I suppose I should post these two quotes on the Gold-gold thread rather than the BDR-gold thread. But the former is a bit too adversarial for me. The useful insights tend to get lost in distracting taunts and repartees.
Quote 1:
"The latest figures out of China suggest that the country ceased buying gold for its reserves in May. An announcement from the country’s central bank indicated its total reserve figure was an unchanged 58.14 million ounces (1,808 tonnes) at the end of last month." (
https://lawrieongold.com/2016/06/08/china-stops-buying-gold/).
Juxtaposed to Quote 2:
"China imported five times more gold from Hong Kong in May amid global and regional economic and geopolitical uncertainties, with gold traders expecting the trend to continue as prices keep rising and investors keep buying as a hedge to the falling value of the Chinese yuan.
Chinese customs data released last week showed imports from Hong Kong to the mainland increased in May mainly due to cross border shipments to meet mainland customer demand." (
http://www.scmp.com/business/global...gold-rush-big-mother-investors-mainland-china).
So Chinese citizens are doing what Indian private investors have done for decades. To get a sense of scale:
- If effective from this new financial year just 5% of China's population can afford to and does buy only 1 oz of gold for personal investment, that's 1.3B x 5% divided by 32,150oz = 2.022 tons, which is 80% of the annual total global production.
- Assuming that they continue to buy the same modest amount over the next 5 years, that's a cumulative total of 10.11 tons.
- If we add this demand value to ongoing demand from Chinese & Russian govts. and Indians private citizens, it's a struggle to believe GS & friends' pog call of $900 per oz.
Doubtless, GS & friends would know the might of the market forces that they have decided to take on. So either they have aces up their sleeves or they do love their game of poker (which only reinforces the view that Americans play poker while Russians and Chinese play chess). R.
