpanhandle's picture

Seems to me Koos made an educated guess and produced the numbers you find "incredulus", per your (funny) joke.  If no one knows, someone has to throw something out there so to begin construing a basis.  If he is off that 1K tons out of 20K tons, that's  95% accuracy which is muck better than "close enough for govt work".

RagaMuffin's picture

 

<<if accurate and greater than "known" gold goes down

<<If accurate and less than "known" gold goes up

Bay of Pigs's picture

It shouldn't come as a surprise to anyone that the Chinese government and the people own a shitload of physical gold. If you don't believe it, take a trip to Hong Kong and some other major cities there and check out their gold shops. They are impressive.

Consuelo's picture

 

 

I'm thinking...   It isn't the gold or lack thereof, for the Chinese.   I am thinking more like they want to make sure all is in place before they pull the curtain (or drop the hammer, take your pick).    Doing so probably requires Russian input and coordination as well.   In fact, it's impossible without them.   Hello Turd world, here we come...!!

 

JRev's picture

Would love to visit the coin shops in Beijing and Shanghai but I've heard getting it out of the mainland can be a hassle. With the prices on some of those semi-numismatic coins, the "collector's arbitrage" alone could make it a worthwhile trip.

BobEore's picture

At the time of the original explosion of interest in China's gold holdings(circa 2013/2014, the topic was understandably a hot item for folks in the Occidental world caught holding the bag after expectations of a soaring price trajectory and end to "cartel suppression" proved as groundless as all previous pump n dumps (Iraqi dinar anyone?)run by boiler-room hirelings of the real $power.

If China was buying a LOT OF gold & silver, reasoning went, then it was but a matter of time before the tricksters holding the "beach ball down under water" were left high n dry; the "free market" would conquer all opposition,lucky holders of shiny metals would count their lucre in luxuriously appointed yacht aft cabins, or custom built Idaho mountain retreats, and the world would be right

again. It didn't work out that way. In fact, by the time enough information had subsequently surfaced to allow the detached and objective observer to dissect both the premise(circa 2015-2016)and the likely consequences of buying into it, anyone still touting the notion that the Chinese/Russians/Brics/etc., were 'going long metals' in order to bring the world back into balance and the 'free' back into markets was definitely a candidate for the sort of haberdashery which eschews armlength sleeves for the more sleek and polished 'straight' jacket look so au courant in the internet pundit world of geopolitical musings and financial advisement!

As it turned out, the only game the Chinese were interested in was the one already going on - involving the numerous monopolist banks and infinitely crooked financialists accustomed to using the savings of the 'lil guy' as a kind of pinata which they would take turns at shattering and then laughing uproariously at the trail of broken dreams n lives thereby created. Far from wishing to upset the tables of the moneychangers, in other words... the cuddly Panda Banksters of our "China saves the day" storyline wanted in on the scam - and a sizable piece of the action, as reward for sending an entire generation of 'young communist' cadres to Merikan institutions of higher learning and otherwise supporting an increasingly tottering western economic structure.

And lo n behold... they surely have succeeded!!! Not just in grabbing a piece of the lucrative OTC trade for themselves - these new era Sino-banksters are nothing if not ambitious - but in executing a brilliant strategy of working with their western cohorts to OWN THE RIGGED MARKETS which their success in learning the ropes of derivative trades and the rest of the dirty tricks by which everyday now huge paper profits are reaped, and then plowed back into buying more control... more shiny metals... and

more mouthpieces in the west, who eke out some kind of living by applying themselves to the now tired script whereby the Pandas are the real friends of the lil guy, and...

you better buy now... because... any day now...

they gonna pull the plug on the bad guys. And then! There won't be any more shiny to buy.

Or something like that. No... I don't count Koos amongst the worst of the huckster skanks. He just got a lil overexcited about the numbers which the wily Easterners dangled front of their western dupes, and decided it was safe to 'buy in.'

But it's over now... it really is... this China meme thang. And it would be good to all just move on, if we could please. Gold will go - where and when it's Chinese and allied western $power allies want it to. In the meantime...

a) it's a must have item in the soul survivors' arsenal, which will unfortunately continue to act more in the manner of a radioactive isotope in eating away at one's health and peace of mind, than as the ticket to financial independence it was meant to be. Till it doesn't.

b) it don't matter a damn whether the wily Pandas have 4000/10000/100000 tonnes of the stuff parked and waiting. Never did. Just another internet pastime for folks with too much time on their hands. Speculatin on the speculators. Fools Gold dat!

It's the dirty low down... all over agin. Always n forever. Say it ain't so ... JOE!

I Feel a little Qeasy's picture

You are absolutely full of shit, I could hardly type for laughing at your ignorance. Read some history you prick.

debtor of last resort's picture

Well, Bob, i sure aint saving $ or €.

JRev's picture

Best damn ZH comment I've read in a while. Some tried to warn the troglodytes that there was much more going on here than the simpleton's narrative peddled by the likes of Sinclair, Holter, Willie, SGTReport, SilverDoctors, and so many others. Once the Yuan was accepted for SDR inclusion, all these fuckwads stopped talking about the "gold backed Yuan." 

I was personally called an "idiot" by one of the aforementioned mouth-breathers for publishing this article a few years back: http://www.activistpost.com/2015/07/masters-of-metal-china-rothschild-fi...

...yet now the voices fall silent. Funny how that works. Well, whatever, onto the next saviour meme! If it ain't China, then Trump will save us. When that fails we can just go back to ranting about Jesus a lot, I guess. 

