Neck and Neck: Russian and Chinese Official Gold Reserves

BullionStar's picture

Submitted by Ronan Manly, BullionStar.com

Official gold reserve updates from the Russian and Chinese central banks are probably one of the more closely watched metrics in the gold world. After the US, Germany, Italy and France, the sovereign gold holdings of China and Russia are the world’s 5th and 6th largest. And with the gold reserves ‘official figures’ of the US, Germany, Italy and France being essentially static, the only numbers worth watching are those of China and Russia.

The Russian Federation’s central bank, the Bank of Russia, releases data on its official gold holdings in the Bank’s monthly “International Reserves and Foreign Currency Liquidity” report which is published towards the end of the third week of each month, and which confirms gold reserve changes as of the previous month-end.

The Chinese State releases data on its official gold holdings via a monthly “Official Reserve Assets” report published by the State Administration of Foreign Reserves (SAFE) that is uploaded within the Forex Reserves pages of the SAFE website. This gold is classified as held by the Chinese central bank, the People’s Bank of China (PBoC). The SAFE report is published during the 2nd week of each month, reporting on the previous month-end.

In both reports, official gold reserves (i.e. monetary gold) are specified in both US Dollars and fine troy ounces. Monetary gold is gold that is held by a central bank or other monetary authority as a reserve asset on a central bank’s balance sheet.

Delta: 63 Tonnes

For the Bank of Russia, its latest report, published on 19 September 2017 addressing August month-end, shows the Bank holding 57.2 million fine troy ounces of gold (1779 tonnes). For the Chinese State, the latest SAFE release is reporting Chinese official gold reserves of 59.24 million ounces (1842 tonnes).

Russian gold reserves, as officially reported, now total 1779 tonnes, and are now just 63 tonnes shy of the ‘official’ gold reserves of the Chinese central bank. Given that the Bank of Russia is expected to add about another 36 tonnes of gold to its official reserves during the remainder of 2017,  then if the Chinese State does not reveal any increase in its ‘official’ gold reserves between now and the first quarter of 2018, Russia will most likely surpass China in terms of official gold reserves by April 2018.

While its possible and probable that the Chinese State / PBoC really holds more gold than it claims to hold, any upcoming scenario in which the Bank of Russia surpasses the People’s Bank of China in terms of gold holdings would at least be symbolic in terms of international monetary developments, and would be sure to generate some chatter in the financial press.

Although the official gold reserves of these two key nations are now nearly neck and neck, there are still some interesting contrasts between them, not least the way in which the Bank of Russia’s reported gold holdings have been steadily increasing month on month, while the reported gold holdings of the People’s Bank of China have remained totally unchanged for nearly a year now, since the end of October 2016.

Therefore the situation which is now emerging, i.e. the distinct possibility that Russian official gold reserves will surpass those of China something in early 2018, is a situation which is emerging precisely because the Russian Federation keeps adding to its gold reserves, while the Chinese State seemingly does not.

Differing Styles of Communication

The routes via which these two strategically important nations have amassed their official gold reserves are also quite different, at least at a public reporting level.

Bank of Russia Gold Reserves: 2006 – September 2017, Source:www.GoldChartsRUs.com

It wasn’t so long ago (2007) that the gold reserves of the Russian Federation were still in the region of 400 tonnes. However, beginning in about the third quarter of 2007, the Bank of Russia began a concerted campaign to rapidly expand its official gold holdings, a trend which never subsided and which has been ongoing now for exactly 10 years. By early 2011, official Russian gold reserves had exceeded 800 tonnes. By the end of 2014, the Bank of Russia was reporting holding more than 1200 tonnes of gold. And by the end of 2016, Russian official gold were more than 1600 tonnes. For full details on the Bank of Russia’s gold holdings, including gold storage, gold reserve management, gold purchases and Russian government views on gold, see “Bank of Russia, Central Bank Gold Policies” at BullionStar’s Gold University.

