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Wikileaks Discloses The Reason(s) Behind China's Shadow Gold Buying Spree
Wondering why gold at $1850 is cheap, or why gold at double that price will also be cheap, or frankly at any price? Because, as the following leaked cable explains, gold is, to China at least, nothing but the opportunity cost of destroying the dollar's reserve status. Putting that into dollar terms is, therefore, impractical at best, and illogical at worst. We have a suspicion that the following cable from the US embassy in China is about to go not viral but very much global, and prompt all those mutual fund managers who are on the golden sidelines to dip a toe in the 24 karat pool. The only thing that matters from China's perspective is that "suppressing the price of gold is very beneficial for the U.S. in maintaining the U.S. dollar's role as the international reserve currency. China's increased gold reserves will thus act as a model and lead other countries towards reserving more gold. Large gold reserves are also beneficial in promoting the internationalization of the RMB." Now, what would happen if mutual and pension funds finally comprehend they are massively underinvested in the one asset which China is without a trace of doubt massively accumulating behind the scenes is nothing short of a worldwide scramble, not so much for paper, but every last ounce of physical gold...
From Wikileaks:
3. CHINA'S GOLD RESERVES
"China increases its gold reserves in order to kill two birds with one stone"
"The China Radio International sponsored newspaper World News Journal (Shijie Xinwenbao)(04/28): "According to China's National Foreign Exchanges Administration China 's gold reserves have recently increased. Currently, the majority of its gold reserves have been located in the U.S. and European countries. The U.S. and Europe have always suppressed the rising price of gold. They intend to weaken gold's function as an international reserve currency. They don't want to see other countries turning to gold reserves instead of the U.S. dollar or Euro. Therefore, suppressing the price of gold is very beneficial for the U.S. in maintaining the U.S. dollar's role as the international reserve currency. China's increased gold reserves will thus act as a model and lead other countries towards reserving more gold. Large gold reserves are also beneficial in promoting the internationalization of the RMB."
Perhaps now is a good time to remind readers what will happen if and when America's always behind the curve mutual and pension fund managers finally comprehend that they are massively underinvested in the one best performing asset class.
From The Driver for Gold You’re Not Watching (via Casey Research)
You already know the basic reasons for owning gold – currency protection, inflation hedge, store of value, calamity insurance – many of which are becoming clichés even in mainstream articles. Throw in the supply and demand imbalance, and you’ve got the basic arguments for why one should hold gold for the foreseeable future.
All of these factors remain very bullish, in spite of gold’s 450% rise over the past 10 years. No, it’s not too late to buy, especially if you don’t own a meaningful amount; and yes, I’m convinced the price is headed much higher, regardless of the corrections we’ll inevitably see. Each of the aforementioned catalysts will force gold’s price higher and higher in the years ahead, especially the currency issues.
But there’s another driver of the price that escapes many gold watchers and certainly the mainstream media. And I’m convinced that once this sleeping giant wakes, it could ignite the gold market like nothing we’ve ever seen.
The fund management industry handles the bulk of the world’s wealth. These institutions include insurance companies, hedge funds, mutual funds, sovereign wealth funds, etc. But the elephant in the room is pension funds. These are institutions that provide retirement income, both public and private.
Global pension assets are estimated to be – drum roll, please – $31.1 trillion. No, that is not a misprint. It is more than twice the size of last year’s GDP in the U.S. ($14.7 trillion).
We know a few hedge fund managers have invested in gold, like John Paulson, David Einhorn, Jean-Marie Eveillard. There are close to twenty mutual funds devoted to gold and precious metals. Lots of gold and silver bugs have been buying.
So, what about pension funds?
According to estimates by Shayne McGuire in his new book, Hard Money; Taking Gold to a Higher Investment Level, the typical pension fund holds about 0.15% of its assets in gold. He estimates another 0.15% is devoted to gold mining stocks, giving us a total of 0.30% – that is, less than one third of one percent of assets committed to the gold sector.
Shayne is head of global research at the Teacher Retirement System of Texas. He bases his estimate on the fact that commodities represent about 3% of the total assets in the average pension fund. And of that 3%, about 5% is devoted to gold. It is, by any account, a negligible portion of a fund’s asset allocation.
Now here’s the fun part. Let’s say fund managers as a group realize that bonds, equities, and real estate have become poor or risky investments and so decide to increase their allocation to the gold market. If they doubled their exposure to gold and gold stocks – which would still represent only 0.6% of their total assets – it would amount to $93.3 billion in new purchases.
How much is that? The assets of GLD total $55.2 billion, so this amount of money is 1.7 times bigger than the largest gold ETF. SLV, the largest silver ETF, has net assets of $9.3 billion, a mere one-tenth of that extra allocation.
The market cap of the entire sector of gold stocks (producers only) is about $234 billion. The gold industry would see a 40% increase in new money to the sector. Its market cap would double if pension institutions allocated just 1.2% of their assets to it.
But what if currency issues spiral out of control? What if bonds wither and die? What if real estate takes ten years to recover? What if inflation becomes a rabid dog like it has every other time in history when governments have diluted their currency to this degree? If these funds allocate just 5% of their assets to gold – which would amount to $1.5 trillion – it would overwhelm the system and rocket prices skyward.
