Episode Details

Two items on the agenda today.

First, my interview with Konstantin Kisin and Francis Foster for Triggernometry has been released. Here it is on YouTube, Spotify and Apple Podcasts

Second, using a different methodology to that which I used in Secret History of Gold (have you read it yet?), I am going to estimate China’s gold reserves.

I was planning to take a look at top silver pick, Sierra Madre Gold and Silver (TSX-V:SM) today, after my meeting with CEO Alex Langer last week, but I will leave that till tomorrow now, meaning you get an extra piece this week you lucky things.

China’s Hidden Gold Empire: How Much Does Beijing Really Hold?

I regard this as one of the most important subjects in geo-politics, which is why I repeatedly come back to it.

It doesn’t matter if you issue the global reserve currency, if you don’t make anything you are in the doo-doo, and this is something the Trump administration is attempting to address with tariffs, a weaker dollar and, more subtly, the managed decline of the US dollar as global reserve currency. It’s all part of Triffin’s Dilemma. As a result, neutral gold’s role as global reserve asset is re-surging.

History’s “golden” rule will soon apply again: he who has the gold makes the rules. (If you are interested in the origins of the phrase by the way, it’s all here).

This different methodology only came to me overnight, and I don’t know what the conclusion will be yet, though I suspect it will arrive at a figure which is more conservative than what I have argued previously. Here we go.

Here, for context, are world central bank holdings, as officially stated.

My argument has long been that China has considerably more than the 2,300 tonnes it says it does.

The People’s Bank of China (PBOC), by the way, is the main custodian, but other state entities, such as China Investment Corporation (the sovereign wealth fund), State Administration of Foreign Exchange and the army also own gold.

Remember China is the world’s largest importer of gold, the largest consumer and the largest producer. it’s been that since 2007 when it overtook South Africa.

I am going to use round numbers, as they are more digestible, and when there is a spread - eg 500-1,000 tonnes, take the middle number, ie 750 tonnes.

It is impossible to know just how much gold China has imported, because so many transactions are private, particularly those which go through London, Switzerland or Dubai. The Hong Kong gold is better disclosed.

However, most - though not all - of the gold which goes to China goes through the Shanghai Gold Exchange (SGE). SGE withdrawals from 2007 to mid 2025 total 29,500-30,000 tonnes, based on aggregated data from the Shanghai Gold Exchange (SGE) and World Gold Council (WGC) reports.

However, the SGE is just a flow metric. It does not represent total consumption. Some of that gold which passes through will have been double counted, either as a result of re-selling and re-cycling, or because of China’s booming money-laundering business and the circular trade with Hong Kong. Estimates for