DANGER AHEAD FOR U.S. & WEST: Shown In These Gold Charts

The U.S. and West are in serious financial danger as the highly leveraged debt-based fiat monetary system becomes weaker each passing day.  You wouldn’t know this was the case by the way the paper price of gold and silver are trading today.  It doesn’t seem to matter the disaster ready to unfold in Europe if (probably when) Greece makes its exit.

Regardless, the current global gold market structure reveals a severe out-of-balance situation.  While the West, especially the U.S., continues to dominate the global financial system with the finest printing press on the planet, the East (BRICS) now control the lion’s share of the physical gold market.

Unfortunately, the majority of investors who receive their information from the Main Stream Media (MSM), have no clue just how weak and vulnerable the current global financial system has become.  However, I believe we may be witnessing a peak in the broader stock-paper investment markets.  The chart below is the current total value of the U.S. Retirement Market:

US Retiirement Q3 2014 Asset Value

Here we can see that the total U.S. Retirement market increased significantly since the U.S. Investment Banking and Housing Collapse in 2008.  In just one year, the value of the U.S. Retirement Market declined 21%, from $18 trillion in 2007 to $14.2 trillion in 2008.  This should provide a guideline on how bad things will get when the broader markets finally head into the toilet once again.

In order to keep Americans believing in the biggest Paper Ponzi Scheme in history, the Fed along with its favorite member banks embarked on a massive official monetary-liquidity injection policy from 2009 onwards.  As trillions of dollars of paper leverage made its way into the system, the U.S. Retirement market grew like a cancerous tumor.

In just six lousy years, the value of the U.S. Retirement Market increased a staggering $10 trillion to reach a lofty $24.2 trillion in Q2 2014.  This was an astonishing 70% increase in this short time period.   However, you will notice that the value did not rise in Q3 2014, but remained the same.

Was this due to the so-called winding down of the Fed’s QE policy?  Some believe the Fed is still buying U.S. Treasuries, but in a more covert fashion through channels with other assorted corrupt central banks.  Either way, the U.S. Retirement Market seems to have hit a peak and will be facing a sharp decline in the future.  Of course, it’s impossible to forecast when the FAN HITS THE CRAPPER, but at least we know, all bubbles must POP eventually.

BRICS Countries Control The Market When It Comes To Gold

As I mentioned in the beginning of the article, the BRICS countries now control the overwhelming percentage of the global gold market.  While the Western Central Banks along with their puppets in the MSM continue to brainwash its citizens into believing PAPER IS WEALTH, the EAST knows better by acquiring PHYSICAL GOLD, hand over fist.

Before I provide that chart, let’s look at the BRICS vs WEST in gold production.  Brazil, Russia, China and South Africa produced 915 metric tons (mt) of gold in 2014… according to the recently released USGS 2015 Gold Mineral Commodity Summary.  The USGS and World Gold Council (using GFMS data) differ in their figures, but it’s not by much.

BRICS Gold Production vs WEST 2014 NEW

The WEST gold producers, Australia, U.S. and Canada produced 641 mt in 2014…. 30% less than the EAST.  I didn’t include any data for Europe as the USGS didn’t break it down.  But, according to the 2014 GFMS World Gold Survey, Europe (Finland, Sweden, Spain & Other) produced approximately 21 mt of gold in 2013.  So, if you want to throw in an additional 20 (or so) mt of European gold for the WEST, be my guest.

Not only do the BRICS countries produce more gold than the WEST, they took the loin’s share of global gold demand.  According to the World Gold Council 2014 Full Year Demand Trend Report, China, India and Russia consumed 1,901 mt of gold in 2014, compared to a total of 545 mt for the WEST:

BRICS vs WEST Gold Demand 2014 NEWEST

The World Gold Council (WGC) does not breakdown gold demand in all countries, but just by the top consumers.    The WEST saw the majority of its gold demand in Europe (266 mt), the United States (179 mt) and an estimated 100 mt for Australia and Canada.  The WGC did not provide data for either Australia and Canada, so I estimated 100 mt using 2013 figures from the 2014 World Gold Survey as a guideline.

The total gold demand for these seven countries was 2,446 mt.  The BRICS took 78% of that amount, while WEST only received 22% of the total.  Furthermore, Europe received the majority of Western demand at 266 mt or nearly 50% of the total.  The major Western gold producers Australia, the United States and Canada only consumed an estimated 279 mt of gold in 2014, while their combined production was 641 mt.

The reality is this… the BRICS consumed 108% more gold than they produced, while the the WEST acquired 85% of their production and exported the rest.  Again, European countries consumed the most gold in the West, but their total gold production was less than 10% of that amount.  Thus, Australia, the U.S. and Canada shipped a large percentage of their gold overseas.