From the above chart, it can be seen that during 2014, 2015 and 2016, respectively, the Bank of Russia added 171 tonnes, 208 tonnes, and 199 tonnes to its gold reserves, or in total 578 tonnes over a 3 year period. In 2017, with the Bank of Russia having added another 164 tonnes of gold for the year to end of August, its official gold reserves now stand at 1779 tonnes.

The route to the Chinese State accumulating 1842 tonnes of gold is a different one to that of the Russians, again at least from a publicly reported angle. While the Bank of Russia has historically published changes to its gold reserves on a monthly basis, the Chinese central bank has chosen to remain very secretive, and between 2001 and mid 2015 had only issued four public updates addressing the size and growth of its gold reserves. These 4 updates were as follows:

  • 4th Quarter 2001: From 394 to 500 tonnes: A 106 tonne increase
  • 4th Quarter 2002: From 500 to 600 tonnes: A 100 tonne increase
  • April 2009: From 600 to 1,054 tonnes: A 454 tonne increase
  • July 2015: From 1,054 to 1,658 tonnes: A 604 tonne increase

Beginning in July 2015, however, the Chinese State started to report changes in its official gold reserves on a monthly basis, and by July 2016 was reporting 1823 tonnes of official gold holdings. The following graphic, taken from a BullionStar infographic on the Chinese gold market, illustrates the sporadic reporting of Chinese official gold reserves between the early 2000s and July 2015. Note that between July 2016 and October 2016, the Chinese State through SAFE reported that the PBoC had acquired another 19 tonnes of gold, taking its total reported gold reserves to 1942 tonnes as of the end of October 2016.

Chinese Official Gold Reserves, 2003 – 2016 Source: Chinese Gold Market Infographic, BullionStar

The sparse official reporting by the Chinese is also clear in the below chart from the GoldChartsRUS website, which shows cumulative holdings of monetary gold by the People’s Bank of China (PBoC) between 2000 and 2017. Looking at the top panel of the chart, it can be seen that between 2001 and 2015, there were only 4 distinct jumps in the quantity of gold held by the PBoC.

This was followed by a period of about 15 months from July 2015 during which SAFE reported small monthly accumulations in PBoC’s gold holdings, as can be seen from the gradual increases in the bars in the top panel from July 2015 to October 2016, and the corresponding presence of frequent activity in the monthly changes in the lower panel of the chart.

Official Gold Reserves of the Chinese central bank: Divulged Holdings 2000 – 2017. Source:www.GoldChartsRUs.com

By September 2016, Chinese State gold reserve holdings had reached 59.11 million ounces. In October 2016, the SAFE report announced that Chinese official gold holdings had reached 59.24 million ounces, a 0.13 million ounce increase from the previous month. However, then something unusual happened, at least in terms of monthly updates. Since October 2016, Chinese official gold reserves have not changed at all. The SAFE updates are still published each month, but the gold holdings figure has remained unchanged at 59.24 million ounces (1842 tonnes).

Therefore, for nearly a year now, the Chinese authorities are signalling that they have not acquired any new gold. At least that is what they want the public to believe. Hence the constantly recurring headlines from the financial media, such as this one from Reuters a couple of weeks ago, “China gold reserves steady at 59.24 mln ounces at end-September – central bank”.

But is it true that China only holds 1842 tonnes of gold and that it has not been active during the last year in continuing to accumulate monetary gold as part of its reserve assets? And for that matter, is it the case that the Bank of Russia and Russian Federation only hold 1779 tonnes of monetary gold?

While its difficult to know for sure, it is possible that the People’s Republic of China and the Russian Federation both hold additional gold that is not reported by their monetary authorities. This is so for multiple reasons, including the opaque ways in which these monetary gold reserves are accumulated, the traditional secrecy of both governments, and the fact that both countries have access to other investment pools that might hold gold that can be transferred at short notice into the respective central banks’ official gold holdings.

How Much Gold could the Chinese State really have?

