safebetter Posted November 16, 2008 Report Share Posted November 16, 2008 China Gold Rush? http://www.thestandard.com.hk/news_detail....&con_type=1 Whole article is worth putting here as there are so many good snippets: "The mainland is seriously considering a plan to diversify more of its massive foreign-exchange reserves into gold, a person familiar with the situation told The Standard. Beijing is considering changing its asset allocations during the financial tsunami in order to build up gold reserves "in a big way," the source said. China's fears about the long-term viability of parking most of its reserves in US government bonds were triggered by Treasury Secretary Henry Paulson's US$700 billion (HK$5.46 trillion) bailout plan, which may make the US budget deficit balloon to well over US$1 trillion this fiscal year. The US government will fund the bailout by printing new money or issuing huge amounts of new debt, either of which will put severe pressure on the value of the greenback and on government bond yields. The United States holds 8,133.5 tonnes of gold reserves valued at US$188.23 billion. China holds gold reserves of just 600 tonnes, worth only US$13.89 billion. Beijing's reserves could easily go up to 3,000 to 4,000 tonnes, Tanrich Futures senior vice president Colleen Chow Yin-shan said. Until now, the United States has had little choice but to issue massive amounts of debt to fund its deficits, and China has had little choice but to purchase it, as there are not many markets deep enough to absorb the mainland's US$30 billion to US$40 billion in monthly capital inflows. Government officials involved in the management of China's reserves are beginning to see gold as an attractive place to park some of these funds. They see it as a real, tangible asset that will not lose its value over time - in stark contrast to the greenback, which is becoming more disconnected from economic realities as more bills are printed. "It's the right time to increase the gold reserves, as the price is about US$710 to US$720 per ounce," said Wan Guoli, vice secretary general of the China Gold Association. (Do they Chinese see this as the bottom?) The International Monetary Fund has made reducing global payment imbalances one of its priorities in the aftermath of the financial tsunami. "I think China probably will expand its strategic reserves into commodities during this downturn," said a Hong Kong-based strategist. (which they are doing in oil also http://www.bloomberg.com/apps/news?pid=ema...id=aku3hyO64O9M) "China will continue to buy treasuries ... otherwise the system would get distorted," he said. "But I think China will diversify its reserves." Just makes you realise how small the worlds total researves are now in $ terms compared to this credit tsunami - will only take a small swing in reserves diversification to move the price upwards resulting in untold rocket posts!!!! SafeBetter Link to comment Share on other sites More sharing options...
Fishfinger Posted November 16, 2008 Report Share Posted November 16, 2008 Perusing the Sunday Times money section today (as one does) there is the following titbit:- Don't Bank on Gold The yellow metal , currently $747, could lose it's shine. Higgins said: "Deflation does not augur well for an asset that is supposed to be an inflation-hedge. We expect prices to fall to $550 next year" John Higgins being of Capital Economics.. Link to comment Share on other sites More sharing options...
notanewmember Posted November 16, 2008 Report Share Posted November 16, 2008 LOL THERE IS NEVER EVER, EVER A GOOD TIME TO BUY GOLD. Link to comment Share on other sites More sharing options...
G0ldfinger Posted November 16, 2008 Author Report Share Posted November 16, 2008 LOL THERE IS NEVER EVER, EVER A GOOD TIME TO BUY GOLD. Ask Ker. Gold could drop to 660, then 550, then 100 and then zero, which is the lower bound, because I will buy ALL gold in the world at this price. Link to comment Share on other sites More sharing options...