And let’s not forget that this is only one class of institution. Insurance companies have about $18.7 trillion in assets. Hedge funds manage approximately $1.7 trillion. Sovereign wealth funds control $3.8 trillion. Then there are mutual funds, ETFs, private equity funds, and private wealth funds. Throw in millions of retail investors like you and me and Joe Sixpack and Jiao Sixpack, and we’re looking in the rear view mirror at $100 trillion.
I don’t know if pension funds will devote that much money to this sector or not. What I do know is that sovereign debt risks are far from over, the U.S. dollar and other currencies will lose considerably more value against gold, interest rates will most certainly rise in the years ahead, and inflation is just getting started. These forces are in place and building, and if there’s a paradigm shift in how these managers view gold, look out!
I thought of titling this piece, “Why $5,000 Gold May Be Too Low.” Because once fund managers enter the gold market in mass, this tiny sector will light on fire with blazing speed.
My advice is to not just hope you can jump in once these drivers hit the gas, but to claim your seat during the relative calm of this month's level prices.
h/t Simon via TF Metals Report
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China's machinations should come as no surprise. Many other Asian and Middle-Eastern central banks have been accumulating gold since 2008. China since before. At first it was merely a way to have an alternative to dollar-debt and total dollar dependency. Dollar monetary policy in the 1990s scared them. From the time of Nixon's first visit through the 2000 stock market bubble it became increasingly clear that money printing was being used as the cure for everything and anything. They understood the dynamic.
chinese banks are solidly in rothschild hands. all of this discussion is moot at best..........it is just postering for the cameras so to speak..
Maybe you're in rothschild hands. For all we know.
China and other central banks aren't private.
H P D @ 19:13,
My $ is NO banks in China are in anyones hands the Commies do not want them to be.
That's the one thing about HUGE Nuclear capable super powers, we have a habit of taking down smaller countries on some off the wall BS reason/s.Just to get them into the fold.
The Chinese are not subject to the rules of the Bankster Elites.THEY may think they are in control, but it is TRANSITORY.........as we have heard say here lately.
All political power comes from the barrel of a gun.(that includes your banks.)
The Rothschilds are totally hedged, so it plays out how it plays out. Other players must make the right decision. So heads or tails?
Having the world reserve currency and no constraints on expansion has been wonderful for the USA. It has been an incredible forty year run.
It may continue longer than most of you expect.
I guess the best of both worlds is own lots of gold and be an american.
I'll take that.
And if worse comes to worse, I can choose:
-- stand and fight for a real America or
-- take whatever I can to Peru and live big.
Ride the wave my friend.
Very interesting.
Raise rates Ben. DON"T listen to that fool Evans.
2% overnight =1000 gold.
Oh yeah, I just wasted 30 seconds of my life.
You will NEVER raise rates(the next guy will be forced to go to 80% onite).
Rickards says Fed will openly target the 2% inflation target. Watcn gold keep going up.
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All right Bob you out trolled me tonight. I give you win. I gotta get some sleep.
Peace.
That's right bitch. Your mom is next.
The ONLY problem with the article is that IF Chinese and bondholders dump US debt, guess what happens to interest rates? The economies collapse with higher interest rates and DEFAULT will be the rule of the day. All these DEBT out there is a PROMISE TO PAY and it is NOT the same as cash. So yeah, cost of credit will skyrocket along with defaults. Higher interest rates will cannot be good for gold OR the economy.
The ONLY problem with the article is that IF Chinese and bondholders dump US debt, guess what happens to interest rates? The economies collapse with higher interest rates and DEFAULT will be the rule of the day. All these DEBT out there is a PROMISE TO PAY and it is NOT the same as cash. So yeah, cost of credit will skyrocket along with defaults. Higher interest rates will cannot be good for gold OR the economy.
Richard Russell always says that in a depression everyone loses. The key is to lose the least.
Pick your path carefully.
May you live in interesting times.
"I don’t know if pension funds will devote that much money to this sector or not. What I do know is that sovereign debt risks are far from over, the U.S. dollar and other currencies will lose considerably more value against gold, interest rates will most certainly rise in the years ahead, and inflation is just getting started. These forces are in place and building, and if there’s a paradigm shift in how these managers view gold, look out!"
So right, these forces are buidling. Also the anger of the people in eg US and EU is building. Lets see if that can be contained too or price of anything wont be an issue soon.
"U.S. dollar and other currencies will lose considerably more value against gold" Yes, unless GOLD stop been publicly traded and be monetized by world-wide finance system completely. Forecasting $10000-25000 Gold is an absurd by exactly the same reason I mention above.
But, but, I thought we were all supposed to be socking away as many FRNs as we possible can into 401ks......
So many people are going to end up with nothing......
all they will do at slv and gld is make up and sell just as many paper shares as these wascally funds want to buy.......
Gengis Khan was the first to introduce 'flying' (paper) money to the world. I think China knows a thing or two how these sorts of tricks play out.
completely OT did you know that sahara like deserts are in the rocky mountains? my crazy extreme mountain man son is doing 5 days here.
http://www.nps.gov/grsa/photosmultimedia/index.htm
wtf are sand dunes doing in CO.
