Forex Trade Room Michael Storm Northport

Bal des Conscrits de Besse Auf dem Vous propose de venir vous dtendre avec nous le temps dune soire, que se soit pour faire une pause anhänger vos rvisions, de souffler aprs les prüft, ou tous einfachheit de passer (encore) une bonne soire avec nous. ) An se retrouve donc le 30 MAI la SALLE POLYVALENTE de BESSE Sie haben keine Artikel im Warenkorb. Produkte vergleichen Es ist kein Artikel zum Vergleichen vorhanden. Mein Warenkorb Sie haben keine Artikel im Warenkorb. Produkte vergleichen Es ist kein Artikel zum Vergleichen vorhanden Donc en GRANDE, trs GRANDE FORME. Lesen Sie mehr 81 haben diese Veranstaltung als Lesezeichen markiert. Ihre Reise beginnt jetzt. Recover password. Category Archives: Ausgewählte Beiträge Physical Gold befindet sich in Hong Kong und London wird verwendet, um COMEX Gold-Futures-Kontrakte durch Exchange für physischen Handel im Freiverkehr Markt zu begleichen. Dieser Beitrag ist eine Fortsetzung von Understanding GOFO und der Gold-Großhandelsmarkt und COMEX Gold-Futures können direkt mit förderfähigen Inventar 8211, in denen Exchange für physikalische (EFP) Handel erklärt wird und wie es offene Interesse an der COMEX erhöhen oder verringern können, abgerechnet werden. Wenn Sie zu diesem Thema neu sind, empfiehlt es sich, meine vorherigen Beiträge zuerst zu lesen. Die meisten Gold-Analysten vermuten, COMEX 100-Unzen-Gold-Futures-Kontrakte (GC) können nur physisch entschieden werden, indem sie nehmen und liefern. Dies ist technisch zutreffend, wenn die Möglichkeit des EFP-Handels in GC durch den Freiverkehrsmarkt ausgeschlossen wird. Während der Börsenhandel im GC offen und wettbewerbsorientiert ausgeführt wird, ist der Handel mit GC im OTC-Bereich (und damit der Goldpreis, seine Form und Lage) ein privat ausgehandeltes Geschäft zwischen Käufer und Verkäufer. Die COMEX ist eine Tochtergesellschaft der CME Group, die ihren Kunden OTC-Handel auf einer Plattform namens ClearPort anbietet. Denn die COMEX in New York ist die liquideste Gold-Terminbörse weltweit 8211, die Edelmetall-Futures anbietet, die auf die am meisten verwendete Währung des US-Dollars lauten. Die Goldindustrie nutzt GC aus einer Vielzahl von Gründen, darunter auch Hedging-Metall außerhalb der vertraglich vereinbarten Geographie . Anschließend können die Verträge über EFP irgendwo um jeden Preis physisch abgerechnet werden. In EFP unterzeichnen zwei Parteien einen Futures-Kontrakt (kurz und lang) und führen gleichzeitig eine Reverse-Spot-Transaktion (Kauf und Verkauf) durch. Eine Seite verkauft kurz den Futures-Kontrakt und kauft Spot-Gold (die Spot-Bein wird als die verwandte Position von CME bezeichnet), während die anderen kauft die Futures-Kontrakt und verkauft die entsprechende Position. EFP-Handel kann die offenen Zinsen erhöhen, die offenen Zinsen verringern oder sie nicht ändern, abhängig von den bestehenden Positionen, die von beiden Parteien gehalten werden, bevor sie eine EFP-Transaktion eingehen. Wenn EFP das offene Interesse verringert, ist die Phrase Settle-Position anwendbar. Eine andere Art zu sagen, es würde Positionen kompensieren oder Netting Positionen. Lassen Sie uns einen Blick auf ein reales Lebenbeispiel haben. Das nächste Bild wurde mir von data wrangler und dem Goldspezialisten Nick Laird (Website Goldchartsrus) zugeschickt. Seine aus dem Buch The Prospect for Gold: Die Aussicht auf das Jahr 2000 von Timothy Green. Im Auszug beschreibt der Autor, wie die Russen in den 80er Jahren ihr Gold in der Schweiz verkauften. Dieses Beispiel stimmt mit meinem vorherigen über EFP überein (Hedging-Metall außerhalb der vertraglich vereinbarten Geographie). Jede Goldbarrenbank, Bergmann oder Raffinerie kann kurz auf COMEX verkaufen und wenn das Gold physisch abgerechnet werden muss, zum Beispiel in der Schweiz, kann die Short-Position durch EFP abgewickelt werden. Die einzige Voraussetzung ist, dass die Menge der zugehörigen Positionskomponente ungefähr gleich der Menge der Austauschkomponente 8211 sein muss, was bedeutet, dass das Punktbein mehr oder weniger 100 Unzen Gold sein muss, was der zugrundeliegende Bestandteil der GC ist. In diesem Beispiel verbindet der GC-Kurzhalter über CME ClearPort mit Exchange For Physical. In der EFP-Transaktion wird er einen Futures-Kontrakt kaufen und gleichzeitig Spot verkaufen. Seine langen und kurzen werden dann ausgerechnet, während er vor Ort die physischen in der Schweiz verkauft. Tatsächlich wurde ein COMEX-Short physisch außerhalb der vertraglich zu liefernden Geographie abgewickelt. Natürlich kann auch in der Schweiz eine Long-Position abgewickelt werden, die dann die andere Seite des Handels ist. EFP bewegt Kilobaren durch CMEs Hongkong-Gewölbe Im März 2015 hat CME in Hongkong einen Gold-Kilo-Futures-Kontrakt (GCK) eingeführt, der in Hongkong physisch verfügbar ist. Von Anfang an war das GCK-Handelsvolumen nahe beieinander und es kam selten zu Lieferungen. Trotzdem gibt es massive Mengen von Kilobar-Gold, das durch das CME-zugelassene Lager in Hongkong im Besitz der Brink8217s, Inc. fließt. Durchschnittlich 3,9 Tonnen pro Tag werden aus diesem Gewölbe zurückgezogen, aber manchmal ist der tägliche Abzug so hoch wie 20 Tonnen. Da Volumen und Lieferung für GCK auf Exchange so niedrig sind, müssen die Rücknahmen durch OTC-Geschäfte erklärt werden. Ein CME-Vertreter actaully bestätigt mir, dass die physische Bewegung durch die Hong Kong Gewölbe durch EFP-Transaktionen verursacht wird. Aber wenn wir die GCK-Volume-Seite betrachten, können wir keine EFP-Trades beobachten, die offengelegt werden. Im Gegensatz dazu ist das EFP-Volumen von GC erheblich. Kann es Gold-Kilobaren in CMEs zugelassenen Lagern in Hong Kong werden verwendet, um die 100-Unzen-Futures-Kontrakte zu begleichen Ja. Meine Theorie ist, dass die von den Goldbarren-Banken im Westen, zum Beispiel in Schweizer Raffinerien, gekauften Kilobars auf der COMEX abgesichert sind, und sobald das Gold Hongkong ankommt, werden die Shorts durch EFP abgewickelt. Von dort wird das Gold durch gepanzerten LKW zu Shanghai Gold Exchange benannten Lagern in Shenzhen von Brinks, die eine grenzüberschreitende Logistik-Lizenz von der chinesischen Regierung hat transportiert. Unterstützt meine Theorie, siehe Exponat 3 unten. Beachten Sie die starke Korrelation zwischen dem Import von 8220 Gramm in Hongkong gegenüber den in den CMEs vaults8221 und 8220re-exportierten Kilobaren aus Hongkong gegenüber den aus CMEs vaults8221 zurückgezogenen Kilobaren. Die Korrelation weist darauf hin, dass die meisten Goldbewegungen durch Hongkong, das für China geleitet wird, in Kilobar-Form und bewegt sich durch CME8217s Gewölbe. Und weil der Großteil dieses Durchsatzes EFP-bezogen ist, nehme ich an, dass die Kilobars verwendet werden, um COMEX-Futures zu begleichen. It8217s schwer zu testen, wenn meine Theorie korrekt ist, weil EFP-Transaktionen im OTC-Realm ausgeführt werden und wenig Informationen verfügbar sind. Möglicherweise ist al Durchsatz in Hongkong EFP-bezogen, aber doesn8217t Auswirkungen der GS offenen Interesse. Wenn jemand eine andere Theorie hat bitte Kommentar unten. London Gold Offsets COMEX Futures Weve gegründet Gold in der Schweiz und Hong Kong wird verwendet, um 8220settle8221 Gold-Futures. Aber es gibt auch Proof Gold in London wird verwendet, um Positionen aus der Phase der COMEX. Bei der Erforschung dieses Themas griff ich zu William Purpura, der unter anderem Vorsitzender bei Northport Commodities ist. Mitglied des Komitees der COMEX-Gouverneure. Und zuvor auf der COMEX-Etage von 1982 bis 2007 gehandelt. Ich fragte Purpura für ein Beispiel, wie EFPs verwendet werden. Er antwortete Klammern von mir hinzugefügt: Der Großteil davon EFP ist von Bullion Banken getan. It8217s hauptsächlich für das Netting heraus. Lot8217s von Zeiten London gegen New York. Sie sehen Lose EFPs, die um 8am in New York auf COMEX gepostet werden. Dort ist es, London versus New York, und, netting out. Aus diesem Zitat lernen wir loco London Gold wird verwendet, um EFPs ausführen, um New York Futures Positionen zu waschen. Man kann argumentieren, die verwandte Position in London ist 8220unallocated8221 8211 I8217m nicht sicher. In der letzten Formulierung von CME zu EFP (Market Regulation Advisory Notice RA1311-5R) hieß es: Wenn die verwandte Positionskomponente 8230 eine physische Transaktion ist, sollte die Transaktion zum Clearing als EFP-Transaktionstyp eingereicht werden. Oft im Großhandel Goldmarkt Parlance physikalischen wird auch für 8220unallocated gold8221, die nicht gerade physikalische meiner Meinung nach verwendet. Im sicher gibt es viele mehr Methoden als I8217ve erwähnt, um EFP zu verwenden, oder jede andere privat ausgehandelte Transaktion (PNT) auf ClearPort, die das offene Interesse an der COMEX beeinflusst. Eine Sache ist sicher, konventionelle Lieferung ist nicht der einzige Weg, um Futures-Positionen zu beenden. Im Gold-Futures-Regelwerk wird dies ausdrücklich von der CME Group festgestellt. Der Auszug unten ist über die Beendigung einer Gold-Futures-Kontrakte Klammern von mir hinzugefügt. 113102.E. Beendigung des Handels Kein Handel in Gold-Futures, die im laufenden Monat geliefert werden, erfolgt nach dem dritten letzten Geschäftstag des Monats. Sämtliche nach dem letzten Handelstag noch offenen Verträge müssen entweder: (A) durch Lieferung beglichen werden, die an jedem Geschäftstag beginnt, der am ersten Werktag des Liefermonats oder am darauffolgenden Geschäftstag des Liefermonats beginnt, spätestens jedoch Als der letzte Geschäftstag des Liefermonats. (B) Liquidiert mittels eines bona fide Exchange für verwandte Position EFP 8230. Dies ist wichtig für unser Verständnis des globalen Papier - und physischen Goldmarktes. COMEX-Gold-Futures-Lieferstatistiken sind nicht alles da. Alles, was es über den chinesischen Goldmarkt und die wahre Größe der chinesischen privaten und offiziellen Goldnachfrage wissen. Fang hier an. Dieser Beitrag wird Sie durch alle relevanten Artikel, die auf BullionStar Blogs veröffentlicht wurden im Laufe der Jahre, die die Mechanismen der chinesischen (inländischen) Goldmarkt und echte chinesische Goldnachfrage erhellen führen. Wenn Sie neu in der chinesischen Gold-Markt sind oder wie Sie Ihr Gedächtnis erfrischen, bietet dieser Beitrag einen Blick darauf, wo Sie durch alle Segmente des chinesischen Goldmarktes Sie gerne studieren zu navigieren. Zum Beispiel chinesische Goldnachfrage Metriken, die Shanghai Gold Exchange (SGE) - System, chinesischen grenzüberschreitenden Goldhandel Regeln, die chinesische Gold-Leasing-Markt und offizielle Goldreserven von China Zentralbank die Peoples Bank of China (PBOC). Die BullionStar Blog Beiträge, die gemeinsam klären, alle Facetten des chinesischen Goldmarktes sind betitelt chinesischen Goldmarkt Essentials. Immer, wenn die Mechanik des chinesischen Goldmarktes alle chinesischen Goldmarkt-Grundlagen entwickelt, werden aktualisiert oder neue werden veröffentlicht werden, um eine umfassende Wissensbasis auf dem größten physischen Goldmarkt in der Welt jederzeit zu bleiben. Alle chinesischen Goldmarkt-Grundlagen sind vor kurzem umgeschrieben worden und der Posten auf PBOC Goldkäufen enthält viele sehr wichtige neue Einblicke. Aktuelle Daten wie die monatlichen chinesischen Gold-Import-Zahlen werden nicht in der chinesischen Gold-Markt-Essentials aktualisiert werden. Diese Daten werden jedoch in neuen Blog-Posts veröffentlicht, die auf meiner BullionStar Blogs-Homepage erscheinen. Begleitet von einem Link zu dieser Webseite komplett sein. Wenn es etwas unklar, wenn Sie zusätzliche Informationen haben oder wenn Sie einen Vorschlag zur Verbesserung der chinesischen Gold Market Essentials haben. Senden Sie mir bitte eine E-Mail an koos. jansenbullionstar. Verstehen des chinesischen Goldmarktes Schritt für Schritt Die einzigartige Struktur des chinesischen inländischen Goldmarktes, des SGE-Systems, und warum die Menge an physischem Gold, das aus den Gewölben der SGE (veröffentlicht auf einer wöchentlichen Basis) zurückgezogen werden kann, kann als Maß für verwendet werden Chinesische Großhandelsgoldnachfrage wird in Teil eins erklärt: Die Mechanik des chinesischen inländischen Goldmarktes. Es bietet auch ein grundlegendes Verständnis der kontrastierenden Metriken zur Messung der chinesischen Goldnachfrage und der Differenz zwischen den SGE-Abhebungen und der chinesischen Verbrauchergoldnachfrage, wie vom World Gold Council bekannt gegeben, der sich von 2007 bis 2015 auf mindestens 2.500 Tonnen gesammelt hat Grund, der World Gold Council und seine Mitgliedsorganisationen kontinuierlich präsentieren schwache Argumente, die den Unterschied erklären sollte. Der chinesische Goldmarkt Essentials entlarvt diese Argumente, wo nötig, wieder durch Fakten. Und zeigen echte chinesische Goldnachfrage. Detailliertere Regeln für den grenzüberschreitenden Goldhandel in und aus dem chinesischen inländischen Goldmarkt und den Freihandelszonen in China werden in Teil 2 diskutiert: Chinesische grenzüberschreitende Goldhandelsregeln. Wenn Sie die Mechanik des chinesischen inländischen Goldmarktes und der chinesischen grenzüberschreitenden Goldhandelsregeln vollständig verstehen, können Sie weiter lesen Workings Of The Shanghai International Gold Exchange über die internationale Tochterbörse der SGE gegründet, um die größte Goldhandelsnabe in Asien zu werden. Verwandt ist SGE Abhebungen in der Perspektive, die bespricht, wie Handelsaktivität auf der Shanghai-internationalen Goldaustausch (SGEI) unsere Ansicht über chinesische Großhandelsgoldnachfrage möglicherweise verschwimmen kann, wenn durch SGE-Abhebungen gemessen. Congratz An diesem Punkt haben Sie ein gründliches Verständnis des chinesischen Goldmarktes. Um mehr über den Unterschied zu studieren, setzen Sie bitte mit chinesischen Rohstofffinanzierungen fort, die hauptsächlich über den chinesischen Goldleasingmarkt erklärt werden. Die Post enthält auch viele Links zu zusätzlichen Beiträgen über den chinesischen Gold-Leasing-Markt, unter anderem ein Papier von der PBOC im Jahr 2011 exklusiv von BullionStar übersetzt geschrieben. Für eine detaillierte Studie über die Differenz, und damit echte chinesische Goldnachfrage, lesen Sie bitte, warum SGE Abhebungen gleich chinesischen Gold-Nachfrage und warum nicht (die Argument-Liste). Schließlich lesen Sie bitte PBOC Goldkäufe: Trennen von Tatsachen von der Spekulation für das Studieren der Menge des Goldes, das von der chinesischen Zentralbank in den letzten Jahren zusätzlich zu den privaten Reserven angesammelt wird. Am Ende des Posten finden Sie einen Überblick über die geschätzten Mengen von über dem Erdgold in China (privat geführte Gold und offizielle Bestände). Dieser Beitrag hat viele neue Beiträge in den letzten Monaten gesammelt, ein muss lesen Dieser Beitrag ist Teil der chinesischen Gold Market Essentials-Serie. Klicken Sie hier, um eine Übersicht aller chinesischen Goldmarkt-Grundlagen für ein umfassendes Verständnis des größten physischen Goldmarktes weltweit zu erhalten. Der Unterschied zwischen den SGE-Abhebungen und der chinesischen Verbrauchergoldnachfrage, wie sie vom World Gold Council veröffentlicht wurde, hat sich von 2007 bis 2014 auf 3.193 Tonnen gesenkt. Natürlich sind wir hier, um das beste Verständnis der chinesischen Goldnachfrage zu bekommen. Um zu erklären, wie der Unterschied verursacht wird, haben westliche Beratungsunternehmen mehrere Argumente in Publikationen und Vorträgen auf Konferenzen vorgelegt, obwohl keiner von ihnen den Unterschied in vollem Umfang erklären kann. Dieser Beitrag ist ein Überblick über all diese Argumente (ergänzt durch meine eigenen Argumente). Im folgenden untersuchen wir, inwieweit die Argumente den Unterschied bewirkt haben oder nicht. Anschließend diskutieren wir die Details aller Metriken, die angewendet werden können, um schließlich unsere besten Schätzungen der echten chinesischen Goldnachfrage 2007 8211 2014 in jeder Metrik berechnen zu können. Dies ist das Argument Liste so weit in chronologischer Reihenfolge: Industrie Nachfrage Lagerbewegung ändern runden Auslösung Leasing offiziellen Einkäufe Recycling-Gold Export der Shanghai International Gold Exchange Schmuggel 2014 der World Gold Council (WGC) kam mit zwei Sonderberichten über den chinesischen Goldmarkt Das sollte ein Licht auf den Unterschied leuchten (China8217s Goldmarkt: Fortschritt und Perspektiven bilden April 2015 und Understanding China8217s Goldmarkt von August 2014). Allerdings enthalten diese Berichte viele falsche Aussagen und die Segmente auf dem Unterschied scheitern kläglich, wie Ive in mehreren Beiträgen (ein zwei, drei, vier, fünf, sechs, sieben, acht). Überraschend, nachdem die Berichte veröffentlicht wurden, kamen westliche Beratungsunternehmen neue Argumente, die den Unterschied erklären sollten. Ich möchte Ihre Aufmerksamkeit auf diese Verschiebung der Argumente lenken, wenn die alten scheiterten, die Firmen unverschämt weiter und kamen mit neuen. Die Tatsache, dass diese Liste von Argumenten sich ständig ändert, bestätigt die Schwäche aller Argumente, die sie besitzt, und die offensichtliche Anerkennung der westlichen Beratungsunternehmen in Bezug auf den chinesischen Goldmarkt. Zunächst gehen durch alle Argumente zu untersuchen, welche diejenigen sinnvoll, am Ende der Post gut einige Anzahl knirscht. 