Errol Posted November 16, 2008 Report Share Posted November 16, 2008 Perusing the Sunday Times money section today (as one does) there is the following titbit:- Don't Bank on Gold The yellow metal , currently $747, could lose it's shine. Higgins said: "Deflation does not augur well for an asset that is supposed to be an inflation-hedge. We expect prices to fall to $550 next year" John Higgins being of Capital Economics.. Someone email Mr. Higgins a gold/sterling chart. He appears to have overlooked it. Link to comment Share on other sites More sharing options...
marceau Posted November 16, 2008 Report Share Posted November 16, 2008 I'm watching that berk Darling on the BBC as I write. It's so clear that the government are going to try and bail out everyone and everything with borrowed money for as long as the world will let them. I can't quote him word for word, but one of his lines was about keeping people in employment no matter what the cost. That will be an even more bloated public sector on its way, then. I reckon they have less than a year before no-one will buy their debt. As much of a tosspot as Osbourne is, I have to agree with him that what is being planned now will send the pound to unimaginable depths. I'll be sticking with gold. Who knows which way this nightmare is going to whipsaw over the next decade. We'll have massive inflation one minute and deflationary default the next. NONE OF IT WILL BE TIMEABLE. I'll buy where I see value that can survive to the other side. Link to comment Share on other sites More sharing options...
Justin Thyme Posted November 16, 2008 Report Share Posted November 16, 2008 More gold manipulation acknowledgement: http://gata.org/node/6876 Will it end in Dec when the Comex can't deliver - not long to find out SafeBetter I think this is yet another of many "countdown to launch" events for goldbugs. I'm confident that our collective prudence with regard to precious metals will pay off but think that, come February, we may be looking at countless posts and links to articles which endeavour to explain how the hell the COMEX didn't default to go with the posts and articles trying to explain why gold didn't engage at warp 9.95 as Lehman Brothers collapsed. Hope I'm wrong though Link to comment Share on other sites More sharing options...
marceau Posted November 16, 2008 Report Share Posted November 16, 2008 I think this is yet another of many "countdown to launch" events for goldbugs. I'm confident that our collective prudence with regard to precious metals will pay off but think that, come February, we may be looking at countless posts and links to articles which endeavour to explain how the hell the COMEX didn't default to go with the posts and articles trying to explain why gold didn't engage at warp 9.95 as Lehman Brothers collapsed. Hope I'm wrong though Agree, a 'jam tomorrow' story for goldbugs. Is COMEX fair? Probably not. Will it default because of the actions of a few gold bugs? Again, probably not. Gold will have it's day when the world suddenly realises that paper is worth nothing. That could still be a long time away (but it's wise to be positioned well ahead of the crowd). Link to comment Share on other sites More sharing options...
romans holiday Posted November 16, 2008 Report Share Posted November 16, 2008 Agree, a 'jam tomorrow' story for goldbugs. Is COMEX fair? Probably not. Will it default because of the actions of a few gold bugs? Again, probably not. Gold will have it's day when the world suddenly realises that paper is worth nothing. That could still be a long time away (but it's wise to be positioned well ahead of the crowd). Or the governments help them along with a sudden devaluation. The last refuge of these scoundrels when reflation fails. Link to comment Share on other sites More sharing options...
wren Posted November 16, 2008 Report Share Posted November 16, 2008 Perusing the Sunday Times money section today (as one does) there is the following titbit:- Don't Bank on Gold The yellow metal , currently $747, could lose it's shine. Higgins said: "Deflation does not augur well for an asset that is supposed to be an inflation-hedge. We expect prices to fall to $550 next year" John Higgins being of Capital Economics.. Wow. Such ill-informed and simplistic thinking, or more like assumption. As I hope all on this thread know, the history shows that gold does well in deflations, as well as being a good hedge against high inflation. Link to comment Share on other sites More sharing options...
qwertyuiop Posted November 16, 2008 Report Share Posted November 16, 2008 I think this is yet another of many "countdown to launch" events for goldbugs. I'm confident that our collective prudence with regard to precious metals will pay off but think that, come February, we may be looking at countless posts and links to articles which endeavour to explain how the hell the COMEX didn't default to go with the posts and articles trying to explain why gold didn't engage at warp 9.95 as Lehman Brothers collapsed. Hope I'm wrong though Who is asking the COMEX to deliver? Is this first time? If it is, why shouldnt they be able to deliver? Link to comment Share on other sites More sharing options...
