Canada selling off there Gold , whats happened ?

[H-2 CHARLIE]

Official International Reserves - March 3, 2016

 

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[Alex Burke]

Iraq buys it with oil profits. Their oil wells are some of the lowest cost to operate in the world...pump for $7, sell for $30...wow!

True but how do they keep the gold safe with Isis hanging out down the street If failed states can buy lots of gold and nobody can trace the gold later it seems like a recipe for disaster. Maybe silver should be the starter back up metal to currency after total anarchy

 

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[Clay Diggins]

India always imports more gold than any other country - not the government of India but the people, they buy it as savings, nobody uses banks there and gold in hand is the traditional savings currency. India offically imports about 900+ metric tons of gold every year. The actual amount is probably considerably higher since a lot of gold is smuggled into India to avoid the sometimes very high taxes.

These days China comes in a close second and although people in China buy a lot of gold the Chinese government buys most of it. China mines more gold than any other country and the Chinese treasury has been making a big effort to convert their 1.4 trillion dollars in U.S. IOUs into something of value. Even with China buying up most of the Copper, gas and Iron production worldwide they still have a lot of money losing treasuries left over to unload. About 600+metric tons of gold a year are imported into China but they are also mining about the same amount. Total Chinese consumption amounts to more than 1,200 metric tons a year.

Iran made deals to sell oil during the embargo with the price calculated in gold. That's not an unusual way to go in the international oil industry. Iran is a very modern and wealthy country and has been one of the financial centers of the world since the 1950's. Since the embargo was lifted they just got a boatload of money released from their foreign accounts and gold is a traditional currency there so expect that 47 tons to go a lot higher in the near future. Iran is the new world hot spot for business and the big international companies are lined up around the block to invest there. They all have gold, Yen and Euros in hand because Iran will not accept payment in dollars.

Iran's 47 tons is puny compared to the trading in London of a reported average of about 18 million ounces a day. London is just one of the major gold trading centers in the world but it gives you an idea of just how active trade in gold is these days.

Russia began a public policy of selling their U.S. treasuries reserves and converting to gold about two years ago. Their central bank has been buying about 55 metric tons a year and it looks like they are going to exceed that this year. Not huge in comparison to other countries but part of a growing trend of getting out of U.S. treasuries and into something more profitable and stable.

There are big differences between the figures of gold mined, gold bought for central bank reserves and gold bought for savings or jewelry by the people of each country. Most countries lie about their gold reserves whether they inflate them, like the US, or deflate them, like China. Gold is not something you brag about holding if you want to keep it. On an international basis it's used as a financial weapon by large companies and governments. On a personal basis only a fool announces publicly how much gold they have in their possession. As a result it's really hard to pin down the actual tonnage being moved around. Take every claim about gold buying with a grain (or a pound) of salt.

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[Clay Diggins]

To give some perspective to the numbers we are using to describe big gold here are some figures.

A metric ton of gold is a cube about 15 inches square.

A metric ton of gold is about 32,150 ounces.

The 18 million ounces a day trading in London amount to about 550 metric tons.

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[russau]

A metric ton of gold is a cube about 15 inches square.

Barry that would make a nice coffee table and one heck of a conversation piece if my floor could hold it!

 

[Alex Burke]

Thanks for the perspective Clay. Just to clarify I was talking about Iraq buying the 47 tons in early 2014 not Iran. Gold being bought or sold by Iran seems less concerning in my opinion as the country is more stable than Iraq.

 

[KevinInColorado]

Many smaller countries who own gold store it somewhere safe and central to the financial markets like Singapore, New York or Hong Kong. I wonder where Iraq, Iran, China and Russia store theirs? Bet it's not in those locations!