Wednesday, December 1, 2010

China Approves Fund That Will Invest In Foreign Gold ETFs, Opening Avenue For Millions Of Mainland Investors | zero hedge

And here is the catalyst: China has approved a fund that will invest in gold exchange-traded funds outside the country, opening the door to mainland China investors who face negative real interest rates on their bank deposits and want to hedge against inflation. Beijing-based Lion Fund Management Co. said they received approval from the China Securities Regulatory Commission on Monday to proceed with the fund. Next stop: gold much higher as the bubble mania is really unleased in such ETFs as GLD, UGL and PHYS.

This bears some thinking about... could it be that China wants to expose the ETF's who are not fully backed by gold... in any event it's hard not to see this as driving up the gold price at least in the short term.. look for a spike in the gold price late December or early January

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