Yifan Hu reports:
Speculators in Wall Street learned a new term recently, the “Chinese Dama” (中国大妈), which refers to middle-aged female shoppers who can move markets. After the gold price fell significantly—by more than $200/ounce in April—the Damas moved in, purchasing gold as if they were cleaning out the jewelry stock at Costco. The gold prices then rebounded to $1485/ounce from $1336/ounce in 10 days.
As a result, sales of gold and jewelry in China amounted to 30.3 billion renminbi in April, rising by 72 percent year over year (YoY), according to the National Statistics Bureau. The China Gold Association also showed that gold consumption totaled 706.3 tons for the first half of 2013, up by 53.7 percent YoY, while total gold production was only 192.8 tons, up by 8.9 percent YoY, reflecting the increasing gap between domestic gold supply and demand.
JW says all those women are idiots, and believe in creationism too.
ReplyDeleteAnd only the real interest rate drives the price of gold. . .what a clown.
Delete"JW says..." Sweet!
DeleteNot me, a different JW.
DeletePretty sure everyone knows which JW we are talking about.
DeleteHow does "middle-aged female" translate to MILF (mother I'd like to f___)? LOL
ReplyDelete+1
DeleteAfter the Chinese officials announced late last month that they'd allow citizens to import seven ounces annually without paying a tariff and without having to report it to customs, expect this to continue and increase. Perhaps they're taking a page out of the American gov't and planning to confiscate the massive amount of gold private citizens are holding in order to create the next world order under the hegemony of a gold convertible renminbi...
ReplyDeleteIn the Beijing Airport, there is a gold store, as well as TCM stores that sell marijuana resin balls and cordyceps-infected caterpillars. In some ways, China, even with its bloated, murderous police state, is more free than the USA. Remember: it was the virus of British prohibitionism that first imposed restrictions on opium poppy extracts.
DeleteFed Gives Middle Finger to Congress, Commodities Customers, and Public, Proposes to Allow More Banks to Participate in Commodities Business
ReplyDeleteNothing like watching a captured regulator like the Fed use a public hue and cry to execute a big bait and switch. Here the ploy is to change rules to further disadvantage the parties making complaints. But it takes finesse to make the finger in the eye look plausible and reasonable, so that when the well-understood bad effects show up later, the perp can pretend to be mystified.
The issue at hand is commodities speculation and price manipulation by major financial firms. In 2003, the Fed relaxed the rules that had formerly prohibited depositing-taking banks from trading commodities. In the early summer of this year, four members of Congress wrote to Bernanke asking whether the Fed had given adequate consideration of the systemic risk of letting major banks participate in the physical commodities. What, for instance, if a systemically important bank had its commodities trading operation fail? And these questions were raised in the backdrop of more general concerns about bank participation in the commodities business leading to other troubling outcomes, such as increased financialization and price volatility, which works to the detriment of real economy users.
A timely bit of reporting by David Kocieniewski of the New York Times in July showed that these reservations were valid and used Goldman to provide a concrete example of demonstrable, measurable harm. And that harm was the direct result of the 2003 rule changes that allowed financial firms to operate in physical commodities, not just as traders in financial contracts. They started backward integrating into owning major components of the delivery and inventorying systems. They gained not only a big information advantage by having better access to underlying buying and selling activity. but also the ability to manipulate inventories, and thus, prices. This piece created a firestorm at the time of its release and increased pressure on the Fed to take the Congressional inquires seriously. And Congress kept the heat on: the Senate Banking Committee held a hearing in late July.
Read more at http://www.nakedcapitalism.com/2013/10/fed-gives-middle-finger-to-congress-commodities-end-users-and-public-proposes-to-increase-rights-of-banks-to-participate-in-commodities-business.html#PZSQsRQJq4OCO3hL.99