RBI says don't sell gold to the peasants

JulieW · May 6, 2013

NEW DELHI: Finding gold coins at your neighbourhood bank branch may become tougher. The Reserve Bank of India (RBI) has suggested that banks should not aggressively sell gold products at their branches. This is the latest attempt by the central bank to stem runaway gold imports, one of the key reasons behind the widening trade and current account deficits.

Sources told TOI that the issue was raised during the customary post-monetary policy meeting with bankers on Friday. Separately, RBI is issuing fresh guidelines for banks that provide incentives to executives for crossselling of gold and other financial products, which are seen to be the key reason behind recent allegations of money laundering and other irregularities.

Bankers said that the RBI advisory may not result in a major reduction in gold sales. "If a customer does not find a gold coin at a bank branch, he will go and buy the same product from a jeweller. What can you do about this?" said a bank chief.
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http://timesofindia.indiatimes.com/...-banks-on-gold-sales/articleshow/19905651.cms

AngloSaxon · May 6, 2013

LOL like your subject title.

JulieW · May 7, 2013

More. This time Hong Kong

http://www.sovereignman.com/finance/its-becoming-harder-to-buy-and-sell-gold-in-hong-kong-11790/

It took me two attempts. But, today I opened an account at the Bank of China.

The reason? They'll no longer buy gold bullion from you unless you bank with them.

I wasn't selling personally. But, an overseas friend is having a temporary liquidity crisis, and asked me to liquidate a couple of ounces from his stash.

I went to the Bank of China and Hang Seng Bank to see where I'd get the better deal for his Maple Leaf coins.

It was no contest. Hang Seng quoted me the Hong Kong dollar equivalent of spot gold. But, the Bank of China quoted me 4.5% ABOVE the spot price of gold.

Needless to say, the choice was obvious. As was the opportunity.

Given the price differences, I realized instantly I could buy Maple Leaf coins at Hang Seng at the spot price of gold plus their HK$50 mark-up, and then sell them for almost 4.5% more at Bank of China.

Talk about a perpetual money machine.

But as it turns out, Hang Seng doesn't actually have any Maple Leafs to sell right now! So, no dice today. I'll check back soon.

Even without the easy arbitrage, though, I went ahead and opened the Bank of China account to get my friend the best deal.

And let me tell you, it wasn't easy even though I'm a Hong Kong resident.

At the first branch I tried, they wanted not only a copy of a current utility bill from my Hong Kong residence, but also a proof of address from my "permanent home." In their limited worldview, this means an address in the country that issues my passport.

I told them I've not lived in that country for over 17 years, certainly don't have an address there, that Hong Kong is my permanent home, and why was that not good enough?

They refused to budge. So, I walked out.

Fortunately my second attempt at a different branch, worked out better. They were satisfied with my explanation.

The lessons here are four-fold:

1. Physical gold is hard to buy right now in Hong Kong. Hang Seng had only Australian Kangaroo nuggets in stock, and no Maple Leafs.

2. Selling your gold at a fair price if you have an emergency is getting tougher too. The paperwork and rules and regulations are becoming stricter, even in a freewheeling place like Hong Kong.

I cannot be sure, but I suspect The Bank of China's new requirements are part of the whole anti-money laundering regime.

If you have an account with them, they've already had a chance to rake over all your private details, and hopefully satisfied themselves that you're not a criminal terrorist mastermind.

3. Opening bank accounts in Hong Kong is becoming more and more difficult, too. It would not surprise me if there comes a time when even the likes of HSBC start refusing non Hong Kong residents.
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Note: "They'll no longer buy gold bullion from you unless you bank with them"

willrocks · May 7, 2013

So they're blaming economic problems on gold hoarders? Sounds familiar.

Caput Lupinum · May 7, 2013

It's all your fault *stamps foot* You and your stacker pals who refuse to believe everything we say. Why don't you all just go out and take out personal loans and buy things to don't need. Be a good consumer!

Grimnar · May 7, 2013

willrocks said:

So they're blaming economic problems on gold hoarders? Sounds familiar.
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Which is interesting for a metal with no monetary value..... BAZINGA!

mmm....shiney! · May 7, 2013

Grimnar said:

willrocks said:

So they're blaming economic problems on gold hoarders? Sounds familiar.
Click to expand...

Which is interesting for a metal with no monetary value..... BAZINGA!
Click to expand...

Stupid barbarous relic, ruining our financial system like that. :lol:

Grimnar · May 7, 2013

mmm....shiney! said:

Grimnar said:

willrocks said:

So they're blaming economic problems on gold hoarders? Sounds familiar.
Click to expand...

Which is interesting for a metal with no monetary value..... BAZINGA!
Click to expand...

Stupid barbarous relic, ruining our financial system like that. :lol:
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*shakes fist at stack* oh wait... wasn't that the whole point??? :/

lamp · May 7, 2013

I paid AUD100 to Bank of China (Australia) to open an account with BoC Hong Kong branch. Last year, HSBC and BoC Australia were offering service to open bank account in HK (to receive the pay out bonus from the HK government), I got mine set up I'd provide my OZ passport, HK ID and a utility bill at the time.

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