Apple To Buy Up To 30% Of The World’s Annual Gold Production?

Technology giant Apple (NASDAQ:AAPL) may soon buy up one third of the world’s gold in order to meet the demands of its highly anticipated Apple Watch, according to reports.  – Mining.com link

Apple is planning on producing 1 million units per month of its new gold iWatch beginning in Q2 2015.  According to sources each watch will contain 2 ozs of gold.  If you extrapolate out, that translates into 746 tonnes of gold per year – roughly 30% of world annual gold mine production.

Even if Apple’s sales of this watch – which apparently has very heavy demand in China – fall short of Apple’s business plan by 50%, it means that Apple will become one of the largest buyers of gold in the world.   This will place a lot more stress on the U.S./UK/EU Governments’ absurdly overleveraged fractional paper bullion scheme

AAPL

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23 thoughts on “Apple To Buy Up To 30% Of The World’s Annual Gold Production?

  1. You know Dave…can’t help but think there’s more to this story than just watches. Everyone knows Apple is hoarding cash…they have more than they know what to do with, and that may not be hyperbole. There are a lot of smart people at the top of Apple, and it wouldn’t surprise me if they want to diversify their cash not only across multiple geographic locations and currencies, but also to include gold. But of course, Apple can’t just come out and announce they’re buying gold as a cash-equivalent, what a shitstorm that would cause. But if they’re amassing a position in gold, purely as a manufacturing input…cough cough…there’s less of an uproar. Just a tin-foil-hat thought…

  2. “According to sources each watch will contain 2 ozs of gold. ”

    Now we know the Fed considers paper gold as identical (= fully equivalent) to physical gold.

    Therefore Apple may always hand out 2 ozs of paper gold with each new iWatch.

    This requirement does not really stress the fractional paper bullion scheme: the banksters merely need to print a couple of extra ounces for each watch…

  3. from tech radar.com…
    “Watch Edition will be the most expensive Apple Watch because of its 18-karat gold case. It may even be locked inside a safe within your local Apple Store.

    It’s been crafted by Apple’s metallurgists to be twice as hard as standard gold, says the Cupertino company, and will come in two colors: yellow gold and rose gold.

    Complementing those cases are color-matching bands made of leather (bright red or rose grey) or fluoroelastomer plastic.”

  4. 1/3 of all the Gold? But of course, there will be no comparison to the famous Hunt Brothers and this unique transaction will have no effect on the value of Gold going forward. Why? Because Apple, that’s why. /s
    If true it would be a market disrupting event. More than that, it’s insane, unprecedented and truly unbelievable.

    Look at the picture, now look at a 1oz. coin. Now double the size of the coin. Now wonder how so much gold can fit inside such a seemingly small watch and also leave space for stuff known as hardware. Now wonder why smart phones are so large, powerful and require such huge batteries. Impossible scenario.

    FTA Apple will require 24Moz/year. “In 2014, preliminary estimated gold production by the top publicly-traded and non state-owned gold mining companies amounted to 30 Moz.”
    http://www.mining.com/top-10-gold-companies-in-2014-67501/

    Will this be an anti trust violation if they try to buy all of the world’s largest gold producers or even their total production?

    I call BS on this whole idea.

  5. The watch doesn’t contain 2oz of gold. The watch itself weighs 2oz with the amount of gold being a fraction of the total weight.

    1. Take it up with the Company. Everyone who has been critical of the article is talking out of their ass. If you want to get the details first-hand, I’m sure Apple’s investor relations dept will take your phone call or answer your email. Take it up with them, not this blog. My commentary shows that even if the estimates are only 50% right, AAPL will still be one of the largest gold buyers in the world.

  6. Don’t know about the Apple story ” gold watches” .
    Has anyone ever heard of a watch by the name of Rolex?
    The Rolex President model is 18k and weighs roughly
    75.5 grams. That is the bracelet and the case that is 18k
    gold. The calculus goes like this, 31grams of gold equals
    one ounce of gold. The Rolex bracelet and case weigh
    75.5 grams. That means that the Rolex contains two
    and one half ounces of 18k gold. That weight total excludes
    the internal mechanisms some of which may also contain
    gold. So maybe there is something to the apple watch.