1) INDUSTRIELLE ANFORDERUNG. Das erste Argument, das mir jemals vorgestellt wurde, war von der WGC. Im August 2013 fragte Ive den Rat, was ihre Erklärung für den Unterschied zwischen ihrer chinesischen Goldnachfrage und ihrer Nachfrage war, die in den CGA Gold Yearbooks (zusammen mit dem PBOC) offenbart wurde, was genau den SGE-Abhebungen entsprach. Sie antworteten mir per E-Mail: Die Daten, die wir in Gold Demand Trends veröffentlichen werden für uns von Thomson Reuters GFMS gesammelt. Unsere Daten stellen Schmuck und Bar Amp-Münze Nachfrage und keine industrielle Nachfrage oder Fertigung zu integrieren. Die in den PBoC-Zahlen enthalten ist. Wie ich sicher bin, werden Sie zu schätzen wissen, die Datenerhebung dieser Art beruht auf einer Reihe von proprietären Quellen und diese sind nicht unbedingt die gleichen für GFMS und PBOC. Es ist daher vielleicht nicht verwunderlich, dass sich die Bedarfsschätzungen etwas unterscheiden. Nicht sehr glaubwürdig die WGC identifiziert eine Lücke von 3.193 Tonnen Gold mit industrieller Nachfrage, aber, obwohl klein sein, ist die industrielle Nachfrage nicht in WGC chinesischen Goldnachfrage gefangen genommen, aus welchem ​​Grund auch immer, und damit teilweise erklärt den Unterschied aus einer metrischen Sicht. Der Grund, warum ich die SGE-Abhebungen zur chinesischen Goldnachfrage, wie von der WGC offenbart, und nicht von GFMS, Metals Focus oder CPM Group zu vergleichen, ist, weil die WGC weltweit die leicht (freie) zugängliche Datenquelle für Investoren ist. In der Regel Investoren und Nachrichtenagenturen weltweit konsultieren die WGC für Angebot und Nachfrage Statistiken, die diese die wichtigsten für ihre Genauigkeit zu testen machen. Warum die WGC die industrielle Nachfrage in ihren Daten beinhaltet, ist mir nicht zugänglich, aber für unsere eigene Untersuchung werden wir es einfach bemerken. Die industrielle Nachfrage ist ein legitimes Argument und ihr Volumen wird für unsere eigene Berechnung der echten chinesischen Goldnachfrage am Ende dieser Position berücksichtigt werden. 2) STOCK BEWEGUNG ÄNDERN. Als ich GFMS im August 2013 über die Nettoinvestition 8211 fragte, wie der Unterschied in den CGA Gold Jahrbüchern 8211 heißt, schrieben sie mir per Email: Wir haben mit unserem Data Specialist überprüft und bestätigt, dass wir eine andere Methode verwenden. Die gesamte chinesische Nachfrage von Thomson Reuters GFMS verwendet nur Schmuck, physische Barren Barscoins und alle industriellen Nachfrage. Jede Bestandsbewegungsänderung (die im Wesentlichen der Nettoinvestitionsposition 6 entspricht) wird nicht als zugrundeliegende Nachfrage einbezogen. So ist nach Ihrer Kategorie sechs Aktienbewegungen ändern Dies wäre Gold hinzugefügt, um die Bestände von Juweliere, Minze, Industrieunternehmen, etc. (dies ist ein paar hundert Tonnen pro Jahr) Das ist richtig auf der Grundlage der Auflösung von unserem Daten-Spezialisten zur Verfügung gestellt. Da SGE-Abhebungen die Großhandelsnachfrage einfangen, ist der Unterschied zum Teil das, was Schmuckfirmen, Raffinerien, Industrieunternehmen und die Minze bei der SGE gekauft haben, aber noch nicht im Einzelhandel verkauft wurden. Und so ist Lagerbewegungswechsel ein legitimes Argument, obwohl die Menge des Goldes auf Lager nie die volle Differenz von 3.354 Tonnen erklären kann. Laut einer Schätzung durch die WGC können bis zu 125 Tonnen Gold von 2009 bis 2013 auf dem chinesischen inländischen Goldmarkt als Inventar absorbiert worden sein: Es ist indikativ, dass bei der Erweiterung der Juweliere auch die Lagerbestände und damit auch der Lagerbestand angestiegen sind Ist unser Urteil, dass branchenübergreifend zwischen 75 t und 125 t seit 2009 in der Supply Chain absorbiert worden sein könnte. Da der Zeitraum, den wir in Bezug auf die Differenz untersuchen, von 2007 bis 2014 größer ist, verwenden wir eine Schätzung von 200 Tonnen für die Aktie Bewegungsänderung. Stock Bewegung Veränderung ist ein legitimes Argument und sein Volumen wird für unsere Berechnung der echten chinesischen Goldnachfrage am Ende dieser Stelle berücksichtigt werden. 3) RUNDE AUSFÜHRUNG. Im April 2014 veröffentlichte die WGC einen Bericht über China mit dem Titel Chinas Goldmarkt: Fortschritte und Perspektiven. Es war sicherlich nicht der erste WGC-Bericht über China, im Jahr 2010 China Gold Report veröffentlicht wurde, aber es war das erste Mal, dass der Rat über die Struktur des chinesischen Goldmarktes, die Shanghai Gold Exchange und die Versorgung Überschuss in der chinesischen Goldmarkt ausgearbeitet . Logischerweise hatte der Rat einige Erklärungen zu tun, denn es war klar, China importiert wesentlich mehr Gold als das, was sie als Nachfrage offenbart. Zum ersten Mal wurden die Commodity Financing Deals (CCFD) in die Councils wide reader base eingeführt. Diese Art der Finanzierung wird verfolgt, um günstige Mittel zu erwerben, es kann getan werden, durch runde Auslösung oder Gold-Leasing. Der Rat schrieb: Diese Operationen fallen in zwei große Kategorien, obwohl es einige Überschneidungen zwischen den beiden. Erstens gibt es die Verwendung von Gold über Darlehen und durch Akkreditive (LCs) als Form der Finanzierung. Zweitens gibt es die Verwendung von Gold für finanzielle Arbitrage-Operationen, die auch auf Gold-Darlehen oder LCs basieren wird. In den meisten Fällen ist das Gold schnell wieder nach Hong Kong exportiert, oft als sehr roh Schmuck oder Ornamente, um die engen Kontrollen auf Goldbarren Exporte zu erhalten. Darüber hinaus, weil fast alle Gold in China fließt durch die SGE, Rund-Auslösung können die SGE Lieferungen aufblasen.) In anderen Fällen ist das Metall in Gewölben in China gelagert oder Hongkong. Insbesondere ist der fettgedruckte Teil nicht wahr, wie wir in meinen bisherigen Beiträgen lesen konnten. Grundsätzlich sind runde auslösende Goldströme völlig vom chinesischen inländischen Goldmarkt und vom SGE System getrennt, deshalb können sie SGE Anlieferung oder Abhebungen nicht aufpumpen. Also, runden Auslösung ist kein legitimes Argument. Nach meinem Verständnis der WGC hat dieses Argument alle zusammen aufgegeben, obwohl GFMS immer noch rund um Auslöser Blöcke SGE Abhebungen denkt. In ihrer Goldumfrage 2015 schrieb sie (Seite 78): Die runden Auslöser strömen zwischen Hongkong und dem chinesischen Festland, das ebenfalls die SGE-Umsatz - und Rücknahmemengen erhöht. 4) GOLD LEASING. Die andere CCFD ist Leasing. Im WGC-Bericht vom April 2014 heißt es: Es liegen keine Statistiken über die ausstehende Goldmenge vor, die in Finanzoperationen im Zusammenhang mit dem Schattenbankgeschäft gefesselt ist, aber die Edelmetalleinsichten. Das PMI hält es für möglich, dass es bis Ende 2013 kumulativ sein könnte 1.000t PMI eingeleitet 1.000 Tonnen ist in CCFDs gebunden, aber als I8217ve deutlich gezeigt, in früheren Posten. das ist nicht wahr. Es gibt keine Notwendigkeit, über diese wieder 8211, wenn Sie bitte lesen Sie meine vorherigen Beiträge für eine detaillierte Analyse. 5) AMTLICHE KÄUFE. Oft ist sein Denken in der Gold-Raum SGE Abzüge in die Gewölbe aus der Peoples Bank of China (PBOC). Anfang des Jahres 2013 die WGC spekuliert, der Unterschied könnte durch offizielle Einkäufe erklärt werden, später in diesem Jahr der Rat seine Meinung geändert. Im Juli 2014 WGC Bericht über China, Understanding Chinas Goldmarkt, können wir lesen: Chinas Behörden haben eine Reihe von Optionen beim Kauf von Gold. Sie können etwas von dem Gold erwerben, das in China fließt, es gab keinen Mangel an dem. Aber es gibt Gründe, warum sie es vorziehen, Gold auf internationalen Märkten zu kaufen: Gold, das auf der SGE verkauft wird, wird in Yuan und Interessenten zum Beispiel vergeben, der PBoC mit großen Mehrwährungsreserven kann eher US-Dollar verwenden als den Kauf von Gold im Inland. Der internationale Markt hätte viel mehr Liquidität. In meinem Beitrag PBOC Gold kauft: Trennen von Fakten aus Spekulationen Ive analysiert, warum es doesn8217t Sinn machen für die PBOC, um Gold durch die SGE zu erwerben. Die Unternehmen werden zustimmen, die PBOC ist wahrscheinlich nicht zu kaufen Gold durch die SGE und damit offiziellen Einkäufe können nicht machen den Unterschied waren nach. 6) RECYCLED GOLD. Das offensichtlichste Argument, um erhöhte SGE-Abhebungen zu erklären, würde man denken, ist Recycling-Gold durch die Börse gezählt immer und immer wie zurückgezogen. Obwohl SGE-Regeln Befehlsstäbe zurückgezogen werden, sind nicht erlaubt, die Gewölbe wieder zu betreten, bevor sie umgeschmolzen und durch eine SGE genehmigte Raffinerie geprüft werden. Das ist nicht sagen, es passiert nicht. Die von den Firmen vorgestellten Argumente für Recyclinggold müssen in Unterkategorien aufgeteilt werden. Im Verständnis Chinas Goldmarkt der WGC war richtig, in der darauf hingewiesen, gibt es zwei Arten von Schrott fließt durch die SGE Gold für Bargeld und Gold für Gold. Gold kann für Bargeld verkauft werden, wodurch das Angebot zu erhöhen, während Gold kann auch für Gold verkauft werden, wodurch sowohl Angebot und Nachfrage. Die Gold-Gold-Versorgung wirkt sich nicht auf die Angebots-Nachfrage-Balance aus, daher wird sie nicht als Versorgung in den WGC-Metriken 8211 gezählt und ist nicht die passende Nachfrageseite. Ich würde sagen, Gold-für-Gold-Zyklen durch die SGE sind ein legitimes Argument, dass SGE Abhebungen zu erklären, zu erklären und wird daher für unsere Berechnung der echten chinesischen Goldnachfrage am Ende dieser Position berücksichtigt werden. Let8217s haben einen Blick an Beispielen von Gold-für-Gold: 6.1) Prozessschrott. Dieses Argument wurde zuerst von der CPM Group vorgestellt. Kurz gesagt, CPM-Staaten Industrieunternehmen produzieren 50 8211 70 Schrott Versorgung des Goldes in der Fertigung verwendet. Der Schrottüberlauf fließt zurück zur SGE. Prozessschrott fliesst somit SGE-Angebot und Nachfrage, weil das Gold bei der SGE (Nachfrage) gekauft wurde, aber fließt zurück für einen bedeutenden Teil (Versorgung). Obwohl es unbekannt ist, wie viel dieses Gold tatsächlich zur SGE zurückfließt oder in eine Raffinerie zur Mautveredelung gebracht wird (eine Raffinerie, die Stäbe oder Draht aus dem Prozessschrot für das Industrieunternehmen gegen Entgelt produziert). Process Schrott, von Jeffrey Christian am Ende dieser Stelle ausführlich beschrieben, ist eine Form der Gold-Gold-Schrott-Versorgung. 6.2) Arbitrageveredelung. Dieses Argument wurde von GFMS am 17. Februar 2015 auf dem Reuters Global Gold Forum vorgestellt, als Jan Harvey Simson Li (GFMS) interviewte. Einige Leute sehen Abhebungen an der Shanghai Gold Exchange als Stellvertreter für die chinesische Nachfrage. Glauben Sie, dass dies gültig ist, hängt von der verwendeten Methodik ab. Zum Beispiel gibt es Raffinerien, die manchmal 9995 Goldbarren aus der SGE zurückziehen, verfeinern sie in 9999 Bars, wenn es rentable Gelegenheit, und dann hinterlegt sie zurück in SGE vault82308230 Vermutlich kann es eine Arbitrage Gelegenheit bei der SGE, wenn Au99 .95 Gold ist ein X-Prozentsatz billiger als Au99.99 Gold. Eine solche Verbreitung wäre ein klassisches Beispiel für einen der unter oder überbewerteten Verträge gegenüber dem anderen. Im nicht ein Händler, aber ich kann mir vorstellen, einen Weg, um die Arbitrage durch Gold-Leasing zu schließen. Das ist meine Theorie: Wenn ein Spread kommt, wird Au99.95 gekauft, gleichzeitig wird Au99.99 (LAu99.99) ausgeliehen und sofort verkauft. Dann wird die Au99.95 zurückgezogen, in Au99.99 verfeinert und an den Kreditgeber zurückgegeben. Wenn das oben beschriebene Arbitrage unter anderem geschlossen werden kann, hängt von der Geschwindigkeit ab, mit der ein Mietvertrag abgewickelt werden kann. Wenn ein Spread auftritt und der Refiner 2 Tage warten muss, bevor er die Lieferung von Au9999 übernehmen kann, fliegt die Arbitrage. I8217ve fragte die ICBC Gold Lease Schreibtisch, was wäre die schnellste Möglichkeit, einen Mietvertrag zu unterzeichnen. Sie erzählten mir, in der Regel dauert es mehrere Tage oder Wochen, da die lessee8217s Kredit-Rating bestimmt werden muss. Obwohl, für Stammkunden der Mietvertrag kann in einer Stunde ausgeführt werden. Es ist schwer für mich zu sagen, ob Arbitrage-Raffinierung ist wirklich möglich, nach der oben genannten Theorie, denn es hängt von vielen Variablen und die etablierte Beziehung zwischen Leasinggeber und Leasingnehmer. Darüber hinaus, warum sollte jemand verkaufen Au99.95, wenn es unterbewertet wurde Meiner Meinung nach das Argument, dass Arbitrage Raffination SGE Abhebungen aufgeblähten kann bezweifelt werden. 6.3) Mehrwertsteuerregelungen. Dieses Argument fand ich selbst, ist aber noch nicht vollständig ausgearbeitet. Auf der South China Morning Post gab es einen Artikel veröffentlicht, wo eine illegale Mehrwertsteuer-Regelung beschrieben ist, die ich vermute, SGE Abhebungen aufblasen können. Ich werde dieses Schema so bald wie möglich untersuchen, denn jetzt ist dies alles, was ich habe. Also, wie viel ist Gold für Gold insgesamt (alle aggregierten Prozess scra p und potenzielle Arbitrage Raffination und MwSt-Systeme) Wir können die Gesamt-Gold-Gold-Angebot zu schätzen, und ich werde Ihnen sagen, wie. Der Vorteil der Berechnung der gesamten Gold-Gold-Versorgung besteht darin, dass wir nicht genau wissen müssen, wie viel die einzelnen Gold-Gold-Volumina ausmachen. Jedes Jahr veröffentlichen die Chinesen die Zusammensetzung des Gesamtangebots im chinesischen Großhandelsgoldmarkt in den CGA Gold Jahrbüchern. Werfen Sie einen Blick auf die nächste Tabelle (I8217ve hinzugefügt GFMS Schrott, die Gold-Bargeld-Versorgung ist): Durch das Wissen, (i) SGE Abhebungen, (ii) Import, (iii), Mine-Ausgang und (iiii) Gold-for (In der Tabelle als GFMS-Schrott markiert) können wir Gold-Gold-Schrott berechnen, da der chinesische Goldmarkt stimmt: Gold-Gold-Schrott SGE-Entnahmen Import Mine-Produktion Gold für Bargeld Es kann sein Schwer zu verfolgen Prozess Schrott und potenzielle Arbitrage Raffination direkt, indirekt offenbaren die Chinesen das Volumen der beiden Ströme als Gold-Gold. Indem wir Import wissen, können wir die Gleichung ausfüllen. Um zu einem gründlichen Verständnis der chinesischen Gold-Angebots-und Metriken Gold-Gold-Schrottströme sind sehr wert wert. Vor allem, weil seit 2013 diese Angebotskategorie gewachsen ist. 7) AUSFUHR. Dieses Argument wurde vom PMI vorgelegt. Auf einer Konferenz in London sagte Phillip Klapwijk, Geschäftsführer von Precious Metals Insights Limited (PMI), dass China rund 1.000 Tonnen pro Jahr exportiert (vom heimischen Goldmarkt). Doch in diesem Stadium der Regeln verbietet Gold-Export aus dem chinesischen inländischen Goldmarkt. I8217ve schrieb eine umfangreiche Analyse auf Klapwijk8217s Präsentation (klicken Sie, um zu lesen), keine Notwendigkeit, über dieses wieder hier zu gehen. Das Exportargument ist nicht legitim. 