High plains desert my friend.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/9/2_Jim_Rickards_-_Investors_Fleeing_GLD_into_Physical_Gold.html
First sign of much higher prems coming, and physical shortages..........................
INTERESTING
Maybe you gold buggers are right.
Sold to soon and missed the last 40 percent or so.
I dont want to buy gold, so I guess that means I should.
Gold bulls. We are gold bulls, not gold bugs...
Buggering the gold is just wrong.
In a pinch, I hear its a safe place though...
Yes, it is important to be able to find a safe place for our gold whatever the circumstances...
I aggree! Good comment.
You can't bugger gold. Yet another weakness.
some of us are fiat bears
It's all coming apart in a slow crash. Three decades of wrongheaded and boneheaded policies have left the fate of the entire economy and the country to the whims of others. Print money, build debt, build a "service economy", financialize to the max, burn oil, become more oil-dependent, give tax breaks to the rich, go shopping in China......Yep. It was all so clever. They couldn't have planned the decline any better.
Gold is not going down until there is a global monetary reset. At that point it will have far more purchasing power than it does now. I'm not a Wall Street genius wannabe so alot of what I hear doesn't make sense to me. I am, however, a student of history. What's going on right now makes the bankers of the 1920s and 30s look like flipping geniuses in comparison. No one has a clue about how to make the status quo work because it has been unworkable from the start. There is going to be a conflagration and PMs will be one of the few financial assets to to survive it.
"At that point it will have far more purchasing power than it does now"
It will have more purchasing power than the old fiat.
So... we're expecting the same pension funds that paid for junkets to Las Vegas for their frivolous, unqualified cadres to buy triple 'A' mortgage backed securities while drinking huge martinis to boot, only to get screwed by the commercial banking sector to buy gold?
????
The US government is using short sellers to go after a major Chinese silver producer, Silvercorp.
Wikileaks is basically saying, world war is around the corner. I doubt that very much because the US & China have been in bed together for a long time. I dont think the "sex" is getting to be boring. But I dont deny China is after gold (see my earlier comment about why Tibet is so important for Beijing).
China knows full well the US is getting old and preparing to kick them out of bed for the new babe on the block ... Gold.
George ... The Greek ... From Canada
this is bullshit
we knew this in april, when the "secret embassy cable" about a radio broadcast was written. china was "buying in april". duh. they wanted all or part of the reserve currency pie. duh. how many times have we been subjected to this already? it MUST be true! the end of the US world leadership and china will now be...
this is for the MSM
it just seems styooopid, here, imo, except possibly as an attempt to jawbone the dollar down after the bond rally and the strength in uncle sugar's various kindsa paper
they said it on the radio and somebody reported it to washington thru the embassy. i really fail to see any secret, or any news. the fact that it's a "wikileak" is just hype, probably dreamed up by the chinese and joe biden between poses with the freaking wrestlers a week ago
do people actually think people will consider this "news" or "intel"? it is neither. gold isn't going "to $5000 b/c of a "leak", b/c there IS no leak, only propaganda
here is today's news & intel: Secret Documents Reveal UK-US Spy Links with Al Qathafi's Regime
please read it
Its no secret when you have a war, its very likely a housecleaning with a huge accompanying noise to boot.
L0L! OK, don't read it! and discount it for otherZ, too!
state dept?
torturer?
This site is bullshit slewie. The ignorant scumbags junk and the realists take it! Hey Slewie I will pay for your new FX account.
I wonder how many posters even know what correlation is? I wonder if these worthless tools know what sector investing is? I wonder how many of these tools know what the ( deviation) on a VIX 30 is?
yeah, yeah.
go smash a melon
and say hi to your ladyfriend for me, too! ok?
Rickards has an interesting interview on KingWorldNews. Yeah, he is pushing his book. But he says that he strongly feels that one day, at random, the US is all of a sudden going to declare gold to be something like 5,000 or so an ounce. On that day, oil to 300 a barrel, etc. It will be a way to go back on the gold standard, inflate all of a sudden, and head off hyperinflation, or at least take off the heat for a while. Also, cuts our debt level, fast.
http://kingworldnews.com/kingworldnews/Broadcast/Entries/2011/9/3_Jim_Ri...
May I ask if you borrowed from the bankers or sold PMs to help pay for the reconstruction. If too personal, disregard.
Love seeing your spunky presence.
In the process of trying to borrow, believe it or not, still. I have a problem I have never heard of, the money I have is not "seasoned" if you can believe it. I am supposed to have cash trackable in the banking system for several months. Not all of mine is. They are having to do an exotic loan arrangement to get it to work. They want to do a currency report, all kinds of bizarre shit that is pissing me off. I am honest, I just don't trust the banks nor do I want to support them by letting them hold my currency.
Audit the fuck out of me, I earned my money honestly, you Fuckers.
That may be more spunk than you wanted. I am dealing with bankers, lawyers, engineers, appraisers, adjusters, etc. At war with one company right now who outright lied about something. If I don't get that one straightened out, I will fuck them up by tweeting and posting the story of what they are doing and how they are lying.
