At the top of China’s government, a plan for getting gold

Shenzhen ­— China National Gold Group Corporation attended 2011 Shenzhen International Jewellery Fair from Sept 14 to 18… Sun Zhaoxue (right), president of China Gold Association, director of National Technical Committee 379 on Gold of Standardization Administration of China, president and secretary of the Party Committee of China National Gold Group Corporation

Via  GATA , 10:50p ET Thursday, August 9, 2012

Dear Friend of GATA and Gold:

China’s interest in obtaining gold, as planned at the highest levels of the government, is recounted in a couple of postings at Centennial Precious Metals’ USAGold Internet site here:

http://www.usagold.com/cpmforum/2012/08/08/chinas-strategy-on-gold/

http://www.usagold.com/cpmforum/2012/08/08/chinas-golden-people/

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

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From USAGold.com:

China’s “golden people”

Pete, the author of that article is not only a member of China’s Central Committee, he is the general manager of the China National Gold Group Corporation, China’s largest gold producer and the driving force behind its state controlled mining and refinery operations. In other words, this individual is in a position to articulate China’s attitudes and policy toward gold, and that is what he does in this article. The translation is rough in parts but the meaning comes through loud and clear.

He makes several important revelations in the article, and perhaps when I have more time I will review them in more detail. Most striking though are the differences between the way Chinese authorities view gold as opposed to the view of most Western policy-makers. For example, he refers to gold as “the cornerstone of global strategic resources.” As such, he says, China needs to accumulate it as a national reserve — as part of national strategic policy. He points out that the U.S. gold reserve represents 70% of total currency reserves while China’s gold represents only 1.6%. For years, we have heard that China is converting its domestic production to reserves, but that speculation has been no more than an educated guess. The author confirms it as China’s strategy — to my knowledge the first time the strategy has been publicly confirmed by a Chinese authority. He talks about gold in national terms — about the making of China into a “gold power.”

He also expands upon and confirms China’s strategy to encourage private ownership of the metal by Chinese citizens. As such, China joins Japan as a country that tacitly encourages gold ownership for its citizenry. He refers to gold accumulators as “golden people” and talks about guiding “people to a rational investment, a reasonable consumer.” He mentions China Gold stores that “strengthen the brand promotion measures effectively to achieve the gold in China, possession of wealth to the people, the Gold strategic goal.” “Practice,” he says, “has proved that private gold reserves is an effective complement to national reserves, is very important for maintaining the country’s financial security.” Can you imagine an American or European economic policy-maker telling the citizenry to purchase gold as a “favorable opportunity” and characterizing private gold ownership as essential to “the country’s financial security?”

Here is the link to the Qiu Shi article.

READ MORE

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From Google Translate:

Build a strong China’s economic and financial security barrier

- Actively build and implementation of the national gold strategy

Date: 2012 08 09:00
Source: “Seeking Truth” issue: 2012/15 Author: Sun Zhaoxue

Gold because of its inherent value, both the national credit money and the cornerstone of global strategic resources. Looking at the world economic powers, without exception, to develop and implement a golden strategy at the national level. Our country is the world’s second largest economy in a relatively short period of time to quickly enhance the core competitiveness, an important aspect of science to build a gold exploration, production, trade, consumption, investment and integration policy system, to strengthen national strategy for this control of resources, thus effectively in the globalization process and safeguarding national economic and financial security, enhance their ability to withstand external shocks.

One from a strategic perspective to understanding the status and role of the gold reserves

The last century, after the disintegration of the Bretton Woods system in the 1970s, the implementation of the collapse of the hundreds of years the gold standard, gold dollar hegemony under the influence of the stabilizing effect of the economic and financial widely questioned by the people, “Golden useless in the global spread. Many people think that gold is no longer the monetary base to store gold reserves will increase cost. As a result, some central banks to sell gold reserves, gold remains in the doldrums. By this point of view the impact of the world’s largest gold producer, began the trend of slow growth in gold reserves.

In fact, since the discovery of gold, it is because of its good stability and the scarcity of people exchange labor measure of value and an important means of wealth reserves. With the deepening of global economic integration as an important international reserve asset, gold in the stable socio-economic, to protect against inflation, the national credit, stabilize the exchange rate, but also have the special status of other financial assets can not be replaced. In particular, the international financial crisis since the gold hedge against inflation function is to highlight the growing, the strategic position of the reserves of their wealth to regain the world’s attention, central banks began to net purchases of gold. Currently, there are more and more people recognize the “golden useless contains too many lies, in fact, have 74% of the world official gold reserves, the United States, to suppress the other currencies in order to maintain dollar hegemony design a “smoke.” Tracing the source of the dollar and the pound sterling and the euro has been able to by a single country currency rose to world or regional currency, because of the huge gold reserves of these countries do support.

Of particular note is the process of the international financial crisis, the United States a huge budget deficit, but it is not the use of gold reserves to reduce debt, but running the printing presses, a huge amount to increase the supply of dollars to the depreciation of those who U.S. dollar as the main reserve currency countries and regions wealth is shrinking fast, so as to achieve the purpose of automatic debt reduction. Sharp contrast with the U.S. dollar depreciated, the international price of gold continued to rise in 2011 exceeded 1900 U.S. dollars / ounce of gold assets should be preserved function and hedge the risk of depreciation of credit assets was. Naturally, the more devalued, the price of gold rose more, America’s huge gold reserves, hedging is more obvious. Despite the international financial crisis hotbeds in the United States, but the crisis has not shake the dollar’s status as an international currency, the net wealth of the United States and not with the depreciation of the dollar to the same degree of decline, an important reason for this is 8133 tons of gold reserves in the United States play a role. In the face of the global financial crisis, the world political and economic game, we again clearly see the gold reserves as financial stability, national economic security “anchor” the special and important role.

After 30 years of reform and development, China has become a highly open country, with hot and cold, not only with the world economy and play an increasingly important role on the world economic pattern changes. Therefore, in order to win the international financial crisis period brought new changes and new challenges, in particular, to effectively promote the process of internationalization of the RMB, China Apart from the huge economies of scale support, should also be the gold reserves as an important parameter that can not be ignored efforts to achieve a reasonable ratio of gold reserves and the total economy. This requires us to forward-looking judged the size of the gold reserves as soon as possible to build and implement the appropriate national gold with the scale of China’s economic development strategy.

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2012-08-10 02:22:14

Source: http://silveristhenew.com/2012/08/10/at-the-top-of-chinas-government-a-plan-for-getting-gold/