8) DER SHANGHAI INTERNATIONALE GOLDAUSTAUSCH. Dieses Argument ist von mir. Wie wir in The Workings der Shanghai International Gold Exchange und SGE Entnahmen in der Perspektive hätte lesen können. Kann das Gold, das aus den Gewölben durch die SGEI in der Shanghai Free Trade Zone zurückgezogen wird, ins Ausland exportiert werden und dadurch die chinesische Großhandelsgoldnachfrage verzerren, wenn sie durch SGE-Abhebungen gemessen wird. Jedoch, bis jetzt (16. Dezember 2015) scheint es, dass SGEI Auszahlungen selten im Ausland, nach mehreren Quellen exportiert werden. Das SGEI-Argument ist (noch) nicht legitim. 9) SMUGGLING. Natürlich kann Schmuggel dazu führen, dass SGE-Abhebungen aufgeblasen werden. Obwohl wir keine Zahlen über Schmuggel haben, kann ich es für unsere Berechnung der chinesischen Goldnachfrage berücksichtigen. Wie viel ist echte chinesische Goldnachfrage Der Unterschied zwischen SGE Abhebungen und WGC chinesischen Verbraucher Goldnachfrage von 2007 bis 2014 für 3.193 Tonnen. Durch die Subtraktion des Goldvolumens, das an legitimen Argumenten von der Gesamtdifferenz beteiligt ist, können wir die echte chinesische Goldnachfrage berechnen. Lets gesetzt, um die Zahlen zu arbeiten und sehen, was passiert. 1) INDUSTRIELLE ANFORDERUNG. Die Daten über die industrielle Nachfrage in China variieren stark. Dabei veröffentlichen sowohl das CGA als auch das GFMS die industrielle Nachfrage einschließlich der Verwendung von Schrott. Da der von den Herstellern produzierte Schrott zurück zur SGE fließt und von den SGE-Abhebungen als Gold-Gold-Anteil abgezogen werden muss, um die echte chinesische Goldnachfrage zu berechnen, müssen wir die industrielle Nachfrage unter Ausschluss der Verwendung von Schrott messen. Schätzung von 200 Tonnen für die chinesische Industriegoldnachfrage (ohne Verwendung von Abfällen) von 2007 bis 2014: 3.193 Tonnen abzüglich 200 Tonnen 2.993 Tonnen 2) STOCK BEWEGUNGSWECHSEL: Für das Wachstum des Großhandelsinventars von 2007 bis 2014 wird auch ein estimate of 200 tonnes: 2,993 tonnes minus 200 tonnes 2,793 tonnes 6) GOLD-FOR-GOLD. This type of recycled gold supply from 2007 until 2014 accounted for 903 tonnes: 2,793 tonnes minus 903 tonnes 1,893 tonnes When we subtract the tonnage from all legitimate arguments from total SGE withdrawals were still left with a difference of 1,893 tonnes of gold. Contrasting metrics can only explain the difference for 1,300 tonnes (3,193 8211 1,893). While, the 1,893 tonnes cannot be labeled as anything else than genuine gold demand (and many Chinese gold industry executives have publicly disclosed to wholeheartedly agree with me). To repeat myself, the residual difference can only be caused by direct purchases from individual and institutional customers at the SGE that withdraw their metal from the vaults. In the chart above you can see the data I8217ve used to write this post. Total SGE withdrawals from 2007 until 2014 accounted for 8,822 tonnes, while WGC demand accounted for 5,629 tonnes over this period. We can only correct the difference of 3,193 tonnes by 1,300 tonnes when taken into account contrasting metrics, leaving a difference of 1,893 tonnes. 5,629 tonnes (WGC demand) 1,893 tonnes 7,522 tonnes, which is genuine (estimated) Chinese gold demand for 2007 until 2014. This post is part of the Chinese Gold Market essentials series. Click here to go to an overview of all Chinese Gold Market Essentials for a comprehensive understanding the largest physical gold market globally. In this post we will analyze everything there is to learn about PBOC gold purchases. Grasping the exact size of their official gold reserves is unfortunately impossible, assuming they have more than what is publicly disclosed (1,800 tonnes), but there are many clues they8217ve covertly bought hundreds if not thousands of tonnes of gold since 2009. The purpose of this post is to get an overview of all clues and data in order to separate the facts from speculation regarding PBOC purchases. From there well estimate how much above ground gold is held in China mainland 8211 official (PBOC) and private reserves . I have been writing for a long time the PBOC does not buy any gold trough the SGE, therefor PBOC purchases must be seen in addition to the flows of gold going through the famous bourse in Shanghai. Though, it8217s necessary to expand on this assumption in detail. Ill tell you what I know and what I think. We have a fairly good view on how much gold is going through the SGE and how much (non-monetary) gold is net imported into China from countries like the UK, Switzerland, Hong Kong and Australia (after which it8217s not allowed to be exported and thus is accumulated in the mainland). If we add domestic mine supply to imported gold we can estimate how much gold is held in reserves by the Chinese. But, are any of these visible gold flows bought by the PBOC If not, how much does the PBOC buy abroad in addition to the visible flows we see entering China mainland through the SGE These questions are the springboard for our investigation. Why The PBOC Would Not Buy Gold Through The SGE I8217ve made a list of reasons why the PBOC would not buy gold through the SGE: 1) The PBOC would prefer to buy gold with US dollars, while all physical gold on the SGE is quoted in yuan. To get a better grip on this subject it helps if we understand why the PBOC would buy gold in the first place, so lets sum up all possible incentives. The main objectives for the PBOC to accumulate physical gold are: Supporting the renminbi for its internationalization (adding trust and credibility). Owning hard currency as the cornerstone of capitalism. Owning reserves that protect the Chinese economy from externalinternal shocks and inflation. Owning neutral reserves that are not controlled by a foreign nation (the US). Diversifying its excessively large US dollar (USD) reserves. Hedge their USD reserves. Overthrow the USD hegemony. After reading this list it should be clear the PBOC rather buys gold with their foreign exchange reserves than with renminbi 8211 Chinas FX reserves are worth about 3.0 trillion and mostly held in USD. The amount of gold currently on the PBOC8217s balance sheet is disproportionate to the amount of USD held. Hence, the PBOC would prefer to exchange USD for gold. All gold on the SGE is quoted in yuan, meaning the PBOC cant exchange USD for gold through the SGE. Therefor, the PBOC is more likely to buy gold abroad and these purchases should be added to the visible gold flows we see entering the mainland through the SGE. 2) The PBOC would prefer to buy gold in large 12.5 Kg bars, which have nearly never traded over the SGE. It should be said the SGE is a subsidiary of the PBOC. In 2002 Chinas central bank erected the SGE to develop the domestic Chinese gold market for the people to trade gold in yuan. The gold bar sizes available on the SGE are 50 gram, 100 gram, 1 Kg, 3 Kg and 12.5 Kg. Though, the volume of 12.5 Kg contracts (Au99.5 and iAu99.5) ever traded on the SGE is close to nil. Only the 50g, 100g, 1 Kg and 3 Kg bars are traded, which are consumer sizes. This is a sign the PBOC is not likely to be buying gold through the SGE. Gold in large 12.5 Kg bars is relatively cheaper and more attractive for central banks. All central banks, that I know of, hold large bars. 3) The PBOC would prefer to hide its gold purchases. The reason we dont know how much Chinese official gold reserves are is because this is the best kept secret in China. The PBOC buys gold in utmost secret or it would influence the market and geo-politics. If we think from the PBOCs point of view, why would they leave a single trace when buying gold Why would the PBOC buy any gold through the SGE for the world to see I think they wouldnt. 4) The PBOC would prefer to import monetary gold which is exempt from being disclosed in customs reports. Let me explain. All bullion gold trade on planet earth that is visible (that shows up in customs reports) is classified as non-monetary. Monetary gold is exempt from being published in customs reports according to the guidelines in the International Merchandise Trade Statistics 2010 (IMTS) drafted by the United Nations. This is perfect for the PBOC to covertly ship gold to China. The PBOC, having an incentive to exchange its superfluous USD in the international OTC market for gold, is actually obliged to monetize the gold it buys abroad. And when these purchases are transferred to China they will not be disclosed in foreign customs statistics. Subsequently, monetary gold imported into China does not go through the SGE 8211 we can see only the non-monetary small gold bars go through the SGE. Therefor, all visible gold exports to China, traded over the SGE, are not PBOC purchases in my opinion. For more information on global trade rules for monetary and non-monetary gold, please read my blog post The London Bullion Market And International Gold Trade . 5) The PBOC would prefer to buy gold in an OTC market, not over an exchange like the SGE. The majority of global gold trade is done through the London Bullion Market the most liquid market there is. This is not a central exchange like the COMEX, but an Over The Counter (OTC) market where buyers and sellers connect (electronically) one on one to trade gold without nosy analysts taking notes. The gold traded can be Loco London 8211 located in London 8211 or elsewhere. The London Bullion Market is ideal for the PBOC, as opposed to the SGE. 6) Another reason for the PBOC to buy abroad would be because its cheaper. Gold on the SGE often attracts a significant premium over London spot. Why pay that premium Especially, if one is buying large quantities. 7) There is anecdotal evidence the PBOC covertly imports gold. Gold industry expert Jim Rickards has written in The Death Of Money (2014): A senior manager of G4S, one of the worlds leading secure logistics firms, recently revealed to a gold industry executive that he had personally transported gold into China by land through central Asian mountain passes at the head of a column of Peoples Liberation Army tanks and armored transport vehicles. This gold was in the form of the 400- ounce good delivery bars favored by central banks rather than the smaller one - kilo bars imported through regular channels and favored by retail investors. This is very interesting. Not only because it demonstrates the PBOC prefers 400 ounce (12.5 Kg) bars over 1 Kg bars, but more so because it confirms the PBOC does not import gold through visible channels. This strengthens my assumption the PBOC does not buy any gold through the SGE. Again, all visible import (in general trade) is required to be sold through the SGE in China. For information on how monetary gold might be imported into China by the military please read my post Chinas Gold Army . 8) The SGE chairman has stated only consumers buy gold over his exchange. On the LBMA Bullion Market Forum in Singapore on 25 June, 2014, a speech was delivered by Xu Luode. then Chairman of the Shanghai Gold Exchange. Lets read a snippet from Xu: Last year, China imported 1,540 tonnes of gold. Such imports, together with the 430 tonnes of gold we produced ourselves, means that we have, in effect, supplied approximately 2,000 tonnes of gold last year. The 2,000 tonnes of gold were consumed by consumers in China. Of course, we all know that the Chinese dama middle-aged women accounts for a significant proportion in purchasing gold. So last year, our gold exchanges inventory reduced by nearly 2,200 tonnes, of which 200 tonnes was recycled gold . Xu mentions the amount of gold imported into China mainland in 2013 (1,540 tonnes). Would Xu be allowed to break Chinas best kept secret on an LBMA forum Would any of these imports end up at the PBOC I dont think so. Moreover, Xu explicitly says all imports and mine output (and scrap supply) has been sold through the SGE system to consumers, not the PBOC. 9) SGE withdrawals are elevated when consumer buying is strong. When examining SGE gold purchases by withdrawals from SGE designated vaults, we can depict a seasonal trend of strong demand around New Year (and in April 2013 when the price of gold made its famous nosedive). The Chinese people typically buy gold in this period as gifts for each other. Does this trend look like PBOC activity No. 10) The WGC assumes the PBOC doesn8217t buy gold through the SGE. From Understanding Chinas gold market, July 2014: Chinas authorities have a range of options when purchasing gold. They may acquire some of the gold which flows into China there has been no shortage of that. But there are reasons why they may prefer to buy gold on international markets: gold sold on the SGE is priced in yuan and prospective buyers for example, the PBoC with large multi-currency reserves may rather use US dollars than purchasing domestically-priced gold. The international market would have a lot more liquidity too. 11) All reliable sources I have regarding the Chinese gold market tell me the PBOC would not buy gold through the SGE. One of these gentleman with ties to bullion banks confirmed to me proxies of the PBOC purchase gold directly in the London OTC gold market that is shipped to Beijing with 8220own airplanes8221 (possibly by the Chinese gold army ). A Chinese banker also told me the PBOC buys gold 8220in the OTC market8221. 12) The SGE President of the Transaction Department confirmed to Na Liu from CNC Asset Management Ltd. the PBOC does not buy any gold through the SGE. Na Liu wrote in a report about 2013 SGE withdrawals: none of the 2,200 tonnes of gold was bought by the Chinese central bank. The President said: The PBOC does not buy gold through the SGE. 13) The head of a global operations company in security transport leaked in 2013 that 12.5 Kg bars were covertly imported into China for the PBOC. When I interviewed Alex Stanczyk, currently Managing Director of Physical Gold Fund SP. on 9 September 2013 he told me brackets added by me: One of our partners had lunch in the recent past with the head of the largest global operations company in security transport. He said there is a lot of gold that theyre moving into China thats not going through exchanges SGE. If the gold is for the government they dont have to declare where its going . They dont have to declare where its going in, or where its heading. We talked to the head of the largest refinery in Switzerland and he told us directly that all that metal thats coming out of London (904 tons YTD ) is being refined into kilo bars and send to China, as well as metal thats coming in from other areas in the world, thats all going to China. Its way more than is being reported or moved through the exchanges. All the kilo bars go to the Chinese people but the PBOC is likely only buying good delivery. With 8216good delivery8217 Alex means the 12.5 Kg large bars that are not being sold through the SGE, but are imported as monetary gold into China without showing up in any country8217s customs reports. The quote very clearly indicates that 12.5 Kg bars are imported into China for the PBOC without moving through the SGE. Why The PBOC Buys Gold Through The SGE For a balanced view, below are the counter arguments: 1) Gold traders on the SGE buy the dips. In the previous chart we could see SGE customers are very keen on buying the dips. Is this buying pattern caused by clever consumers or is the PBOC perhaps in play here (My response would be, currently the SGE has 8,358 institutional customers 8211 and 7.33 million individual customers, I believe these buyers can perfectly be responsible for the buying pattern we see on the SGE with regard to withdrawals in relation to the price of gold.) 2) Part of the gold sold on the SGE can be found on the balance sheets of Chinese commercial banks. Some analysts think this gold can be flipped to the PBOC8217s balance sheet in the future. There is a lot of metal on the balance sheets of Chinese banks. Although the annual reports of the banks do not specify these holdings other than precious metals, presumably they can be gold, silver, platinum, gold savings accounts, gold swaps, leases, pledges, derivatives, and much more. Let us read a little through the annual reports from ABC, CCB and BOC