They have never met anyone who wanted to do geothermal, or build like I am doing with ICF. This house is going to be strong and tight (blast and bullet resistant, stand up to 140mph winds). But if it all goes well, I will have my bunker built in 4 months. It is getting exasperating though.
Thanks for asking. ;-)
There is no end to their machinations for profit is there?
"Seasoned" money is comical. Salt, pepper, fresh garlic on your dollars anyone?
Going through a miniature version of your story myself. Someone ran into one of my trucks, totaled it and put my employee out of work for three weeks. In a three man company with no cash reserves left, that pretty much kills a business.
Insurance company tells me my (bought and paid for) truck is worthless.
I viewed it as priceless.
This sounds corny as hell, but you will find a way. You may need to barter for the favor of borrowing a vehichle for a while, get a few jobs under your belt. May need to take on jobs you would not normally do (I have been a painter before, done finishing end drywall, other stuff I won't mention here to make ends meet).
The person who hit you was uninsured I take it...
I wonder if it is time for a lawyer? You never know with this stuff, sometimes they just get a cut of what you would have gotten anyway.
Hurts to hear about your truck, I admire entrpeneurs.
just tell you insurance company that that B.S. is unacceptable.
if you had a 1999 chevy with 188K miles and good tires and brakes, just tell them to replace it. what they say it is "worth" doesn't matter. your truck is insured, not some "price". don't let them frame the question.
if your insurance covers the event, they owe you an old worthless paid-off truck. no shit. just tell them you'll find one which they'll accept or they can find one which you'll accept. no lawyer. just you and YOUR insurance company
the fact that they're tits up isn't your problem
you prepaid them to take care of this, and the state office of insurance is there to back you up, too (we hope)
what they say doesn't matter. they want to pretend they don't owe you a truck. just tell them that is unacceptable. you weren't self insuring. you don't want a check. you want a truck. when will they deliver your truck? tell them you want a date, and w/in two weeks is reasonable. it's an old truck, for pete's sake, and it's insured!
when it costs more to repair a vehicle than it is "worth", it is "totalled"
you truck is not worth fixing due to the damage and the "value" from the standard blue book, probably. so they don't fix your truck, they replace it b/c it is cheaper and the correct legal remedy
really! go tell them what you expect and get it!
Insurance companies boggle the mind. I bought a cheap car for just over $1k in college. Dinged up the front, called the agent and said I don't want to report it, just letting you know if the other driver calls and I'll pay for their share out of pocket. Agent tells me my rates will go up because he'll have to report the accident now. I said fine, I'm filing the claim. They 'totaled' the car, paid me $1800 and paid the other drivers claim. I bought it back from them at 'scrap' value for $600 thinking I'd just fix it but when I took it to the mechanic who did my work and asked for an estimate he bought it for $900 for the parts. My rates never went up...
Read the contract. If the insurer wants to give you a check, then it's perfectly legal. The odds are they'll give you check that is greater than the market value of the truck. You are their customer and they don't want to completely piss you off. You'll have to do the searching, but if you are successful, you'll get another clunker and pocket the difference.
For the record, my guesses on the Ford pickup question were:
A. EMP proof (ding ding ding)
B. Dependable. roaming, high caliber machine gun mount.
Had to open a different browser to answer you. I will try again.
I am often surprised by the guys who have those kinds of pickups with guns, and no sheilding. I will see if this posts or not. http://www.crawlcanada.com/forum/showthread.php?p=103588
Good choice in ICF. Wish I had, would have been a better contractor and not the one I picked who got into shouting matches with the architect two months in and then walked off the job. As soon as I removed him from the permit he sued. $25k later I fired all the lawyers and settled for .10 on the dollar with the architect who was the only one with an insurance company. Had I fought the builder to the end he would have folded, had his son get his license and be back to work the same day. Bank(BAC) issued him a 2nd draw without my written consent which was in my contract after he poured a footer in a tropical downpour. Lawyers said forget BAC, even if I was 100% right and won, I'd lose all the money fighting them. 11 years later I have a one story walkout, almost finished, but the county wants all the fees over again and will reinspect all the work which was substandard to begin with but their inspector approved it nonetheless. I spent $5k on new engineering and plans and the county is sitting on them and I can't get an approval on my roof even though the product is approved in FL already. It's taken so long I'll have to have my plans recertified because the building code has already changed. It's the true American Nightmare. They sure don't make it easy. That's why I'm all for bringing it down, their system, not my house. Good luck to you and I hope your road smooths out for the next leg of your journey...
Sorry to hear your troubles, thanks for the warning. Wow! This is so much greif I don't even know what to say that does not sound trite.
While Im bullish about GC this article misses the point since it uses the consensus view that China's economic might and growth are unstoppable. That is total nonesense. If we account for total on and off balance sheet loans during 2009, they represent 90% of GDP. Obviously not sustainable. China bulls response is that China has huge FX reserves therefore it can afford a wave of NPL's. Again wrong. China has a huge FX reserves in order to keep the value of the Rembibi down and are not a savings account for China to use as it pleases. They are essentially an asset liability missmatch. Dollars on one side and Rembibi on the other. China will either implode or become the latest victim of economic hitman's.
