Financial markets are shaken as almost 2 Million ounces of fake gold bullion, is found guaranteeing loans in China!

Authorities tested 83 TONS of gold being used to ensure loan safety and found them to be copper fakes, with gilded gold surfaces. This is a Massive counterfeit effort, and in China, it will get you killed.

Image from Article:
https://thebreadwinner.co/2020/07/03/gold-industry-hit-hard-from-new-chinese-loan-scandal/

Article on the counterfeit gold:
https://thebreadwinner.co/2020/07/03/gold-industry-hit-hard-from-new-chinese-loan-scandal/

We see here a world altering amount of 'gold' that is actually gold Plated Copper! Stackers need to begin checking incoming gold for weight and size. These fakes will either be too light, due to a reduced specific gravity; or they would be oversized, to be the right weight, for the same reason.

So be Very careful, they are counterfeiting various types of Gold bullion, so BE CAREFUL, and Observe fully; every single piece of gold you get, they will likely try to recover some of this loss, by dumping some of this 83 tons on someone else!

This total lack of honesty and zero quality control is why I banned China made items in my house over a decade ago. If China is the only source, I either make it myself, or I do without.

One of China’s largest gold jewelry manufacturers, Kingold Jewelry Inc., has been using fake gold to secure loans obtained from 14 Chinese financial institutions, Caixin reported Monday. The loans were for 20 billion yuan ($2.8 billion) obtained over the past five years. The Wuhan-based jewelry company was able to pass on the fake gold as pure gold, using it as collateral for loans and insurance policies to cover any losses. The publication detailed:

At least some of 83 tons of gold bars used as loan collateral turned out to be nothing but gilded copper. That has left lenders holding the bag for the remaining 16 billion yuan [$2.3 billion] of loans outstanding against the bogus bars.

This is the best reason that I pay a little more for my jewelry gold and buy only American Made metal. The real risk here is that these counterfeits, is that they are not obviously Chinese. So CHECK your new acquisitions; and NOT just with the acid testers, because these copper ingots are all coated with 24 Carat gold.

The fake gold was first discovered in February when Dongguan Trust Co. Ltd. tried to liquidate Kingold’s collateral to cover defaulted debts. However, the gold bars turned out to be just “gilded copper alloy,” the news outlet described, adding that “The news sent shockwaves through Kingold’s creditors.” China Minsheng Trust Co. Ltd., one of Kingold’s largest creditors, then obtained a court order to test Kingold’s gold bars sitting in its coffers. The test result came back on May 22, confirming that the gold bars were just copper alloy. Two other creditors also tested Kingold’s pledged gold bars and found they were fake, Caixin learned, adding:

Understanding how tolerant the Chinese Communists are, I have no doubt, that the Man rrsponsible, along with those who made the fakes; are as good as dead!

This is Bad for gold, but will help Bitcoin growth; as it becomes a safer trading option.

The news of China’s fake gold has been heavily discussed on social media, with some questioning how much of the overall gold market is fake gold. Saifedean Ammous, the author of the popular book “The Bitcoin Standard: The Decentralized Alternative to Central Banking,” tweeted: “A quantity [approximately] 20% of China’s annual gold production was found to be fake. China is the world’s largest gold producer. How much more fake gold is out there? Could gold’s market supply be growing at 5-15% every year because of all the fake gold?”

New York Times bestselling author Jim Rickards opined: “The problem with Wuhan is not only do they lie about the [covid-19] virus, they lie about gold also. Wuhan looks like the world center of counterfeit gold bars.”

It is difficult to estimate the ripple down effect this counterfeit gold will have on the World gold market at this time, but 83 tons of 'gold' just disappeared from the World stage! That has to have a real effect, by reducing the pool of available material; which Must raise the price of what is left. It also needs to be mentioned that some people will stop buying gold entirely, fearing Chinese counterfeits.

I think stackers will be better served by silver coins, as they are not expensive enough to be worth the risk of felony counterfeiting! This is the direction I plan to use myself, including holding off on gold purchases for a time, while this crisis resolves itself.