to learn what these 8220precious metals8221 consist of: Precious metals comprise gold, silver and other precious metals. As a major precious metal market maker in the PRC, the Bank provided customers with precious metal trading, investment and hedging services through leasing gold, trading of precious metal derivative to customers and trading physical precious metal in the Shanghai Gold Exchange, the Shanghai Futures Exchange and the London precious metals market. In 2014, the number of customers with the Account Precious Metals totalled 16,103,300. The Bank proactively explored Precious Metals Trading (Shanghai Gold Exchange) Agency business and the number of contracted customers of Individual Precious Metals Trading (Shanghai Gold Exchange) Agency business amounted to 2,160,700. It introduced innovative products including silver leasing for enterprises and PC client for Individual Precious Metals Trading (Shanghai Gold Exchange) Agency business. With respect to investment and financial market business, the Bank introduced innovative products such as sales of physical precious metals to corporates The Group entered into various derivative financial instruments relating to precious metals and other commodities for trading, hedging, asset and liability management and on behalf of customers. As we can read the 8220precious metals8221 on the bank balance sheets can be many gold (or silver) products. Im positive all this gold has at some point been through the SGE system and therefor belongs to the visible gold flows. But for now, lets be open minded to the possibility some of this gold can be added to the PBOC balance sheet in the future. Song Xin, President of the China Gold Association, General Manager of the China National Gold Group Corporation and Party Secretary, wrote I an opinion editorial in July 2014: Establish a Gold bank . We need to establish our gold bank as soon as possible, and enable it to break the barrier between the commodity and monetary world . It can further help us acquire reserves and give us more say and control in the gold market. It may be guided under the PBOC and led by the China Gold Association, involving leading gold industry companies and commercial banks . and its business would include: gold pricing (fix), gold financing and leasing, gold-guaranteed payments, gold saving accounts, gold lending, gold production chain financing and issuance and trading of paper gold and other gold investments. This gold bank can then naturally use market-oriented methods to change commodity gold into monetary gold reserves, thus help us increase our strategic gold reserves. 3) All over supply in the Chinese gold market went to the PBOC. Probably the most logical reason why analysts think the PBOC buys gold through the SGE is because of the huge difference between SGE withdrawals and consumer demand as reported by the World Gold Council (WGC). Lets have a look at this difference in a chart. As you can see there is an immense difference between the purple bars (WGC demand) and the red bars (SGE withdrawals). Possibly some of this gold has been moved to PBOC vaults. (Ive extensively been writing on these pages the difference was not filled by PBOC purchases - for a lot of reasons 8211 but, Ill briefly let go of this analysis here, simply to be able to present all pros and cons.) 4) The PBOC buys discounted gold on the SGE to support the Chinese gold market. There have been periods in, for example, 2014 in which gold on the SGE (Au99.99) traded at a discount to London spot. When the price in China is lower than in the UK this means there is relatively more supply in Shanghai than in London. In the periods of persistent discounts on the SGE i. e. March 2014 8211 withdrawals remain quite high. Is the PBOC buying the discounted gold to take possession and support SGE trading I shall rest here. The purpose of the listed arguments is to provide you with as much information about the Chinese gold market and PBOC purchases as possible. In short: according to my analysis the PBOC does not buy gold through the SGE How Much Gold Does The PBOC Hold What do we know about how much the PBOC is buying (abroad) Allow me to present the clues we have: 1) From a study by Zhang Bingnan, Vice President of the China Gold Association, we can read the PBOC buys approximately 500 tonnes a year (August 2012 ): Forecast the optimal gold reserve capacity in the next 20 years. The conclusion is: 2020, Chinas gold optimal reserves should be 5,787 tonnes 6,750 tonnes. 2030 should be 8,995 tonnes 10,532 tonnes. 2) Yi Gang, deputy Chinese central bank governor, stated the PBOC is able to buy approximately 500 tonnes a year (March 2013 ): We will always keep gold in mind as an option in reserve assets and investments. We are able to import 500-600 tons a year, or more . but we will also take into consideration a stable gold market. If the Chinese government were to buy too much gold, gold prices would surge, a scenario that will hurt Chinese consumers. We can only invest about 1-2 percent of the foreign exchange reserves into gold because the market is too small. 3) Song Xin, President of the China Gold Association, wrote on July 2014 the PBOC should first aim to reach the 4,000 tonnes mark: That is why, in order for gold to fulfill its destined mission, we must raise our official gold holdings a great deal, and do so with a solid plan. Step one should take us to the 4,000 tonnes mark, more than Germany and become number two in the world, next, we should increase step by step towards 8,500 tonnes, more than the US . 4) According to Deutsche Bank Markets Research the PBOC buys 500 tonnes a year (November 2014 ): In another example, the Chinese governments open market purchases of roughly 500 tonnes per year have not prevented the gold price from plummeting in recent years. 5) Numerous Chinese analyst suggest the PBOC aims to hold 5,000 tonnes in official gold reserves. Roland Wang, World Gold Council China Managing Director, said (March 26, 2015 ): China currently holds about 1.6 percent of its foreign exchange reserves in gold, which is relatively low compared with developed countries and some developing countries, WGC China managing director Roland Wang said. The ideal amount should be at least 5 percent of its total forex reserves, Wang told Reuters in an interview in Hong Kong. Remarkably, the exact same day Reuters published Wangs statement Chinese newswire Caixin published a story on gold written by Hedge Fund manager Li Sheng (March 26, 2015 ): Gold accounts for only 1.6 percent of Chinas forex reserves. This is only a fraction of the figure in the United States and many other developed countries. If China ever increased the level to 5 percent, it would have an enormous impact on global demand for gold. Li mentions the exact same numbers as Wang from the World Gold Council on the same day: 1.6 and 5 of total FX reserves. If China would announce they hold 5 of total reserves in gold, this would translate into roughly 5,000 tonnes. If the PBOC would have more than 5,000 tonnes of official gold reserves their 8216gold to GDP ratio 8216 would be on par with to the US, Europe and Russia. One of the theories about our current international monetary system that was detached from gold in 1971 is that it can shift to a new gold anchored system when the power blocks have equalized the chips (Jim Rickards ). In other words, if the US, Europe, Russia and China all have an equal ratio of official gold reserves to their GDP, the international monetary system could make a transition towards gold. 6) Jeremy East, Managing Director Global Head, Metals Trading, Standard Chartered Bank, stated the PBOC is planning to support the renminbi with gold for internationalization (June 25, 2014 ): I was at the Shanghai Derivatives Forum at the end of May and one of the speakers was a representative of the China Gold Association. He gave us quite an interesting insight into the flavor of what is going on in China from a strategic perspective. Some of the things he talked about included that China planned to change the landscape of world gold markets. He talked about having a strong currency and about having that currency backed by gold, like the US dollar. He also talked about people holding more gold and encouraging more people to hold gold. That is not just individuals, but also the central bank. 8230 (By the way, China is not planning to 8220back8221 their currency with gold in my opinion, they8217re more likely to 8220support8221 their currency with gold at no fixed parity.) 7) The PBOC could have bought as much as 1,750 tonnes of gold in London in between 2011 and 2015. Although, its virtually impossible to track monetary gold flows around the world, as these are exempt from international merchandise trade statistics . the least we can do is try. In September 2015 Ronan Manly and Nick Laird conducted an investigation with respect to how much monetary and non-monetary gold was present in the UK. Luckily, the London Bullion Market Association (LBMA) had published a few estimates in recent years about the total amount of physical gold in London (monetary and non-monetary). In 2011, there were 9,000 tonnes in London. In 2015, there were 6,256 tonnes in London likely all in 12.5 Kg Good Delivery (GD) bars. These estimates from the LBMA combined with Manly and Laird their investigation have resulted in the next charts (conceived by Nick Laird, Sharelynx ): For a better understanding of physical gold located in London you can read this post by Ronan, this post by Nick or have a look at the next illustration conceived by Jesse from Cafe Americain : Remarkably, according to estimates by the LBMA the total amount of gold in London decreased by roughly 2,750 tonnes in the period from 2011 until early 2015, while UK8217s customs department discloses only 1,000 tonnes were net exported as non-monetary gold during this period. Implying, 1,750 tonnes have been (covertly) exported as monetary gold. For more information please read my post The London Float And PBOC Gold Purchases . 8) Dutch newspaper NRC Handelsblad published an article in 1993 about a 400 tonnes gold sale from the Dutch central bank that was partially bought by the PBOC (you can read a translation of the article here ). From NRC: With 99 percent certainty we know that the Peoples Bank of China has been one of the buyers of the Dutch gold, said Philip Klapwijk from Goldfields Mining Services, an institute in London affiliated with the South African gold mines that specializes in research into the gold market. Also other London bullion dealers have a strong suspicion that China was involved in the gold sales of DNB. We have noted that the Chinese central bank has bought gold in recent months, said John Coley of the London bullion dealer Sharp Pixley and spokesman of the London Bullion Market Association. I should add, in the nineties the PBOC was the primary (monopoly) dealer in the Chinese domestic gold market and in theory could have sold the gold to Chinese jewelry fabricators. 9) The PBOC could have bought as much as 600 tonnes of gold in Hong Kong in 2013. The PBOC (or its proxies like SAFE, CIC and the Bank Of China ) is likely to buy bullion from places like the UK, US, Switzerland, Hong Kong or Singapore the big gold hubs. Possibly, gold has at some point been imported into one of these countries, and disclosed in their respective customs reports as such, after which it was exported to China as monetary gold, without being disclosed in any customs reports. Lets take Hong Kong for example. From January 2013 until March 2015 Hong Kong has net imported 836 tonnes of gold, illustrated in the chart below. That is a lot of gold for a country with 7 million inhabitants. Some of this gold could have been visibly (non-monetary trade) imported into Hong Kong, and then invisibly (monetary trade) exported to PBOC vaults in Beijing. Resulting in less residual gold present in Hong Kong than data from the local Census Department indicates. Facts And Speculation Lets chew on some numbers. In the first chart below Ive plotted a conservative estimate of the total above ground gold reserves in China mainland on 30 September 2015. This conservative estimate is based on the assumption the PBOC has bought 654.5 tonnes of gold since 2009, totalling at 1,708 tonnes in September 2015 (this is what the PBOC officially discloses). What about the amount of private reserves displayed in the chart Let me explain my calculations from the starting point in 1994: Precious Metals Insights (PMI) has estimated that 2,500 tonnes of gold where held by population in the mainland in 1994, thats the dark grey jewelry base you can see in the chart. The PBOC official reserves in 1994 accounted for 394 tonnes. In addition, Chinese domestic mining was 90 tonnes in 1994. Below is a chart showing historic Chinese domestic mining output. China is said to be a gold 8220importer since the 1990s8221, suggesting domestically mined gold was not exported after 1994. In the next screen shot from the China Gold Market Report 2010 we can read China has been a gold importer since the 1990s . Furthermore, China began importing (non-monetary) gold a few years ago, have a look the next chart that shows historic gold trade between Hong Kong and China. Net imports ramp up in 2010. Other countries than Hong Kong, such as Switzerland, also started to visibly export to China after 2010. So, the starting point in the first chart on Estimated Total Gold Reserves in China is computed as: 2,500 (jewelry base) 394 (official reserves) 90 (mining) 2,984 tonnes in 1994. Subsequently, I8217ve added yearly domestic mining output, as the Chinese didnt net export any gold since 1994, and net imports every succeeding year in the chart. I8217ve subtracted all PBOC official reserves gains before 2007 from cumulative domestic mining, the gains after 2007 have I have not subtracted from cumulative domestic mining. Why Two reasons: The Chinese domestic gold market (SGE) was fully liberalized in 2007 after which I think the PBOC stopped taking in any gold from domestic mines. According to my calculations, from 2003 until 2009 total Chinese gold supply (scrap mine import from Hong Kong) wasn8217t sufficient to meet total consumer demand and 454 tonnes in PBOC purchases over that period. Although the PBOC claims all purchases before 2009 were done from domestic mines and scrap. I don8217t think that8217s possible. Hence, I think the PBOC started invisible import somewhere in between 2003 and 2009. And therefor, anything the PBOC added to its official gold reserves after 2007 I did not subtract from cumulative domestic mining . Lead by the aforementioned calculations, the PBOC had accumulated 1,708 tonnes and the Chinese private sector 13,070 tonnes on 30 September 2015 (in total 14,778 tonnes). This does not capture gold in the black market, that thrived before 2002, neither any assets from wealthy Chinese families. Its the most conservative estimate I can make using all data I could find. However, in my opinion the PBOC has bought a lot more gold in recent years. What all the clues mentioned above have in common, is that the PBOC has bought roughly 500 tonnes of gold per year since 2009. Let8217s make a new more speculative chart: The above chart is a copy of the previous conservative estimate, supplemented by 500 tonnes per year since 2009 in PBOC purchases, which I have not subtracted from cumulative domestic mining or cumulative import . as my assumption is this gold has invisibly been imported and not bought through the SGE. Speculating: the PBOC has accumulated 4,000 tonnes and the Chinese private sector 13,070 tonnes as of 30 September 2015 (in total 17,070 tonnes). Above you could read clues from Song Xin (China Gold Association, July, 2014 ) and Jeremy East (June 25, 2014 ) about China working on a new monetary system that will include gold. Something similar was said by Zhou Ming. General Manager of the Precious Metals Department at ICBC, when Jeremy East asked him at the LBMA forum in Singapore (June, 2014) if the statement Western gold moves East was true: With the status of the US dollar as the international reserve currency is shaky, a new global currency setup is being conceived. Uncertain changes will happen to golds traditional dollar-pricing so the US dollars influence on gold pricing needs to be re-evaluated. An open letter to all pension funds The United Nations (UN) is preparing a Multilateral Legal Framework for Debt Restructuring Processes. At the highest level an orderly sovereign debt restructuring for developed countries is designed. As Ive stated before on these pages, effectively the only thing Quantitative Easing (QE) can buy is time. Since 2008 our monetary wizards have merely been able to keep the can on the road, perpetually kicking it further into the abyss through QE. Solutions are still debated between policy makers behind closed doors, as our current fragile international monetary system does not allow public debate on significant changes or it will risk implosion. If sustainable monetary solutions can be implemented at all from the top of governing bodies within a society waiving the flag of capitalism remains to be seen. In my opinion our system . which is still presented as capitalism, can only survive from the essential input of the economic agents operating at the bottom of the market, producing goods with labor, setting prices, taking risk and creating real wealth. Denying these fundamentals is what brought us into this crisis. Please read below a few snippets from resolution 68304 drafted by the United Nations (UN) in September 2014 on global sovereign debt restructuring. Reading between the lines the UN admits our current system is unsustainable and because of 8220systemic fragilities reform to strengthen the international financial system8221 is needed a monetary reset. 