Is China Stockpiling Gold?

goldbug15 · February 12, 2014 10:30PM

Chinese usage of gold increased 41% in 2013 from 2012 to more than 1,100 metric tons (500 more metric tons than anticipated). Analysts believe the numbers may be even higher, but aren't being reported by the Chinese government at this time.

Are they simply taking advantage of the buying opportunities in a bear market, or are they preparing for something much larger?

Read more about it here: Is China Stockpiling Gold?

ricko · February 12, 2014 11:22PM

Of course they are...... Cheers, RickO

CaptHenway · February 13, 2014 12:17AM

That's what I've heard for years.

DoubleEagle59 · February 13, 2014 12:21AM

The Chinese have a history of more than 3000 years of complete trust in Gold.

Why should they stop now?

derryb · February 13, 2014 12:34AM

Not only are they importing record amounts, they are keeping all of their domestic production and encouraging citizens to stock up.

Has the buying opportunity been created to appease one of our largest debt holders who are witnessing a threat to their US debt investment?

Why were the Chinese sold JPM's Chase Manhattan Plaza office building at about half its value? This building contrans the world's largest vault, is across the street from the NY FED and is reported to have an underground tunnel connecting it to the NY FED.

cohodk · February 13, 2014 2:04AM

Seems to me like they are selling gold...

http://www.apmex.com/category/512/chinese-gold-pandas-2014-prior

I could post 100 more sites where Chinese gold is readily available for sale.

derryb · February 13, 2014 2:07AM

<< Seems to me like they are selling gold...

http://www.apmex.com/category/512/chinese-gold-pandas-2014-prior

I could post 100 more sites where Chinese gold is readily available for sale. >>

Marketing strategy to get westerners used to the idea of Chinese money. Before you know it, it will be everywhere.

cohodk · February 13, 2014 2:10AM

Thats a good one derryb.

reddwing · February 13, 2014 2:12AM

U bet they are. In fact, i think a fundamental shift of stacking gold is happening in Asia. This would include India, Vietnam, Singapore along with China. Not sure about Japan or what the typical Japanese of Korean think about gold.

Baley · February 13, 2014 4:53AM

Of course they are! Everybody cool is stockpiling gold! Next question!

ksammut · February 13, 2014 5:05AM

Without a doubt.

secondrepublic · February 13, 2014 5:32AM

It's obvious to anyone who has been alert these past few years that China wants to be Number 1 in the world. Look at the Beijing Olympics extravaganza, their planned moon mission, etc. China won't be #1 while its gold reserves are far below the reported 8,000 ton U.S. government gold reserves. Ergo they stack. I think they'll keep stacking until they have 20,000 tons. Then they can look at us and laugh.

johnny9434 · February 13, 2014 6:13AM

<< Of course they are! Everybody cool is stockpiling gold! Next question! >>

no doubts.

roadrunner · February 13, 2014 9:15AM

China has been adding 500-1000 tonnes/year to their official reserves for the past 5 years. The latest "unofficial" word is that they are up to around 2500-3000 tonnes or more than double what they reported in 2009.
One also has to add to this the 500-1000 tonnes they import each year as well as their internal mine production of 350+ tonnes per year. I would suspect that Pandas, AGE's, Philharmonics, Krugs, and every other
sovereign gold coin is a drop in the bucket to the 100 and 400 oz bars being poured every year. The Swiss refineries for one have been running flat out for a year trying to keep up with pouring all these new bars for
China. That GLD gold that was sold had to go somewhere (ie China). China is not going to be happy until they get into the 3000-4000 tonne range to be competitive with everyone except the US. And for all we
know their ultimate goal is to approach the US (ie 8,000 tonnes). Somebody out there is stock piling all the gold that is leaving GLD, Comex, and LBMA. Obvious choices are the BRICS.