Bay of Pigs's picture

BobEore aka chivachiva, while entertaining with his prose, has hardly been accurate himself except to badmouth anyone promoting gold and silver ownership. He is bombastic and a total asshole to anyone who disagrees with his personal theories. Fact is, nobody knows what China, Russia and others will do when King Dollar comes crashing to Earth.

JRev's picture

BoP, love 'ya, followed your comments here and on SD under a different alias for years, but you're one of the guys who threw their weight behind this thesis and came up short. Sorry. Chivachiva gets it wrong sometimes but is consistently thought-provoking despite having a writing style that's sometimes hard to follow. 

Just ask our old friend Ranger (may he rest in peace, that glorious bastard) who literally DIED waiting for this shit to play out. 

Bay of Pigs's picture

Fair enough. I understand the issue all too well, but it doesn't mean the thesis is wrong. Timing is always a bitch. Looks to me we are facing a stock and RE crash again (1929, 2001, 2006-7), at precisely the worst time to bail on your gold and silver positions.

Good luck and best wishes to you.

JRev's picture

I concur. Hindsight's always 20/20 and I'm a buyer at these prices. Just wish I wouldn't have been from late 2012-2015 is all. I appreciate the relative anonymity of gold and silver regardless of where the price goes. At least I listened to my gut and not the PM gurus of SD and divested into cryptos at the same time - were it not for that I'm not sure I'd be liquid enough to HODL. 

debtor of last resort's picture

Mistery man, he should write a book.

Another mysterious track to prevent you from leaving the fiat road to hell.

Read me, buy btc, no roi, barbaric relic, fuck 'm Bay.

GoldVu's picture

Regarding the gold backed Yuan going silent - throw into the mix the fact that physical vaulted gold & silver are about to get their title of ownership digitized to be used as a digital currency, then why would they need the Yuan to be backed if you can keep it as inflatable fiat and yet still access monetized gold & silver in another way?  > BullionCoin: http://www.goldvu.com/bullioncoin.html

 

JRev's picture

Exactly, GoldVu. 

Not sure if it will be one of these "pseudo" cryptos that's "backed by gold in a vault, trust us plz" or if they'll do the same at the supranational level as a cardre of Globalist think-tanks and PBOC governors have floated for years, but it'll be something like this. They only need just enough (irredeemable) gold to reset the balance sheet and restore confidence. 

factorypreset's picture

"If China was buying a LOT OF gold & silver, reasoning went, then it was but a matter of time before the tricksters holding the "beach ball down under water" were left high n dry; the "free market" would conquer all opposition,lucky holders of shiny metals would count their lucre in luxuriously appointed yacht aft cabins, or custom built Idaho mountain retreats, and the world would be right"

 

Now THAT is a freaking awesome sentence!

Jungle Jim's picture

I'm one of the simpletons who took the bait, hook, line, and sinker. And it sank me. What the guy says is true. It may not remain true for all time to come, but it has been and is true for now.

The stupidest thing I ever did (other than joining the Army at age 18, and, 13 years later, going to college at age 32) was buying a shitload of silver and gold in 2010-2011.

 

When I saw that silver was circling the drain and I was being *forced* to sell it for much less than I had paid for it, I tried to "rotate" some of the funds into gold, in the hope that gold might not fail quite so spectaculary.

 

This too proved a fool's hope, and before long I was being forced to sell my gold too, until there is almost none left. Yes, I mean physical. It was *all* physical, all along.

oddjob's picture

It's not a total loss, it has given you the motivation to try and scare others into selling, maybe you could monetize that, but you'd probably fuck that up as well.

Jungle Jim's picture

I'm just telling you what happened to me. Your mileage may vary, if the timeing is in your favor.

oddjob's picture

So why not get short and profit from your own advice?

Jannn's picture

Pay special attention to:

"causing a bull run on steroids if institutional interest for gold rebounds in the West. Ascending above ground reserves within China imply declining above ground reserves in the rest of the world. And the more scarce the metal in the West, the higher price when demand revives. I’ve described this phenomenon in my previous post How The West Has Been Selling Gold Into A Black Hole. In a forthcoming posts I will add more texture to my analysis."

The Chinese are having too much fun buying cheap metal. The price is set by WESTERN physcial supply and demand. IF the West decides gold is hot again - and I'm not talking about internet gold bugs, I'm talking baout institutions - the price is likely to go up faster "than usual" as China has soaked up much gold. 

(btw, the Chinese/Asians have never set the price coz the like to buy low and sell high. In contrast to Western investors.)

JRev's picture

Chinese commercials have been LBMA board members since the late 80s and now sit in prominent positions on both the gold and silver fix. Charles Savoie pegged Zhou Xiaochuan as a chief suppressor of the silver price, acting through the PBOC, over a decade ago: 

http://www.silver-investor.com/charlessavoie/cs_july04.htm

They've been at it since at least 2004. So yes, China DOES have a signifiant hand in setting the rigged price and has for decades, which begs the question: Why does "the West" let them do this? Is it because they're just bankrupt idiots or are they simply moving their gold from one superpower to the next as has been done many times throughout history? Are all these "Western" corporations whose board members sit on the Trilateral Commission helping build out the New Silk Road infrastructure for shits and giggles, too? 

http://www.activistpost.com/2015/07/agenda-21-in-china-and-technocratic....

Never forget that it was Goldman Sachs who coined the term BRICS years before they were actually an alliance of any sort.

Go on believing the fairy tale of clashing Nation-States if you like. No skin off my back, the reality will manifest before your eyes soon enough, anyways. But if you want to argue the "Baby's First Macrofinance" version of this story, you'll have to come up with some rather creative refutations to the facts as they currently stand.