Gold History

The most important international gold spot market in the world includes:
In London, Zurich, Hong Kong, and New York, other places such as Tokyo and Istanbul are also the center of the gold spot trading market.

1. The London gold trading market

Historical background and supply and demand characteristics of the London gold market

The London Gold Market is the largest and long-established gold market in the world. As early as the early nineteenth century, London was the center of world gold refining, sales and exchange. In 1804, London replaced Holland Amsterdam as the center of world gold trading, and the London gold market was formally established in 1919. The main supplier of gold in the London gold market is South Africa. Prior to 1982, the London gold market was dominated by gold spot trading; the London forward gold market opened in April 1998.

The trading system of the London gold market is very special. It belongs to the wholesale market of the store. It has the nature of spot and forward market. There is no actual trading place. The transaction is carried out through intangible means and is completed by the sales network of major gold merchants. Exchange members are composed of five authoritative gold merchants【Note 1】and some companies or stores that are considered to be eligible to purchase gold from the top five gold merchants, and then consist of chain of various processing manufacturers, small and medium-sized stores and companies.

The London gold market is at the heart of the world's gold trading, and its gold price is very important. London has almost monopolized gold sales in South Africa, the world's largest gold producer, and most of the gold market is traded through the London gold market. Moreover, the five gold merchants in the London gold market are also well-known internationally, and have extensive contacts with many gold mines and gold merchants in the world; the five major gold merchants have many subsidiaries, and the subsidiaries are associated with many stores and gold consumers. In connection with this, the scope extends not only to the London gold market, but to the entire world, making the London gold market price the most important gold price in the world.

【Note 1】The current top five gold merchants are Barclays Capital, Deutsche Bank, HSBC, Scotia Mocatta, SG and so on.

2. The Zurich gold trading market

Historical background of the Zurich gold market

The Zurich Gold Market was established in 1968 as an international gold market developed after the Second World War. Switzerland's special banking system and an auxiliary gold trading service system provide a free and confidential environment for gold trading, plus a preferential agreement between Switzerland and South Africa to obtain gold imports from South Africa and gold from the former Soviet Union (Russia). It is also here, making Switzerland not only the largest relay station for gold in the world, but also the world's largest private gold storage center. Zurich's gold market ranks second only to London in the international gold market. 【Note 2】There is no formal organizational structure in the Zurich gold market. The two largest banks in Switzerland: UBS-AG and Credit Swiss First Bank (CSFB) are responsible for clearing and closing accounts. The two largest banks in Switzerland are not only for customers. Trading on behalf of the bank, and the gold transaction is also the main business of the two banks themselves. 【Note 3】The Zurich Gold Pool is based on the informal consultations of the two largest banks in Switzerland. It is not subject to government jurisdiction. It acts as a combination of a combination of traders and clearing systems, and plays a role in the market.【Note 4】The rapid growth of the Zurich gold market has its unique political factors. Switzerland is a permanent neutral country, giving people the impression of security and stability. Therefore, it attracts a large number of customers who are engaged in gold purchases or engage in gold speculation.

In addition, UBS has the second largest smelter in the world at the Swiss-French border, and is engaged in the acquisition of non-standard gold for refining. Because of the gold in hand, it is able to provide services to customers around the world in terms of real gold, including the provision of gold commodities ranging from one to one hundred grams for individual investors.

【Note 2】The world's largest gold producing country is South Africa, and other countries include the United States, Russia, Canada and the mainland.
【Note 3】Switzerland's two largest banks were formerly the three major banks of Swiss Bank Corporation (SBC), Swiss Credit Bank (SCB) and Union Bank of Switzerland (UBS). After the merger of Swiss Bank (SBC) and UBS, Switzerland has changed from the three major banks to the two largest banks.
【Note 4】The "Zurich Gold Pool" purchased gold from South Africa and the Soviet Union, the major gold producers, and sold it in Zurich, making Switzerland the world's leading gold trading market after London.

3. The Hong Kong gold trading market

The historical background of the Hong Kong gold market

The Hong Kong gold market has a history of more than 90 years and its formation is marked by the establishment of the Hong Kong gold and silver trading market. Hong Kong had already had a market-style gold and silver currency exchange as early as 1904. The company organized the establishment of the "Gold and Silver Industry" from 1910, when a simple rule was established. After the First World War, the government registered the case and officially named it "Gold and Silver Trade Field."

In 1946, the Standard Gold Bar Group (referred to as the Gold Group) was established in Hong Kong, specializing in the casting of gold bars for settlement. Before 1962, the market traded gold and silver, including regional and international currencies. In 1974, the Hong Kong government withdrew its control over the import and export of gold. Since then, the Hong Kong gold market has developed extremely fast. Later, due to the change of the objective environment, the transaction gradually concentrated on gold trading.