The historical track record of the Chinese State in sporadically communicating the size of its monetary gold holdings shows that there has often been a large gulf between the true size of its gold reserves and what the Chinese claimed to have via its piecemeal and rare updates. For example, even based on its official numbers, the PBoC accumulated over 600 tonnes of gold between April 2009 and July 2015 but did not reveal this until July 2015.

The nearly year-long hiatus between October 2016 and the present, during which the Chinese authorities, via SAFE, claim that the PBoC’s gold holdings have remained at 1842 tonnes, could be true, but only in so far as the Chinese State does not wish to inform the world about its sovereign gold reserves. Beyond this, the true gold holdings of the Chinese central bank may be significantly higher than even official published figures suggest.

There is very little transparency into how the Chinese authorities accumulate monetary gold. In July 2015, when SAFE announced the first update to its gold holdings since 2009, it stated that the “major channels of accumulation” of gold were from purchases in foreign markets, domestic gold production, domestic scrap sources, and other transacting in the domestic market. But beyond this, the Chinese authorities never comment on where they source gold from.

There is lots of evidence that the Chinese State purchases significant quantities of gold in the international market, including in the London Gold Market, and then monetises this gold (i.e. classifies it as monetary gold) , before transporting it back to Beijing. See “PBoC Gold Purchases: Secretive Accumulation on the International Market”, at BullionStar Gold University for further details.

The Chinese State is also a possible candidate for having purchased a tranche of the IMF’s gold during IMF gold sales in 2010. See BullionStar blog  “IMF Gold Sales – Where ‘Transparency’ means ‘Secrecy’” for further details.

There are also plenty of other State entities and state controlled entities in addition to the Chinese central bank that could conceivably be holding gold reserves that could in time be reclassified as PBoC gold, and brought into the sphere of reporting. See section “Gold Transfers from other Chinese State entities” in BullionStar Gold University article “Gold Policies of the People’s Bank of China” for further details.

There is also evidence to suggest the Chinese State is really buying about 500 tonnes of gold per year, and that it has a first step target of holding at least 4000 tonnes of gold. This evidence, which is from 3-5 years ago, comes from senior people in the China Gold Association (CGA). See section “How much gold might the PBoC be buying each year?” in article PBoC Gold Purchases.

A gold reserves-to-FX reserves ratio of 5% would currently put Chinese state gold holdings at nearly 4000 tonnes. A gold-to-GDP ratio of about 1.77%, which is the equivalent of the gold-to-GDP ratio of the US, would currently put Chinese state gold holdings at nearly 5000 tonnes of gold.

Russia: Golden Pipelines and Stockpiles

In its “Methodological Notes to International Reserves of the Russian Federation“, the  Bank of Russia defines “monetary gold”  as:

“standard gold bars and coins with a purity of at least 995/1,000 held by the Bank of Russia and the Government of the Russian Federation. It comprises gold in vault, en route and in allocated accounts, including that which is held abroad. The item monetary gold includes unallocated gold accounts with non-residents.”

The primary source of gold flowing to the Bank of Russia comes from Russian gold mining production, with the Russian Federation acquiring a large percentage of domestic gold mining production each year. In practice, a small group of state influenced Russian banks are authorised to intermediate between the gold mining companies and the State, acting as a gold pipeline between the mines and the Bank of Russia / Government. These banks finance the mining companies, purchase their gold output , have it refined into gold bars by Russian gold refineries, and then offer this gold to the Russian State.

Some of these banks include Sberbank, VTB, Gazprombank and Otkritie. For details see section “Russian Banks as bulk buyers of Russian Gold” in the Russian gold market article in BullionStar’s Gold University.

But its possible that some of this gold ends up not with the Bank of Russia, but with other Russian State entities, one of which is the “Gosfund” or “Precious Metals and Gems fund” operated by “The Gokhran”.

