WOW thats impresive. Thanks House. I just hope that we are stacking for the same reasons they are and the result will be awesome for us in years to come.
270 tons in 2013 from the USA. PLUS about 400 tons domestic production. PLUS what they buy from other sources. PLUS what they are not telling us about! Over the past 4 years or so. 5000 tons, at least! JMO OC
Focusing on the wrong thing. It really doesn't matter which Central bank has the gold. It is the whole market that will drive the gold price. Gold can still drop regardless of these transactions. I could own all the moon cheese in existence but unless there is a worldwide demand increase outside of moon cheese fanatics it will not improve the price. If you think the East are going to move to a gold based currency then you are badly mistaken. It will be like the blacksmiths waiting for the imminent return of the indispensable horse. Everything moves forward.
for what other reason would the eastern world continue to acquire such massive amounts? Is there some industrial use that only they know about?
When China sees that the supply of gold has ground nearly to a halt, that is when we will get an announcement. I do not expect that to be until after SHTF Day. JMO OC
Whatever the new curency is it does not matter. You will have access to it if you have some gold. I would rather have gold to bargin with. US dollars wont cut the mustard me thinks.
We all know China has a long term outlook and is not governed by short 3-4 year election cycle's like the West. So my theory is that they realise that the US never intends to pay back what they owe without significantly devaluing the USD. So they are converting their US bonds into hard assets that will actually be worth something in the future. We can easily see this with the amount of investment just in Oz alone, let alone Africa and the rest of the world. They will position themselves to be the World's leading economy at some stage and when the USD losses it dominance they will step forward with their own reserve currency possibly with partial backing of Gold. The Chinese govt has been encouraging their citizens to buy gold for some time now, whilst in India the population has never really trusted fiat currency and Gold has always been desired. Meanwhile back in the West we are loaded up to our eye balls in debt and living the good life whilst it last. I think we are in for a shock, who knows how far away but it's going to be ugly when it goes down.
+1 "So my theory is that they realise that the US never intends to pay back what they owe without significantly devaluing the USD. So they are converting their US bonds into hard assets that will actually be worth something in the future." Their US Bond holdings are about static, and i am sure their new funds are going anywhere but the USA. Not a lot they can do about that US$1.3 trillion they are sitting on though. Feed it into the markets a bit at a time, but that is all. The USA will "Kill the dollar"! JMO OC
I've thought about this a lot and it's very hard to find answers in the quagmire of self-interest and misdirection that is the internet ( or as one writer says: the blogsofear. In Australia (and USA) we have never seen hyperinflation and civil unrest which leads to the sort of SHTF scenario that I've seen referred to often. Sure we had oil crises and major inflation in the seventies but we've never seen gunfire at bank runs and total wealth destruction such as has been seen in almost all other countries. As Pirocco kindly pointed out - http://forums.silverstackers.com/to...g-then-suddenly-it-blindsides-you-page-2.html the world's banks have nowhere near the 'doomsday' view of the USA - even though to my mind, the world is in a Polyanna mood when it comes to economic matters. A truism is that the rich will risk the loss of everything, rather than endure the loss of anything, and this is the self-interest that keeps this current ponzi thriving imho. China has a very turbulent history where currency is concerned, and actions of the State of course. The purchase of massive amounts of gold by the Chinese is very understandable given this history. We in most parts of the West have not 'needed' gold - being real, fungible, uncorrupted 'money' in a long time - and in Australia probably never. (history buffs step in here). We may never need it (I hope) but along with many here I see gold as insurance, and for similar reasons to the Chinese. Barring the Government of the day seizing all wealth, gold will do for me what it is meant to do - insure a few months expenses whilst the world rights itself. I have no doubt that Australia's imports of gold will never appear on the record books, and I'm happy to be an 'oddfish' in holding some gold against disastrous circumstances. Blah Blah Blah [youtube]http://www.youtube.com/watch?v=axh7quv4HAQ[/youtube]
Julie, You are obviously an intelligent person, and much nicer when you are writing like that instead of sprouting the party line. Too smart to be a communist! JMO OC
(Treasuries as billion USD) Jan 2007 China, Mainland: 353.6 Hong Kong: 54.7 Jan 2008 China, Mainland: 492.6 Hong Kong: 54.4 Jan 2009 China, Mainland: 739.6 Hong Kong: 71.7 Jan 2010 China, Mainland: 889.0 Hong Kong: 146.6 Jan 2011 China, Mainland: 1154.7 Hong Kong: 127.6 Jan 2012 China, Mainland: 1159.5 Hong Kong: 134.3 Jan 2013 China, Mainland: 1214.2 Hong Kong: 142.9 Jan 2014 China, Mainland: 1273.5 Hong Kong: 160.3 Take into account that Hong Kong isn't part of what news/media generally reference as 'China'. Yet, both US Treasury holdings show the same trend. China has now 3.6 times the US Treasuries it had in Jan 2007. Hong Kong has now 2.93 times the US Treasuries it had in Jan 2007. So the US exported 215 tonnes to Hong Kong in 2013. The average gold price of 2013 was $1411.23 215 tonnes is 6,912,405 ounces gold. So the USD value of it was 9,755 billion. Hong Kong has sincee 2013 about USD 160 billion. 9,755 is a mere 6,1% of 160. This is Hong Kong's full year (Jan 2014 - Jan 2013) data: Hong Kong 160.3 158.8 141.7 137.3 126.5 126.5 120.0 124.2 136.4 141.2 146.6 144.7 142.9 So your claim that they are converting their US bonds into gold, as a weighted (read: reality) measurement, appears as completely wrong, on the 1 year term, and even ridiculously wrong (multiplied by 3), on the 5 years term. Do you have any comment on this? Another kind pointing-out of Pirocco! Don't shoot the messenger!