What we are seeing here is a perfect example of GRESHAM’S LAW at work (Wikipedia):

“When a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.”[1] It is commonly stated as: “Bad money drives out good”.

The undervalued money is GOLD, and it’s leaving the Western country(s) and disappearing into BRICS hoards.   Most of the BRICS gold demand in 2014 went to individual Indian (843 mt) and Chinese (814 mt) investors, whereas most of Russia’s consumption (244 mt) was from Central Bank purchases (173 mt) and jewelry (71 mt).

Now, this data is from the World Gold Council, who according to Koos Jansen, underestimated total Chinese gold consumption in 2013 by 1,000 mt.  In his most recent article, Koos Jansen vs WGC/GFMS/CPM Update, Koos believes actual Chinese gold demand was at least 1,800 mt in 2014. 

Koos spent a great deal of time detailing gold supply and demand figures for China in that article which I highly recommend.  Koos states that the WGC actually revised China’s gold consumption from 1,066 mt in 2013 to 1,312 mt.  If Koos is correct, and I believe his figures are more accurate, than this is a more realistic picture of BRICS gold demand in 2014:

Adjusted BRICS vs WEST Gold Demand 2014 NEW

Using these adjusted figures, the BRICS countries consumed at least 2,887 mt of gold in 2014.  Thus, total gold demand for these seven countries revised upward to 3,432 mt, giving the BRICS 84% of the total amount, while the WEST now only accounts for 16%.

There must be a pretty good reason the World Gold Council is underestimating Chinese gold demand.  If the World Gold Council stated Chinese gold demand of 1,800 mt compared to the 814 mt in their report, it would totally destroy their “supply-demand” balance.

The World Gold Council shows a total of 4,278 mt of gold supply in 2014 with 3,924 mt of demand and 354 mt of OTC investment and stock flows.  Basically, that 354 mt is a supposed surplus that made its way into the OPAQUE OTC DARK MARKET (OTC- Over-the-counter).

If we consider Koos Jansen’s higher Chinese gold demand figure, the global gold market would have suffered a 632 mt deficit in 2014 rather than a 354 mt surplus.  Of course, this can’t be shown in the official data as that would make the entire gold market look quite silly to say the least.

Even though the PAPER RIGGED market shows another big sell-off in the precious metals today, we can certainly guarantee the BRICS are adding more gold to their holdings.  Already Shanghai Gold Exchange withdrawals are 315 mt for the first 5 weeks of the year.  This is a hefty amount for the Chinese, given the fact that record withdrawals took place as the price of gold shot up $130 in January.

The markets will continue to price gold and silver as if they were second class assets, only good enough for 1-2% of the fringe population to acquire.  Unfortunately for the 98%, time is running out for the grand illusion called the highly leverage derivatives FIAT MONETARY REGIME.

When the great MONETARY RESET finally arrives, it will probably be much worse than most realize.  Owning gold and silver may turn out to be one of the few bright lights in a sea of dark.

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32 Comments on "DANGER AHEAD FOR U.S. & WEST: Shown In These Gold Charts"

  1. In my latest post I expand on different metrics used to measure Chinese gold demand. Anyone is free to pick its own metric 😉


    • Koos,

      Thanks for posting the link to your article. I did include a link to your post in the article as well. Just wanted to say thanks for all the great work you do over there at BullionStar.com.


      • Both your efforts help bring some clarity in a world gone mad with Keynesian-Marxist-Socialism.

        Da gubamint will take care of everything…right up until it can’t. Then hang on.

    • Adam,
      I take from a quick scan over the position paper you linked to, by a Chinese intellectual, is that he proposes that the best form of new currency for the future is the IMF’s SDR and not a gold based or partially gold based basket of currencies. Is that correct or what?

  2. How all this scheming can continue when everyone and his brother-in laws ass knows it’s all BS is beyond me. I have faith in the fact Gold and Silver will be left standing when Fiat gives up the ghost. Thanks for the work you do and for sharing it.

    • Most brothers and all brother-in-laws are far more worried about missing out on the next 20% gain in stocks than they are in losing everything. If they lose everything they can claim everyone else did too. If they miss out on a run in stocks they look stupid among the sheeple at work.

  3. I feel liberated. Sold all my gold and silver. I don’t care anymore. I decided I didn’t want to be like Ted Butler and potentially waste a coupe decades of my time on a lost cause. So I sold. I have held silver since 16-19 per ounce (almost 5 years ago now) and gold too.I am out. It feels great. I have wasted 5 years and I won’t waste another day.

    If it hits the Fan WE Americans will be in it together. Holding Gold and silver won’t help that cause. I am out.

    Have a great life y’all.

    • “Those that fret the decline in the gold price don’t really understand gold”

      There’s your problem Frank. It’s simple. You don’t understand gold. You should have watched this video entitled Understanding Gold. Here’s a link:


      It will be the best 22 minutes you ever spent understanding…your problem…with gold.