electroweak Posted November 16, 2008 Report Share Posted November 16, 2008 Who is asking the COMEX to deliver? Is this first time? If it is, why shouldnt they be able to deliver? Their warehouses only hold about 5M ounces of gold, afaik. There are roughly four times that number of gold 'longs' - holding ounces adding up to four times the content of the warehouse. There are roughtly the same but more gold 'shorts' - again, I think it's about 21M ounces of short positions. This means that if all the longs (even >25% of longs) were to request delivery, COMEX / participants would be having to find gold from elsewhere. For silver the situation is even more precarious. There, Comex have said (I think) only 1500 contracts per month can be physically delivered. what a joke. there's a net short position equal to (I think) a whole year's production! Also, note CGNAOs recent post about a silver miner/refiner who decided to sell silver 100Oz bars direct sidestepping COMEX..they sell for higher prices than when selling to COMEX so they are happy. COMEX will be in bigtrouble if there are lots of physical delivery requests for silver and it is hard for them to obtain it as the refiners/miners sell elsewhere for more. Link to comment Share on other sites More sharing options...
qwertyuiop Posted November 16, 2008 Report Share Posted November 16, 2008 Their warehouses only hold about 5M ounces of gold, afaik. There are roughly four times that number of gold 'longs' - holding ounces adding up to four times the content of the warehouse. There are roughtly the same but more gold 'shorts' - again, I think it's about 21M ounces of short positions. This means that if all the longs (even >25% of longs) were to request delivery, COMEX / participants would be having to find gold from elsewhere. For silver the situation is even more precarious. There, Comex have said (I think) only 1500 contracts per month can be physically delivered. what a joke. there's a net short position equal to (I think) a whole year's production! Also, note CGNAOs recent post about a silver miner/refiner who decided to sell silver 100Oz bars direct sidestepping COMEX..they sell for higher prices than when selling to COMEX so they are happy. COMEX will be in bigtrouble if there are lots of physical delivery requests for silver and it is hard for them to obtain it as the refiners/miners sell elsewhere for more. What are the value of the long contracts held.? I would assume that no default could take place as it would be contracted that positions that couldnt be satisfied would be settled in cash? It would just mean a another bailout *just* ! This is no secret to investors surely? Link to comment Share on other sites More sharing options...
electroweak Posted November 16, 2008 Report Share Posted November 16, 2008 What are the value of the long contracts held.? I would assume that no default could take place as it would be contracted that positions that couldnt be satisfied would be settled in cash? It would just mean a another bailout *just* ! This is no secret to investors surely? In Gold, I think it's about 20M Ounces Long. In Silver, 280M (??) Yes, I think that's right, but in the situation of COMEX fail to deliver, would you want dollars??!!!! I certainly wouldn't! EDIT I just saw the POG hit infinity at CoininvestDirect: Warning: Division by zero in /home/ciduser/public_html/engine/server/price/PriceStrategy.php on line 388 http://www.coininvestdirect.com/main.php?a=10&id=2 Link to comment Share on other sites More sharing options...
azazel Posted November 16, 2008 Report Share Posted November 16, 2008 Thanks for the tip. I just bought 100,000 kilos of silver for £0.00, awesome. Thought I ought to get some Gold too. I ordered 200 x 100kg maples, and 10000 kg bars of gold. cgnao is gonna be pissed that he missed this! Ker was right about it going to zero!! Get your free gold and silver here. I bet they will default like comex will! Link to comment Share on other sites More sharing options...
marceau Posted November 16, 2008 Report Share Posted November 16, 2008 Thanks for the tip. I just bought 100,000 kilos of silver for £0.00, awesome. Thought I ought to get some Gold too. I ordered 200 x 100kg maples, and 10000 kg bars of gold. cgnao is gonna be pissed that he missed this! Ker was right about it going to zero!! Get your free gold and silver here. I bet they will default like comex will! Me too. I now own half the world's gold. Watch out though, I may sell it all and crash the market. Link to comment Share on other sites More sharing options...
azazel Posted November 16, 2008 Report Share Posted November 16, 2008 Me too. I now own half the world's gold. Watch out though, I may sell it all and crash the market. Expect a big spike up in the price of gold tomorrow. GEI members have cornered the worlds gold supply due to an unforeseen glitch in the matrix. Dooh! Link to comment Share on other sites More sharing options...
