Gold flows out of Switzerland up 10% mainly to China
 

Gold flows out of Switzerland up 10% mainly to China
http://img-s-msn-com.akamaized.net/t...l=f&x=165&y=52Switzerland refines two-thirds of the world’s gold and far from demand slowing down, as lower prices might suggest, the latest year-on-year figures show a 10 per cent increase to 108 tonnes in May. The flow of gold from the West to the East continues with Switzerland importing gold from countries like the UK and exporting to China and its business hubs, Singapore and Hong Kong, and India. West-East gold flow For 2105 projections indicate that 2,000 tonnes of gold will be exported from Switzerland, the second best year on record. It could be much higher if the financial crisis in China gets out of control, and the 30 per cent crash in local stock markets over the past three weeks is **t encouraging. Europeans are also likely to be bigger buyers of gold as the value of the euro takes a hit from the ongoing debt crisis in Greece that still looks months from any resolution with a referendum supporting an exit from the euro yesterday. In the short term the flow of money into the dollar and US bonds may be more significant than the flow into gold, and that could weaken the gold price. Sudden stop? But in the longer term credit is **w beginning to freeze up across the world. Emerging market bonds are becoming illiquid, that is to say they don’t have a buyer at any price. The Chinese equity crash also risks a ’sudden stop’ in the world’s second largest eco**my. Companies have been swapping massive debts for equity through IPOs, something they **w can**t do as all IPOs were suspended at the weekend. This is the bubble created by huge and uncontrolled stimulus measures in China since the last global financial crisis and the authorities have this time created a monster that they can**t contain. Think Wall Street Crash 1929. In these circumstances any rational person left holding paper money will want to turn it into something more solid. This is **t a new trend in China. That’s why the gold flow from Switzerland has been predominantly into its hands. Gold to surge However, the stock market crash has **w ******* what had become gold’s biggest competitor for Chinese investors, big and small. Expect the flow of gold from West to East to become more of a flood. **w what will a huge surge in demand met by ** increase in supply do to the gold price? Dollar bulls should take **te that the dollar’s strength will also come under pressure in due course as the US eco**my slows and goes into recession. Then everybody in the entire world will want to own gold.