Could China Propel Gold to $2,000? By Erik Bethel, Seeking
Alpha - Date: September 15, 2009
Last
week Alan Greenspan noted that "Rising prices of precious
metals and other commodities are an indication of a very early
stage of an endeavor to move away from paper currencies."
In other words, people are buying gold as
a hedge against inflation....
...Over the past six months Beijing has made
a series of moves to protect itself against a dollar devaluation.
In a recent "BRIC Summit" in Russia several months
ago, Chinese leaders came out strongly in favor of a new reserve
currency to replace the dollar...
As recently as 2002, the private ownership
of gold was prohibited in China. You could be jailed if caught
with any in your possession. Beginning in 2009, in a stunning
about-face, the central government removed all restrictions...
It truly is as simple as can be, because every
bank sells gold and silver bullion bars in four different
sizes to individuals. (Try to find the same the next time
you make the trek down to Wells Fargo.)...
Thus China, which only yesterday was the lowest
per-capita consumer of gold in the world, is bidding to become
the biggest...
All this suggests a mania in the making, and
only in the formative stage. Imagine if hundreds of millions
of new consumers climb on that particular bandwagon...