June 28th, 2013
Jeff Nielson: There was more mind-blowing news this week in bullion markets. This is to be contrasted with the deluge of shrill, gold-bashing propaganda being cranked out by the Corporate Media at maximum decibels. As usual (these days); the news centers on India’s bullion markets.
As has been mentioned in numerous previous commentaries; Indian bullion-buyers are notoriously price-conscious. So the recent, unprecedented rape committed in the paper-gold and paper-silver markets has been nothing less than a dinner-bell “chime” for Pavlov’s Dogs.
Gold and silver on sale…at (literally) once-in-a-lifetime-prices.
As reported by many commentators within the sector; gold demand (i.e. demand for real gold) in India has been nothing less than insatiable. This is despite a six-month propaganda blitz by the banking cabal to try to steer Indians into the fraudulent, paper-called-gold market.
The complete failure of that propaganda campaign has prompted a rapid-fire series of what can only be termed “desperation measures” within India. First the Indian government jacked-up import duties on gold. Then (in a world which runs on credit) it prohibited any of the Indian bullion banks from importing gold on credit.
Now we have the most-outrageous move yet:
The All-India Gems and Jewellery Trade Federation (GJF) has asked its members not to sell gold coins and bars to curb imports of the precious metal, and help the government reduce the current account deficit…
This move is effective July 1st. As has been previously explained; there is no “current account deficit” in India resulting from the importing of gold (which is a currency). This is all just an accounting sham. Thus all these moves are aimed squarely at suppressing gold demand in India – blatant restraint of trade, targeting only precious metals.
The increasing desperation is the product of staggering numbers on Indian gold imports. How large are the numbers? We’re no longer quite sure. After reporting massive imports of over 142 tonnes in the month of April; it was originally reported that India’s gold imports exploded to 262 tonnes in the month of May.
This was followed by a near-immediate retraction; with India’s finance ministry (supposedly) claiming it had “made a mistake” in reporting its own gold imports, and the correct number was ‘only’ 162 tonnes. A “typo”? In an official, government release? Are we to believe that in a nation of more than 750 million people that the Indian government can’t find anyone to proof-read its own, official press releases?
While we must suspect that Indians actually imported over 400 tonnes of gold in the months of April and May alone; for the sake of argument, let’s accept the propaganda. India imported more than 300 tonnes of gold in April and May. And with the desperation-measures just being escalated again; we can expect another large number for June’s imports (or perhaps another large lie?).
Regular readers will clearly remember the news trumpeted previously that central bank gold-buying has soared to “all-time records”. Even at record levels; these banks are expected to collectively import less than 600 tonnes of gold all year.
This is still an enormous number. Previously, the central banks were able to squash the gold market for many years; primarily as a result of central banks dumping 500 tonnes per year onto the market. Then there is Indian gold-buying.
Even at the suspicious, lower figures; this puts the Indian gold market on an annual pace of importing close to 2,000 tonnes per year. Total, annual global mine production is less than 3,000 tonnes. And with the banksters’ scorched-Earth attacks on the mining companies; supply will almost certainly start falling next year – if not already this year.