Both China and the US are trying to keep their populations docile by appearing to be "doing" something in the face of depleting resources. They each have a story they are telling their populace. Both are centrally planned economies. Their story is that they are, together, deferring gratification for the greater good of the nation. Our story is "We are #1, we can live large, and live it now. Fuck everyone else." Which story will look like a lie to the majority of their respective populaces first? That will be who collapses first. If resources run out for the Chinese first and they revolt and starve, we win. If we have a lower tolerance for contraction (i.e. we are too spoiled) and blow up first, they win.
The USA will win, because they are higher up on Maslow's triangle. All that is required is an "attitude adjustment".
Interesting insight.
Since I'm stupid I really don't understand anything you wrote but I gotta agree with you. I can't wait to see the China bulls' reaction when they find out the country has been making up all these incredible economic stats. But again I'm stupid(and terrified cause I'm not in safe waters) so what do I know. Not only am I stupid but I don't own any physical gold or silver and haven't done so for years. Nor do I have enough guns and ammo to equip a small army.
Nope all I got is stupidity but you still make a great point. If I only had a brain. :(
speaking of stupid, this one fellow we know must have inherited some pm's sold them to set up a college fund for his one year-old baby...now that is STUPID.
If that kid ever hears the story, OMFG. Is that a justifiable homicide in court?
yup, I am speechless. If that kiddo ever hears that story he probably will kill his dad and eat him with evil sauce.
That was "rich"... Like those little birds the French eat...<
Dollar loses 12% value every year. It's policy now in order to inflate the massive debt away. PMs, grain, coal, oil....all are ways to protect yrou buying power as the dollar continues downhill....on purpose.
RE, bonds, dollars....all will continue losing value. China (and India) are on top of this trend.
L0L!!!
i just punched up goldseek to look @ the weekly summary from chris mullen: Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Almost 5% on the Wee (he takes prices as of 1PM eastern on Friday)
and here we have that the cable is from 2009, and that (i can't stop laughing) china knows about gold price suppression schemes! and they have for 2 1/2 years, almost. as professor antal fekete might say: these economists are just tooling the chinese!
here's the text: Raw Text: Beijing Embassy Cable; China's Gold Reserves
here's chris powell @ GATA: FLASH: China knows about gold price suppression, and U.S. knows China knows (Wikileaks - 2009 cable)
i'm still laughing! do NOT read about the moQ, MI6 and the CIA! we must think only about the "news" and the "leaks from our embassy" about china and gold!
devaluation? confiscation? mad rush from pension funds now that china knows? how can they keep the price down NOW?
Hahahahahaha!
hey i don't know what the price will do but here's the news outa libya again (about a secret documant, lo less!!!) Secret Documents Reveal UK-US Spy Links with Al Qathafi's Regime
Very embarrassing documents have been discovered by Human Rights Watch and the British Independent newspaper's journalists that reveal close intelligence relationship between the United States, the Uk and Libya during the so-called War on Terror....
...Also among the files is evidence that the US used Libya as a base for its rendition programme.
...According to the documents just discovered, US and UK spy agencies built close ties with their Libyan counterparts, and also suggest that the US Central Intelligence Agency, CIA, abducted several suspected militants from 2002 to 2004 and handed them to Tripoli.
and so on... GET IT???
The end around... Just like the European Fiasco!
bingo!
http://www.thedailybell.com/2875/Peter-Schiff-The-Last-Haven-Standing
Peter nails the obvious again, has commnet on our mutual never gets it right-er.
I am only invested in gold and silver and have maintained this stance since 2005.
For new PM investors, caution is advised for next week. PM ran up hard last week. While ZH is my first and last read every day, this supposed release is a little too neat. I agree with the sentiments expressed. But, just be careful out there. The bankers will not go down without a fight and a forceful counterattack is overdo. Good luck to all.
FWIW, I bought my first silver in November 2010 and my first gold about a month ago. Even with two beat downs--one in silver, one in gold--I'm still ahead. I don't think it is ever too late--at least not until the Bernank runs out of ink.
I purchased two $5 gold uncirculated commemeratives from the U.S. Mint less than a month ago, and I am $5.83 to the good in melt price for each coin, even after counting in shipping. If they command any premium at all, so much the better.
If China bought as much gold as it is buying U.S. Treasuries lately, gold would be at $20,000/oz.
I'm amazed how China continues to wolf down more and more Treasuries come hell or high water, driving yields down to insane lows.
China is selling US treasuries Ya tool! It's buying XAU to off set the peg! I see your point though.
R T @ 21:33,
I heard China had scaled back it's purchases.
If not, no matter.
They have a plan, and they will unleash it at the proper time.
My take is they will use them to buy half the USA, when they come to cash them out..................some damn fine cheap RE, and rename it China Deaux.
China has been flexing it muscles for a while. Many should have taken the hint when the first submarine poped up next to a US aircraft carrier during war games. The second hint was that EMP missle that came out of the Pacific off LA. The media said it was a contrail, but the folks on that cruise ship that had to be towed back to San Diego weren't amused when all their electronics failed. Buy gold, buy silver. It will be around long after paper has turned to dust.
Uh, an "asset" whose value's increase over the past decade is a few hundred dollars shy of a 10-bagger speaks poorly of U.S. and European power to "always [suppress] the rising price of gold." A fatally flawed premise put forward without consideration of whose gold bought low now sells at premium prices?
