Post by unlawflcombatnt on Nov 30, 2009 16:09:04 GMT -6
Today China expressed a desire to purchase 6-10,000 tons of gold over the next few years. Purchases of this size would have huge effects on gold prices, despite claims to the contrary by media propagandists.
from Bloomberg News
www.bloomberg.com/apps/news?pid=newsarchive&sid=aMnUukhsa.hM
By Bloomberg News
Nov. 30, 2009
"China should increase the amount of gold it holds in reserves to reduce potential losses from a depreciating dollar, the China Youth Daily said today, citing Ji Xiaonan, head of the supervisory committee at the state-owned Assets Supervision and Administration Commission.
“We recommend China increase its gold reserves to 6,000 metric tons within 3 to 5 years and possibly to 10,000 tons in 8 to 10 years,” the paper quoted Ji as saying. China increased its gold reserves by 76% to 1,054 tons since 2003, the official Xinhua News Agency reported in April.
China is likely to become the world’s largest producer and consumer of gold this year, Rozanna Wozniak, investment research manager at the World Gold Council, said yesterday. The dollar has fallen about 20% against the euro since Feb. 18. Dubai World’s possible default may give China an opportunity to invest its foreign currency reserves in the metal and oil, Ji said in a separate report by the Economic Information Daily.
“Given the size of their reserves compared with the size of the gold market, there’s a limit on how much they can add,” David Barclay, commodity strategist with Standard Chartered Bank in Hong Kong, said today. “But it certainly seems that there’s scope for further addition.”
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Wrong, Mr. Barclay, unless you consider being able to purchase 150% of current official gold reserves as a "limit."
The entire world gold supply (158,000 tons) that ever existed is worth about $5.7 trillion, if the Gold price is $1,180/oz.
Calculating
Total Gold ever in Existence = 158,000 tons (However, current official world reserves total only 29,600 tons.)
32,000 oz = 1 ton
32,000 oz/ton x 158,000 tons = 5.056 billion oz (5,056,000,000)
$1,180/oz X 5.056 billion oz = $5.7 trillion.
China has somewhere between $1-2 trillion in reserves ($1.67 trillion, using the World Gold Council's statistics for China's reserves.)
Technically, China could purchase 1/4 to 1/3 of the entire world gold supply that ever existed. In fact, it could purchase the entire "official" supply of gold reserves (since it could purchase 44,000 tons of gold at the current price, which is 15,000 tons more than current official gold reserves of 29,600 tons).
So that's the "limit" of how much gold China could buy. Obviously China could finance the purchase of 6,000 tons over the next 3-5 years, as well as 10,000 tons in 8-10 years. They could buy it right now if they so desired.
from Bloomberg News
www.bloomberg.com/apps/news?pid=newsarchive&sid=aMnUukhsa.hM
By Bloomberg News
Nov. 30, 2009
"China should increase the amount of gold it holds in reserves to reduce potential losses from a depreciating dollar, the China Youth Daily said today, citing Ji Xiaonan, head of the supervisory committee at the state-owned Assets Supervision and Administration Commission.
“We recommend China increase its gold reserves to 6,000 metric tons within 3 to 5 years and possibly to 10,000 tons in 8 to 10 years,” the paper quoted Ji as saying. China increased its gold reserves by 76% to 1,054 tons since 2003, the official Xinhua News Agency reported in April.
China is likely to become the world’s largest producer and consumer of gold this year, Rozanna Wozniak, investment research manager at the World Gold Council, said yesterday. The dollar has fallen about 20% against the euro since Feb. 18. Dubai World’s possible default may give China an opportunity to invest its foreign currency reserves in the metal and oil, Ji said in a separate report by the Economic Information Daily.
“Given the size of their reserves compared with the size of the gold market, there’s a limit on how much they can add,” David Barclay, commodity strategist with Standard Chartered Bank in Hong Kong, said today. “But it certainly seems that there’s scope for further addition.”
----------
Wrong, Mr. Barclay, unless you consider being able to purchase 150% of current official gold reserves as a "limit."
The entire world gold supply (158,000 tons) that ever existed is worth about $5.7 trillion, if the Gold price is $1,180/oz.
Calculating
Total Gold ever in Existence = 158,000 tons (However, current official world reserves total only 29,600 tons.)
32,000 oz = 1 ton
32,000 oz/ton x 158,000 tons = 5.056 billion oz (5,056,000,000)
$1,180/oz X 5.056 billion oz = $5.7 trillion.
China has somewhere between $1-2 trillion in reserves ($1.67 trillion, using the World Gold Council's statistics for China's reserves.)
Technically, China could purchase 1/4 to 1/3 of the entire world gold supply that ever existed. In fact, it could purchase the entire "official" supply of gold reserves (since it could purchase 44,000 tons of gold at the current price, which is 15,000 tons more than current official gold reserves of 29,600 tons).
So that's the "limit" of how much gold China could buy. Obviously China could finance the purchase of 6,000 tons over the next 3-5 years, as well as 10,000 tons in 8-10 years. They could buy it right now if they so desired.