Here’s another quick #China update. There was a sudden surge in gold buying here in Shanghai over the weekend. You can see here in the attached video.

The catalyst was a round of household vouchers issued by the local government.

Basically, a series of different vouchers were made available including Rmb150 on a Rmb500 purchase all the way up to Rmb1,000 for a Rmb10,000 purchase. In the very savvy Chinese fashion, rather than use the vouchers for the intended purpose, to incentivize consumer discretionary spending like washing machine or clothing or some other more typical consumer item, the vouchers were used to buy gold.

No prohibitions were made on how the vouchers were to be used. The gold shops even got with the program promoting the opportunity. Most point-of-sales were between 1 and 5 grams.