China Gold Demand May Double Within Decade March 29 (Bloomberg) -- Gold consumption

Discussion in 'Economy' started by Neubarth, Mar 30, 2010.

  1. Neubarth
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    Neubarth At the Ballpark July 30th

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    China Gold Demand May Double Within Decade
    March 29 (Bloomberg) -- Gold consumption in China may double within the next 10 years, boosting prices as supplies fail to keep pace with booming demand from investors and the jewelry industry, the World Gold Council said.

    “China has an insatiable appetite for gold, which looks likely to continue in an environment where domestic mine supply lags behind demand,” the council said in a report today.

    China’s economy grew 10.7 percent in the fourth quarter from a year earlier, the fastest pace in two years, after a 4 trillion yuan ($586 billion) stimulus package spurred record lending and consumption. The world’s biggest gold producer has increased reserves by 76 percent to 1,054 metric tons since 2003 and has the fifth-biggest holdings by country, Hu Xiaolian, deputy governor of the People’s Bank of China, said in April.

    “An uptick in China purchases could bring an impetus back to the gold market,” said Hwang Il Doo, Seoul-based senior trader with KEB Futures Co, by phone today. “Given China’s currency reserves and rising wealth, the impact from their buying on prices will be powerful, although it may take time.”

    Bullion prices have gained 21 percent in the past year as the global recession spurred demand for haven assets and the dollar weakened 5 percent against six major currencies. Gold for immediate delivery was little changed at $1,106.80 an ounce at 1:50 p.m. in Singapore.

    “On the investment side, we see exponential growth,” Albert Cheng, the council’s managing director for the Far East, said in an interview in Beijing.

    http://www.marketwatch.com/story/china-gold-demand-to-double-in-10-yrs-trade-group-2010-03-29

    http://www.businessweek.com/news/20...y-double-within-decade-wgc-says-update2-.html
     
    Last edited: Mar 30, 2010
  2. Neubarth
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    Gold is a commodity. So is sugar, corn, wheat, soybeans, silver, iron oar and stuff like that. For those nincompoops who think we should base our currency on a commodity and thus limit our ability to build massive projects like the highway system (That Eisenhower called for way back when he was President post world war), then the best commodity that we could base it upon would be corn. We produce a lot of it. We do not produce as much gold and since gold is scarce, it would be practical to use corn. Since very few countries intend to honor the international agreements on preventing global warming, another commodity that might serve us well would be coal. Asia would love to buy our coal. Of course, we could always base our currency on Fresh Water. We've got a lot of it in the Great Lakes. Canada might disagree with us on that, but they would only be greedy as they have all that snow and ice and permafrost further up north. In that regard they are very rich.
     

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