107th plenary meeting Recalling further the International Conference on Financing for Development and its outcome document, in which sustainable debt financing is recognized as an important element for mobilizing resources for public and private investment, and the Follow-up International Conference on Financing for Development to Review the Implementation of the Monterrey Consensus and its outcome document, the Doha Declaration on Financing for Development, as well as General Assembly resolution 68204 of 20 December 2013, Noting that sovereign debt crises are a recurring problem that involves very serious political, economic and social consequences and that the restructuring processes of sovereign debt are a frequent phenomenon in the international financial system, Stressing the importance for developing countries, on a case-by-case basis, of debt relief, including debt cancellation, as appropriate, and debt restructuring as debt crisis prevention and management tools, Stressing also the need to work towards the establishment of responsible and preventive financial crisis policies to enhance transparent and sustainable national financial systems, Recognizing the sovereign right of any State to restructure its sovereign debt, which should not be frustrated or impeded by any measure emanating from another State, Recognizing also that the efforts of a State to restructure its sovereign debt should not be frustrated or impeded by commercial creditors, including specialized investor funds such as hedge funds, which seek to undertake speculative purchases of its distressed debt at deeply discounted rates on secondary markets in order to pursue full payment via litigation, Noting also the concern expressed in the declaration of the Summit of Heads of State and Government of the Group of 77 and China on the theme For a New World Order for Living Well, held in Santa Cruz de la Sierra, Plurinational State of Bolivia, on 14 and 15 June 2014, concerning the so-called vulture funds and their actions of a highly speculative nature, which pose a risk to all future debt restructuring processes, for both developing and developed countries, Recalling, among other things, the work carried out by the International Monetary Fund in 2003, with the support of the International Monetary and Financial Committee, to formulate a proposal for a sovereign debt restructuring mechanism, Stressing also the need to continue to address systemic fragilities and imbalances and the need for continuing efforts to reform and strengthen the international financial system, Noting with concern that the international financial system does not have a sound legal framework for the orderly and predictable restructuring of sovereign debt, which further increases the cost of non-compliance, Recognizing the need to create a legal framework that facilitates the orderly restructuring of sovereign debts, allows the re-establishment of viability and growth without creating incentives that inadvertently increase the risk of non-compliance and acts as a deterrent to disruptive litigation that creditors could engage in during negotiations to restructure sovereign debts, Stressing, in this context, the importance of establishing a clear set of principles for the management and resolution of financial crises that take into account the obligation of sovereign creditors to act in good faith and with a cooperative spirit to reach a consensual rearrangement of the debt of sovereign States, Emphasizes the special importance of a timely, effective, comprehensive and durable solution to the debt problems of developing countries in order to promote their inclusive economic growth and development Calls for the intensification of efforts to prevent debt crises by enhancing international financial mechanisms for crisis prevention and resolution, in cooperation with the private sector, with a view to finding solutions acceptable to all Calls upon all Member States and the United Nations system, and invites the Bretton Woods institutions and the private sector, to take appropriate measures and actions for the implementation of the commitments, agreements and decisions of the major United Nations conferences and summits, in particular those related to the question of the external debt sustainability of developing countries Recognizes the roles of the United Nations and the international financial institutions in accordance with their respective mandates, and encourages them to continue to support global efforts towards sustainable development and a durable solution to the problem of the debt of developing countries Decides to elaborate and adopt through a process of intergovernmental negotiations, as a matter of priority during its sixty-ninth session, a multilateral legal framework for sovereign debt restructuring processes with a view, inter alia, to increasing the efficiency, stability and predictability of the international financial system and achieving sustained, inclusive and equitable economic growth and sustainable development, in accordance with national circumstances and priorities Also decides to define the modalities for the intergovernmental negotiations and the adoption of the text of the multilateral legal framework at the main part of its sixty-ninth session, before the end of 2014. Additional ad hoc meetings on a Multilateral Legal Framework for Debt Restructuring Processes , open to all Member States and observers of the United Nations, were held in February this year and will continue through March, May and June in New York. ht Matt McBride This post is part of the Chinese Gold Market essentials series. Click here to go to an overview of all Chinese Gold Market Essentials for a comprehensive understanding the largest physical gold market globally. The largest physical gold market globally is the Chinese domestic gold market. At the core of this market is the Shanghai Gold Exchange. This article is serves as an introduction to both. The Shanghai Gold Exchange (SGE) is the largest physical gold exchange globally because China is both the largest gold importer and mine producer, and nearly all supply channels in the Chinese domestic market flow through the SGE. Since 2013 the yearly amount of physical gold withdrawn from the SGE vaults has exceeded 2,000 tonnes. While Western consultancy firms like the World Gold Council (WGC) and Thomson Reuters GFMS (GFMS hereafter) report annual Chinese gold demand to be roughly 900 tonnes, the China Gold Association (CGA) states Chinese demand equals SGE withdrawals and thus is more than twice as much as is portrayed by the WGC and GFMS. This articles examine the basic mechanics of the Chinese domestic gold market and how nearly all physical gold in China flows through the SGE, in order to achieve the best understanding of the size of this market and true Chinese gold demand . In addition, the enormous difference between SGE withdrawals and Chinese gold demand as disclosed by GFMS is highlighted. According to our analysis the structure of the Chinese domestic gold market with the SGE at its core has been designed by the People8217s Bank Of China (PBOC), (i) to provide the Chinese citizenry direct access to the gold wholesale market 1. (ii) to grant all gold traded in the Chinese wholesale market to be of the highest quality, (iii) to be able for the PBOC to monitor the gold traded in the Chinese market, and (iiii) keep track of the amount of gold added to Chinese (non-government 2 ) reserves. Sprouted from the centrally minded Chinese authorities the SGE system was conceived in 2002 to facilitate the citizenry to buy physical gold, strengthen the Chinese economy and develop the Chinese gold market to support China8217s internationalization. For our analysis of the Chinese domestic gold market we8217ve relied on Chinese laws, annual reports drafted by the CGA, SGE, PBOC and Shanghai Futures Exchange (SHFE), next to sources in China at commercial banks and individual traders. The aforementioned reports are: China Gold Association (CGA) Gold Yearbook 2006, 2007, 2008, 2013 (Chinese). SGE Annual Report 2007, 2008, 2009, 2010, 2011 (English and Chinese). SGE Monthly Report December 2013. China Gold Market Report 2008, 2009, 2010, 2011 (English and Chinese). Most of these reports have been written in conjunction by the CGA, SGE, PBOC and SHFE. All the English reports were available on the SGE website until 2014, after which they8217ve been taken offline. Introduction Prior to 2002 the Chinese gold market was practically non-existent. Back then the PBOC had the monopoly in trading gold in China and the people were only allowed to buy jewelry in designated shops. In 2002 the PBOC erected its subsidiary the SGE to allow the free market to take over the the pricing and allocation of gold. However, the Chinese domestic gold market didnt change over night. By approximation, the Chinese domestic gold market functioned as was planned starting in 2007, as in that year for the first time the amount of physical gold withdrawn from SGE vaults equaled Chinese wholesale gold demand that year. All supply and demand was matched at the SGE, without the interference of the PBOC in 2007. In the CGA Gold Yearbook 2007 it8217s stated brackets added: In 2007, the amount of gold withdrawn from the warehouses of the Shanghai Gold Exchange, the total wholesale gold demand of that year, was 363.194 tonnes 8230 From 2002 until 2007 Chinese wholesale gold demand did not equal SGE withdrawals, to which we conclude the reform of the market wasnt fully worked out in those years. From 2007 until 2011 SGE withdrawals exactly matched Chinese wholesale gold demand, from 2012 until present SGE withdrawals roughly matched Chinese wholesale gold demand, according to the metrics used by the CGA in its Gold Yearbooks published in Chinese. Until this date (2016) we deem SGE withdrawals to be a useful indicator for Chinese wholesale gold demand, though true Chinese gold demand is slightly lower. There are a few basic rules in the Chinese domestic gold market that make SGE withdrawals equal Chinese wholesale gold demand, these rules compound to the mechanics of this market. In the following these rules are expanded upon. First with respect to the supply side, then the demand side. Chinese Gold Import Since 2011 the main conduit of supply into the Chinese domestic gold market has been bullion import. Gold bullion import into the domestic market can be done by banks that enjoy approval by the PBOC 3. though for every shipment a new License must be requested at the central bank. This policy is referred to as 8220one batch, one License8221. Bullion export from the Chinese domestic gold market is prohibited as far as is publicly known. Currently there are fifteen banks that have been approved by the PBOC to import bullion, presented in random order: Shenzhen Development Bank Ping An Bank Industrial and Commercial Bank of China Shanghai Pudong Development Bank Agricultural Bank of China China Construction Bank Bank of Communications China Merchants Bank China Minsheng Bank Standard Chartered Bank of Shanghai Industrial Bank Bank of China Everbright HSBC ANZ All bullion imported into the Chinese domestic gold market by one of the fifteen banks must be standard gold 4 and sold first through the SGE. Standard gold in China is bullion casted by an LBMA or SGE approved refinery in bars or ingots of 50g, 100g, 1Kg, 3Kg or 12.5Kg, with a fineness of 9999, 9995, 999 or 995. Solely standard gold is allowed into SGE certified vaults to be traded through the SGE system. The Chinese cross-border gold trade rules state 5 brackets added: Gold to be imported shall be registered at a spot gold exchange SGE approved by the State Council where the first trade shall be completed. It8217s possible non-bank gold enterprises, if approved by the PBOC, can import (and export) gold dor, ore and jewelry into out of the domestic market if accompanied by a License, but this tonnage is insignificant in the greater scheme of things. Most gold imported is standard gold and very little gold is permitted to be exported. An exception, for example, is the Chinese Mint that can export golden Panda coins from the domestic market. The Chinese domestic gold market with the SGE at its core is separated from Chinese Free Trade Zones 3 ( Customs Specially Supervised Areas ) where different cross-border trade rules are applicable. Individuals can freely import and export 50 grams of gold when traveling. However, this rules isn8217t very stringent on the import side. Many mainland tourists visit Hong Kong to buy jewelry and bring as much jewelry as they like across the border when they return home. In Hong Kong jewelry doesn8217t carry Value-Added Tax which makes these products less expensive than in China mainland. The Value-Added Tax System When standard gold is traded over the SGE or SHFE its exempt from Value-Added Tax 6 (VAT). When standard gold is not traded over the SGE or SHFE it8217s not exempt from VAT. In addition, when non-standard gold, for example 200 gram bars, is traded in the Chinese domestic gold market off-SGE it8217s exempt from VAT. The VAT rules in the domestic market incentivize wholesale gold supply to be traded in the form of standard gold through the SGE which is most liquid exchange. In the table below the different forms of gold in China and the related VAT rates are listed. Domestic Gold Mining The Peoples Republic of China has the biggest gold mine production globally with an output of roughly 450 tonnes per annum 7 (2015). The vast majority of this output is sold first through the SGE, as Chinese miners are required to sell standard gold over the SGE 8 . Overseas gold mining output can be imported into the Chinese domestic gold market 3. subsequently to be refined into standard gold by an SGE approved refinery and traded over the SGE. Because of the aforementioned rules the best trading liquidity in China is at the SGE and thus gold mining companies are incentivized to cast their output in standard gold bars to sell on the SGE. However, miners are also allowed to sell non-standard gold or gold products off-SGE. For example, China National Gold Group Corporation 9 is a mining company that has its own physical stores to sell bars and ornaments. Recycled Gold All supply that is not domestically mined or imported into China we8217ll label as recycled gold. Because of the liquidity on the SGE and the VAT rules regarding standard gold, recycled gold in the domestic market has an incentive to flow through the Chinese center bourse. Recycled gold is not required to be sold through the SGE, yet many refineries cast standard gold and thus most finds its way to the center bourse. 