## FOREX TRAINING COURSES IN MALAYSIA ## FOREX TRADING INVESTMENT>> FOREX REVIEW

Greek Euro Exit Likely Within Days

The game is up for Greece as there is surely no way back for the country and a rapid Euro exit is increasingly likely. Without decisive action, the Euro is also likely to come under increasingly severe selling pressure as the financial crisis spreads. In theory, the EU and IMF can continue to provide the funds agreed under the existing bailout programme, but this will only delay the inevitable as on the current trajectory Greek public debt is likely to be at least 180% of GDP next year. The collateral row also illustrates how difficult it will be to keep EU members on board and willing to contribute to the planned second bailout package. Indeed, there is a high risk that the second bailout will unravel within the next few days.

Greece will have to reflate its economy and default on its sovereign debt to help secure a medium-term recovery and this will not be possible within the Euro-zone. It is increasingly likely that Greece will be sacrificed politically and economically in an attempt to keep the rest of the Euro area intact and aim for a more orderly move towards greater fiscal union even though this may be politically impossible.

The market’s vote of no confidence in Greece and the bailout package could hardly be clearer as Greek bond yields rise exponentionally, at one point the 2-year yields rose to a staggering 55% on Monday. The only question now appears to be the timing and method of Euro exit. Greece can either make the decision itself or it will effectively be forced out by the other members.

The decision could be taken out of Greece’s hands by the German constitutional court which will rule on Wednesday whether the EU bailouts were legitimate under German Law. If the court rules unambiguously that the bailouts were unconstitutional then the Euro-zone in its current form would have no chance of survival as the peripheral countries would come under immediate and terminal attack. A more complex and less clearly defined ruling looks the more likely outcome which would demand additional guarantees for future aid.

Such an outcome would also create market uncertainty and confusion. It would also make life even more difficult for Greece, but would not be decisive enough to force am immediate exit. More importantly, it would intensify political tensions in Germany as Chancellor Merkel would find it even more difficult to gain parliamentary support for an expanded EFSF as domestic opposition would increase further.

Tensions are flaring throughout the Euro area as Italian bond yields rise even with the support of ECB buying. Last week, the ECB almost doubled its buying of peripheral bonds as they bought EUR13.3 compared with EUR6.7bn the previous week. Italian yields have still increased back to the 5.50% area and credit-default swaps also rose sharply on Monday. European banking stocks were also sold very heavily during Monday.

The ECB is clearly extremely frustrated with the situation and has warned Italy not to slide on austerity measures in expectation that the ECB will prevent any market fall-out. The Italian government will continue to debate austerity measures on Tuesday at the same time as a General Strike has been called and the domestic willpower looks shattered.

The political and economic developments appear to have a surreal quality with key political players calling for action to stem the crisis, but simply insisting that measures agreed previously need to be implemented in full and more quickly. The calls for austerity in the face of recessionary conditions and rising debts will simply not work as the outcome will be for a further increase in debt and even weaker growth while political support will crumble.

In this environment, it is far from clear that the European authorities will be able to prevent a more substantial break-up of the Euro area. If Greece leaves the Euro, Portugal and Ireland would have great difficulties staying in while Italy would also be extremely vulnerable.

The only logical policy is for Europe to chop away as much of the periphery as is required to stop the infection from destroying the core. If they act quickly and promise more fiscal co-operation, then the casualty list may be small. The longer a decision is delayed, the more likely it is that countries such as Italy will also be forced out of the Euro area with the emergence of a two-tier Euro area.

join now button 300x134 Greek Euro Exit Likely Within Days

China to Have Half of Asia’s Millionaires by 2015

Yuan China to Have Half of Asia’s Millionaires by 2015 China’s millionaires will account for about half of Asia’s rich and hold more than half of the region’s wealth by 2015, according to a study by Julius Baer Group and CLSA Asia Pacific Markets.

Asia’s millionaires will more than double in number to 2.8 million, with 1.4 million high net worth people in China, according to the Asia Wealth Report released yesterday. Chinese millionaires will hold $8.76 trillion of the $15.81 trillion that the region’s millionaires are expected to have, it said.

“In terms of the overall amounts of wealth that will increase, it’s very much a China story,” Stefan Hofer, emerging market equity strategist at Julius Baer, said yesterday at a press conference held for reporters in Singapore and Hong Kong.

Expansion in the world’s fastest-growing major economy created 502,000 millionaires in the country last year, according to the report. State and private investments helped drive a 9.5 percent gain in second-quarter gross domestic product from a year earlier, the government said in July, faster than estimated as growth in industrial output and retail sales accelerated and copper and aluminum production reached records.

The tripling of Asian millionaires’ assets from $5.6 trillion in 2010 will be also driven by currency appreciation in the region, according to the report, adding to the economic growth and gains in asset values.

The currency gain may create 600,000 new millionaires — or individuals with more than $1 million of investible assets excluding their primary residence – - by 2015, it said.

