China Still Fudging Gold Numbers (And Everything Else)

07/25/201514 Comments

With the release of China’s latest phoney baloney gold reserve numbers we are still nowhere near answering the question of how much gold China really is hoarding. With fake GDP numbers and opaque treasury holding numbers, is there anything at all we can believe about China (or most other countries’) economic figures? And what does the latest jaw-dropping Chinese capital outflow data portend for the world economy…and the world at war? Join James in this week’s subscriber newsletter to find out.

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  1. Oscar40 says:

    Hi James,

    Good article! So thank you for writing that!

    However, there is also an other plausible reason for why the Chinese only updated their offical gold holdings to 1,658 tons: China is playing ball with the NWO. Having read the brilliant transcript of your podcast “China and the New World Order” I’m surprised that you didn’t mention this possibility.

    I have two articles to back up this thesis:

    1)
    One is written by Jim Rickards, author of ‘Currency Wars’ and ‘The Death of Money’ amongst other things. He is an insider in the sense that he has top-level connections with Central Bankers, the Pentagon, the Treasury, the Fed and all sorts of people. He is saying that the low figures in China’s gold update figures are because “China is not trying to destroy the old boys’ club — they are trying to join it.”

    You can read his article at:
    http://www.dailyreckoning.com.au/why-most-pundits-are-dead-wrong-about-chinas-gold-2/2015/07/22/

    A small excerpt:
    “China wants to do what the US has done, which is to remain on a paper currency standard…but make that currency important enough in world finance and trade to give China leverage over the behaviour of other countries.

    The best way to do that is to increase its voting power at the IMF and have the yuan included in the IMF basket for determining the value of the special drawing right (SDR). Getting those two things requires the approval of the United States, because the US has veto power over important changes at the IMF. The US can stand in the way of Chinese ambitions.

    The result is a kind of grand bargain in which China will get the IMF status it wants, but the US will force China to be on its best behaviour in return. This means that China must keep the yuan pegged to the dollar at or near the current level.”

    2)
    An article by Koos Janssen, who follows the Chinese gold import/export very closely and also translates Chinese Central Bank documents (among other things) into English has written numerous times about the Chinese Gold Market. His latest article is called “Analyzing PBOC Official Gold Reserves Increment” and deals what the reason is why the Chinese updated their official gold reserves to 1,658 tons.

    His article can be read at:
    https://www.bullionstar.com/blogs/koos-jansen/analyzing-pboc-official-gold-reserves-update/

    A small excerpt:
    I’ve accumulated all domestic gold mining output and known gold imports isolated from “Official reserves” since 2009. The “Official reserves” increments in 2001 and 2003 are subtracted from “Cumulative domestic mining”, the “Official reserves” increments in 2009 and 2015 are not subtracted from “Cumulative domestic mining” or “Cumulative total import”, as my theory is that this was covertly imported. A detailed description of how I compiled this chart can be found in my previous post on this subject.

    If I’m right in my analysis that the PBOC has mainly been buying gold abroad since 2009, there are currently 13,781 tonnes of gold in China, of which 1,658 tonnes are official gold reserves and 12,123 tonnes are private reserves. Needless to say, everything the PBOC potentially holds in addition to 1,658 tonnes official reserves must added to these estimates. (I do not rule out the PBOC is able to buy gold in the domestic market.)
    ………………….

    PBOC Gold Reserve Increment Is A Strategic Move
    ………………….
    With the US having the power to obstruct renminbi inclusion into the SDR, the Chinese have to play it safe. They are required to be transparent about their true gold reserves, but may not want to upset the US by disclosing an official gold reserve figure at 3,500 tonnes. The 1,658 tonnes figure, which is too little to rock the global financial order, though a sign that China assesses gold to be “an important element of international reserve diversification” may thus be an appropriate figure. It’s not in China’s interest to rush into a new international monetary system as they continue to diversify away from the US Dollar.

    Koos Janssen recommends to read another article first, before reading his latest article:
    https://www.bullionstar.com/blogs/koos-jansen/analyzing-pboc-official-gold-reserves-update/

    • candideschmyles says:

      Great job James, you are worth every yen and bit o bitcoin. And a first reply from Oscar kicks off what has to be a tiafeng of a discussion. Followed Rickards on twitter for a couple of years now. He certainly appears well connected, like Max Kaiser. Maybe more so as Max seems to get a lot of his info via Rickards. As for me I don’t have a Scooby Doo.

  2. Ukdavec says:

    Fudge is as good a term as any to cover the topic of gold holdings from China.

    The following 18 minute video gives another spin and scenario – worth viewing if you are interested in gold.

    https://www.youtube.com/watch?v=iQ86ztOLChQ

    • nosoapradio says:

      Many thanks UKDAVEC pour this video!

      Definitions matter! Just ask semantic magician Chomsky!

      In fact, ambiguous definitions and slippery connotation = perception control.

      Scenario 2 is certainly provocative, apparently impoverishing everyone but massive physical gold holders… how convenient.

      In fact, I now realize that…

      …what the notorious gold-seeking alchemist discovered is that he didn’t need the formula for producing gold –

      only a formula for controlling people’s perceptions of gold and wealth or lack thereof.

      This formula includes such terms as “Forex reserves”, “sovereing wealth fund”, “fiat” and “bubble bubble toil and trouble….

      Sorry Willy…

  3. Colin Green says:

    Thinking out loud. China is building Islands on reefs near the Spratly Islands to increase its territorial reach in the south China seas. Thousands of acres created by dredging the sea bed. The scale of this enterprise is unprecedented and is likely to be a huge cost. Perhaps accounting for a significant portion of the Trillion dollar bond sales?

