Tungsten-stuffed gold story delights inflation-wracked Vietnam government

Section:

Tungsten-Filled Bullion Gold Helps Cure Inflation

From VietnamNetBridge, Hanoi
Tuesday, May 31, 2011

http://english.vietnamnet.vn/en/business/8876/tungsten-filled-bullion-go...

The information about the appearance of imitation gold bars filled with tungsten on the market has turned out to be good news because it has helped curb inflation.

Several days ago Vietnamese people got startled at the information that imitation gold has appeared on the market.

Goldsmith shop owners received offers to sell bullion gold from some dealers from Hong Kong. However, when they cut the gold bar samples, they found that the bars contained only 60-75 percent of gold and had some sediment like fine sand particles, which they thought wolfram.

The information has immediate caused big worries among Vietnamese people, who have the habit of keeping gold as their assets in the context of high inflation, but they do not know for sure if the gold in their coffers is real gold or imitation. The problem is that the imitation gold cannot be discovered with modern machines.

... Dispatch continues below ...



ADVERTISEMENT

Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit,
Extending the Mineralization of the Southwest Vein on the Property

Company Press Release, October 27, 2010

VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:

-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.

-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.

-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.

Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.

"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."

For the company's full press release, please visit:

http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf



The information has turned out to be a good solution to help curb inflation. People have become hesitant to purchase gold to store in the context of high inflation, which has helped ease the pressure on the gold market.

The information about imitation gold immediately made the domestic bullion gold market "fall into a crisis," according to Nguyen Minh Chau, general director of Bao Tin Minh Chau Gold, Silver, and Gemstone Co.

"The bullion gold trade turnover of goldsmith companies has decreased by 50 percent. Many companies have seen the turnover drop by 60-70 percent and they are at the risk of having to shut down business," Chau said.

He went on to say that the gold business has fallen into crisis because of the people's psychology.

Just a piece of news about imitation gold is enough to bring immediate effects. Prior to that, government agencies had to apply a lot of measures to stabilize the market.

The State Bank of Vietnam had strenuously resisted criticism from the public when it was compiling the government decree on bullion gold trade. The governor of the State Bank many times had to explain to the public that the state does not intend to prohibit people from keeping gold, and the policy to tighten the bullion gold trade will be implemented in a cautious way to avoid shocks to the market.

Recently the director of the Price Statistics Department under the General Statistics Office, Nguyen Duc Thang, told local newspapers that people have every reason to say that inflation in Vietnam is influenced by gold and dollar prices. A big volume of gold and dollars is being traded on the market, while gold and dollars could be considered as means of payment. He also said that besides the demand pull and cost push, which are considered the main reasons behind high inflation, in Vietnam, people's psychology also serves as an important factor that causes inflation.

Therefore, when the bullion gold market suddenly falls into crisis, the pressure on inflation has been eased. And the information about the gold with impurities has turned out to be an effective method to curb the psychology inflation.

Analysts said that if the information about imitation gold had come to the public sooner, in November 2009, for example, the gold price would not have gone up and down so dramatically over the last time.

Dr. Tran Dinh Thien, director of the Vietnam Economics Institute, said that to successfully curb information, especially when prices are influenced by people's psychology, the government needs to make efforts to obtain confidence from the public. It happened that local newspapers focused on reporting the price increases of goods and services at the same time, which then caused big worries among people, thus putting a hard pressure on the fight against inflation.

To get confidence from the public, Thien said, the government needs to be transparent in applying policies.

"When the government, for the first time, made public the information about foreign currency reserves, the exchange rate changed immediately," he said. "After the government announced the demand stimulus packages, the business confidence index has increased."

* * *

Join GATA here:

World Resource Investment Conference
Sunday-Monday, June 5-6, 2011
Vancouver Convention Centre East
Vancouver, British Columbia, Canada

http://cambridgehouse.com/conference-details/world-resource-investment-c...

Gold Rush 2011
GATA's London Conference
Thursday-Saturday, August 4-6, 2011
Savoy Hotel, London, England

http://www.gatagoldrush.com

Support GATA by purchasing gold and silver commemorative coins:

https://www.amsterdamgold.eu/gata/index.asp?BiD=12

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon:

http://www.goldrush21.com/

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16



ADVERTISEMENT

Lewis E. Lehrman on How to Solve the U.S. Debt Problem

Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, advises that to reduce the $1 1/2 trillion U.S. deficit, the Republican Party must initiate an investment program.

Working Americans are not saving, which enables the banks to lead the country into a cycle of debt, leverage, boom, panic, and bust.

Lehrman says: "Eliminating the budget deficit of a trillion and a half dollars cannot be done overnight. The proposal by U.S. Rep. Paul Ryan was very dramatic -- one Republican called it radical -- but it was not happily received. The solution, of course, is to design an American program for prosperity, because you can solve these entitlement problems with a growing economy.

"We need a tremendous program of investment, and investment comes from savings. When you pay savers, middle-income professionals and working people, 0 percent at the bank, you are not going to encourage them
to save. Then we are left with a bank cycle of debt, leverage, boom, panic, and bust."

To read more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit:

http://www.thegoldstandardnow.org/gata