1. SGE Standard Gold Bar. 2. SGE Logo. 3. Brand Logo. 4. Bar Brand ( is Mount Tai, which is produced by Shandong Gold). 5. Fineness. 6. Weight. 7. Bar Serial Number. When it comes to measuring recycled gold supply it gets complicated as all sources available (CGA, GFMS, Metals Focus, CPM Group) for this data do not use the same metrics and nomenclature. In the remainder of this article the focus will be on the differences between GFMS and CGA metrics and nomenclature. The most significant difference with respect to recycled gold is that GFMS merely discloses scrap (old jewelry and industrial products that are sold by consumers) in their statistics, where the CGA discloses recycled gold comprising scrap , disinvestment . and recycled distortion . The significance of differentiating between several recycled gold types is to separate the ones that have no net effect on the price from the ones that do. Recycled gold can be subdivided in three categories (this following is BullionStar nomenclature): Scrap . old gold products (jewelry or industrial) sold for cash by consumers at retail level, and therefore true supply having a net effect on the gold price. These scrap flows are included by both GFMS and the CGA in their statistics. Disinvestment . bullion wholesale supply. Fact is, in China any individual or institutional investors can buy (demand) gold directly at wholesale level (SGE). If down the road these investors decide to sell (supply) gold they can do so directly to a refinery. Such disinvestment can then make its way to the SGE. An investor wanting to sell 1500 Kg in gold bars is not likely to walk into a jewelry store to sell its material, more likely he will approach a refinery. Because disinvestment surpasses retail stores (jewelry shops and banks) it8217s not included by GFMS in their supply statistics. The CGA does include disinvestment in their supply statistics. Disinvestment has a net effect on the price. It can also be referred to as institutional supply 10 . Recycled distortion . recycled distortion can be for example process scrap . which is metal spilled in manufacturing processes of jewelry or industrial products. Suppose, a jewelry manufacturer buys 1 tonne of gold at the SGE and starts fabricating jewelry. During production 800 Kg makes it into finished products while 200 Kg is scrap spill over. The spill over, called process scrap . is being sold back from the jewelry manufacturer to a refinery making its way to the SGE. Effectively the 200 Kg has been recycled through the SGE being both demand and supply, having no net effect on the price. Therefore, process scrap overstates any supply and demand balance. Next to process scrap there can be other forms of gold being recycled through the SGE, which we8217ll collectively label as recycled distortion. Recycled distortion is not included in GFMS data, but is included in CGA data. Have a look at an overview on how recycled gold types are named by all consultancy firms, next to if they8217re included in their statistics. Because in terms of trading total supply and total demand are exactly equal 8211 one cannot sell gold without a buyer or buy gold without a seller 8211 consequently we can gauge demand by measuring supply. As GFMS publishes incomplete Chinese gold demand statistics 10. it8217s essential to measure all types of supply to get the best estimate of true Chinese gold demand. Just like the London Bullion Market Association (LBMA) the SGE respects a chain of integrity. Meaning, only SGE approved refineries can supply bars to the SGE system and once bars are withdrawn from SGE certified vaults they leave the chain of integrity. To prevent fraud the bars that are withdrawn are not allowed to re-enter the SGE vaults. The only way they can re-enter the SGE system (the Chinese wholesale market) is if the bars are melted down and recast into new bars by an SGE approved refinery. In the SGE8217s Detailed Rules for Physical Delivery of the Shanghai Gold Exchange 11 it8217s stated: Any gold bullion withdrawn by a member or customer shall not be loaded into any Certified Vault in the future. The same rule is disclosed on the websites of China8217s largest banks that offer customers SGE trading accounts. On ICBC8217s website it8217s stated 12 (point 2): This rule is important for comprehending the mechanics of the Chinese domestic gold market, because traders cannot easily recycle gold through the SGE. SGE Withdrawals Equal Chinese Wholesale Gold Demand Above has been established that supply equals demand and in the Chinese domestic gold market nearly all supply flows through the SGE. Consequently, the volume of gold being withdrawn from SGE vaults is a proxy for Chinese wholesale gold demand. Additionally, we saw that that there is recycled distortion flowing through the SGE that is overstating the supply and demand balance. Simply put, when the volume of recycled distortion is subtracted from SGE withdrawals what is left is true Chinese gold demand . Presented below are a equations to clarification: SGE withdrawals Chinese Wholesale Gold Demand As import mine scrap disinvestment recycled distortion is total physical supply to the SGE and everything that is withdrawn is total demand: SGE Withdrawals Import Mine Scrap Disinvestment Recycled Distortion Total Supply Wholesale Demand But as was mentioned before recycled distortion blurs our view of demand, it has no net effect on the price, so it has to be subtracted from SGE withdrawals: True Chinese Gold Demand Import Mine Scrap Disinvestment SGE Withdrawals - Recycled Distortion Chinese Wholesale Gold Demand True Chinese gold demand Recycled Distortion SGE Withdrawals Please note, in our Chinese gold supply and demand study two elements are left out. On the supply side we left out stock carry over in SGE vaults from previous years, as this information is not publicly available, on the demand side we left out gold bought at the SGE that was not withdrawn from the vaults, as this information is also unknown. The formulas are supported by reports from the CGA and SGE from 2007 until 2013, as every year SGE withdrawals equaled wholesale gold demand in these documents. Presented are CGA demand figures and SGE withdrawals from 2007 until 2013: 2007: SGE Withdrawals 363.2 Tonnes 2010: SGE Withdrawals 837.2 Tonnes 2013: SGE Withdrawals 2,197 Tonnes Exhibit 13. SGE Monthly Report December 2013, framed in red is total 2013 SGE withdrawals in Kg Exhibit 14. CGA Gold Yearbook 2013: framed in black is total demand 2013 in tonnes (Red jewelry manufacturing, blue small bar production, purple industrial material, turquoise coin manufacturing, yellow other, green net investment) Exhibit 15. CGA Gold Yearbook 2013: framed in black is total supply 2013 in tonnes. (Purple domestic and overseas mine output, green recycled gold, blue bullion import) In the last screen shots (from the CGA Gold Yearbook 2013) we can see total supplydemand in 2013 was 2,198.84 tonnes, which is 1.88 tonnes higher than SGE withdrawals. This can be explained by jewelry import that was counted as demand, but not sold through the SGE. Chinese Gold Demand Metrics After having examined the supply side of the Chinese domestic gold market let8217s move on to the demand side. From the fact most supply flows to the SGE, logically most demand is directed to to the SGE as well. Chinese wholesale gold demand as disclosed by the CGA, which equals SGE withdrawals, is the widest measure of demand. It consists of consumer demand . institutional demand and recycled distortion (see exhibit 6 and 15) . Consumer demand includes jewelry . bar and coin sales at retail level and gold used in industrial fabrication. Institutional demand comprises, in the case of China, individual and institutional investors buying bullion directly in the SGE wholesale market. The predominant reason for the difference between SGE withdrawals and Chinese gold demand as disclosed by GFMS, is the fact that GFMS only discloses consumer demand in its reports, not institutional demand. (And they do so not only for China but for the rest of the world as well, which is an incomplete and misleading representation of gold supply and demand. Hereby GFMS makes gold look like a commodity instead of a currency, denying its most important trading characteristics in price formation 10 .) Stunningly, the difference between SGE withdrawals and GFMS demand has aggregated to an astonishing 5,922 tonnes from January 2007 until September 2016 13. The next graph illustrates the difference. As on the supply side, we can draft simple equations for the demand side: SGE Withdrawals Consumer Demand Institutional Demand Recycled Distortion Chinese Wholesale Gold Demand Consumer Demand Institutional Demand True Chinese Gold Demand Consumer Demand Jewelry Retail Bar amp Coin Industrial Institutional Demand Direct Purchases At The SGE Direct Purchases At The SGE SGE Withdrawals 8211 Recycled Distortion 8211 Consumer Demand In the CGA demand table for 2013 (exhibit 14) it8217s stated the difference between consumer demand and total demand was labeled as net investment . which is calculated by the CGA as a residual, 8216SGE withdrawals minus consumer demand8217. Demonstrated in equations: Net Investment Institutional Demand Recycled Distortion However, because the exact volume of recycled distortion and disinvestment is unknown, institutional demand is unknown as well. Our best estimate of institutional demand is net investment. Again, all this is clearly illustrated in exhibit 6. Everyone In China Can Buy Gold Directly At The SGE So what8217s causing the massive direct purchases at the SGE 8220Demand for gold8221, is the simple answer. But there8217s more that can be told on direct purchases . In China not only wholesale enterprises such as jewelry manufacturers and bullion banks can trade gold on the SGE, everyone can open an SGE account and start trading. The next graph illustrates how wholesale manufacturers are responsible for approximately half of SGE withdrawals (for exact ratios see exhibit 16). These wholesale enterprises will buy gold at the SGE and subsequently withdraw the metal to fabricate products (ie jewelry, ornaments and bank bars) to be sold at retail level. Individual and institutional SGE customers are responsible for the other half of SGE withdrawals. These customers will buy gold directly at the SGE and withdraw the metal to store in private vaults. According to our analysis the PBOC does not buy its monetary gold through the SGE, so effectively all gold flowing through the SGE ends up in the private sector 14 . Purchasing gold directly at the SGE is fairly simple in China. Every natural person, institution or wholesale enterprise can buy gold or trade derivatives at the SGE. For 50 RMB one can open an SGE account at his local commercial bank branch or via a smartphone application 1. Then, he or she receives a unique 10-digit trading number that gives access to the account consisting of a Bullion Account and Margin Account . The 10-digit trading number will stay with an individual forever, even if he or she switches banks. The procedure is illustrated in the picture below: When an SGE physical gold contract 15 is exchanged the full amount of corresponding funds is promptly transferred from the buyer8217s Margin Account to seller8217s Margin Account. At the same time the related bullion is transferred from the seller8217s Bullion Account to the buyer8217s Bullion Account (settlement is T0). Gold credited to a Bullion Account is allowed to be withdrawn from the vaults at any time. Early 2016 was the launch of the smartphone application Yijintong 1 that allows anyone with an internet connection in China to open an SGE account and trade directly on the SGE wholesale platform appreciating the lowest spreads in China. The Yijintong smartphone app can be downloaded through the following QR-code: As fas as is publicly known, when Yijintong was launched the SGE already counted 8.3 million individual and 10,000 institutional customers, next to 246 members globally of which 183 domestic members and 63 international members 1. From the huge amount of individual and institutional customers we can easily understand the huge volumes of direct purchases at the SGE. The only reason individual investors would buy gold in a jewelry shop or bank is because these bars are aesthetically superior and come in all sorts of shapes and sizes. Though decorated bars come at a significant premium. Obviously, large investors would not buy retail bars but prefer relatively cheaper SGE bars. Which is the reason for the huge discrepancy between consumer demand and SGE withdrawals: many investors buy gold directly at the SGE. Wang Zhe, Chairman amp President of the SGE in 2010 wrote 16 : During the first four months of this year, the number of individual investors kept growing rapidly and now has exceeded two million. The Exchange has become the main channel of investment of physical precious metals, fulfilling the needs of domestic residents. This quote describes that as early as in 2010 direct purchases at the SGE by individual clients exceeded retail bar purchases. And individualinstitutional investors bypassing retail shops buying gold directly at the SGE has been a trend that has accelerated ever since (see exhibit 16). Conclusion By now a comprehensive framework has been provided of the basic mechanics of the Chinese domestic gold market. From all the equations and illustrations presented readers should be able to grasp the sheer size of this physical gold market. Kindly note, to avoid confusion, in some publications the CGA discloses only consumption demand, similar to GFMS, excluding net investment. For example in 2014 17 brackets added: Gold consumption in China grew to 1,176.40 tonnes in 2013 8230. with jewellery demand 8230 716.50 tonnes and retail bullion demand 8230 375.73 tonnes Lastly, more examples are provided that confirm the more realistic size of Chinese gold demand. Na Liu, from CNC Asset Management Ltd, traveled to China in 2014 and spoke to The President of the SGE Transaction Department. Afterwards Na reported on Chinese gold demand in 2013 18 brackets added: The President of SGE Transaction Department (The President) said: This 2,200 tonnes of gold, after leaving our vaults, they entered thousands of Chinese households in the form of jewellery and investment purchases consumer demand direct purchases. 