    • WHEN it hits the fan I will be in better shape because I have some silver.

      Your frustration is understandable.

      However I would caution people not to shoot themselves in the foot because the trudging has been hard.

    • You did not indicate what it is you sold your gold and silver for. Was it rusty tin cans? Stacks of paper? Assurances from your bank about US dollars? WHAT? We are dying to know what your new investment is.

      By the way, Ted Butler’s gold and silver from two decades ago is worth far more now. Your humor is appreciated. 🙂

      • @mike: Productive businesses.


        P.S. One common denominator among gold bulls is the lack of understanding for the power of truly productive businesses over time.

        P.S.S. About Ted Butler, you ARE KIDDING RIGHT? After decades, Ted Butler has one of the worst CAGR’s in the world. Figure out what CAGR means, okay?

        • Productive businesses are great. I own some myself. Look at a long term chart of the Japanese stock market, the Greek stock market, or the Cyprus stock market. It’s sobering. High levels of debt and government regulation are very efficient at killing productive businesses. So you have to ask yourself if the fed buying stocks is enough to keep PE ratios going higher. It might actually be! When they finally lose control the Federal Reserve might end up owning most of the productive businesses in this country.

          In any event, I don’t believe you actually sold your metal at these prices simply because you lost patience or couldn’t sleep at night. Surely that was meant as humor.

  4. P.S. Snapchat alone is going to be valued at 19 billion. If Russia really wanted to counterattack the U.S. they would drain the silver supply. Since they don’t, Russia and the U.S.are really working together. he U.S.and Russia are in cahoots.

  5. BoJ is buying S&P futures with printed money. This year, more than 100% of .gov debt worldwide is being monetized. Countries like Greece aren’t allowed to leave the ponzi. We’re in the mother of all bubbles, when peak oil really hits, paper blows up, and supply lines will probably break. Start prepping, and enjoy life.
    Bread and circusses in paper promises is what you see, nothing more, nothing less…

    • Correct. When the currency is worth nothing guess who ends up owning the entire oligarchy. The central banks. They bought it all fair and square with printed money, just as the law allows them to.

      • First we get the printing for .gov and the banks / institutions. After that, democracy needs a bit printing too, watch Greece, can’t have democracy blowing up ponzi stuff can we? So, the helicopters will drop some fiat ‘for the people’. And so on. This shit can go on for a while, and probably will. But the world lost it’s balance 10 years ago, it’s financial balance is over the top. World gdp is going down, printing goes up to compensate the ‘losses’ in debt acummulation. We have to prepare, you cannot be to early in this stage.

  6. Frank.At least you ARE frank about what you did.respect for that…. but. there are so many buts to your decision.If you are happier now that’s the point for you.Go in peace man.

  7. I think the bugs will not accept that the Money circulates in the circle banks and government.
    Without interest rate they can print what they want.The bonds are the security for the government to make debts.And for the banksters it’s the security not to fail.When the bond rate is to high the next higher instance will buy the bonds.In Europe the ECB in USA the FED and so one.A snow ball System that allows the banksters with the poltician to survive.

  8. Regarding your chart of ‘US Retirement Market Peaking’, consider these of US money supply and commercial/industrial credit growth for timing the bust:


    “Below is a chart showing the annualized growth rate in commercial and industrial loans in the US. The annualized rate of growth has recently accelerated to about 13.8%, which means that commercial banks have so to speak taken the baton from the Fed in terms of creating money supply growth.

    It remains to be seen whether the recent collapse in the oil price will affect these credit growth rates. A lot of credit has been pumped into the oil patch in recent years, and this activity seems now likely to grind to a halt. It seems therefore possible that the slowdown in the broad money supply growth rate in evidence since its 2010 and 2011 peaks will soon resume. Currently (i.e., as of year-end 2014), the year-on-year growth rate stands at 7.97%, which is down from the 16.7% and 15.67% peak growth rates in 2010 and 2011 respectively, but roughly still in the same range that has prevailed since late 2013 when “QE” was discontinued…

    As this chart also indicates, asset price bubbles tend to peak with a lag to peaks in money supply growth rates, usually after a certain (unknowable) threshold in the annual growth rate is undercut. The threshold just prior to the 2008 crisis was very low (less than 2%), but it was e.g. at about 5% in 2000 before the Nasdaq bubble broke. What level of money supply growth will be decisive this time around is something we will once again only be able to ascertain in hindsight, but the fact remains that such a threshold exists”

  9. Here a proof for the newest example for Money for nothing and chicks for free.Everyone greek is broke.

  10. Sorry my PC collapsed.Here a proof for the newest example for Money for nothing and chicks for free.Everyone know greek is broken.
    Mr. Schäuble(financial Minister Germany) said officially he won’t pay any longer for greek.In the same time the ECB gives 68 Milliarden(german notary) credits.But who is the ECB?An organ that can print Money like they want.
    I’am pretty shure that they give more credit. The whole financial corpses will appear when they must
    make up the Balance of the national bankruptcy.
    Until the creditor is not be liable for the financial risk you Need know PM.In anyway the Banks are not in Response for there Money playing.They will always be covered by the goverments.
    Thes same in the USA.Maybe there will broke the national small Banks, but never the big one.
    In the book “The Creature from Jekyll Island ” you can read that.

