Commodity Trade Mantra

Posts Tagged ‘Gold holdings’

Massive Debt Pain in China Could Be a Blessing for Gold Investors

Although the economy grew by 6.7% in 2016, the debt is causing a host of problems in China. The main reason many Chinese are buying gold is to preserve wealth against the backdrop of massive fiscal stimulus & lax credit conditions. Never has a big economy piled up so much debt so quickly without serious repercussions. It could be wise to take a lesson from Chinese investors & buy physical gold.

Central Banks’ Attitude to Gold Allocation to Undergo a Massive Change

Demand for physical gold, to escape the alternative of counterparty risk on deposits with Eurozone banks, is bound to grow. One suspects that the Eurozone area will be the first to see widespread gold buying by high net worth individuals, trying to protect themselves from a systemic event that has become all but certain, and will even threaten the entire banking system.

China will soon own the Largest Gold Reserves in the World

The US remains the world’s largest gold owner. But for how much longer? There are changes afoot. China is now the world’s largest gold producer. It has held this title since 2007. Not only that, but China is the world’s biggest importer too. Since 2011, China has imported more than 5,000 tonnes. Another 3 years at a similar rate & China will have imported more gold than there is at Fort Knox.

Higher Debt Will Accelerate Central Bank Gold Demand

The U.S. government is currently saddled with $19.9 trillion in public debt. The US dollar accounts for about 64 percent of central banks’ foreign exchange reserves. With the potential for higher U.S. budget deficits and debt risking dollar strength, central banks around the globe could be motivated to increase their gold holdings, says Credit Suisse.

Fearful Capital Turns to Gold and Silver - the Ultimate Financial Insurance

One can easily foresee the financial and political turmoil looming large just ahead. And, there is lots of that coming our way. Now is the time to be proactive in case the situation escalates, which seems to be unavoidable. Gold and silver have been acquired for centuries as a form of wealth preservation, as a long-term store of value and as safe-haven assets in such times.

China On A Gold Buying Binge Despite Massive Debt For Obvious Reasons

Similar to that of other developed nations, China’s debt has also reached “bubbly” proportions. But they know that during the next crisis those nations with a large gold backing will not only survive, but will be prosperous as well! China will most certainly increase its gold reserves even further. Imagine if only a portion of their $1.22 trillion US treasury holdings are shifted to gold. BOOM…

China’s Monetary Ascension Is Paved with Gold

When the Chinese yuan becomes an SDR currency, that could be the inflection point for a new multi-polar currency regime that sees the US dollar decline in stature. Could gold also begin to emerge as a leading currency in world trade? Over time, it certainly could. But the more immediate implications for gold’s monetary role center on its increasing accumulation by central banks such as China’s.

The Significance of the Massive Change in the Gold Market

The significance of the change in the gold market can be better seen by the average annual increase in total gold holdings during the 2009-2012 period which was 15 Moz compared to 25 Moz for the first half of 2016. If demand for gold continues as strong in the second part of the year, we could see upwards of 50 Moz move into these total gold holdings versus 45 Moz for the 2009-2012 period.

Gold Price Spike Triggers Massive Surge In Gold Investment Demand

The spike in the gold price during the holiday weekend triggered a record ONE-DAY surge in mainstream investor gold demand. How much gold flooded into Gold ETF’s and Funds on July 5th? Mainstream investors piled into gold on Tuesday, July 5th, thus pushing the ONE-DAY flow into Gold ETF’s to a record 1.4 million oz. The one-day previous record was about 1.25 Moz.

Gold Mania Will Fuel Gold Prices Beyond Anything Logical

Gold will suddenly be up by $100 one day, then by $200 the next day. At first the pundits will be claiming that it’s an anomaly, but as rises continue, a point will be reached when people say, “This seems to be a trend. Better buy some gold.” But once the trend is underway, the price then will have no bearing on whether gold is available. We shall see a gold price rise for the record books.

Bull Market in Gold Driven by Massive Gold Investment Buying

After shunning prudent portfolio diversification with gold for years, investors are finally starting to reestablish those essential positions. And since their collective gold holdings were so incredibly low heading into 2016, reflecting hyper-bearish sentiment, the gold investment buying has only begun. It will likely take years to complete, driving gold’s new bull higher on balance the entire time.

Thanks to Overvalued US Dollar, Gold Prices Have No Upper Limit

Thanks to an overvalued US dollar, gold prices may have nowhere to go but up. The biggest gold producers in the world have seen their share prices double this year. Not only are gold prices soaring, but producers are cutting costs and slimming down debt as they pave the way for gold to return to the top of the favored commodities list. This safe haven is back & the recovery is clear.

The Fed is Data Dependant - Gold Price is Dollar Dependant

Rising gold holdings have been the one bright spot for the gold price that has held steady even in the face of weakness on the gold chart. The big question the market is going to be asking is can the Fed indeed hike rates at a pace that would send the US Dollar higher with all the negative side effects from that. Much depends on what the Forex markets do with the US Dollar.

Gold is a Permanent Menace to Government's Power over Fiat Money

Existence of gold in the economy is a constant reminder of the poor quality of government paper & it always poses a threat to replace the paper as the country’s money. Despite government backing of its prestige & its legal tender laws to fiat paper, gold coins in the hands of the public will always be a permanent reproach & menace to government’s power over money.

Canada Sells Nearly Half Of All Its Gold Reserves

The latest data shows the total Canadian gold reserves have now dropped to 0.62 tonnes. The amount of gold the Canadian government holds has therefore been falling steadily since the mid-1960s, when over 1,000 tonnes were kept tucked away. Half of those reserves were sold by 1985, then through the 1990s & by last year, Canada’s gold reserves were down to just three tonnes.

Silver Is More Important Than Anything Else In The World

If I am correct about the silver for delivery coming from the most likely of all places, China, then I believe this will be looked back on by historians as “the Chinese silver fox in the West’s golden hen house! Am I correct? I don’t know but we will soon see as the global paper financial edifice is quaking on its own. The silver can ONLY be coming from where it exists…Chinese legacy silver!

Radical Underinvestment in Gold Today is Super-Bullish

American investors are going to soon plow tens of billions of dollars back into gold in an attempt to regain some modicum of prudent portfolio diversification. While these capital flows will be small compared to the stock markets, they are massive relative to gold investment demand. All that buying is going to catapult gold prices far higher.

Peak Debt & The Need For A Reliable Store of Value: GOLD

Most investors seem unconcerned about the unsustainable levels of global debt and the inflationary potential of the trillions of dollars created by the major central banks especially the U.S Federal Reserve. I expect to see gold and silver demand increase dramatically in the coming years as more prudent investors see the truth and look for a reliable store of value.

China Bought Gold With Proceeds From Record Sale Of US Treasurys

In a month in which China sold a record $83 billion in Treasurys, it had no qualms about rotating the sale proceeds into gold. Or at least that’s what it was eager to telegraph with its data. However, even as China is buying gold, it is still doing so at half the pace of neighbour Russia. Between China and Russia, some 47 tons of gold were purchased in the open market in past month.

Gold Soars After Chinese Currency Devaluation

Over one billion Chinese will soon be scrambling into gold to preserve their purchasing power after the PBOC’s dramatic devaluation announcement. Any day now the PBOC will update its revised foreign reserve and gold holdings. And so the next big leg up in gold will take place when it is revealed that the PBOC had only exposed a portion of its “new” total gold inventory.

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