8230when we asked why the China Gold Associations consumer demand number is so low, the President said: They mainly cover the gold sales through the gold shops. This is their main source of information. And their number is quite useful in that way. However, our system SGE withdrawals has broader coverage. Clearly consumer demand is 8220 gold sales through the gold shops 8221 and SGE withdrawals have 8220 broader coverage 8221 (consumer demand direct purchases). Needless to say, the people that run the SGE, CGA, PBOC and SHFE are all related. Depending on the occasion they choose to disclose consumer demand or wholesale gold demand. SGE Chairman, Xu Luode, said at the LBMA conference in 2014 19 brackets added: Last year 2013, China imported 1,540 tonnes of gold. Such imports, together with the 430 tonnes of gold we produced ourselves, means that we have, in effect, supplied approximately 2,000 tonnes of gold last year. The 2,000 tonnes of gold were consumed by consumers in China. Of course, we all know that the Chinese dama middle-aged women accounts for a significant proportion in purchasing gold. So last year, our gold exchanges inventory reduced by nearly 2,200 tonnes SGE withdrawals, of which 200 tonnes was recycled gold. Typically, Xu measure the supply side 8216import mine production8217 (2,000 tonnes in 2013), for Chinese gold demand, as this is the amount of gold added to Chinese private sector reserves (recycled gold doesn8217t add anything to reserves). Indirectly Xu shows interest in the amount of private sector gold reserves within the domestic market. All in all, there are several ways to measure Chinese gold demand. A next article 13 is dedicated to the data and details of all metrics, for now, please have look at an overview below: Gold sold at retail level (consumer demand) GFMS demand Import mine net gold added to Chinese private sector reserves Import mine scrap disinvestment true Chinese gold demand SGE withdrawals wholesale gold demand The definition of SGE withdrawals slightly changed late 2014 with the inception of the Shanghai International Gold Exchange. How it was changed can be read in the subsequent posts of the Chinese Gold Market Essentials (Workings Of The Shanghai International Gold Exchange. Why SGE Withdrawals Equal Chinese Gold Demand And Why Not 8211 The Argument List ). All Chinese Gold Market Essentials Articles Kindly note the pattern There is a story being told to the masses about Chinese gold demand that is grossly incorrect. The huge discrepancy between numbers from the World Gold Council (WGC) and actual gold demand is so wide yet cunningly hidden I must conclude there is essential information about physical gold demand deliberately kept privy. Lets go back to April 2013 the price of gold made a nosedive, which spawned an unprecedented physical buying spree across the globe, most notably in China. Withdrawals from the vaults of the Shanghai Gold Exchange (SGE), that equal Chinese wholesale demand. closed at 2,197 metric tonnes December 31, 2013, up 93 yy. However, the WGC ( the global authority on gold ) initially stated Chinese consumer gold demand had reached 1,066 tonnes in 2013, an astonishing 1,131 tonnes less than wholesale demand. In the China Gold Association (CGA) Gold Yearbook 2013 it was disclosed China had net imported 1,524 tonnes and domestically mined 428 tonnes. Without counting scrap supply this adds up to 1,952 tonnes adding scrap total supply has been well over 2,000 tonnes. Its impossible consumer demand was only 1,066 tonnes. Finally the WGC admitted their initial estimate of 1,066 tonnes of Chinese gold demand was grossly understated. By email they wrote me on February 12, 2015: Thank you for emailing the World Gold Council, we apologize that your previous enquiry was missed. Our figure for Chinese consumer demand in 2013 has since been revised upwards to 1,311.8 tonnes from the original figure of 1,066 tonnes published in the full year 2013 Gold Demand Trends report. Thats an increase of 23 by the largest physical buyer on the planet. Although still far from actual demand, 23 is quite a revision. Was there an official press release from the WGC to inform the world on this revision No (Ive asked the WGC, but I got no reply). Did the mainstream media properly cover the 23 revision Not that I8217m aware of. Actual Chinese gold demand 2013 has been knavishly hidden from the masses (99 of the financial industry copies WGC numbers). In 2014 the WGC again grossly understated Chinese gold demand. SGE withdrawals accounted for 2,102 tonnes, though the WGC stated Chinese consumer demand was only 814 tonnes. Again, a gap of more than 1,100 tonnes. All arguments the WGC has brought up to explain the surplus in the Chinese gold market can only make up about 15 of the gap (gold-for-gold supply and stock movement change ). For 2014 grossly understating Chinese gold demand wasn8217t enough for the Council to distract the worlds eye from Chinas gold hunger more was needed. By a few tonnes the WGC put Indias consumer gold demand ahead of China. In their Gold Demand Trends Full Year 2014 Indian demand is disclosed at 843 tonnes, transcending Chinese demand (814 tonnes) by 29 tonnes, just enough. Most media simply copied these numbers and are stating India is now the worlds largest gold consumer 8211 no critical thoughts added. In my opinion this is the biggest fallacy in finance of our time. In 2014 China imported at least 1,250 tonnes and domestically mined 452 tonnes. According to GFMS scrap supply was 182 tonnes, adding up to total supply at 1,884 tonnes. But, we8217re supposed to believe India is the largest gold consumer on earth at 843 tonnes Yes. I8217m open minded towards the possibility there is an agenda that is allowing China to buy as much gold for as little fiat as possible to make them accumulate whatever necessary before a monetary reset. I see no other explanation for the events unfolding in front of our eyes. Can you imagine what would have happened to global gold sentiment if the WGC had disclosed 2013 Chinese demand at 2,100 tonnes and 2014 Chinese gold demand at 1,850 tonnes Sentiment would have been influenced to say the least. As I wrote in my first post on why SGE withdrawals equal Chines wholesale demand September 18, 2013 : If you think about it, the redistribution of gold is the only logical thing to happen given the state the world economy is in. gold has to go to China in order to equalize the chips. More Awareness About Chinese Gold Demand Luckily my camp is growing. More and more analysts are using SGE withdrawals as a proxy for Chinese wholesale demand instead of inaccurate WGC data. CNC Asset Management wrote in a newsletter September 25, 2014 : To understand Chinas real physical gold demand, investors should simply look at the weekly withdrawals from Shanghai Gold Exchange vaults. We visited the Shanghai Gold Exchange (SGE) in May and talked to the senior executives of the exchange. After reviewing the exchanges trading mechanism, we are of the view that the weekly withdrawal figures provide a much more accurate data series that reflects Chinas aggregate wholesale demand in a timely way. More recently MarketWatch published SGE withdrawals and its significance, and Dr. Martin Murenbeeld, Chief Economist at Dundee Capital Markets, wrote in his newsletter on February 2015: It follows from this opaque picture of Chinese supply and demand that some observers, including ourselves, have decided Shanghai Gold Exchange (SGE) deliveries data provides the best window on what might be happening on the demand side in China. (There are a number of observers who have noted the widely circulated estimates of gold demand are woefully inaccurate, precisely because these data are so significantly lower than SGE deliveries data.) Latest data from the SGE shows withdrawals in the last five days around Lunar Year (February 16, 17 and 25, 26, 27) accounted for 38 tonnes. Total SGE withdrawals in the first two months of 2015 surpassed 410 tonnes. SGE withdrawals Q1 can reach 550 tonnes or more. However, don8217t expect Chinese gold demand published by the WGC on Q1 to be anywhere near these figures. One of the main causes some of my colleague gold analysts assume SGE withdrawals are inflated and cannot be used as a measure for Chinese wholesale gold demand, is because of Chinese Commodity Financing Deals (CCFDs). However, this analysis is incorrect as will be demonstrated in this post. Round Tripping And Chinese Gold Trade Rules CCFDs are ways for Chinese speculators to acquire cheap funds using commodities as collateral. When it comes to using gold as collateral for CCFD there are two options: round tripping and gold leasing . What is round tripping Goldman Sachs (GS) has properly explained the process in a report dated March 2014. From GS brackets added by me: While commodity financing round tripping deals are very complicated, the general idea is that arbitrageurs borrow short-term FX loans from onshore banks in the form of LC (letter of credit) to import commodities and then re-export the warrants (a document issued by logistic companies which represent the ownership of the underlying asset) to bring in the low cost foreign capital (hot money) and then circulate the whole process several times per year. As a result, the total outstanding FX loans associated with these commodity financing deals is determined by: the volume of physical inventories that is involved commodity prices the number of circulations Our understanding is that the commodities that are involved in the financing deals include gold, copper, iron ore, and to a lesser extent, nickel, zinc, aluminum, soybean, palm oil and rubber. Chinese gold financing deals are processed in a different way compared with copper financing deals, though both are aimed at facilitating low cost foreign capital inflow to China. Specifically, gold financing deals involve the physical import of gold and export of gold semi-fabricated products to bring the FX into China as a result, Chinas trade data does reflect, at least partially, the scale of China gold financing deals . In contrast, Chinese copper financing deals do not need to physically move the physical copper in and out of China, so it is not shown in trade data published by China customs. In detail, Chinese gold financing deals includes four steps: Onshore gold manufacturers pay LCs to offshore subsidiaries and import gold from Hong Kong to mainland China inflating import numbers offshore subsidiaries borrow USD from offshore banks via collaterizing LCs received onshore manufacturers get paid by USD from offshore subsidiaries and export the gold semi-fabricated products inflating export numbers repeat step 1-3 Important to understand is that gold in round tripping needs to be physically imported into China and then exported, in contrast to copper. The reason being, which GS fails to mention, that the trade rules for gold in China are different than for all other commodities. General Trade vs Processing Trade In essence gold bullion is prohibited from being exported out of the Chinese domestic gold market by the PBOC in general trade . For general trade fifteen banks enjoy a PBOC license to import gold. Shenzhen Development Bank Ping An Bank Industrial and Commercial Bank of China Shanghai Pudong Development Bank Agricultural Bank of China China Construction Bank Bank of Communications China Merchants Bank China Minsheng Bank Standard Chartered Bank of Shanghai Industrial Bank Bank of China Everbright HSBC ANZ All bullion imported through general trade is required to be sold first through the SGE, and consequently all gold flowing through the SGE is prohibited from being exported . Detail: a few jewelry companies also have a gold trade license for general trade, but this is insignificant. But there is more to it, which is another form of cross-border trade processing trade . To explain what processing trade is, it would be best to first describe why it exists. Since 2002 the State Council is active in stimulating the Chinese population to accumulate physical gold. Through commercial banks the Chinese people are informed about golds function in the economy and able to purchase gold granted of the finest quality. They can submit for a gold savings account, speculate in paper gold on the SGE or buy physical gold directly at the SGE, all through a commercial bank as a broker. Some examples of how state-owned banks promote gold, from the Agricultural Bank China : Physical gold is both a commodity and a financial product. It can be a gift or collection and may serve as an important investment vehicle for realizing preservation and appreciation. With a distinctive preservation function, physical gold is powerful to defend against inflation. Considerations 1. Do not stop when gold price is low. Gold price may go up or down depending on the political and economic conditions and many other factors. Only by constant accumulation will the overall investment cost be reduced. 2. Persistence is the key. Investment risk is reduced by the average cost, the longer the investment period, the better in mitigating the impact of the fluctuation in gold price. When the market rallies, the gain will be protected and increase the investment. The State Councils strategy is to import as much gold as possible and export nil in order to build a strong economic and financial security barrier for China. However, China doesnt want to be left out in the global jewelry fabrication market, for which gold is required to be exported. To make China participate in the global jewelry fabrication market Chinese jewelry companies can import and export gold through processing trade . This is how it works, simplified: In processing trade raw materials from abroad are imported, processed into finished goods and then these products are required to be exported . This processing is usually done (there can be exceptions) in Customs Specially Supervised Areas (CSSA), also called Free Trade Zones (FTZ). Gold processing trade doesnt require a general gold trade license from the PBOC. Note, to export gold from a CSSA to a non-CSSA (the rest of the mainland) a general gold trade license from the PBOC is required. The next illustration demonstrates two types of processing trade. An example for a processing trade would be gold from Hong Kong is exported to Shenzhen (a CSSA just across the border from Hong Kong and well known for its vast jewelry industry 4000 manufacturers), then the gold is fabricated into jewelry (changed in shape or formprocessed) and imported back into Hong Kong. By the way, this trade would show up in Hong Kongs customs report, but it wouldnt affect Hong Kong net export to the mainland. Through processing trade gold can be imported into exported out of China mainland, but these flows are completely separated from the Chinese domestic gold market where the SGE system operates. Gold imported through processing trade is therefor not required to be sold through the SGE 8211 it is not even allowed to be traded through the SGE. In the next illustration we can see Hong Kong (representing the rest of the world), the CSSA in Shenzhen and the mainland (the Chinese domestic god market). Processing trade is often done between Hong Kong and Shenzhen all gold exported from China (CSSA) to Hong Kong or any other foreign nation is processing trade. Round tipping by Chinese speculators can only be done through processing trade it simply isnt possible through general trade, as in general trade gold is prohibited from being exported. Round tripping flows are completely separated from the Chinese domestic gold market and the SGE, hence, round tripping doesnt inflate SGE withdrawals. Only by bending the rules, set up a fake gold jewelry company in a CSSA, speculators can import and export gold to round trip. Consequently, GS notes gold needs to be physically imported and exported for round tripping, in contrast to copper. In theory the gold tied up in round tripping can be at max the amount of gold yearly exported from China (to Hong Kong), at minimum a far smaller amount that is being used in many cycles, in every cycle being counted as import and export. Round tripping doesnt inflate net export from Hong Kong to China. The Chinese Gold Lease Market The other gold financing deal that can be used by Chinese speculators is gold leasing (which is exactly the same as a gold loan). In general gold leasing is a normal market practice. For the sake of simplicity, I have categorised all potential gold lessees (borrowers) in three groups (gold miners, jewelers and speculators) to have a look at some examples (with US dollars) to learn how gold leasing is done in financial markets: A gold miner needs funds to invest in new production goods. It can borrow dollars from a bank at an 7 interest rate, or borrow gold from a central bank at 2 8211 the gold lease rate is usually lower than the dollar interest rate. The miner chooses to borrow 10,000 ounces from a central bank and sells it spot at 1,500 an ounce. The proceeds are 15,000,000 that can be used to invest in new production goods. In a years time the miner has mined 10,200 ounces to repay the principal