So, once all 1,100 tons are mined sometime in the future, it will increase the worldās supply of gold by 0.5%. That shouldnāt effect the price of gold all that much, except that it will reduce the amount that China imports.
DB2
Iām thinking it gives China a far richer trove of gold supply, which backs its currency, which becomes more stable and a bigger threat to the hegemony of the dollar (especially if its economy continues to grow.)
Long game. Not tomorrow, obviously.
Iām not sure itās a large factor. Last year China imported over 1400 tonnes of gold, more than the total of the new find (whose annual production years from now will be a fraction of that).
āChina imported over 1,400 tonnes of gold in 2023, making it the largest gold importer in the world. It exports a negligible amount, so net gold imports are still about 1,400 tonnes. China is also the worldās largest gold producer, producing 375 tonnes last year.ā
DB2
Yes, and they spent hard currency to do so. Instead they will be able to spend significantly less (on employment, say, or housing for workers there), make a substantial profit, and stop send hard currency overseas. This could (emphasize ācouldā) be a significant boost to their economy and infrastructure, at the price of decreasing one of the largest buyers of foreign gold around the world. Not sure, but I think thatās a pretty big change.
If you convert that to money, thatās roughly about the size of Chinaās trade surplus. Seems like instead of taking the trade surplus money and putting it into treasuries (like they used to), they are putting it into gold. At least for 2023. And very roughly.
It could also be a kind of insurance policy for the period just after a Taiwan invasion.
Is that pulling it all out of the ground and āconverting itā in one year for one yearās worth of trade surplus? Will one yearās worth make that much difference?
Pete
No it wonāt. Demographics determine a pretty large part of the future. And they arenāt going to have āgoodā demographics for quite a while.
ā¦and at least equally with the demographics, Xiās undoing of Deng Xiaopingās market and party decentralization reforms so as to regain control over, well, everything, fed into an explosion of unchecked corruption. They have nuclear tipped missiles with water in their fuel tanks, enormous expensive infrastructure projects made from ātofu fragmentsā
and almost all the local and regional governments are in some form of disquised bankruptcy.
Demographics is the next act! First comes marxist-Stalinist-Maoist lunacy showing off why checks and balances are essential to modern governanceā¦ā¦
Hmmm. That reminds me of something, something closer to home.
d fb
But itās not significantly less. Even if all the gold in that new find were extracted in one year China would still be importing gold. Of course, the mine will last 10, 20 years and the change in imports will be small.
DB2
Elsewhere in the worldā¦
El Salvador could be āsitting on a gold mineā with $3 trillion in unmined gold
https://www.msn.com/en-us/money/other/el-salvador-could-be-sitting-on-a-gold-mine-with-3-trillion-in-unmined-gold/ar-AA1vAP3C?ocid=BingNewsSerp
In a dramatic shift from its previous environmental stance, El Salvador is reconsidering its landmark 2017 ban on metal mining, with President Nayib Buckle claiming the country is sitting on a potentially transformative economic treasureā¦
The preliminary studies also suggest the presence of other critical minerals like cobalt, nickel and lithium ā resources considered essentialā¦
DB2