Over 5,000 Chinese investors have been fleeced for a total of $59.62 Billion in a paper ‘gold’ futures scam.
This should have enormously bullish implications for the PHYSICAL metals markets, as 5,000 Chinese have just been taught Doc’s rule the hard way:
If you don’t hold it, you don’t own it!!!
While this has not been widely reported in the Western media, news broke this week of a massive illegal gold-futures trading scam in China. Not only does it underscore the growing hunger for gold among the newly minted Chinese middle class, but also hits home the rationale for owning physical gold, according to one U.S. based asset manager.
Over 5,000 investors were bilked out of 380 billion yuan, or $59.62 billion in a scheme involving Loco London gold since 2008, according to a report in the China Daily.
While details are unclear how the scam worked, the implications could be bullish for gold in a number of ways. Perhaps gold prices could be at even higher levels than they are right now, if this money had been properly invested.