Golly gee Wizzz, Beaver / I trade currencies!
Hey Snidley, I have my EYE on you!
Can you hear the big crunch when people realize 50% of their gold investment is imaginary? Stand for delivery!
Always buy in physical form, never in paper. When TPTB control it, they control you.
of course! of you want 100 ounces, go BUY them. or 500, or a ton. or two ounces. use the cash market(s), and "stand for delivery" = cash n carry
if you think it's cheaper to get phyzz by going thru the crimex, go ahead! but you won't get coinage, will you?
if you haven't seen the recent cots report, i think it is worth a look: COT Gold, Silver and US Dollar Index Report - September 2, 2011
why? well, you'll see that when the contract month "ended" in the take-down that the contracts and options didn't get "rolled forward"; they got liquidated
open interest is down pretty good,imo. see what you think, ok?
GOLD IS THE MOST AMAZING INV.Vehicle OF ALL TIME !!!!!!!!
Or is it.... http://img823.imageshack.us/img823/4449/screenshot3xm.png
I believe if a currency isn't redeemable in gold, then gold backing is worthless.
American paper currency started as a claim check on physical gold (or silver). The paper has no value other than being a claim check on physical PM. Take away the redeemable aspect, and it has no value.
It's like a claim check given to you by a coat check lady when you hand her your coat. As long as she has your coat the claim check is worth something. After you get your coat back the claim check is worthless.
Why didn't FRNs collapse in '71 when Nixon closed the gold window?
Because they were legal tender by law. American merchants we're required by law to accept them as payment.
But there's no law saying what they're worth. That's up to each merchant to decide.
Fed can make them legal tender, but can't say what they're worth. That's Fed's Achilles heel.
I believe you are in to "TANK ASSES"" xl~~...
MMmmm .... Gold..
NOT just a breakfast cereal.
Fuck You Ben Bernanke and Little Timmy G.
*
GOLD 4 denial dummies
Nixon killed Bretton Woods in '71 and said "let the games begin." and so they played. The corrupt government in the District of Criminals set the gold price at 1oz for $35 USD's. Ok, I'll play that game. Except now it costs $1,882 USD's for an ounce...WTH? What happened there shalom Ben? Can you splain?
XAU lovers... The 500 point drop is coming. Load your Currency buckets. I'll be buying depreciating assets!
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T-R-O-L-L alert!
toy boy c_iff gonna get his ass kicked?
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suck it
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Cliff, you're making a fool outa yourself.
JW doesn't use multiples, to the best of my knowledge; is it against your rules to answer yourself? i do it, and i don't use multiples
bob_d isn't a troll; he trades commodities. he understands the game as well as anyone here. he called his nat gas play and doesn't like gold here. he smells something. nobody is always right, but these folks aren't too shabby. you are bullish (fine) and apparently fuking loaded on something. you haven't said too much, really, but seem intent on calling out people who haven't done too much wrong, here, have they?
i don't think you're a troll either, but you're acting like one, here
you're really not adding too much, here, today
yen isn't a troll; he's a trader: fx. he called the USD/Yen top to 1/2 cent @ 81.
me? maybe
you? this site is scaring powerful people? you're not saying anything except you're bullish in gold @ 1880+$$$ so how much did you buy in the last month? i didn't buy any. can't afford it
i got in a big fight w/ jay-dub myself recently; called him a bunch of names; maybe troll was one of them, but i don't think so. i just remember thinking he was way too violent, and he kept getting worse
fuk, dude, i couldn't talk him outa it! so what?
if you're fuked up, here, why not just say so, and we'll all have a laugh. this ain't gonna make it, cliff. really. if you're not fuked, can we get more than name-calling for these folks? what's the matter, man?
yen's got a problem and he published it. bob_d doesn't like the bullishness here
i don't like the piece: i think it's propaganda. 2009? wtf? china thinks CBs manipulate gold and other stuff. this is fuking news? and, i put up what i thought was important. here's a cable from 2009. why do "they" wikileak it this morning? c'mon, man, connect the dots
if you're wasted, who cares? if you're not, what's up, man? talk about it, ok?
I know Jw doesn't use multiples I was just messing with him. Same with bob. Just having some fun.
Peace.
thanks
i just didn't understand b/c it didn't compute
but i'll certainly accept that and t.y. for the reply
Cheers!
so what should I say?
let's all hold hands across America and pray that the Lobby Whores in Washington DC and their owners on Wall Street will stop raping and murdering Main Street?
it has been 40 plus! years of NO CHNAGES and shit getting worse and worse.. and if we look at history! this shit isnt even a new issue! just better managed by our Owners!
http://www.youtube.com/watch?v=lrZeYODHmlA
after the Rockefellers Murdered all of those people.. they moved onto propaganda / population management.
http://www.openfilm.com/videos/psywar <---- Thanks "CD" http://metanoia-films.org/index.php
which leads us to today's modern day robbery's!
SOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO! what should we do? Protest? Voting with Bullets is to, too much! the Nazi Pigs Vote with Bullets all the time! handcuff you! then shoot you in the back! like the fucking cowards they are!