India, South Korea

Indian Billionaires China to Have Half of Asia’s Millionaires by 2015

India will be the second-biggest market in Asia by 2015, with 403,000 millionaires and a combined $2.5 trillion net worth, the report said. South Korea will be ranked third.

Julius Baer, the Swiss private bank which has Asian offices in Hong Kong, Singapore, Jakarta, Abu Dhabi and Dubai, wants to expand further in the region, said Thomas Meier, the bank’s chief executive for Asia and the Middle East, calling it the company’s “second-home aspiration.”

The bank aims to have a fourth of its overall assets under management in Asia by 2015, he said. It now has about 10 percent to 20 percent of its 166 billion Swiss francs ($205.4 billion) in assets under management in Asia.

Wealth managers are looking to boost allocations to markets in the Asia-Pacific region in the next 12 months as they expect higher returns, according to a study by Scorpio Partnership Ltd. in July.

Eighty-four percent of investment professionals at wealth management companies are planning to invest more in the region, while 33 percent are considering increasing investments in Latin America, the Middle East and North Africa, the study showed. Managers catering to high-net-worth investors are turning to emerging markets and non-traditional asset classes for returns while reducing inflationary risks, the Scorpio study said.

The number of millionaires in China grew by 12 percent to 534,500 last year, according to a report by Capgemini SA and Merrill Lynch Global Wealth Management in June. China ranked fourth in the number of millionaires, trailing the U.S., Japan and Germany.

To contact the reporter on this story: Sanat Vallikappen in Singapore at vallikappen@bloomberg.net

The World’s Biggest Gold Reserves

Who Has the Most Gold?

Gold Trading Malaysia 300x200 The Worlds Biggest Gold Reserves The price of gold eclipsed $1,800 per ounce in August, rising 26.0% in 2011, following uncertainty in the equity markets and the global economy as a whole.

The biggest individual holders of gold—central banks, international entities and governments—are believed to account for approximately 16.5 percent of the world’s gold, holding about 30,700 tons.

The numbers are taken from the monthly report produced by the World Gold Council, which is the gold industry’s key market development body. The holdings presented here are as of WGC’s August 2011 report, unless otherwise noted.

So, who holds the most gold? Let’s go to find out!

SS world gold holdings portugal 300x200 The Worlds Biggest Gold Reserves 15. Portugal

Value of reserves: $24.6 billion
Holdings total: 421.5 tons

The westernmost nation in mainland Europe is home to the 15th largest gold reserve in the world. At 421.5 tons, Portugal’s holdings are overseen by Banco de Portugal and are valued at roughly $24.6 billion, accounting for 84.8 percent of the country’s foreign reserves.

SS world gold holdings taiwan 300x200 The Worlds Biggest Gold Reserves 14. Taiwan

Value of reserves: $27.2 billion
Holdings total: 466.8 tons

Renowned for its technology industry and robust economic growth, Taiwan also boasts one of the largest gold reserves in the world.

The Central Bank of the Republic of China (Taiwan) manages the island nation’s foreign reserves, which have been reported at 466.8 tons. These holdings are worth $27.2 billion at today’s prices and comprise approximately 5.0 percent of the country’s foreign reserves.

SS world gold holdings euro central bank 300x200 The Worlds Biggest Gold Reserves 13. The European Central Bank

Value of reserves: $32.23 billion
Holdings total: 553.3 tons

Established in 1998 by the European Union, the European Central Bank (ECB) is responsible for the monetary policy of the member nations of the euro zone and is headquartered in Frankfurt.

The ECB’s 553.3 tons of gold accounts for 31.3 percent of the bank’s foreign reserves and would be worth $32.23 billion in today’s market.

SS world gold holdings india 300x200 The Worlds Biggest Gold Reserves 12. India

Value of reserves: $35.79 billion
Holdings total: 614.6 tons

Shooting up in the rankings in the past few years is India. The second most populous nation in the world maintains the 12th largest gold reserves. The size of India’s holdings were bolstered in November 2009 by a $6.9 billion purchase of 200 tons of gold from the International Monetary Fund.

The Reserve Bank of India currently oversees the country’s 614.6 tons of gold, which are valued at $35.76 billion, comprising 8.7% of its foreign reserves. India’s current ranking may also continue to move upwards, as the government has asked the Geological Survey of India to mine previously untapped gold reserves in many of its states.

SS world gold holdings netherlands 300x200 The Worlds Biggest Gold Reserves 11. The Netherlands

Value of reserves: $39.3 billion
Holdings total: 674.9 tons

The Netherlands has the 11th largest reserve on the list, with 674.9 tons of gold. The Netherland Bank manages the country’s national finances, including the gold reserves, which amount to approximately $39.3 billion and account for 58.9 percent of the country’s foreign reserves.

SS world gold holdings bank of japan 300x200 The Worlds Biggest Gold Reserves 10. Japan

Value of reserves: $49.11 billion
Holdings total: 843.3 tons

Although Japan is ninth on the list, its 843.3 tons of gold account for only 3.3 percent of total foreign reserves. On the open market, Japan’s gold reserves would be worth around $49.11 billion, and are overseen by the Bank of Japan.