GTG Posted November 16, 2008 Report Share Posted November 16, 2008 I am in the UK UK may go the same way as Iceland Gold will protect me from that so I am sticking with gold. Yep, that's my position. Link to comment Share on other sites More sharing options...
Justin Thyme Posted November 16, 2008 Report Share Posted November 16, 2008 This might've been posted by someone else but if not, here's . Link to comment Share on other sites More sharing options...
kernull Posted November 16, 2008 Report Share Posted November 16, 2008 The big picture for the end of 2009 and a bit beyond that: EUR/USD: http://i430.photobucket.com/albums/qq30/ke...eurusd-1115.png USD: http://i430.photobucket.com/albums/qq30/kernu11/usd1115.png OIL: http://i430.photobucket.com/albums/qq30/ke...115-monthly.png Stocks: http://i430.photobucket.com/albums/qq30/ke...dow-monthly.png http://i430.photobucket.com/albums/qq30/ke...-1115-daily.png GOLD: http://i430.photobucket.com/albums/qq30/ke...115-monthly.png http://i430.photobucket.com/albums/qq30/ke...1115-weekly.png http://i430.photobucket.com/albums/qq30/ke...-1115-daily.png http://i430.photobucket.com/albums/qq30/ke...d-1115-4hrs.png SILVER: http://i430.photobucket.com/albums/qq30/ke...115-monthly.png http://i430.photobucket.com/albums/qq30/ke...-1115-daily.png Link to comment Share on other sites More sharing options...
kernull Posted November 16, 2008 Report Share Posted November 16, 2008 Ask Ker. Gold could drop to 660, then 550, then 100 and then zero, which is the lower bound, because I will buy ALL gold in the world at this price. listen, if you want to start bull & bear battle, find someone else Link to comment Share on other sites More sharing options...
G0ldfinger Posted November 16, 2008 Author Report Share Posted November 16, 2008 listen, if you want to start bull & bear battle, find someone else Link to comment Share on other sites More sharing options...
Pixel8r Posted November 16, 2008 Report Share Posted November 16, 2008 The big picture for the end of 2009 and a bit beyond that: GOLD: http://i430.photobucket.com/albums/qq30/ke...115-monthly.png http://i430.photobucket.com/albums/qq30/ke...1115-weekly.png http://i430.photobucket.com/albums/qq30/ke...-1115-daily.png http://i430.photobucket.com/albums/qq30/ke...d-1115-4hrs.png Ker, Would you mind doing some of these charts and analysis in GBP. A lot of the people on this board are using GBP to buy rather than USD. http://stockcharts.com/h-sc/ui?s=$GOL...id=p64060619744 The chart looks a lot different in GBP, not half as bearish, it looks set for surge up again soon. In fact it looks much more positive in loads of currencies. It has recently hit new highs in UK Pound, Canadian Dollar, Rupee, Rand & Australian Dollar. Why the focus just on USD? Here's a collection of long term charts in those currencies. Link to comment Share on other sites More sharing options...
electroweak Posted November 16, 2008 Report Share Posted November 16, 2008 I think Pixel8r, what we are seeing is essentially 'no change' in gold - simply the USD appreciating against EVERYTHING, except appreciating slightly less against gold than GBP,ZAR etc. This story is not yet about gold , it's about the dollar for now. When things kick-off for gold, we will surely know it. Link to comment Share on other sites More sharing options...
Pixel8r Posted November 16, 2008 Report Share Posted November 16, 2008 I think Pixel8r, what we are seeing is essentially 'no change' in gold - simply the USD appreciating against EVERYTHING, except appreciating slightly less against gold than GBP,ZAR etc. This story is not yet about gold , it's about the dollar for now. When things kick-off for gold, we will surely know it. I agree with what you say, just am curious as to why TA chartists always just use the USD. Link to comment Share on other sites More sharing options...
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