So! what if NOT! force should we use to defend ourselves from being robbed blind?
and with all the drama the Government is creating.. what makes you think that Population Management is NOT! what the Government wants!
Maybe they want us all to kill each other.. so the polite lil Mexicans can work in this new service economy that has been developed by sending all the manufacturing jobs elsewhere around the world?
when will it be appropriate to do SOMETHING! to stem the Destruction of America?
Law Enforcement.. Sworn to Up Hold the Law!! only Preys on working people or "We the People".. Never do they lift a Finger against Wall Street! Never do they lift a finger against the Lobby Whores who have sold our entire manufacturing base / tax base to other Countries! if that is NOT Treason I dont know what the Fuck is??
So! Tell Me! what the other thing to do is? no one is going to fight back! no one will get off their ass until they get hungry.
when these idiots start making people hungry! when the "We the People" realize that the entire manufacturing base has been shipped off to another country!! then there will be some justice! REAL JUSTICE handed out!
and the Nazi Pigs who still have their Union and Pensions.. will have to earn their money gunning down "We the People"! No worries the Army will help! Shit maybe the Rockefellers will hire the National Guard AGAIN!!
$16 Trillion Dollars???
http://info.publicintelligence.net/GAO-FedAudit.pdf
PLUS!!!
Wall Street Aristocracy Got $1.2 Trillion in Fed’s Secret Loans
http://www.bloomberg.com/news/2011-08-21/wall-street-aristocracy-got-1-2-trillion-in-fed-s-secret-loans.html
PLUS!!!
SEC Covering Up Wall Street Crimes?
http://www.rollingstone.com/politics/news/is-the-sec-covering-up-wall-street-crimes-20110817
Plus!!!
How about the $2.5 Trillion in Social Security Bailouts??
http://moneywatch.bnet.com/retirement-planning/video/good-news-on-social-security/478373/
THANK YOU!
Anyone can feel the declining value of paper. Not just the dollar, anywhere in the world. Buying power is just getting crushed and there's no end in sight. And none of the political candidates have any plan either. None.
And the really comical part is that the majority of people dont even bother to ask why. They simply accept that thier currency buys less and less each year without any concern for the mechanisms at play, whether or not those mechanisms at some point will trigger a system failure (debt saturation - phase transition point - already passed!).
IMO, the last couple of years were the wake up call. Anyone not awake yet is in a coma.
As long as they have immigrants, welfare cheats and billionaires to blame eveything on people will always take the scapegoat route. It's easier than thinking.
patriots and the chinese join forces to destroy the common enemy... NWO scum who seek to enslave us with debt.
Politics makes strange bedfellows.
Go China. I forsee a strengthening Libertarian party in the future... they are the ones who have been pushing gold since the beginning.
just asking, but...
that "leak" was from a radio broadcast on China Radio International. nothing confidential or really unknown?
doesn't seem like a game changer.
true!
This is one Great thread! My spicey potatos should be ready about now...
Before I accept China’s Grand Plan of dollar reserve status destruction as a fait accompli, I need to know if the real China is the one largely absent from the march of human progress since the Renaissance, or the one who waited until the heavy lifting (invention and discovery) was done and then started buying/stealing off-the-shelf, which is the China of only the last few decades. Intent doesn’t necessarily equate to success.
As for gold, it might be something special, but power trumps all. Power comes in the form of military might, in the form of custodianship over natural resources, in the form of food production capability, and increasingly in the form of custodianship over water resources. Power also comes in the form of being able to selectively default on debt by CUSIP number. ("If I owe the bank a hundred dollars the bank owns me; if I owe the bank a trillion dollars, I own the bank.")
Gold only has value if someone with an excess of necessities wants some of it. Granted the same is true of any means of exchange, but the point is clear: those with necessities, not gold, call the shots.
...Gold only has value if someone with an excess of necessities wants some of it. Granted the same is true of any means of exchange, but the point is clear: those with necessities, not gold, call the shots...
The mother of all 'irrational exuberance' bubbles : When the 'herd' stampedes over the cliff on a mad bubble run, and 'buy, buy, buy,' becomes the only cry heard in the blue sky, you ask yourself how can the dawning morn suffer such a rush to intemperate hoarding; if it 'chills' real productive investment into a sterile mountain of Midas's cherished plaything, and neglects human needs. The mountain has to melt whatever its attraction to those who love its fatal glitter. We may not be there now but the signs of the times could transmute a safe haven trend into a runaway roller coaster...
As for China's Grand Plan, perceived today as a new threat to Occident alike the medieval Mongol invasion : whereas then, Temujin and his hordes were totally fed on their own nomadic, simplistic, atavistic impulse to cleanse the world of decadent sedantarisation, in today's age the 'new sedantarisation' that has made CHINA uber-alles, is fed on the USA's own Oligarchical runaway greed to 'outsourcing', at inordinate profit margins on a short term suicidal basis, its industrial power base, delegated by proxy, to the toil of the poor and teeming masses. The irony of it, the West taught the Orient how to manufacture its own know-how generated, accumulated, like squirrel's acorns, since Renaissance days. Chinese Prometheus has now stolen his fire.
