Diplomat Admits China Is Accumulating Gold To Back The Yuan

Today acclaimed money manager Stephen Leeb stunned King World News when he said he was recently speaking with a Chinese diplomat and the diplomat accidently admitted to him that China was accumulating gold specifically to back the yuan.  This was a shocking admission and the diplomat then attempted to backtrack but it was too late.

But first, here is what Leeb had to say about what is happening in the gold war:  “The Federal Reserve here in the US recently announced they are willing to print over $1 trillion worth of paper in the next 12 months.  We can print as much money as we want but it’s not going to do any good.”

Stephen Leeb continues:

“Unless the Federal Reserve comes up with a long-term plan for printing food, water, rare earths, silver, we are going to have serious problems because the paper will become worthless.  Longer-term, no one is going to keep giving you something that is critical and rare in exchange for something you can just press a button and print.

The Chinese obviously get this and they are hoarding these critical resources....

“This is related to the action you are seeing in the gold market.  How many times can you watch the gold market go down $25 in a minute or two when there is no volume?

People around the world are starting to figure out that the dollar is toast going forward, so who in their right mind sells gold the way they did yesterday?  No one could accumulate that much money and be that stupid.  So that manipulation is being done deliberately.

There is a ritual we see in overnight trading.  Gold is usually up $4 or $5 at around midnight or 1 AM east coast time.  I’ll be watching gold trade at this time and I can’t count the number of times that in just a minute or two, instead of gold being up $4 or $5, it’s now down $20.  No one is trading at 12 or 1 or 2 in the morning.  Somebody is doing this and it always happens when there is no liquidity.  So you have a game of desperation going on here and the Chinese are aware of this.  

I was just speaking to a Chinese diplomat and I said to their diplomat, ‘Your two most important commodities are water and gold.’  And this diplomat said to me, ‘Yes, we need gold to back up the yuan.’  Well this diplomat realized very quickly they had made a terrible mistake in admitting that and began to back off and stated, ‘No, it’s not to back the yuan.  It’s because of jewelry.’  But it was too late, the horse had left the barn so-to-speak.

So the Chinese get this in spades.  The only way for them to become the world’s powerhouse and continue accumulating materials in the resource war is if they have a currency that’s backed up by gold or they have the actual physical gold itself. 

The bottom line here is that when I see gold engaged in one of these drops I know it doesn’t make any sense.  The Chinese let the price of gold dip because they are smart buyers and we are playing into their hands with this ridiculous manipulation.

This game of manipulation we are engaged in with the gold market is going to stop sooner rather than later.  Time is running out on these schemes and when it does stop and when they lose control, you had better be positioned in gold because this will be a bull market to end all bull markets.”

Source: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/12/19_Diplomat_Admits_China_Is_Accumulating_Gold_To_Back_The_Yuan.html