It was reported yesterday by a Beijing paper, Guangzhou Daily, that its central bank is considering the purchase of 4000 tons of gold. This equates to their possibly acquiring 128,600,000 ounces of gold.

China currently holds $1.9 trillion in reserves mainly in US paper products. If China did commit to purchasing 4000 tons this would use up only about 5% of their reserves.

Jim Sinclair made the following comment today, "Once 21,000 bars have been taken(from COMEX) the paper gold’s reign over the price of gold is over." 21,000 bars times 100 ounces equals 2,100,000 ounces of gold. I'm not sure if the COMEX bars are in 100 ounce lots but I figued it out that way to get total ounces anyway. If this is not correct, would someone please correct me.

The bottom line: There is a sizable potential buyer indicating, unofficially, that they may have a need for 128,6000,000 ounces of gold. Where is this gold going to come from if China goes ahead with their possible buy program? What will COMEX do if China comes knocking with intentions on taking delivery?