| Bullion, Bureaucrats, and Bitcoin! |
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If you're paying attention to the gold market you've heard about the insatiable demand for physical gold from China, and that this demand alone in 2013 is nearly equivalent to world-wide mine supply. So how does a global appetite for gold that far exceeds mine supply manifest into a 19% price drop (thus far in 2013)? Fortunately, we have access to the smartest guys in the room to help decipher the truth and make sense of this black-is-white 'market'. These gold market patriots have helped us understand how Western Central Banks have been 'leasing' their gold reserves for many years, and more recently how the various gold ETF's have been raided as a means to satisfy physical demand. They've also helped us realize that a quid pro quo must surely exist between the western bankers and their Government debtors, and the Chinese powers holding their treasuries and bonds; cheap gold flows eastward to insure that the debt of the western nations doesn't flow back. This game of roulette will continue until the Western vaults are tapped completely, an event that now appears to be close at hand, and that will send gold (and silver) prices much, much higher. My advice is to get in front of this event before the western bureaucrats relay to their constituents a mandate similar to that of the Indian Government today, to wit: "Import of gold coins and gold medallions is prohibited. Nobody can import gold coins and medallions." I'm here to help when you're ready. Cheers!
Screen-traded 'Fiat Gold' Could Get Violent Wake-up Call
In the initial Reuters report on the London-Zurich-Hong Kong-Shanghai gold pipeline, Macquarie gold analyst Matthew Turner suggested that the 1016 metric tonne United Kingdom export (up from 85 tonnes the previous year) might have been shipped to Switzerland for refining into "smaller bars more attractive to Asian consumers or to be vaulted there instead." If, as the smaller bar sizes suggest, the UK-Swiss aspect of the pipeline functions as a bar resizing operation, then we may have a long way to go before China's official sector (central bank) needs are satisfied simply because so much of it is going directly to Chinese consumers. It also implies that the demand we have already seen, as large as it is, could be just the tip of the iceberg.
China's Gold Reserves At Least 2.5 Times Higher Than Reported
A deeper look into China's gold holdings warrants attention (see charts). Its last reported gold holdings in April 2009 were 1,054 metric tons. After adjusting for net imports from Hong Kong and domestic output, the figure is closer to 5,086 metric tons. If one were to take away gold uses for jewelry, industrial, and other categories and only add implied bar demand to central bank holdings, the figure is likely closer to 2,710 metric tons according to Bloomberg Industries' Andrew Cosgrove and Kenneth Hoffman.
TF Metals: More Deception at The Comex
We (recently) noted an unusually large addition to the JP Morgan eligible vault. The sheer size of it caught my eye and you can see it on the report below. While HSBC and Scotia posted the usual moves in thousandths of an ounce, the JPM eligible addition is a flat, round number. Not only that, the round number in question is 192,900.000 troy ounces. What is so significant about that number?
Sprott: An Open Letter to the World Gold Council
The supply-demand imbalance is obvious to all. In reality, without the massive outflows from ETFs (half of world mine supply), it is hard to imagine how this demand would have been met. Since ETFs have a finite size (about 1,900 tonnes left), these outflows cannot continue for much longer. All these observations point to a considerable imbalance between supply and demand (unless Western Central Banks decide to fill this void with what is left of their reserves). If recycling was reduced by one half (China, India and Russia) and the temporary sales from ETFs were excluded, demand could be as high as 5,185 tonnes versus supply of 2,140 tonnes.
Happy To Help ..
Now is NOT the time to be complacent. Those that have been right about this market (Sprott, Sinclair, Turk) believe that these recent paper price attacks were a signal that the coming financial hurricane is closer than ever, and that physical silver an gold ownership is an absolute necessity. We currently have a healthy supply of gold and silver products, in all shapes and sizes. Please contact me for the very best pricing and discreet, informed service.
Bullion Bulls: U.S. Hyperinflation and Cultural Insanity
Hyperinflation is an insidious, economic killer. It inevitably (but insanely) creeps up on its victims in plain sight, before decimating them with an always unexpected ambush. How can one of the most-obvious of all economic phenomena always end up as a "surprise"? Look at a chart showing a 98% decline in anything, and the expectation will be that the last 2% is also about to be lost. Or, in market vernacular; "the Trend is your friend." It is irrational, bordering on insane to expect such a chart to reverse itself, or even stabilize.
Bitcoin Climbs to Highest Price Since April, Led By China
The Chinese government has recently been more vocal in its ongoing campaign to see the dollar removed from global reserve status. While such calls for an international reserve note are generally assumed to refer to Special Drawing Rights issued by the IMF, it may have bolstered enthusiasm for bitcoin's apolitical nature. Also out of China was news that Baidu, the world's fifth largest website, is now accepting bitcoin for certain services.
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Sovereign Exchange International Ltd.
Steven Merrill, President
www.sovereignize.net
phone:
778.835.7667
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Engage a Rich New Audience; Reconcile to your Private Account; Settle for Metal at Any Time. The Sovereign Exchange was founded by Steven Merrill and a small network of individuals from across British Columbia with a vision to embrace Austrian economic principles and provide a sound and stable payment facility than be trusted for commerce and used to store wealth.
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