This Gosfund could be buying a portion of Russian gold mining output, stockpiling it, and intermittently releasing some of its stockpile to the Bank of Russia. When I asked the Gokhran last year could it reveal its gold holdings, the Gokhran replied to me that “it does not publish information about the amount of gold reserves in the Russian Gosfund nor any data about its precious metal operations.” See letter reply from Gokhran below (for those who can read Russian):

Gokhran reply January 2016 to query on whether it could publish its Gold Holdings.

Conclusion

Given the high degree of opacity with which both the Russian State and Chinese State accumulate monetary gold, and the fact that they both can probably tap additional gold stockpiles to boost their official gold reserves, it will be interesting to see whether China, through SAFE, announces any increase in the PBoC’s gold holdings between now and the end of Q1 2018.

Because if China does not do so, the Russian Federation will soon have the distinction of being the world’s 5th largest gold holder, pushing China into 6th place. Will China update its gold holdings before the end of 2017, or at least by early 2018? Nothing is certain, but with an ‘official’ difference of only 63 tonnes of gold between them, the race is on.

This article first appeared under the same title, 'Neck and Neck: Russian and Chinese Official Gold Reserves' on the BullionStar.com website.

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Wormwoodcums's picture

As I understood they are infact both neck and neck, however they are sitting on around 60,000 tonnes combined.  At least we still have Fort Knox.

skipweston's picture

"Neck and Neck: Russian and Chinese Official Gold Reserves" More Propaganda from BullionStar. no one knows China's Gold Reserves.

China's Gold Facts:
1. China was mining Gold before the Europeans around 3000 BC.
2. Once again, China was the largest producer of gold in the world, mining 455 MT in 2016. The country has now held that position for 10 years in a row.
3. China started hoarding Gold over 25 years ago to increase their Gold Reserves.
4. The SAFE data of China's Reserves at 1,800 tonnes is nothing by Globalist's propaganda lie.
5. The real gold estimates are between 15,000 tonnes to 50,000 tonnes. There is even on theory that the old wealth of White Tiger Family may have 100,000 tonnes of Gold.
6. Someday the world will find out what China's real Gold Reserves are and it will thousands of tonnes more than whats left in Fort Knox.

alexcojones's picture

Love the name "Ronan Manly." Seems almost from an Austin Powers movie.

My question: HOW believeable are the Russia & China tonnage when we cannot even trust US estimates?

Anybody can make up numbers and as Bluskyes wrote, .gov probabaly does.

Maestro Maestro's picture

The Russians and the Chinese are in bed with the Americans. The Russians betrayed us all worse than than the Americans. It's starting to come out into the light. Gold could never have gone down without active Russian and Chinese collaboration with the Americans. From the Jews' mouth:

https://www.debka.com/kurds-win-syrian-oil-secret-us-russian-deal-prize-...

https://www.debka.com/shoigu-gave-israeli-leaders-rare-insights-moscows-...

bluskyes's picture

I believe these .gov numbers as much as I believe every other number they put out - 0

Hkan's picture

Turn question around.

How is THIS world gonno handle THIS wonderful unpayable dept?

Any idea?

Whatabout.......G.

Before critics.....find better way.

 

ReturnOfDaMac's picture

Give it a rest bugs.  As long as western central banks exist, can print ad-infinitum, and paper short non-existent gold into the mud, pet rocks are going nowhere.  Wake up folks, you will take their paper, and you WILL like it.

SubjectivObject's picture

you will take their devaluation, and you will like it

tuetenueggel's picture

Russia and China both together have more then 5 times the qty, USA claim to own.

As we all know, indeed there´s not a single ounce left in US vaults.

Even more ugly, they spent gold that is not their own as Germany´s Ukraines´and much more.

Criminals als always since the founding of US.

Secret Weapon's picture

The headline word that popped out to me was "official".  The official rate of inflation is 3%, the official rate of unemployment is 5%, and lie after lie after lie. Basically all governments have psychopaths and sociopaths running the show.  Their word is no good and cannot be trusted. Ever.