If the USD dollar is toast today it is not the result of age old atavism of the chinese, it is a result of new age atavism of the US oligarchs to dig their own graves, like the Egyptians or Mayans of old.
The Vedas if the Indians, the oriental, Aryan variety, have a word for it : Karma!
"Gold only has value if someone with an excess of necessities wants some of it."
Gold is a time-tested repository of surplus value. What is the newly emerged alternative?
Nice collectivism there.
You have thirty seconds to find something manufactured in America GO GO GO.
Debt?
GOLD...ISSSS.........Sucking my balls.
Wait fot it...
Nippin shorts at the heels. I hope it goes up...nip a bit here and there. Than I'll start CHOMPIN down.
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Why don't you guys get a room? My mouse has a scroll wheel.
Right? This is getting unbelieveably Fucking ANNOYING! I have three children therefore my time in limited. The trolling behavior makes reading commentary such a fucking chore anymore; it used to be fun and useful. After a certain number of junks, it should be hidden-with option to show- so people don't have to scroll thru that shit.
Act your age, not your shoe size.
Most of the articles here are over my head. Would it be correct to say that this news released by Wikileaks could be the impetus to push gold, and maybe silver, up faster and higher than any other news story in many years?
My uneducted reading says gold and silver could soar beyond anyone's imagination in the next month or two in response to this publicized admission by China.
How does this look to you?
This article is predicated on a "leaked" cable, where the cable-writer was reporting on open source information, so it is unlikely to be a game changer. Most Chinese would have read it years ago, as would most major hedge fund managers. Regularly old fund managers just watch CNBC and read research reports out of Goldman Sachs or JPM.
As for the possibility of fund managers ramping up their asset allocation (if their bylaws allow it), it could happen as the author suggests, but his writing reminds me of a commercial I saw in the US of a bullion dealer holding some coins in his hands and stating with dramatic effect, "if gold goes to five-thousand dollars an ounce, as many experts suggest, just the gold I am holding in my hands right now would be worth more than fifty-thousand dollars".
Perhaps if Steve Jobs said "Come on!", the fund managers would lemmingly follow, but potential is not certainty.
As El Awrence said, "Nothing is written".
Talking of El Awrence :
That scene with ANthony Quinn character (Auda Abou Tayi) crying his rage after they took Al Aqaba : "You promised me gold, El Awrence, where is the gold? Only paper here, Turkish paper! You have cheated me El Awrence".
Awesome and hilarious 'gold bug' scene.
What Chindit13 said, low impact if any. Wish otherwise but I think not.
ditto
zH JUST pROvES wHAt a cLUSTER f.CK WE aRe iN! I love the Tylers!
Yen>
Hello, ZHers, first post, and i would like to ask a question if i may...if things go _WESTERN (shtf), what could you buy with an full 1oz gold coin, doesnt it have too much value? fair question...thank you for your time.
land.
I am gonna eat some gold one day.
Remember Uncle Warren: "Gold has no utility and BAC is worth putting in $5 Billion." I'll bet $5 Billion in gold will soon be his wish........
MsCreant/ krispykritter my sincere condolences. Good luck and Godspeed to you both, I'll devote a novena to you both: sorry I don't do contractor exorcisms.
China didn't get Bernanke's memo: Gold isn't money.
Gold IS money and so is silver.
The Zimmerman Telegram this ain't. As a matter of fact, it puts the gold holders on the side of China and gives the U.S. reason to participate in the manipulation to bring the price of gold back to the exosphere of 5 or 6 hundred dollars an ounce.
Clearly the Wikileaks cable is being flashed around the globe in an effort to get more and more people into gold. Whether or not TF Metals is a buyer or seller of gold on Tuesday only their hair cutter knows.
For couple of weeks before the cable, I had suspected that the fix may have been in. It was about the time gold pounded through 1900. With gold a hop, skip and a jump from 2000, I thought of Nasdaq 5000, the very pin prick of the Dot Com Bubble. And then I thought about crude oil in 2008. Do you remember that fiasco?
Mid Jan 07 $52 bbl
Xmas 07 $96 bbl
this was about the time of the macro rumor of $150 crude oil.
July 4, 08 $147 bbl
Jan 16, 09 $36 bbl
Notice that crude oil never went past $148 a bbl. That's because the books were loaded with short sales at $147 below the rumor price of $150. After the last short found the last buyer, the long crude holders started to dump their positions.
This leaked cable only makes me think they're about to do the same thing with gold. That cable as TF Metals showed us, will be used to sell gold
at $1850 and to infinity and beyond.
After all, according to the cable, the purport of which, written by the US Embassy in China, we are fighting a financial war with China. A high price of gold is how China will sink our ship.
Obviously, we must suppress the price of gold. Will the USG participate in a false market? We report, you decide.
"The U.S. and Europe have always suppressed the rising price of gold. They intend to weaken gold's function as an international reserve currency. They don't want to see other countries turning to gold reserves instead of the U.S. dollar or Euro. Therefore, suppressing the price of gold is very beneficial for the U.S. in maintaining the U.S. dollar's role as the international reserve currency"
This theory is one of my usual tin foil hat theories. And I wanted to let the gold players here know there may be icebergs in these waters.