What You Need To Know About China's Gold Holdings

Jul. 24, 2015 1:43 PM ETGLD, IAU, FXI, GXC13 Comments
Jeff Opdyke profile picture
Jeff Opdyke


  • Gold has sunk to five-year lows, but it's still in the news.
  • China recently revealed that its own gold holdings haven't grown as much as expected.
  • But there's more to know about China's gold. And the truth reveals why you need to invest in gold yourself.

For stock market buffs, here's a blast from the past: the Plunge Protection Team. You remember those guys? That's the catchy nickname for a presidential group of officially sanctioned market manipulators who sprung out of Wall Street's 1987 crash, and who have been pulling strings and pushing levers behind the scenes ever since, to keep the markets from collapsing.

Well, I'm not sure how to say "plunge protection team" in Chinese, but last week's news makes it clear: China has one. China released its latest data on the amount of gold its central bank is holding. The number was a shocking lie. And what seems clear in this lie is that China only released the data for one reason: to stanch the bloodshed in its stock market.

I will tell you right now that if there's one investment you make this year, it should be gold -- physical gold. At just over $1,100 per ounce as I write this, gold prices are at the lowest levels since 2010. The latest move down stems from China's big, golden lie.

The country announced last Friday that its official gold holdings now stand at 1,658 tons. That's just 600 tons more than the country supposedly owned in 2009. It's a lie as big as the country itself. China now mines more gold than any other country. It has mined more than 2,000 tons of gold since 2009. Much - if not all - of that gold ends up in the People's Bank of China.

And depending on the month, the country is also the No. 1 or No. 2 gold importer. It has imported well over 3,300 tons of gold through Hong Kong. China has also imported nearly 700 tons from Switzerland since January 2012. And yet the country's official gold holdings increase by just

This article was written by

Jeff Opdyke profile picture
Globally minded analyst who has traveled to nearly 70 countries and serves as editor for International Living's The Savvy Retiree. I was staff writer for The Wall Street Journal's Money & Investing and Personal Journal sections for 17 years, and I've written several books on personal finance, overseas investing and the rise of the non-Western middle class. My focus is on U.S. and foreign stocks, as well as gold and collectibles, with a goal of helping retirees and those approaching retirement to see and understand trends, risks and opportunities ... all with the aim of pursing a richer life in retirement.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. Business relationship disclosure: As a lifelong world traveler, Jeff Opdyke has been investing directly in the international markets since 1995, making him one of the true pioneers of foreign trading. He is Investment Director for The Sovereign Society and a weekly contributor to The Sovereign Investor Daily (http://thesovereigninvestor.com/).

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