Conax's picture

Silver is money, gold is collateral.  You can't back your currency with silver because they tried that and the banks' vaults were stuffed with morgans to the rafters.  People preferred lightweight folding currency. Back the currency with gold and every fiat paper country comes for it with a boatload of paper with the ink still wet. It's a diabolical conundrum, trying to have honest, stable money.

You can't even discuss it without writing a book... So to keep it short,

Start off by hanging the bankers and keep hanging them until they create a tolerable system.

They're so savvy, I'm sure they could come up with one.  After a couple thousand twist in the wind.

HRClinton's picture

Re.. "Start off by hanging the bankers and keep hanging them until they create a tolerable system.

"Keep hanging until..."?

No, just hang them. Your sentence states that money should remain their dominion, and that we should merely 'tighten' (pun intended) our Oversight.

Hang 'email all, and let (((their desert storm god))) sort them out!

HRClinton's picture

I'm amused by the 1.77% gold-to-GDP ratio. The reciprocal is 56.5:1.

That's mostly symbolic, than of any real significance. That's no real linkage between fiat Money and Gold. Unless you revalue gold to the Stratosphere. Even at 50% (2:1) ratio, the gold re-price would have to jump to (50/1.77)*$1275, or $36,000/oz.

Not gonna happen. And forget about 100% (1:1) ratio, or $72,000/oz.

All I can see, is that the CBs are jokeying, to avoid a comparative disadvantage, i.e. to be on a ratio-parity for defensive purposes -- and no more.

BTW, if you kept pace with these CBs, then your 1.77% Gold-to-Annual_Income would look rather puny. If, say, you grossed $100k/yr, you'd need to have $1,770 in gold. Whopee! 

How's that for context and perspective? 

Maestro Maestro's picture

No.

China and Russia are not the good guys either. In fact, China and Russia are only playing good cop, bad cop with their partners, the Americans and the Europeans.

China, like Russia, is not pro-gold and acts in collusion with the COMEX and LBMA to suppress the price of gold. When gold goes up in price, it will be against the will of the Chinese, the Russians and the Indians.

The BRICs are all IMF member countries and are thus forbidden to monetize gold, or link their currencies to gold, or use gold as a trading or exchange mechanism:

http://m.beforeitsnews.com/silver/2016/04/how-the-imf-forbids-the-use-of...

http://www.24hgold.com/english/news-gold-silver-why-does-the-imf-prohibi...

India recently collaborated with Western bankers and following the West's instructions, temporarily destroyed the purchasing power of its own Indian population by demonetizing physical cash, under the guise of eliminating tax evasion and cash-only criminal activity. This has had the effect of crashing the gold price by temporarily removing the Indians from the gold market, exactly when the Trump inauguration lit a fire under the gold price.

The Russians never abstained from using dollars even at the time of the communist USSR! If they did not demand gold for their oil during the Cold War, why would the Russians do it now when the Russian central bank is owned and controlled by the City of London banking establishment since the creation of the new Russian Constitution under Yeltsin? The Russians are forbidden to issue their own currency the Ruble without permission from Western bankers and the Russians can only buy US Treasuries with the dollars they get for their oil, not gold. There are more dollar assets than Rubles in Russia:

http://anonhq.com/checkmate-central-bank-russia/

http://www.pravdareport.com/russia/economics/30-12-2014/129431-usa_russi...

The gold price would have skyrocketed if the Russians and the Chinese were buying gold hand over fist as alleged. Why do you think that Western bankers would give gold away at or below cost to their purported enemies?

Unless they were not enemies in reality, and just partners playing good cop, bad cop for the purposes of fooling and manipulating their unsuspecting respective populations?

http://www.mygen.com/users/ufo/Mao_was_a_Yale_Man_2.html

Why do the Russians never ask the Americans to leave Syria where the Americans are illegal invaders under international law? Why did the Russians never prevent the Israelis from attacking their allies the Syrians?

The Shanghai Gold Exchange is a fraud designed to legitimize the fraudulent COMEX "discovered" gold price. Goldman Sachs and JPM never could have manipulated the gold and silver prices lower without active Chinese collaboration. That the Shanghai Gold Exchange is a physical only market is a LIE:

https://www.sprottmoney.com/blog/the-new-shanghai-gold-exchange-does-any...