Interesting figures, ok so it looks like they are not directly converting their US Bonds(if indeed these figures are even accurate) into hard assets but I can tell you for a fact that they are buying up Australian mining assets which include Gold mines, one which I held until recently was FML. So they may not be using their US Bonds to buy these assets but they are still using Fiat currency and a lot of it to buy hard assets all over the world.
It's good to not just accept anything. I ceased to do so, even for seemingly 'generally accepted' ones, after unveiling too much stories as misleading. This is the most recent published data, for 12 successive months: http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt This is older data, as an number of various files of various figures of a time, stored in a zip with a datestamp in its filename: http://www.treasury.gov/resource-center/data-chart-center/tic/Pages/ticarchives.aspx The files in the zip are named like the most recent file, so here the 'mfh.txt' in each zip IF you believe figures released by the Federal Reserve Central Bank. I decided to do so, since the alternatives are at least much worse / less reliable, and contain many contradictions. The only thing I believe more, are my own eyes. The Fed can publish that the sky is green, I'll take my own eyes for true instead. The real question is not THAT they (Hong Kong) are buying gold related assets, it's the DEGREE in which they do so. As calculated, 2013's total gold figure, combined with an average 2013 price (depends on which moments they bought of course, but we don't know that data and whenever it was, it won't change that much as total relative to other totals), was about 10 billion dollars. What is 10 billion dollars? Over the same year 2013, they bought 17.4 billion dollars extra US Treasuries. Since 2008, they bought 105.6 billion dollars extra US Treasuries. How much gold, on a net basis, did Hong Kong (and again: this is NOT what media reference as China, for what it matters since the very same happened there, and as ) buy/sell since 2008? If one looks at the whole, this article is a movement of gold from US to Hong Kong. That's it. That's all. What happened with the gold there? Was it stockpiled at dealers/banks there? Was, or will it, be sold to local buyers? Was, or will it, be sold to foreign buyers? One thing is for sure: they will eat it nor throw it into the ocean. Often, gold imports are called 'consumption'. But that's just bullshit, it's stockpiling, and that makes a huge difference, since in the case of consumption, it won't reappear for sale at a zero cost (no recycling needed), while in the case of stockpiling, it will. This all just says that the topics article is, in terms of price movement, a total nothingsayer. What remains 'informational' from the topics article: a property shift from a former gold owner to a new gold owner. And that throws up a completely different question: which of both will have made the best decision? Two things are for sure: 1) a gold seller (here: US based) thought in january 2014 that the gold price will drop. 2) a gold buyer (here: Hong Kong based) thought in january 2014 that the gold price will rise. The real question thus is: which of both was the smartest in january 2014? In january 2014, the average gold price was USD $1244.80 In february 2014, it was $1300.97 In march 2014, it was $1336.08 In april 2014 so far, it has been $1299.69 And this brings up another crucial question: how relevant is the topics article TODAY? It's 3 months ago. The Hong Kong january 2014 purchases could have (helped) driving the gold price that $1300.97-$1244.80=$56.17 up. But we don't know yet what it was in february 2014. And march. And this month april. It is even possible that those Hong Kong based january 2014 buyers, in MEANTIME sold this month april 2014, and (helped) driving the gold price $1336.08-$1299.69=$36.39 down. All this together meaning that the topics articles 'sentiment' can be lagging 3 months on todays reality. Some say: "WOW that's impresive". To then take today as starting point for the years to come. Well WRONG. The starting point was end january 2014. Why above? To make clear that one should understand that, as tolly_67 (although I've no clue why he brought up central banks, there is not a single mentioning) said, that the whole of the market drives the price. What happenED in a part of it says nothing about the price movement then, and the price movement now. You're looking at an incomplete picture. It is possible that it reflects the rest too, but it's also possible that it doesn't, and indeed, any focus can be dangerously misleading. And the zerohedgers and silverdoctors have a very ugly reputation on that focus aspect. Until some past (apparently in meantime they realized that their scam didnt work anymore) they touted out all bigger Comex depositories gold/silver inventory drops, and near to never an increase. One could see an increase of 1Moz every day for 10 days long, to then drop 10 Moz in a day, with the manipulators at zerohedge and silverdoctors being silent about the former, to then write an sensational article about a 10 Moz drop in a day while suggesting in every sentence shortages and price explosions. Often people talk about manipulation and blame X Y Z, but that the very people that do so all the time, do it themselves, as to trick them into making decisions that benefit them (regardless whether wrong or not for the decision maker), they don't realize. It's for this reason that I don't take anything of importance on this forum and others for true, until I verified it myself. And if not, I don't hesitate to bring it up, and contrary to the zerohedgers/silverdoctors/etc club that almost never actually link to original source articles (they DO link alot to eachother lol), I include them, so that one can just verify it himself the same way I did. So, the bold in your "So they may not be using their US Bonds to buy these assets but they are still using Fiat currency and a lot of it to buy hard assets all over the world.", is wrong. We'll only know when the USGS reports the following period upto today (april). In "investing in precious metals" (read: the money for nothing club) there are two major classes of misleading: incomplete figures, and wrong timeframes. No problem with reading articles here and there, they may provide a useful piece of data, but don't let them succeed in inflicting you a narrowview on the world, look around, then compare, as to recognize contradictions, then try to give them a place in a whole, and gradually you'll have constructed a whole that closes in on reality, gives you understanding, improving your ability to foresee, and make the better decisions. This was Pirocco's Sundays Investigation and Morale Story. If you want to make yourself predictable and frontrunnable, zap to the Technical Analysis Rock Paper Scissors TV Channel instead, and Follow the Patterns there!