    1. Not sure why everyone is doubting the story – take it up with Apple’s investor relations. The information for the article about the watch came from the company. I’d say Apple has much bigger global brand name than Rolex. Rolex is for the Geritol generation. It’s a “been there, dont that” item.

      1. Yes I agree it is a older persons kind of watch and not
        something I would want to be seen wearing. A bit to
        ostentatious if you catch my drift. I will tell you this,
        if you take that watch down to Rick Harrison’s pawn shop
        in Las Vegas you will be set for the evening. “Winning”

  7. No way it holds 2 Ozs. gold and its 18 ct anyway so that makes it 1.5 Ozs, but I don’t believe that either.
    And the 1mm Unit sales per month?
    Maybe in total including the cheaper versions but not for the gold version
    Has anyone compared those numbers to the luxury gold watch market?
    Does Rolex sell 12mm units of their gold watches a year and how much gold do they contain?
    Story is misleading sorry.
    But I do think Apple could do well with this watch if it has some good features.
    And apple endorsing gold’s value doesn’t hurt either

    1. Rob, how do you know they don’t use 2oz of worth of 18k gold? You don’t. It sounds like based on the information which came from the WSJ that the WSJ got the watch specs from the Company. The article specifically said that the watch was very hot in China. Go argue with the Company about their sales projections, not this blog

      1. Holy crapper! You are right, Dave! Sorry doubting you. 😉

        Here the relevant part from http://blogs.wsj.com/digits/2015/02/17/apple-orders-more-than-5-million-watches-for-initial-run/

        Orders for Apple Watch Edition – the high-end model featuring 18-karat gold casing – are relatively small in the first quarter but Apple plans to start producing more than one million units per month in the second quarter, the person said. Analysts expect demand for the high-end watches to be strong in China where Apple’s sales are booming.

        Apple Watch Sport will start at $349. Apple hasn’t announced pricing for the other models, but Apple Watch Edition is expected to be among the most expensive products the company has ever sold, likely surpassing the $4,000 Mac Pro computer.

        The question now is: where will Apple get all this gold from? My best guess would be the COMEX! 🙂

        1. Comex doesn’t have that kind of gold to deliver. Based Friday’s warehouse stock report, the Comex only has 10 tonnes of deliverable gold (“registered” account). And that assumes that the warehouse stock report is fraudulent, which I believe it is.

          1. 10 tonnes would be a start for Apple. That kind of gold wouldn’t even last for one week of production! Time to go for eligible too. Let’s open the COMEX gates and see what’s really in there.

  8. Dave not arguing with your blog and no I don’t know the real facts, just trying to point out the lack of research given in the article.
    Would love it if it contained 2 Ozs. And they sold a million a month.
    You believe that because the wsj said so without any supporting info such as luxury watch sales?
    Apple is being quite mum about the watch specs.
    I’ll keep my comments to myself in the future sorry for the intrusion

    1. Lack of research? The article I linked from Mining.com links the source article from WSJ. I read every word of both. I guess you did not look at either. The article specifically references Apple’s initial production run based on indicated demand, of which much is specifically referenced from China.

      I’m pretty meticulous about posting source references whenever necessary.

  9. I read them both several times. Rarely post anywhere
    Thought this might be a good place to challenge their (not your) incomplete and obfuscated info and get the real facts. Guess not.
    I mean they didn’t even correct for 18 vs. 24 ct which knocks 25% off their numbers and shreds their credibility.
    In the future I will keep my thoughts to myself.

  10. LOL..I never thought I’d see the day when Apple started hoarding gold. Too funny and terrifying at the same time.

    I do think the solid gold watch with Gold electronics is absolutely cool. The new generation of Daddy’s wealth will consider it a prestigious symbol of their cleverness and a mark of technical ingenuity. I believe the watch will be remembered as a symbol of China’s rise to power. It will be a collectors item for sure. The page of history is turning on the U.S.

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