The Chinese government defrauded and stole from their own Chinese citizens by encouraging them to buy gold at the top. The Chinese bankers then colluded with JPM and Goldman Sachs to crash the gold and silver prices. Large amounts of physical silver were leased out and sold into the physical markets by the Chinese authorities as well:

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

http://m.digitaljournal.com/article/279166

http://www.dnaindia.com/money/column-china-urges-citizens-to-buy-gold-an...

Do not forget: It's the international ruling classes against the common folk. That's the real meaning of globalism.

Consuelo's picture

 

 

 

"...the sovereign gold holdings of China and Russia are the world’s 5th and 6th largest."

 

Go back to sleep, BullionStar...

el buitre's picture

This article is a waste of electrons.  The official gold holdings is about as reality based as the Warren Commission Report or the 9/11 Commission Report.   Both China and Russia have at least 15 times their "official" holdings, and Fort Knox has a 55 gallon drum filled with 90% gold coins and a lot of cannisters of poison gas - the rest has been stolen by our glorious leaders.  Russia and China are both "banking" on the idea that the planet will reset to a gold backed standard.  The price of gold, of course, would shoot up, but not as much as some critics estimate, as in the implosive reset, most credit will go to money heaven.

Rex Andrus's picture

You lost me at our glorious leaders. They're our deplorable captors.

LawsofPhysics's picture

So fucking what? NOBODY and NO GOVERNMENTS have gone back to a gold standard? Until that actually happens this means nothing.

HRClinton's picture

Not that I disagree, but for reference, shits and giggles, one needs to compare the Russian gold reserves to that of countries with comparable GDP: Australia or Canada.

Australia's and Canada's reserves are practically non-existent above ground. All their reserves are left underground, to be mined as needed for commercial, industrial and consumer use.

Unless Russia and China plan to go to a "Gold Standard" in the future, and this is just the build-up for that event, it's probably a reasonable supposition that they are ramping for defensive purposes. 'Defensive', in the sense that the US may use gold reserves as an offensive weapon on a currency or economic war. Not bloody likely, but you never know what those devious (((hobgoblins))) might do.

Latitude25's picture

Who needs a gold standard anyway?  What good will it do you if gold is fixed at some $ amount per ounce?

Maestro Maestro's picture

A gold standard means the bankers' charter to steal is revoked. Now tell me you're insidious and devious enough not to understand this.

1) You fix the price in terms of grams or ounces of gold and silver. In other words, in units of specie and NOT banker fiat digits aka as dollars, euros, roubles, or shekels and dinars.

2) Which precludes the bankers and their treasonous governments (that's ALL fucking governments extant bar fucking NONE) from issuing unlimited amount of cryptos or fiat, same fucking difference.

LawsofPhysics's picture

It will seriously limit the amount of new money useless fucking paper-pushers in banking and finance can create. Thus preserving the purchasing power of people's saving and 401ks.

as the saying goes...

"Full Faith and Credit"

 

What good it is to be a millionaire if your millions won't buy you shit?

Latitude25's picture

So in a gold standard you want the price fixed at some value that you desire or at some value that colluding bankers desire?  It's unlikely that the little guy will triumph but you can keep hoping.  You want it fixed at $10000 per ounce even if the bankers keep printing money willy nilly?

Maestro Maestro's picture

No.

1) You fix the price in terms of grams or ounces of gold and silver. In other words, in units of specie and NOT banker fiat digits aka as dollars, euros, roubles, or shekels and dinars.

2) Which precludes the bankers and their treasonous governments (that's ALL fucking governments extant bar fucking NONE) from issuing unlimited amount of cryptos or fiat, same fucking difference.

Now tell me you don't understand.

Latitude25's picture

"precludes the bankers".  In your dreams.  Whatever happens you'd better start figuring out how some alternative system will be set up that the bankers approve of unless you really believe that they will lose their power.  I don't hold  that illusion.  

