Pan Asia Gold Exchange, opens Q4 2011 w/ 1:1 paper:gold ratio

[Adeptus]

The "PAGE" Pan Asia Gold Exchange, is currently set to open in Q4 of 2011 for Chinese residents trading 10 oz gold contracts and then is to expand to allow international trading in Q1 of 2012. This endeavour is part of the Chinese government's 12th five year plan , and is backed up by 6 Chinese banks.According to the second video below, it will trade gold contracts with 100% gold backing and allow conversion to Renminbi. In short, no more 100:1 ratios.

The people talking in the videos below such as Andrew McGuire (JP Morgan whistleblower), James Turk (owner of goldmoney.com - alternative to bullionvault) Ned Naylor-Leyland from GATA, and Richard Poulden (the only private investor in PAGE) should be considered just a tad biased (understatement) in their outlook of this new development .

So in light of wanting a more balanced or even counter-perspective on this upcoming development, I ask the following questions:
1) What impact over what period do iTulipers think this will have on the spot price of gold?
2) How do you envision this impacting how the COMEX and LBMA do business? Will everyone run to trade at PAGE, or will COMEX and LBMA wind down their exhorbitant paper to physical ratios?
3) Why do you think this development is occuring (i.e. what are the Chinese government's *real* motives?)

Thanks in advance,
Adeptus

VIDEO#1 - 2:25

VIDEO#2 - 15:59

VIDEO#3 - 6:32

[Adeptus]

Re: Pan Asia Gold Exchange, opens Q4 2011 w/ 1:1 paper:gold ratio

As for China's possible motives... this just in from ZH a few mins ago. The cable below is the likely result of yesterdays' Wikileaks 60GB entire cable torrent distribution from 300 embassies between 1966-2010.

SOURCE (wikileaks 2009 Chinese Cable): http://cables.mrkva.eu/cable.php?id=204405

3. CHINA'S GOLD RESERVES

"China increases its gold reserves in order to kill two birds with
one stone"

The China Radio International sponsored newspaper World News Journal
(Shijie Xinwenbao)(04/28): "According to China's National Foreign
Exchanges Administration China 's gold reserves have recently
increased. Currently, the majority of its gold reserves have been
located in the U.S. and European countries. The U.S. and Europe have
always suppressed the rising price of gold. They intend to weaken
gold's function as an international reserve currency. They don't
want to see other countries turning to gold reserves instead of the
U.S. dollar or Euro. Therefore, suppressing the price of gold is
very beneficial for the U.S. in maintaining the U.S. dollar's role
as the international reserve currency. China's increased gold
reserves will thus act as a model and lead other countries towards
reserving more gold. Large gold reserves are also beneficial in
promoting the internationalization of the RMB."

[astonas]

Re: Pan Asia Gold Exchange, opens Q4 2011 w/ 1:1 paper:gold ratio

Wow, this is incredibly rich information. Thank you for posting it. I now see a much clearer path to Chinese monetary independence, and perhaps even dominance. The timelines discussed (announced 4 years ago, kicking off now) correspond well with Chinese government purchases of bulk gold, and the advantages of the 1:1 gold exchange could successfully shift the gold market a tremendous amount.

Henry Kissinger famously said that the west plays Chess, but China plays Go. I think I just saw China's "eyes", and am beginning to understand why they weren't worried about the U.S. taking the "queen" in the reserve currency devaluation game.