Chinese Gold Investment Demand Surges While Americans Pile into Stock And Crypto Bubbles
The comments above & below is an edited and abridged synopsis of an article by SRSRocco Report
Chinese demand for physical gold surged in 2017, while Americans went for cryptocurrencies and the stock market. Chinese citizens purchased the most gold bar and coin products since the same period in 2013, when they took advantage of huge gold market price selloff.
Stock and crypto market action has frustrated precious metals investors, but gravity will bring us back down to earth. While blockchain technology offers interesting solutions, the speculative mania is a different story entirely.
The Dow jumped by 30% last year, and the Hang Seng market surged 43%.
Chinese gold bar and coin demand increased by 44%, while US physical gold investment demand fell by 55%. Some may believe that increased Chinese purchases were due to the Chinese government banning trading on cryptocurrency exchanges. However, that didn’t take place until the last quarter of 2017. The 44% increase in Chinese gold demand occurred prior to the banning of their cryptocurrency exchanges. Because of the crypto exchange ban, we may see a spike in Chinese gold demand during Q4 2017, when statistics are released.
For whatever reason, Chinese physical gold investment demand increased significantly Q1-Q3 2017, while US demand dropped like a rock. It will be interesting to see how 2018 unfolds, and if the extreme leverage in the stock and crypto markets finally unravels. While many believe the Dow will continue higher forever, all markets have to correct. The next correction may turn out to be one heck of a crash.