Koos Jansen: China likely has more gold than announced but isn't ready to rock the world


9a ET Sunday, July 19, 2015

Dear Friend of GATA and Gold:

And now for what is probably the most informed analysis of last week's announcement by the People's Bank of China about its gold reserves -- the analysis by gold researcher and GATA consultant Koos Jansen.

Jansen's main assertions:

1) The announced reserve total is probably an understatement of actual reserves.

2) China's import data acknowledges imports of both monetary and non-monetary gold but customs reports quantify only the non-monetary gold, never the monetary gold, thereby signifying that the People's Bank of China does not want is gold purchases made public. That is, official gold purchases in China, like official gold swaps and leases in the West, are highly sensitive and top-secret.

... Dispatch continues below ...


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3) Gold is a politically and diplomatically sensitive subject as China grows its worldwide economic power and aspires to turn its renminbi into a reserve currency as a component of the International Monetary Fund's "special drawing rights." Jansen writes: "With the United States having the power to obstruct the renminbi's inclusion into the SDR, the Chinese have to play it safe. They are required to be transparent about their true gold reserves, but may not want to upset the United States by disclosing an official gold reserve figure at 3,500 tonnes. The 1,658 tonnes figure, which is too little to rock the global financial order, though a sign that China assesses gold to be 'an important element of international reserve diversification,' may thus be an appropriate figure. It's not in China's interest to rush into a new international monetary system as China continues to diversify away from the U.S. dollar.

4) China is not selling U.S. treasuries but has stopped buying them and is very gradually converting its foreign exchange into gold.

Jansen's analysis is headlined "Analyzing PBOC Official Gold Reserves Increment" snd it's posted at Bullion Star here:


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

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