  4. Colin Green says:

    China,India & Russia are buying up the worlds gold. Not America though. Even though it is well known that Germany has asked America for their gold back from the federal reserve (and been told it will be returned via drip feed). Why aren’t we reading reports of American (or Federal reserve) gold buying to enable the repayment to Germany? Could the answer be that America is stealing the gold instead? First they stole hundreds of tons of Iraq’s Gold then another 400 tons of Libya’s gold. Where has all this previously recorded gold gone?

  5. MarkAustralia says:

    Anther great article, thanks James.
    On this exact topic, here is a REALLY GOOD audio interview with Stephen Leeb on King World News from last week:

    http://kingworldnews.com/dr-stephen-leeb-7-18-15/

    • nosoapradio says:

      Hey MARKAUSTRALIA!

      Fascinating term Leeb uses again and again: “The Wealth Effect…”

      “The wealth effect is the change in spending that accompanies a change in perceived wealth.[1] Usually the wealth effect is positive: spending changes in the same direction as perceived wealth.”

      https://en.wikipedia.org/wiki/Wealth_effect

      Good to know.

      Gives new dimensions to the concept of “perception management”…

      You can’t eat, drink or burn gold to stay warm… yet…

      The gold paradigm… the gold effect?

      a form of highly maleable mass hysteria? collective delusion…?

      At the count of 5 I will snap my fingers and you will awaken…

      and then what?

      The technocratic “energetic input/output effect?”

  6. nosoapradio says:

    Sorry, I missed a chapter. How does the following fit in?

    http://www.reuters.com/article/2015/07/23/us-gold-market-rout-idUSKCN0PW0A520150723

    http://www.rt.com/business/310268-gold-crashes-as-china-dumps/

    Again, artificially keeping prices low?

  7. phreedomphile says:

    Since the global fiat endgame is race to the bottom debasement to achieve a diluted swamp of currencies that can all be merged into one, why must “currency wars” be on the agenda and actual war? There’s no need and it’s ultimately counterproductive undermining and/or destroying the prison planet technocratic infrastructure build out with its gleaming global smart cities and big brother surveillance system. Not to mention the need to maintain a level of confidence in the larger System.

    FWIW, about 11-12 years ago I stumbled upon some Western currency war propaganda, heavy cointelpro stuff, and then followed some bread crumbs to learn that some best selling books in China (no doubt hyped by the Chinese oligarchs) focused also on the “currency wars” meme. Looked like Orwell’s superstates faux rival archetype then and still does now.

    Finally, apologies this tip is a bit vague, but here goes. Shortly after the economic meltdown in 2008, Patrick Wood hosted a teleconference for his regular readers and mentioned that members of the Establishment (Trilateralists??) had decided some time ago the IMF’s SDR should be the transitional global currency and the global currency itself should be BACKED BY GOLD. There was even a proposed name which I don’t recall, it seemed to have incorporated the French or Latin name for gold. I don’t recall that Wood was specific in his 2008 talk as to what group proposed this. Sounds like the gold backing proposal is intended to be a selling point for the new global currency. Whatever the salesmans’ pitches will be, we all know the globalists’ ultimate wet dream is a tightly rationed resource or energy based (“carbon credit”) distribution hypertechnogrid. I wouldn’t be surprised if there is another Matryoshka doll to open after that – referring to more layers of deceit, smoke and mirrors.

  8. candideschmyles says:

    Like everyone here will know there has been no end of alternative pundits dancing and getting lyrical over how you have to buy gold. That it’s not only the safest but also the shrudest investment, except of course for bitcoin. I still think the price of gold to be much more volatile than it has been since its 2010/11 historic high and a rapid decline in value is not out of the question. I do not base this uncertainty on what I hear from economic soothsayers but from the scientific press. I know that there are new techniques available for extraction that effectively double the previous output. It also worth noting that the output from Russia has seen a seismic shift upwards recently. Putin of course is desperate the counter the revenue losses from fossil fuels and going turbo on gold production is an obvious way to do so.
    Link included just because I want to share the leader pic for the site of the most beautiful bit of gold I ever saw.
    http://www.mining-technology.com/projects/-olimpiada-gold-mine-russia/

    • Ukdavec says:

      candideschmyles – intriguing comments.

      1. Your knowledge emanating from the SCIENTIFIC press regarding new gold extraction techniques to DOUBLE gold output.

      Care to share a link or provide further details?

      2. Any increased gold output from Russia will head straight into the Russian CB – any spare will be soaked up by China – the anglo american gold market (which is the price setting mechanism currently) will not see any increased production from Russia – as they also do not get a chance to buy any of the ramped gold production from China. Therefore this will have zero impact on the price of gold IMHO.

      Looking forward to the links/details from you.

    • Ukdavec says:

      I have been following the gold industry for 14 years. I am only aware of a number of new developments related to reducing the use of cyanide in gold extraction.

      http://www.bloomberg.com/news/articles/2015-06-30/barrick-s-cyanide-breakthrough-on-gold-solves-a-puzzle-for-gain

      Any use of this technology may make a marginal increase in gold extracted from SOME deposits, but will also increase mining costs, so overall would be expected to be gold price neutral, at best.

      As regards seismic expansion of gold production from Russia see this link.

      http://www.mineweb.com/news/gold/russia-gold-output-seen-rising-by-3-in-2015/

      3% is not a seismic increase in my world.

      Would be happy to be corrected by candideschmyles but I do not see any validity to the reasoning to back up the assertion of these factors being a catalyst to reduce the price of gold.

      I await facts to prove otherwise.

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