Chinese Banks May Be the Big Gold Story in 2005
Chinese Banks May Be the Big Gold Story in 2005, According to Lear Capital
SANTA MONICA, Calif., April 7, 2005 /PRNewswire via COMTEX/ -- Gold has always been revered in the Chinese culture. But not until 2003 have Chinese citizens legally been allowed to buy it.
So why haven’t 1.2 billion gold-loving Chinese sent the precious metal soaring? “In a word, distribution,” says Kevin DeMeritt, President of Lear Capital, a leading precious metal management firm. “But with the four top Chinese banks now entering the gold picture, that’s all about to change.”
Until now, distribution of gold in China has been poor at best, DeMeritt explained. “There just haven’t been the resources to get gold to the people. But with the Bank of China allowed to sell gold, and now three other major banks expected to receive permission shortly, the resources are now in place.”
As it is, the Chinese have one of the lowest gold ownership rates in the world. “In China there’s just 0.1 grams of gold owned per capita. The India rate, by contrast, is 0.73 and the U.S., 1.41. So once the Chinese banks spur distribution, a lot of gold can be sold in a relatively short time,” DeMeritt said. “And that could send gold into record territory in the years to come.”
Investors can learn more about China and the price of gold by calling Lear Capital for a Free Gold Investors guide and audio tape “Rising Rates Rising Gold.” Call, toll-free, 1-800-576-9355.