Our last article addressed the ongoing oppression happening in China, right now. The arrests, extortion, and beatings going on have a major effect on a certain market in particular: gold.
Something most people who are not familiar with China do not know is that Chinamen always are trying to move their money OUT of China. One of the primary ways in which they do this is by buying gold and either hiding the gold or storing it abroad. Considering the beatings and intimidation tactics of the Communist Party of China going on right now within China, the Chinaman's instinct to move his wealth out of the country seems entirely correct, right?
However, the repression has only started within China, and this means it might soon become a capital offence to move money out of China. If you recall, the Communist Party of China is sending goons to every business, no matter how big or small, to make the owner register in the Party and audit his employee membership in the Party. This also means that when the currency crisis hits China, these same CPC goons will hit the same people with inspections, and if they find something suspicious, they could respond with arrests, torture, or even summary execution. They will force every Chinaman to register his investments, including gold, and may seize it or force him to sell it to the government at a huge loss.
Given this terror, who would want to risk being shot over moving money out of China? I don't think many would: the door will shut, and that's that(aside from the Chinese mafia, which, of course, gives kickbacks to the governing elite to be protected).
Once the door shuts on money leaving China, these Chinamen, who have been buying gold for years, will be cut-off from the market. That means a huge chunk of gold buyers will be gone. Naturally, before this happens, the Chinese Government and Insiders will all dump their gold before they crash their own gold market, and they will certainly take short positions in the metal to profit from the crash they will cause.
This means, for you, one thing: if you're losing money on gold or silver, sell it now. If you're not losing money on gold or silver, sell it now. If you own mining shares, sell them now. You can buy any of this stuff back in a few months or so, once the crisis blows-over, but when it hits, it will be a catastrophe for the precious metals market. We could see gold below $800/oz, and by then, it will be far too late to get out.