Because I couldn't have written it better, below is cut and pasted from Zerohedge:

Sometimes, such as after pervasive liquidations in precious metals (or is that AAPL? Has it become clear yet that with widespread "quality" collateral shortages, gold and AAPL stock have become unexpected and almost interchangeable collateral replacements) it is easy to lose sight of the forest for the trees. A forest, in which the New York Fed is procuring (through the open market) the rehypothecated gold that the Bundesbank demanded for repatriation in January; in which JPMorgan's gold holdings have plunged by 75% since said stunning Bundesbank announcement and hit new record lows on a weekly basis paradoxically just as the price of spot gold keeps sliding ever lower; and in which China is importing unprecedented amounts of gold and adding more and more each month. So let's do a quick refresh on the forest, shall we.
Here is what we discovered in September 2011, as part of Bradley Manning's trove of declassified US cables. From Wikileaks:

3. CHINA'S GOLD RESERVES

"China increases its gold reserves in order to kill two birds with one stone"

"The China Radio International sponsored newspaper World News Journal (Shijie Xinwenbao)(04/28): "According to China's National Foreign Exchanges Administration China's gold reserves have recently increased. Currently, the majority of its gold reserves have been located in the U.S. and European countries. The U.S. and Europe have always suppressed the rising price of gold. They intend to weaken gold's function as an international reserve currency. They don't want to see other countries turning to gold reserves instead of the U.S. dollar or Euro. Therefore, suppressing the price of gold is very beneficial for the U.S. in maintaining the U.S. dollar's role as the international reserve currency. China's increased gold reserves will thus act as a model and lead other countries towards reserving more gold. Large gold reserves are also beneficial in promoting the internationalization of the RMB."
And now for some empirical trees.

While we don't know how much of the several hundred tons that Jens Weidmann has demanded for delivery from Liberty 33 has already been purchased and/or delivered, we know one thing: since publishing the Wikileaks disclosure China has imported nearly 2,000 tons, and just under 1,500 tons since January 2012...

... and that Chinese gold imports in 2013 continue to surpass those from 2012 "despite" the violent slide in the gold price - almost as if unlike E*trade momentum chasing babies, China buys more the lower the price drops.

In other words, China - pragmatic as always - decided to call the "rising gold price suppression" bluff of the US and Europe and do the only logical thing that takes advantage of an artificially suppressed gold price: buy hand over fist.

As for everyone else selling their (mostly paper) gold over fears that this time, unlike the previous two, Bernanke will actually stop monetizing debt and in the process eliminate all concerns of monetary collapse, China is happy to wave it in (and why not: it is only a matter of time before the taper makes way for the untaper).
Finally, we concluded our previous post looking at recent gold technicals with the following rhetorical question:

Someone more inquisitive than us may wonder: just where is all this gold being "withdrawn" to...
Rhetorical, because we have a very good idea where this gold is going.

And don't miss this:

JP Morgan Vault Gold Drops To New Record Low; Brinks Gold Plunges By 24% In One Day

Last week we defined the golden sentiment rule as "anything that isn't off the chart soon will be." This will happen in a "perfectly sustainable" fashion, where increasingly more paper gold is shorted to record levels even as actual physical holdings held by official Comex vaults continues to drop. For one particular reason why the price of paper gold may be at 3 year lows, we will provide some formerly classified perspective shortly in a post. But in the meantime, and while we await the weekly CFTC commitment of traders report (delayed until Monday due to the July 4 holiday), we are happy to report that the JPM disconnect between the epic delivery requests and its reported gold holdings (for which the "Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness") reconnected modestly, and as per the latest Comex update, another 6.8k ounces of gold was pulled from JPM's 1 CMP world's biggest gold vault, dropping its total gold inventory to a fresh record low.

Perhaps even more notable is that on Friday, that "other" depository, Brink's, saw 24% of its entire registered gold holdings, or 133k ounces, quietly get withdrawn. This, together with the moves in JPM and HSBC inventory, meant that total Comex gold holdings dropped by 116K ounces to a new low not seen for the first time since 2006.

Finally, for that all important marginal source of paper gold supply or demand, ETFs,the two largest ones (GLD and IAU) have now retraced 50% of their "holdings" gain since the fall of Lehman.

Someone more inquisitive than us may wonder: just where is all this gold being "withdrawn" to...