This year has truly been momentous for investors in gold coins.

The China syndrome.

November 30, 2010 – This year has truly been momentous for investors in gold coins, and the prospects for 2011 are even better. Gradually reality has to sink in, and already a shift in sentiment can be seen among investors who up until now had put their faith – and wealth – into the dollar. Although the dollar has been doing well against other currencies, the decline in its true value is clearly evidenced by the steadily climbing price of gold in dollar terms.

Now China has thrown another wrinkle into the already precarious currency market. The country’s policy against the free trade of its currency in effect prevents its citizens from investing abroad and forces them to save at interest rates the government has capped below the rate of inflation. In the first of its kind move China has now made it possible for its people to invest in a mutual fund containing foreign gold ETFs.

The Chinese are fanatic savers, and given the choice between the negative effective interest of domestic deposits and the expected returns from foreign gold investments there is no question about which they would choose. If China continues this policy the world gold market will experience a tremendous surge in demand, and the Chinese currency will take another step towards global exchange.

Looking back over gold prices for this year one thing stands out: the price of gold is not steadily climbing – it is accelerating. The market is being driven by investors seeking safe haven from the perilous state of fiat monies brought on by government manipulation, the ranks of which may well be joined by millions of Chinese next year.

The climate for gold coin investments is the best it has been in several decades.

Kevin Johnson

Senior Staff Writer –

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