  11. “BRICS Countries Control The Market When It Comes To Gold”

    Perhaps sometime in the future but certainly not now.

    The vast majority of the world’s accumulated bullion lies in the West (e.g. ask yourself who was producing/importing the world’s gold production before China started doing so in 2011). Then sum that up over decades.

    In particular investors in the West are quite prepared to buy then dump depending on various macroeconomic conditions/indicators. And it’s this process, which controls the price… gold being pulled into US, UK, Switzerland during the bull market then pushed out during the bear (imports minus exports).

    • “The vast majority of the world’s accumulated bullion lies in the West (e.g. ask yourself who was producing/importing the world’s gold production before China started doing so in 2011). Then sum that up over decades.”


      Several highly knowledgeable people in the PM industry question or dispute that statement you make.
      For example Eric Sprott: PM’s are his business, and between he and his close associates they have been analyzing everything related to PM’s…for many decades. He tracks the most accurate numbers he can get about the gold imported, mined & recycled in the U.S., versus what is used in jewelry and being sold…leaving this country [mostly to the East]. He says the numbers don’t add up and large gold vaults have to be supplying the difference. He is one of many analysts that question how much gold the U.S. government or Fed still has. Several have stated their opinion it is very little.

      • Eric Sprott is on record (2013 if memory serves me correctly) for saying that Western central bank vaults are empty or very close to it. In order to fill a supply gap. This follows on from what GATA claimed about central banks losing 25% of their gold in the late 90s updated to 50% a few years later. Which is fine but Eric can make this claim only once, not again in 5 or 10 years time etc.
        To this I say nonsense, central banks still have their gold. What is happening is Western investors buy and sell and gold moves around and changes ownership. Most recently to China sure, but they only became a meaningful importer in 2011.

        • PM analysts also say what they have may be leased…. some portion [perhaps the majority], and there may be several leases per ounce of gold, using the “fractional reserve” model.

        • I think western vaults being empty is B.S. Think about it: if supply was TRULY running tight then the bullion banks WOULD NOT be manipulating the spot prices down to where they are…..50% of the gold miners in the world are unprofitable with gold at 1100. And the ones that are profitable today have cut cap-ex big time, employee head count, and exploration. If supplies were tight the bullion banks wouldn’t be supressing the bullion prices to these levels. Recall, the Goldcorp CEO said he think we’re at Peak Gold THIS YEAR.

          So none of this makes sense. The bullion banks wouldn’t be keeping their boots on the neck of PM prices if there was a problem with supplies while we are at PEAK GOLD to boot.

          Clearly, those in charge of the real bullion vaults in connection with the central banks and bullion dealers are in complete control…..and as I’ve been saying: that doesn’t look like it will change for YEARS (possibly another decade or two).

          That is why I have stopped wasting my time with gold and silver. There are better things to A) do with my time and B) better places to invest.

          Gold and silver are for suckers.

          • Also, it looks like the Dow/Gold ratio might go north of 25 to me.

          • “So none of this makes sense. The bullion banks wouldn’t be keeping their boots on the neck of PM prices if there was a problem with supplies while we are at PEAK GOLD to boot.”

            I agree it doesn’t make sense. But it is entirely possible they are hell-bent on keeping the current fiat currency/stocks/equities/derivatives paradigm going until they can’t. And I suspect that will be before 2020. But people much more knowledgeable than I am think that. These are people will the greatest access to real data, the most knowledgeable people, and the best understanding of where we are in the unraveling of this paradigm.

            “Gold and silver are for suckers.”

            I’m glad to be counted among the “suckers”.

    • Read Dimitri Speck’s excellent book that he published last year, it is filled with data and lots of original research on gold. His data does not agree with your statements.

  12. Prediction: When China, Russia and India have finished buying as much gold as they can at cut rate prices relative to the dollar they will launch a gold backed world reserve currency. Europe will realise that they have backed the wrong side in the US’s war in Ukraine.

  13. Derrick Michael Reid | February 22, 2015 at 8:13 pm |

    Mad5Hatter here from TF, bookmarked you so I can read stuff always, and your stuff is always great! 🙂

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