As the Hong Kong gold market just filled the gap between the US gold market and the pre-opening market in London, it formed a complete world gold market through the time of Asia, Europe and America. 【Note 5】Hong Kong's superior geographical conditions have attracted the attention of European gold merchants. The top five gold merchants in London and the three major banks in Switzerland have set up branches in the local area. They brought the gold trade in London to Hong Kong and gradually formed an invisible "Loco London Gold Market" based on the "Loco London System". One of the world's major gold markets. 【Note 6】Hong Kong has two gold spot markets. The first is the "golden and silver trading ground" with a fixed position in China. There are two gold specifications in the trading market. 99% of 99 gold, each basic purchase price is 100 two, the minimum price fluctuation is 5 Hong Kong dollars per square point; and the color is 99.99% kilograms, each basic purchase and sale quantity is 5000 grams, the minimum price fluctuation is per HK$1 cents.

The second is a group of foreign funders who have settled gold in London; they have close links with the London gold market and there is no fixed trading venue, the so-called “local London gold market”.

【Note 5】The US gold market referred to here refers to the branch of the New York Mercantile Exchange (NYMEX), the Commodity Exchange (COMEX).
【Note 6】The "local London system" is the basis for quoting, trading and delivery of non-designated accounts of gold or silver based on the basic London delivery criteria. This system is based on the London Good Delivery Standards System and establishes a local quotation and delivery system for Loco London Gold. Therefore, the so-called "local London gold market", which is a gold spot trading trader and investor, can buy and sell London spot gold outside of London, and the delivery location is in London. The standard gold color is 99.5% and the weight is 400 gold. Gold troy ounce.

4. The New York gold spot market

The historical background of the New York gold market

The New York gold market has evolved since the mid-1970s. In 1974, the US government lifted the ban on restricting people's possession of gold. Since January 1, 1975, when people were allowed to legally own gold, gold trading has gradually flourished. In terms of supply, it is currently one of the three largest gold producing countries in the world; 【Note 7】The demand side is due to the wide population and industrial development, so the demand for physical gold for gold and industrial gold is quite large, in terms of gold entity demand. It is currently the fourth in the world.【Note 8】In addition, after the 1985 depreciation of the US dollar, Americans profited for arbitrage and value-added investment, which made gold futures develop rapidly. The gold trading in the US market is mainly based on “gold futures trading”, the spot trading is small, and the main trading market type is storefront trading.

【Note 7】The three major gold producing countries in the world are South Africa, the United States, and Russia.
【Note 8】The main markets for global gold entity demand include India, Italy, countries in the Middle East, the United States and China.

5. Tokyo Gold Exchange Market

Historical background of the Tokyo gold market

Since Japan itself produces very little gold, the source of its trading gold is almost always dependent on imports. Since 1973, the Japanese government has allowed Japanese gold traders to directly import gold and sell it. Until 1980, the Japanese gold market was completely lifted, and the Tokyo gold trading market was able to develop rapidly.

Japan's gold trading is not a centralized trading method. There is no fixed trading place, but trading through many gold traders. Some traders even provide online gold trading services through the Internet.

In developed countries, Japan is the main investment channel for buying gold. In Japan, the amount of gold stored is increasing at an annual rate of about 19% or 10 metric tons per year. In recent years, this rate has increased dramatically. In 2001, for example, the gold consumption for Japanese collection and preservation was 379. The metric tons, an increase of 70% over 2000, of which 70 tons of gold bars were purchased by individuals, 17 tons more than in 2000, all due to the deteriorating economic environment.

6. Istanbul gold trading market

Historical background of the Istanbul gold market

In 1980, the Turkish government began to liberalize the structure of the trading market, covering all economic levels, including the establishment and regulation of the gold trading market. The initial prototype of various reforms was completed in 1984, and the Turkish central bank also established a gold market index based on the lira, in addition to the exchange ratio of gold and foreign currency to the Turkish lira. Since 1989, with the establishment of a gold market index denominated in foreign currencies and the gradual liberalization of the capital market, the import and export volume of Turkish gold has gradually enlarged, and gold trading has become increasingly prosperous. However, in order to effectively regulate the trading of gold so that it can operate better under the system and the trading information can be more effectively spread, the Istanbul Gold Exchange was formally established on July 26, 1995, and the Turkish gold market gradually developed. To liberalize and integrate into the pulse of the international market, this move not only facilitates the trading of domestic gold traders in Turkey, but also attracts foreign investors.

The gold trading method in Turkey is mainly to import gold from the central bank that is given the right to import gold, and in the gold market established by it, the bank or the designated institution purchases gold in foreign exchange according to international standards, and then the bank or the designated institution Turkish lira is sold to the general consumer. Since the government's management and policy regulations were well-planned before the official operation of the Istanbul Gold Exchange, the operation after the opening did not create excessive market risk. The current exchange market is divided into three parts: the precious metals market (including standard gold, non-standard gold, silver and platinum markets), the gold futures and options market, and the precious metals lending market, while the currencies traded can be the US dollar, the euro and the Turkish lira. , but not between various currencies. Turkey adopts an active supportive attitude towards the market. In addition to exempting all taxes, it also requires that the first trade of imported precious metals such as gold must be completed through the exchange. Trading is more convenient and faster.