Wall St Banks Furious At China For Hoarding Gold - Gainesville Coins News
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Wall St Banks Furious At China For Hoarding Gold

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Wall St Banks Furious At China For Hoarding Gold
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Taiwanese website WantChinaTimes has posted a story from a Chinese-language business site that says Wall St. megabanks are upset over the Chinese government's gold policy, calling the Peoples Bank of China "the world's biggest gold hoarder."  (A curious accusation, since the U.S. is supposed to have the world's largest reserves, at 8,133 tonnes.)

The article begins: "The People's Bank of China, China's central bank, is the world's biggest gold hoarder and the bane of Wall Street traders, reports the Chinese-language financial news website BwChinese, citing a Hong Kong financial analyst.

Leung Hai-ming told the portal that China's central bank took advantage of the US Federal Reserve's quantitative easing program in 2013, when the price of gold fell by 27%. The bank bought in over 1,000 tonnes of gold, representing almost one third of the world's 3,756 tonnes last year.

moneyman

The author goes on to claim the the U.S. Federal Reserve lends out government gold to Morgan Stanley, Goldman Sachs, Citibank, and other "too big to fail" banks, so that they can suppress the gold price. The banks then buy the gold back when the prices fall, to repay the Fed.

The banks and the Fed are upset, because China is breaking their game by buying the gold and keeping it:

"But this measure is absolutely useless because China's is hoarding the gold and does not follow the rules, Leung said. When it sees that gold prices are going down, the first thing it does is buy them, and does not sell when prices continue to fall. It seems that Wall Street cannot do anything to counter China on this, according to Leung.

The analyst said that the People's Bank of China is putting pressure on Washington and Wall Street as the US dollar has been linked with gold prices since its rise as the leading global currency. The Fed hopes to manipulate gold prices in its favor, Leung said, but the Chinese central bank is standing in its way."

What do you think? Is the story true, or is this an attempt by China to erode confidence in the U.S. dollar and Western banking system? Or, is it a little of both?

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