AUTOREFRESH 
PBOC adviser calls on the US to sell some of its Gold reserves
By Sean Lee || November 25, 2010 at 22:05 GMT
|| 32 comments || Add comment
Very interesting Bloomberg article, and thanks to Pablo for the link. This much quoted PBOC adviser is telling the US what to do; stop printing money and start selling Gold. In other words, the US should give China some of its Gold in return for retiring some debt or instead of issuing new debt.
One person I just spoke with thought this was bearish for Gold but I think it’s the most bullish thing I’ve ever heard. China wants Gold, not paper. The US is not going to sell its Gold but will keep printing paper. Therefore China is going to have to use more of its vast amounts of ever-devaluing paper to buy Gold.
hi please tell me.. not able to trade gold its disable for 1 hr whts the reason behind it
I agree with you Sean. What was his reasoning for this being a bearish sign for gold? China wants real assets.
Jim Rogers just might be right about gold hitting 2,000 haha.
Hi Nverstop, I think his initial reaction was that if the US starts selling Gold then the price must go down.
And what about the guy on CNBC a few years ago who laid out all his reasons and then added the punchline; Gold must go to $25,000/oz
Lol Rogers target does sound a bit more convincing
.
He seems to have pretty good long term calls. Although Soros and himself have noted his poor qualities as a “trader” haha.
I found his Hot Commodities book interesting just for the thought process he goes through. Books like that and Inside the House of Money are few and far between for us guys looking into trading methods besides technical analysis
.
I guess that trader’s reaction reinforces the reasons why we have markets
. His reaction was totally opposite of mine because my initial reaction is to laugh just thinking about the US actually selling some of its gold.
Why sell gold when people still accept paper
.
If you’re going to make a big call, then make it a really big call; I think that was the justification behind the 25k call
How long until we start seeing silver and rare metals (hasn’t China just resumed exporting them to Japan this week?) go the same way?
unless you can buy your burger with Gold… all is now pointing for big sell off in gold…
eurusd – another 300 pips possible downmove till Dec 7.
Ever depreciating paper? China has HUGE capital gains on its US bond holdings with rates not too far from record lows. Dollar is above its 5-year average against the euro...In gold-terms, they are in bad shape, but they would have gotten screwed in tulip bulb -terms back in the day as well…
Your turkey’s going cold Jamie
The dollar is dead, long live the dollar!!
Countries like China and India, in fact Asia in general, place more value on Gold than is the case in Western developed economies. They don’t have a lot of faith in Fiat paper and if they start measuring their wealth more in terms of precious metals and commoditiies than in paper terms then the paper is devaluing quickly.
Three ways that may help the U.S. achieve that target include reducing military expenses, selling part of its gold reserves and relaxing some export limits on technology, he said.
“He didn’t mention whether China would be willing to purchase any gold from the U.S.”
Come on China stop trying to iceskate uphill with the tech stuff :0
The question remains how much Gold does the US really have?
Im thinking not very much.
Cor are you two gonna carry on your ‘lively discussion’ now.
Shall I get me knitting?
Supposedly around 8,965.65 tons according to CNBC.
The Bloomberg article quotes over 8k.
http://www.cnbc.com/id/33242464/The_World_s_Biggest_Gold_Reserves?slide=15
We could start talking cricket Lilac?
What on earth does Jamie know about cricket?
Probably as much as I know
I was gonna say you could have him stumped there.
But I thought better of it.
Thanks for restraining yourself Lilac
It was a one-off
We ought to start investing in turkey futures…
Good morning, Sean. Mr. Xia is a well-known, fiscal hawk who is allowed to use his position (director of a Cabinet-level, Chinese think tank) to float lead balloons that look golden to the unamused: http://www.telegraph.co.uk/finance/markets/2813630/China-threatens-nuclear-option-of-dollar-sales.html
Despite what CNBC “suggest”, there has been no USA GOLD audit for a very long time. 50+ Years.
Many are becoming suspicious.
“In God we trust” – perhaps but not a US Official
Thanks Solange for the insider rub. We see and hear these ‘advisers’ speaking and for all we know they could be the Chinese equivalent of Sarah Palin.
Careful Sean, she might just go on the tv and ‘refudiate’ your statement
Yeah, and “propulgate” hockey absurdities…
Agree with the long term bullish sentiment, at current levels wouldn’t make much of a dent in US deficit but at $25k oz sure would
But kind of interesting that with the US having such a large gold holding a rising gold price actually improves the US position relative to China and indeed the rest of the world.
So I think that the US is not against a rising gold price ( although it will never say so ), providing of course it does not get out of control and enter a manic phase. Of course China realise this, would like more themselves and are acquiring it as fast and as cheaply as they can. However, rather than working to crash the gold market I think their energies are now much distracted with keeping other commodiity prices down to avoid potential internal strife. After all isn’t this useless lump of metal doing world consumers a favour in absorbing funds which would most probably flow into other commodities if it didn’t exist.
So I take the point that it feels like gold has had a good run, but I think for these reasons there is more of the bull run to go ( whilst accepting that there will be pullbacks ).
Cheers Sean,
I see it as well as very bullish sign. It also shows renewed PBOC nervousness sitting on the pile of US debt which is never good sign when they go public with it.
Just to add to heated debate!
Fair enough Lasty but sounds like a conspiracy theory and I don’t think those can help anyone trade.
Yeah….just maybe, as soon as gold hits $5000 then U.S. may
sell China 177000 oz of its gold. U.S. has about 8966 tons of it.
Many think U.S. is stupid….tut-tut.
ciao
China’s a bit cheeky. Yes they accumulate dollars via the trade deficit. However, they *also* accumulate dollars by printing oodles of their own currency and selling it for dollars; part of their mercantile devaluing policy.
However, China gets “double bubble”, not only does it acquire those dollars simply by printing its own currency, and devaluing it. China *also* expects to then earn a return on said dollars for “lending” to the USA?
So the US must now “work” to pay interest on the loans that China sourced by devaluing its own currency, thereby making it in fact harder for US to “work” to pay those “loans”!
USD/YEN selling opportunity 8390/400 to 8150