TANGIBLE INVESTMENTS - Los Angeles - by James O'Dell - Gold and Silver prices rebounded on Friday with Gold climbing 1.13 percent to $1,307.80 an ounce at the time of this writing, and Silver rising 1.71 percent to $20.75 an ounce on bargain hunting and short covering, even as the dollar advanced against a basket of major currencies after better than expected gains in U.S. durable goods orders in June.
Buying picked up in the physical market when prices dipped below the $1,300 level, this is when the Asian market typically steps in to pick up bargains. In fact, some say China is using the Shanghai Exchange to sell futures forward along with the U.S. to keep the Gold price depressed while quietly siphoning off all of this nation's physical Gold.
Earlier this year noted investor, Richard Russell, publisher of the Dow Theory Letters, described Gold’s migration from West to East as follows: “While US citizens are spending their money on TV sets, washing machines, and new cars, the people of China are being encouraged by their government to load up on Gold as fast as they can. China is now the world’s biggest producer and greatest hoarder of Gold," said Russell.
That could explain the uptick in China’s demand for Gold jewelry in the first half of 2014 which climbed to 426.2 tons, while demand for Gold bars eased a bit to 105.6 tons from a year earlier. Industrial bullion rose 11 percent to 26.8 tons, while demand for Gold coins dipped to nearly 11 tons. But don't lose too much sleep over Gold demand falling in China the World Gold Council (WGC) reported in April that long-term, China’s consumption is expected to jump to at least 1,350 tons by 2017 as Asian wealth increases.
"Chinese leaders are well versed in history. They know that the nation that holds the greatest amount of Gold and the nation with the most powerful military is the nation that historically has owned the world’s reserve currency," says Russell. At the end of the day, when America realizes its need for physical Gold...and that time is not far off...it will all be gone and in China, the emerging wealth of the 21st century... and it won't be coming back... so WAKE UP!
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