>Gold Poised for Move Upward

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Another of what I refer to as a “significant event” occurred this last week in China. The Chinese government is encouraging their citizens to buy gold and silver.

China pushes silver and gold investment to the masses

“A report suggests that the Chinese government is pushing the general public into buying gold and silver bullion, which could have a dramatic effect on the markets.”

Source: Mineweb.co.za

The Chinese government is encouraging the public to “invest” in silver and gold. This promotion of precious metals as an investment option is a 180 degree turn about for the Chinese government. Just a few years ago, the sale of gold and silver was under strict government control. Now, for the first time, Chinese citizens can invest in silver bullion. Silver bars are available in weights from 500 grams to 5 kilograms with a purity of 99.9%.

Herein lies the significance of what the Chinese government is doing by promoting the investment of the Chinese public in precious metals: China holds over 1.5 trillion dollars of its reserves in US debt, mostly US Treasuries. If the Chinese were to switch these reserves into precious metals, like gold and silver, this move would undoubtedly drive the US dollar down and the global price of gold and silver up.

The Chinese government has recently publicaly stated their concerns about the dollar holding its value over the long term. They may be getting ready to take proactive steps to protect their interests.

Those who hold gold and or silver might well benefit from such a protective move.

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