Looking at Panda production in 2011 it came out to be 750,000 ounces or approx 23.4 tonnes. Even if every Panda were exported overseas (very unlikely) this 23 tonnes is a drop in the bucket vs. 800-1500 tonnes per year
coming into or being produced in China. One estimate I saw for 2014 production is about 1.4 MILL ounces of Pandas. So figuring 50% or more of that mintage stays in China, it still only leaves 23 tonnes for the rest of the world.

Chinese Panda production

derryb · February 14, 2014 1:21AM

China's Gold Demand

jmski52 · February 14, 2014 1:50AM

Is China Stockpiling Gold?

Does a Bear s**t in the woods?

cohodk · February 14, 2014 2:27AM

If I was a Chinese millionaire I would be buying lots of gold also. The Depression that China will soon face will make the 1930's Depression look tame.

Even if the Chinese Govt had all the gold, you that make you want to invest in their country?

cohodk · February 14, 2014 2:28AM

What will happen to prices once China has all the gold? Or at least all they want?

mkman123 · February 14, 2014 3:38AM

Maybe China is working on a statue of Mao the size of the Statue of Liberty made in gold?

jk.

derryb · February 14, 2014 3:42AM

<< What will happen to prices once China has all the gold? Or at least all they want? >>

There will be less of it on the market for sale.

cohodk · February 14, 2014 3:44AM

<< 

<< What will happen to prices once China has all the gold? Or at least all they want? >>

There will be less of it on the market for sale. >>

Dont they dig it out of the ground (print) everyday? Wont there be one less big buyer for this every increasing supply?

derryb · February 14, 2014 3:46AM

<< 

<< 

<< What will happen to prices once China has all the gold? Or at least all they want? >>

There will be less of it on the market for sale. >>

Dont they dig it out of the ground (print) everyday? Wont there be one less big buyer for this every increasing supply? >>

Yep, it grows on trees.

jmski52 · February 14, 2014 3:53AM

Dont they dig it out of the ground (print) everyday?

Yep, but not NEARLY as fast as they create fiat.

cohodk · February 14, 2014 4:31AM

<< Dont they dig it out of the ground (print) everyday?

Yep, but not NEARLY as fast as they create fiat. >>

Thats not the issue.

If a big buyer is out of the market yet supply constantly increases, what happens to the price?

jmski52 · February 14, 2014 5:01AM

If a big buyer is out of the market yet supply constantly increases, what happens to the price?

As you've noted, it depends on what the market sentiment is doing at that point. And market sentiment depends on a lot of things, does it not?

Sometimes, I do wonder whether or not holding precious metals is the answer. While I was growing up, even though silver was used as coinage, there was no gold around. When I was a kid, I always wondered why gold wasn't around, because sure enough it was in the Redbook. But, there was no retail market for gold bullion. How long did it take to get that way after FDR issued his confiscation order? I figure it only took a few years before nobody talked about gold anymore.

The fact that lots of $20 Double Eagles ended up in Europe is testimony that gold didn't lose it's value - it only lost it's legal status in the US. In 1971, Nixon ceased shipping "government gold" to France and ceased dollar convertability into gold in order to stop a run on the gold inventories at Ft. Knox. As we can now see, Germany is going through the same song & dance with the US government in trying to get back the gold that they earned through trade during the past few decades. Sounds like another run on gold inventories (if there is any left, but who really knows).

If China is in bad shape economically like the pundits are saying, then they fear a worldwide slowdown and gold is simply their backup currency (and everyone else's too) when the currency wars continue to drive government issued fiat (and government-issued debt) into the ground around the world. The End Game is ultimately all about getting a reasonable pay for your work & products. The backup position in the game of worldwide liar's poker is to have real, tradeable currency. That's precious metals, guys.

The question is whether or not our government will let individuals own anything (including gold or silver) when push comes to shove. Their track record hasn't been The Greatest, especially of late.

cohodk · February 14, 2014 3:48PM

if our government will let individuals own anything

Perhaps the individuals need to remind the G who is really in control. Or have we no self respect?

Is China Stockpiling Gold?

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