SS world gold holdings russia 300x200 The Worlds Biggest Gold Reserves 9. Russia

Value of reserves: $53.7 billion
Holdings total: 922 tons

The Central Bank of the Russian Federation is in charge of the country’s 922 tons of gold, which are valued at $53.7 billion and comprise 7.7 percent of the country’s foreign reserves.

In 2009, Russia increased its gold production by 21 percent, due in part to the launch of several new mines. Last year, the country overtook Japan in total holdings, adding more than 140 tons to its stockpile in 2010 alone.

SS world gold holdings swiss 300x200 The Worlds Biggest Gold Reserves 8. Switzerland

Value of reserves: $66.75 billion
Holdings total: 1,146.2 tons

The Swiss National Bank conducts Switzerland’s monetary policy and manages the country’s 1,146.2 tons of gold.

With the world’s eighth largest reserve of the precious metal, Switzerland’s supply is worth approximately $66.75 billion in today’s gold market. It accounts for 17.8 percent of the country’s foreign reserves, though this is down significantly from a year earlier.

SS world gold holdings china 300x200 The Worlds Biggest Gold Reserves 7. China

Value of reserves: $67.65 billion
Holdings total: 1,161.6 tons

At 1,161.6 tons, the world’s most heavily populated country has the world’s seventh largest gold reserve. Expect it to be higher on the list? Well, bear in mind that China’s gold only accounts for 1.6 percent of its foreign reserves. With a population of 1.34 billion, the country holds about $50.49 worth of gold per person, totaling $67.65 billion.

SS world gold holdings 2011 SPDR 300x200 The Worlds Biggest Gold Reserves 6. SPDR Gold ETF (GLD)

Value of holdings: $70.7 billion
Holdings total: 1,213.9 tons

Unlike other major gold holdings, this is one that investors can actually buy in to. As the price of gold fluctuates, so does the value of SPDR Gold Trust, also known the GLD. The fund held 38,845,889 ounces, or 1,213.9 tons of gold as of its 10-Q filing on June 30, 2011.
Although gold is off it’s all time highs, during the week of August 22, 2011, the SPDR Gold Trust surpassed the heavily-traded S&P 500 SPDR (SPY) for the first time. Like many investors, the ETF has indicated they have increased their holdings of gold since their most recent filing.

Pictured: Gold bars are displayed at the GLD Fifth Anniversary Celebration Hosted By SPDR Gold Shares in New York

SS world gold holdings banque de france 300x200 The Worlds Biggest Gold Reserves 5. France

Value of reserves: $156.31 billion
Holdings total: 2,683.8 tons

The French National Bank, Banque De France, is home to the country’s gold holdings, which comprise 66.2 percent of its foreign reserves. With 2,683.8 tons of gold in reserve, France’s holdings are worth approximately $156.31 billion.

SS world gold holdings banco ditalia 300x200 The Worlds Biggest Gold Reserves 4. Italy

Value of reserves: $157.36 billion
Holdings total: 2,701.9 tons

The Banca D’Italia manages Italy’s foreign reserves, which have been reported at 2,701.9 tons by the World Gold Council and comprise the fourth largest gold reserve in the world.

These holdings are worth $138.33 billion and account for 71.2 percent of the country’s foreign reserves.

SS world gold holdings imf 300x200 The Worlds Biggest Gold Reserves 3. The International Monetary Fund

Value of reserves: $180.6 billion
Holdings total: 3,101 tons

The International Monetary Fund (IMF) oversees international economic operations of 185 member countries. Its gold policies have changed in the last 25 years, but the reserves remain to stabilize international markets and aid national economies.

In one such instance, the IMF sold a portion of its reserves in December 1999 to aid the Heavily Indebted Poor Countries Initiative. The 3,101 tons of IMF Gold would fetch roughly $180.6 billion in the open market.

SS world gold holdings frankfurt 300x200 The Worlds Biggest Gold Reserves 2. Germany

Value of reserves: $218.28 billion
Holdings total: 3,747.9 tons

The Deutsche Bundesbank, Germany’s central bank, has 3,747.9 tons of gold reserves, which are valued at about $218.28 billion. According to the World Gold Council, Germany’s gold coffers account for 71.4 percent of total foreign reserves.

SS world gold holdings USA 300x200 The Worlds Biggest Gold Reserves 1. United States

Value of reserves: $522.16 billion
Holdings total: 8,965.6 tons

The United States Bullion Depository in Kentucky—otherwise known as Fort Knox—is the most famous gold stockpile in the world. It holds the majority of the nation’s gold reserves, the remainder of which is held at the Philadelphia Mint, the Denver Mint, the West Point Bullion Depository and the San Francisco Assay Office.

Altogether, the total gold reserves of the U.S. equal 8,965.6 tons and would be valued at approximately $522.16 billion in today’s market.

Source: World Gold Council, with conversions by CNBC | Photo: Cliff