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Gold's Surge Unlikely To Slow As China Could Emerge As Massive Gold Reserve Buyer

 

 

December 1, 2009 11:10 AM EST

 

With government's around the world devaluing their currencies, pumping their economies with liquidity created out of thin air, and with central banks around the world choosing to diversify into gold, do you really need another reason to own the precious metal? Well, comments from senior Chinese official yesterday on gold are adding fuel to the fire and puts another feather in the cap of goldbugs.

 

On Monday, Ji Xiaonan, chairman of the supervisory board for large firms at State-Owned Assets Supervision and Administration Commission, said the Dubai crisis could give China a buying opportunity to put some forex reserves into gold or oil reserves.

 

A Chinese paper, the China Youth Daily, quoted Ji as saying a task force was set up last year to look at the issue of gold reserves. "We suggested that China's gold reserves should reach 6,000 tons in the next 3-5 years and perhaps 10,000 tons in 8-10 years," the paper quoted Ji as saying. It was last reported that China's gold reserves had risen to 1,054 tons from 600 tons since 2003. So this could mean an increase of up to 10-fold!

 

After taking a breather Friday on dollar strength, due to the Dubai debt concerns, gold is back to all-time highs. Spot gold last traded at $1196.10, up from yesterday's close of $1178.90.

 

 

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EDIT: long, staying so, not trading, just reporting :)

On the minus side, Barrick says it has now eliminated its' hedges.. (no more buying there)..

Barrick says it has eliminated gold hedges

By Euan Rocha

Reuters

Tuesday, December 1, 2009

 

http://www.reuters.com/article/marketsNews...148789420091201

 

TORONTO -- Barrick Gold Corp. said today it has completed the elimination of all of its gold hedges as planned, a move that should remove what has been a big drag on its shares.

Also...

After quietly doubling reserves, China is wary of gold 'bubble'

By Ambrose Evans-Pritchard

The Telegraph, London

Wednesday, December 2, 2009

 

http://www.telegraph.co.uk/finance/china-b...hina-wary-of-...

 

The Chinese authorities have given the clearest indication to date that they view the surge in gold to an all-time high of $1,217 (L730) an ounce as a speculative frenzy.

 

Hu Xiaolian, the vice-governor of the central bank, said Beijing would not buy gold indiscriminately.

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Going to move 50% of my gold stash into Dollars as I'm moving there. I also think the USD will be strong for quite a while during the next phase of the economic bear market.

 

I have around 80% of my wealth in precious metals. I've accumulated Dollars over the last few months.

Sweet. I'm in a similiar position myself.

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I meant: "Now what?"

 

:lol:

 

I am beginning to think that the tail may now be beginning to wag the dog. I believe that the POG is used by many as a gauge for uncertainty but at a certain point, especially after a fast rise, I think the price will, of itself, feed the uncertainty - and start a cascade.

 

Also, with Sinclair's first prediction having arrived, I believe it may deter 'profit taking' and perhaps embolden fresh buying from those who, having seen a concrete 1224 - despite many calling the top at 1150, will feel that Jim's 'magic numbers' are on track.

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What now? :rolleyes::unsure:

 

 

You did say back on the 14th March 2007 on HPC.

 

I would not sell below USD 1200, which is in my opinion the equilibrium price today.

But I expect it to go much higher, since markets are not rational. Just look at house

prices - another case where it's difficult to call the max. Inflation adjusted maximum

prices for gold in 1980 were around USD 2000/ GBP 900 per ounce. That might give

you an idea. Gold would have to triple from where it is now. But 1980 was not Armageddon.

 

http://www.housepricecrash.co.uk/forum/ind...43821&st=15

 

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Capital Gains question about gold held with GM or BV.

 

Dont know if this has been discussed before, but can CGT be avoided when selling GM or BV holdings by selling and leaving the proceeds there in the pot and only withdrawing it to the nominated bank account at maximum CGT allowance each year? Thanks.

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You did say back on the 14th March 2007 on HPC.

Very nice. :) The $1,200 was van Eedens equilibrium price back then, BTW. Meanwhile I don't give van Eeden so much credit anymore, and the models I believe in show much higher equilibrium prices.

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Is there a thread about selling gold on here? I can't find one. I'm starting to look at offloading a few coins but obviously looking to get the best bang for buck as possible.

 

Ebay & Paypal fees are astronomical!

I have been telling everyone on here for ages that you should always work out your exit strategy when you buy including the tax implications. FYI the best way to sell gold coin is to a bullion dealer unless it has numismatic value in which case then sell to a numismatic dealer. There are some bullion dealers that will buy at just under spot when the market is going up of course ;)

 

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Is there a thread about selling gold on here? I can't find one. I'm starting to look at offloading a few coins but obviously looking to get the best bang for buck as possible.

 

Ebay & Paypal fees are astronomical!

 

C.I.D. have a 'buy' price for every coin / bar they sell. Also, you have to send your items to Germany, so that won't be cheap (insured)

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Yeah I fell out with CID a while ago and no longer deal with them. <_<:lol:

 

What was the problem with CID? Don't expect 'blow by blow' just the general gripe - if you don't mind.

 

Regarding selling, why not mention here on GEI what you wish to sell - and anyone interested can PM you.

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