Maestro Maestro's picture

Go collect your thirty pieces of silver from Goldman Sachs, you spineless piece of shit.

Latitude25's picture

Your response and downvote indicate that facing possible alternate future realities is not one of your strengths.  International bankers have a proven track record of being extremely creative and successful in perpetuating a fraudulent usuary system.  

Maestro Maestro's picture

Everybody knows that the bankers are directly to blame for the next major economic and financial crisis. That's why the bankers are scared shitless and manipulating asset prices always to the upside (except for precious metals) as if their lives depended on it.

Because it does. No high-ranking banker went to jail for the 2008 debacle, as far as I know. Lots of bankers won't be going home when the next crisis hits.

Dead men don't set the rules. No matter how crafty they were in their previous life.

Go get some fresh air.

BobEore's picture

Good to see yu makin some headway gainst the headwinds here MM!

But don't be harsh with our buddy Lats - unlike the legion of legendary loons who populated these pages with their endless sockpuppet bs for close to a decade now...

at least he is willing to put forward an idea or two without directing quotation out of the BIGGOLD script! Hard to find ... anymore

Maestro Maestro's picture

You're right. I apologize my friends. I'm sorry Latitude25.

BobEore's picture

Interestin.

Readers: take note.
Man = person of the male persuasion not ever afraid to pologize.

Metalhead retards who pimp for the moneypower = never say their are sorry. Never admit to being wrong bout anything. Never show remorse for leading fellow metal holders to the graveyard... and when challenged by irrefutable evidence of their own retardation...

invariably double down on their own bullshit!

Latitude25's picture

What makes you so sure that you will be the winner and bankers the losers?  Excessive confidence on your part.  

Maestro Maestro's picture

The bankers' gambit is predicated on endless economic growth, endless creation and assumption of debt, and the fooling of all of the people all of the time.

I am not interested in playing games nor winning per se.

You tell me whose position is more sound.

Latitude25's picture

The bankers will just reset it to their liking.  It's not necessarily more sound, just much more likely based on history.  Sure what you say follows the zh approved script.  That does not mean that's what happens.

Maestro Maestro's picture

I apologize for having insulted you previously. It was unwarranted.

However I disagree with your belief that bankers are supermen impervious to kryptonite. I shared my opinion as to the why all over this comments' thread.

LightBulb18's picture

I have never heard A coherent explanation as to why the amount of gold reserves A country has is meaningful. Small ones like it could be used to back up currency, but the amount of gold that exists and can be mined is small compared to the amount of currency A modern multi trillion dollar economy exchanges. Maybe if gold rises to A million dollars an ounce then it could work, but the whole thing doesn't make any sense.

Consuelo's picture

 

 

I am no expert, but will offer this:

 

- Gold (and silver) have been recognized as stores of value and real money nearly as long as human beings have bought, sold, traded, bartered, etc., in a civilized manner.

- Gold doesn't 'rise' to anything, let alone dollars.   The inherent and recognized (above) value of gold simply reflects the state of a nation's currency - and/or reckless profligacy.

- If a nation holds a significant and verifiable amount of physical gold under its possession/sovereign ownership, other nations will view their currency as 'safe' or a vehicle in which to trade/do business with confidence.    This last point is perhaps the most important in answer to your '$Trillion dollar economy' comparison.   The $Trillion dollars being simply a representation of an inflated/debased currency, when in reality, the Trillion dollar economy could very well be a Billion dollar economy if fairly valued.

Up to now, everyone in the global economic sphere has 'played along' with the Bretton Woods scheme, but that is owing mostly to geopolitical stability and 'fealty' to the system.   That is all changing now.    Russia and China aren't massively accumulating gold out of stupidity or economic ignorance, that you can be certain of.

Maestro Maestro's picture

You just divide the amount of currency you issued by the amount of gold and silver you possess to expose the degree of fraud you committed.

