Investors worldwide are diversifying savings and retirement accounts
into gold coins and bars. Especially in Southeast Asia smart investors
know the value of storing wealth in gold and taking possession of the
shinny yellow relic.
January 16, 2007 – Singapore, Shanghai, Sydney. What do all of these
places have in common? Gold! Yes gold demand has increased tremendously
worldwide over the last two years but demand in these regions has
outpaced world gold demand by 300%. Why might one ask? Because
investors in these areas really have their hand on the pulse. We would
normally use the expression “finger on the pulse” but with the
explosion of commodity and commodity related investments over the last
five years and expected to continue over the next fifteen to twenty
five years especially in the Asian region more and more money is
pouring into the gold market with no end in sight.
Recently World Financial president Marc Lubaszka had a chance to speak
with some of China’s leading banking institutions while in Shanghai and
had this to say “China right now is going through an unprecedented
amount of growth. That’s why I wanted to see and speak with the Chinese
directly and on their own soil. They are growing economically,
militarily, and socially adopting many of the ways of the west into
their strategy. It was made very clear to me that continuously
increasing their gold reserves would not stop anytime soon.”
The country is expected to witness a rapid industrialization over the
next 15 years, which means the country will consume a huge amount of
resources. The Chinese economy is expected to grow at an annual rate of
8% during the period of the 11th Five-Year Plan (2006-10). That means
China will achieve its goal of quadrupling its gross domestic product
from 2000 to 2020 ahead of schedule. Han Wenxiu, a senior official at
the National Development and Reform Commission said that China’s
economic success story witnessed over the past two decades will
continue in the coming 20 years. This is mainly due to the accelerated
urbanization process and the upgrading of the consumption structure
from small items such as TV’s and washing machines to large items such
as houses and cars. On the investment side of the consumption model
gold coins and gold bars are at the top of the list.
Also while in China Lubaszka had a chance to stop into the Shanghai
Gold Exchange which was just established in 2002. The opening of the
Shanghai Gold Exchange marked the deregulation of the gold market in
the country after over half a century of government monopoly.
China's status as the world's fifth largest gold producer and third
largest consumer, combined with Shanghai's developed credit system and
financial market, enabled the municipality likely to achieve its
continued ambition.
There are currently more than 40 major gold markets worldwide, with
London, New York, Chicago, Zurich and Hong Kong as the top five
markets. Most of the gold markets are now situated in international or
regional financial centers instead of being located in gold production
belts.
For a city to be turned into an international gold trading center, it
must have a developed commodity economy and credit system, a
sophisticated financial market, stable political environment, as well
as sound transportation, communications and warehouse facilities and a
good legal system.
As long ago as the 1930s and 1940s, Shanghai was already a renowned
financial center in the Far East and the largest gold trading center in
the region. More than half a century later, Shanghai is now well on its
way to recovering its status as China's financial center and an
international financial center.
“The exchange has not only allowed the Chinese citizens to participate
in a commodity that is growing at a tremendous rate but it also allows
them to add protection from terrorism and a lot of the other problems
that plague our global economic environment. One of the citizens of the
peoples republic that I spoke with said she wants to have some of her
families money in gold coins, something she can hold onto not in a
currency that can be devalued as she has seen happen to US citizens”
said Lubaszka.
Shanghai's edge as a major hub of capital and other production factors
and its strong storage capacity and developed communications and
transportation facilities mean that the metropolis possesses the major
essential conditions to become an international gold trading center.
World Financial is one of Americas leading suppliers of precious metals
to household investors nationwide. To receive information free on how
to buy gold safely, where to store it, how to sell it back and even how
to pay the lowest possible price so that you can exchange your paper
dollars for the most gold possible call 1-800-940-7793 now!