debt plus interest (the interest on gold loans can be settled in gold or dollars, depending on the contract). Through gold leasing the miner has acquired cheap funding, if compared to a dollar loan. The movement in the price of gold during the lease period is neglected in this example. A jeweler needs funds to buy gold stock for production. It can borrow dollars from a bank for 7 , or borrow gold for 2 . The jeweler borrows 10,000 ounces, with which it can start fabricating jewelry. To hedge itself against price fluctuations the jeweler can sell spot, for example, 10 of the 10,000 ounces it has borrowed (1,000 ounces at 1,500 makes 1,500,000) to buy gold futures contracts in order to lock in a future price. After a year the jeweler has sold the 9,000 ounces (as jewelry) for dollars and can take delivery of the long futures contracts to repay the gold loan. If one buys (long) 10,000 ounces through a futures contract for delivery in a year8217s time, initially he is required to pay a margin . for example 10 . When the contract expires and he wants to take physical delivery he must pay the remaining 90 . A pseculator is looking for cheap funds. It can borrow dollars from a bank for 7 , or borrow gold for 2 . He borrows 10,000 ounces, sells it spot at 1,500 an ounce. The proceeds are 15,000,000 and subsequently these newly acquired funds can be used to invest in higher yielding products (gt 2 ). If the trader chooses to hedge itself in the futures market is up to him. After a year the 10,000 ounces plus interest need to be repaid, either the trader can purchase gold with the profits made on the higher yielding investment or from delivery of futures contracts. In China all gold leases are settled through the SGE both lessor (lender) and lessee are required to have an SGE Account. If a lease is agreed between two parties gold is transferred from one SGE Bullion Account to the other, when the lease comes due the gold is returned. At SGE level its as simple as that. There is a big difference between jewelers that lease gold in contrast to miners and speculators. Jewelers lease gold because they need physical gold for fabrication miners and speculators lease gold because they are seeking cheap funds, they will always sell the leased gold (without withdrawing the metal) spot at the SGE to use the proceeds. Why would a speculator withdrawal the metal Therefor, IF SGE withdrawals contain leased gold this is for jewelry fabrication that eventually ends up at retail level. When a jeweler needs to repay the lease it simply buys gold at the SGE, subsequently this gold will be transferred from his SGE Bullion Account to the lessors SGE Bullion Account. Its not likely a jeweler would buy gold off-SGE to repay a lease, which than would need to be refined into newly cast bars by an SGE approved refiner to enter the SGE vaults and to be credited to the lessors SGE Bullion Account. Phillip Klapwijk, analyst with Precious Metals Insights (PMI) in Hong Kong, previous Executive Chairman of Thomson Reuters GFMS and consultant for the World Gold Council, has stated there is 1,000 tonnes of gold tied up in CCFD (not true). Additionally, he said: 8230 a good part of the withdrawals represent gold that is used purely for financing and other end-uses that are not equivalent to real consumption. Needless to say I dont agree. Am I the only one No. When Na Liu of CNC Asset Management Ltd. visited the SGE in May 2014 he was told by the President of the SGE Transaction Department: First, the withdrawal data reflects the actual gold wholesales in China. In 2013, the total gold withdrawal from the SGE vaults amounted to 2,196.96 tonnes. The President of SGE Transaction Department (The President) said: This 2,200 tonnes of gold, after leaving our vaults, they entered thousands of Chinese households in the form of jewellery and investment purchases. Second, none of the 2,200 tonnes of gold was bought by the Chinese central bank. The President said: The PBOC does not buy gold through the SGE. Third, the financing deals do not exaggerate SGEs assessment of Chinas gold demand. This is because the financing deals do not take place after the gold leaves the vaults. The President of the SGEs Transaction Department is clearly stating most leasing happens within the SGE system and the metal is not withdrawn. I8217m not saying it can8217t occur a speculator would withdrawal metal from the SGE vaults, but in general he would not. Therefor, gold leasing by speculators does not inflate SGE withdrawals and therefor does not explain the difference between SGE withdrawals and Chinese consumer gold demand as disclosed by the World Gold Council. As mentioned before jewelers do withdraw gold from the SGE vaults, but this is eventually to be sold as jewelry. However, the amount of gold leased and withdrawn by jewelers that has not yet been sold as jewelry, is stock inventory (likely hedged in the futures market) and thus can be excluded from gold demand depending on what metric is used. The WGC had also stated in a report 1,000 tonnes was tied up in CCFD. based on PMIs data. But, when I send the WGC an email to ask about the details, they replied brackets adde by me: Gold leasing: Banks have built up this business to support Chinas burgeoning gold industry. Miners, refiners and fabricators all have a requirement to borrow gold from time to time . For example, fabricators borrow gold to transform into jewelry, sell and then repay the bank with the proceeds. It is an effective way for the fabricator to use the banks balance sheet to fund its business . Banks have strict policies in place for who they can lend to, and these have been tightened over recent years, but during PMIs field research it identified that, in some instances, organizations other than genuine gold business had used this method to obtain gold, which it would then sell to obtain funding in this case the gold wouldnt be withdrawn from the SGE vaults . It would then hedge its position. According to PMI, this can generate a lower cost of funding than borrowing directly from the bank. Our colleagues in China think this would be a very small part of total gold leasing the majority of it would be used to meet the demands of genuine gold businesses. Here the World Gold Council admits gold leases that are withdrawn from the SGE vaults are used for genuine gold business (being part of true gold demand). More confirmation gold leasing does not explain the difference . Conclusion Round Tripping gold flows are completely separated from the Chinese domestic gold market (SGE) and gold leasing only inflates SGE withdrawals when used for genuine gold business. Therefor, SGE withdrawals equal Chinese wholesale gold demand. Just after I reported on the repatriation of 122.5 tonnes of gold by The Netherlands from the Federal Reserve Bank of New York (FRBNY) and about the Eurosystem allocating as much of its gold reserves as possible 8211 a global run on gold which can only be seen in advance of a reform of the international monetary system, the next Eurosystem member has come forward, Belgium. In Europe so far Germany has been repatriating gold since 2012 from the US and France, The Netherlands has repatriated 122.5 tonnes a few weeks ago from the US, soon after Marine Le Pen, leader of the Front National party of France, penned an open letter to Christian Noyer, governor of the Bank of France, requesting that the countrys gold holdings be repatriated back to France, and now Belgium is making a move. Who8217s next And why are all these countries seemingly so nervous to get their gold ASAP on own soil VTM-nieuws has just reported the Belgium central bank has confirmed its investigating to repatriate all its gold reserves. Our country is investigating to repatriate all gold reserves. The Belgium central bank has confirmed this to VTM-nieuws. UPDATE December 8: Moments ago I called the Belgium central bank. The press department stated they couldn8217t tell me anything more than the Governor of the Belgium central bank (NBB), Luc Coene, told VTM-nieuws. I found the full item from VTM-nieuws (make sure captions are on). Presenter: 8230stored abroad, in specialized strongly secured banks. The lion share is stored in London at the Bank Of England, however, the Belgium central bank is now investigating how that gold can be repatriated. Luc Coene: If one feels that in surrounding countries these decisions are taken, one knows that this question will be asked to us as well. So we8217re pro-active investigating all the elements, so when the question will be asked, we can answer it. Presenter: The Netherlands repatriated in utmost secrecy a part of their gold reserves a few weeks ago, Germany did the same to take away the uncertainty about the gold. At the end of the nineties Belgium sold 1,000 tonnes of gold the pay of debt. Now our country owns 227 tonnes. To ship this back home is not a simple task. Luc Coene: The practical problem is the transport of the gold, with all the risk that come with it. Second, if we repatriate we need to setup a large security system in Belgium. Though currently this is done by certain central banks that are specialized in this. Presenter: In the end, if the gold will be repatriated is a decision that has to be taken by the government. 8220If one feels that in surrounding countries these decisions are taken, one knows that this question will be asked to us as well.8221 This statement by Coene tells me the repatriation virus is spreading in Northern Europe the question is not IF Belgium will repatriate, but WHEN. Remember, in 2012 the Governor of the Dutch central bank said he wasn8217t planning to repatriate the Dutch gold and that all gold was safe in New York, though shortly after this statement he started the repatriation process (as demonstrated in this post ). The fact Coene clearly states he8217s investigating the repatriation process will very likely ensue in shipping home the Belgian gold. Additionally, I don8217t think many central bank members of the Eurosystem operate in isolation. Not so long ago we learned the Eurosystem is disclosing the ratio of allocated versus unallocated gold reserves and is decreasing the amount of unallocated gold. Repatriating would only be a logic next step. The presenter of the news item says Belgium sold 1,000 tonnes of gold in the nineties to payoff debt, however, it can be Belgium sold gold for the same reason The Netherlands sold 1,100 tonnes. Which is, according to Jan Kees de Jager (former Minister of Finance of The Netherlands): ..to equalize its gold holdings relative to other important gold holding nations. Since 1999 all European central banks collaborated in a program called the Central Bank Gold Agreements (CBGA), or the Washington Agreement On Gold, to jointly manage gold sales. It8217s possible European central banks managed their gold sales also prior to 1999, after all the preparations for the euro started long before and all these central banks must have been on the same page ever since. Belgium holds a large share of its reserves in the UK, a smaller part in Canada and at the BIS in Basel. Of the total 227 tonnes Belgium gold reserves, 210 tonnes are allocated and 17 tonnes are unallocated. The NBB presumably has a little less than 24 tonnes leased. From the NBB website : At the end of May 2013 there are still gold loans outstanding with five commercial banks totalling 24.97 tonnes of gold. Taking account of the due dates, that position is expected to decline further during the 2013 financial year. Click here to read (French and Dutch) the official statement of the Belgium government on the location of its gold reserves. NBB just send me the official statement of Luc Coene in the VTM-nieuws item (in Dutch). Click to view. This is all I could find for now. This post will be updated when more news comes in. Posts navigationMany of the supported Trading services use the Sierra Chart Historical Data Service for historical Daily data. 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Open Interest data is not available for the current day and for the prior day it may not be finalized. If there any missing or incorrect Open Interest values in a Historical Daily chart, then right-click on the chart from the date you want to start a download from and select Delete and Download Data . Session Times for Forex Symbols The Historical Daily bar data for Forex symbols, example: EURUSD, begin at 17:00:00 US Eastern time and covers trading through 16:59:59 US Eastern time into the next day. Weekly Data To request weekly data for a particular symbol, append - W to the end of the symbol. For example IBM-W . Sierra Chart supports creating weekly bars from Daily data. So there is only a need to do this for specialized purposes. Otherwise, it is strongly recommended against. Continuous Futures Contract Symbols To open continuous Futures Contract charts, refer to the Continuous Futures Contract Charts documentation. This is the proper and preferred method to create Continuous Futures Contract charts. In the case of Historical Daily charts, it is possible to use the underlying future symbol with a appended to it to get a long-term Continuous Futures Contract Chart. This is not the preferred method, but it is useful when you want very long-term charts which otherwise may not be available by using the Continuous Futures Contract chart feature. Format: underlying futures symbol . Example: CL . Refer to the Futures page for the underlying futures symbols. BATS Exchange Symbols BATS symbols are the same as NYSE and NASDAQ symbols but they end with the letters. BZ . For example, MSFT. BZ . Futures Month Codes The following table lists the Month Codes for futures symbols. These are standard Month Codes established and standardized by futures exchanges. Futures Options Symbols Overview Format . XMSSSSC or XXMSSSP X or XX is commodity code from symbols list. SSSS or SSS is strike price. C call this year, D call next year, E call two years out, F call 3 years out, G call 4 years out. P put this year, Q put next year, R put 2 years out, S put 3 years out, T put 4 years out. Example . ZCH800D is the symbol for Corn March 800 Strike Call. Futures Options Symbols Overview - Extended Symbology Format . XXXMYSSSSSC or XXXMYSSSSSP XXXMY is the futures symbol. XXX is the commodity code, M is the month, Y is the year, is the delimiter. SSSSS is the strike price, left justified, zero padded to the right. C Call, P Put. Example . ZCH3800C is the symbol for Corn March 800 Strike Call. Charting Total Volume and Open Interest Follow the below instructions to create a Historical Daily chart which shows total Volume and Open Interest among all futures contracts for a particular futures market. These instructions only apply when using the Sierra Chart Historical Data Service or if the Trading service you are using, uses this service for Historical Daily data. Select File gtgt Find Symbol . Locate the futures markets symbol on the Futures Symbols page. Add a - T to the end of that symbol. Manually enter this symbol into the Selected Symbol box. Example: ES-T . Press the Open Historical Chart button. Add the Volume and Open Interest studies to the chart following the AddingModifying Chart Studies section. Last modified Thursday, 05th January, 2017.HTTP Status 500 - Request processing failed nested exception is org. thymeleaf. exceptions. TemplateInputException: Error resolving template quotmobilecontacts-popularquot, template might not exist or might not be accessible by any of the configured Template Resolvers type Exception report message Request processing failed nested exception is org. thymeleaf. exceptions. TemplateInputException: Error resolving template quotmobilecontacts-popularquot, template might not exist or might not be accessible by any of the configured Template Resolvers description The server encountered an internal error that prevented it from fulfilling this request. Note Der vollständige Stack-Trace der Grundursache ist in den Apache Tomcat8.0.14-Protokollen verfügbar. Apache Tomcat8.0.14