OR

Just declare how much gold you have backing how much currency you issued and we'll know how much each unit of your currency is worth in terms of gold and silver.

In other words,

Insidious piece of shit hasbara troll,

All you need is DIVISION

In order to back your monetary mass with gold. Even with just one fucking ounce of gold or LESS.

Just divide, insidious moron.

philipat's picture

Put differently, and to quote JP Morgan "Gold is money. Everything else is credit".

Maestro Maestro's picture

The bankers know exactly what they are doing...

BobEore's picture

Oh my! Tis Sunday night in Gulagistan...

and therefore, we are treated to multiple replays of our fave serials - "Gold is Cheap" followed by ... STARSKY N DUTCH!

gotta luve the "goodcop/badcop" dynamic that our bullion merchandiser "BS" serves up on these pages.

Ronan - a rigorously correct fact-chaser who seldom reaches for the rhetoric button, in his quest for clarity within the 'opaque world o gold'...

and "hate crime victim" DUTCH KOOJAN ... popularity-chaser extraordinaire, and a clear follower of the GORDON DUFF "40% DISINFO" skool of reportage. Together, our wacky bouys in blu crack open more cases than Eddie Murphy an the BH detectives!

Here's an understatement of the decade contender...

"The historical track record of the Chinese State in sporadically communicating the size of its monetary gold holdings shows that there has often been a large gulf between the true size of its gold reserves and what the Chinese claimed to have via its piecemeal and rare updates."

This just in!

All "Central Banks" are tied into the same "k/j \zharian mafiya network .... they ALL lie... all the time. So...

those roadkill warriors here who laughably worship at the feet of "good" Central Bankers wearing "panda" or other "bear" outfits...over top their BEAGLE BOY masks... and the 'gold gurus' who shill for them

are not just immune to any sense of IRONY...or self-reflection, but lack even a whiff of CRITICAL REASONING skill, not to mention the slightest sense of humor. And will continue to rigorously/righteously adhere to the false doctrines whereby bagholders mingle with their pie-eyed pipers on these pages, joined in a jerky danse macabre at a BALL OF THE RED MASQUE poe-type novella,

till they all fall down... in final rigor mortis, on the side of a highway to hell once called
GOLDBURG... where the streets where paved... with BS>

I Feel a little Qeasy's picture

Quite a rant, but then again all bullshit. Thanks anyway moron.

BobEore's picture

And ...
it's back! Had a feeling they could be induced into dragging the thing back from the dead!
And look@@ee...

finally sumthin in the nets!

U sound upset lil feeli fella - you wouldn't be a "stakker" woulds ya? Good to see....

some of yas still writhin and moanin on the roadkill roadside to hell. Place just won't b the same once youse ALL gone! Rant on runt!

Latitude25's picture

Maybe the Chinese and Russians are liars.  Maybe Koos is a liar.  Maybe BobEore is a liar.  When data gets confirmed by multiple independant sources it tends to be more credible.

BobEore's picture

And then...
it was gone.

After a full day of driving stock down to the coast, from our mountain quarters... I figured I'd end the day with a looksee at what the wind blew in...

in the next sequence of our BS soap opera. Nuthin in the nets. And like close to a dozen other GOLD RELATED posts this year that have NEVER LEFT THE TARMAC... cause o ol Bob delivering another bullseye which left the media masterz with NO OPTION... CEPT TO "puLL It!" tHIs here BS post seems to have disappeared real quick.

Weaker n weaker... our cast of villains be. And I'll drive them down too!

My pants ain't on fire... my nose ain't growin... and I gots one particular mission to finish here fore I says goobye... for good...to the Gulagistanis. There's nobody left, reporting from on the ground... in good ol journalistic style... cept me.

Truth in media. \it don't need no multiple sources. Just one guy who wouldn't lie down and take his 10 shekels o silver. You don't like it... you can always drink the Foolaid!

Latitude25's picture

Just one guy who says it's the truth and that's that.  OK.  Whatever floats your boat.