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World Gold Council Discloses Investors Bought 5.6 Tonnes Of Gold Via ETFs In Q1
The rush for money debasement around the world has escaped nobody's attention, and as a result the one undilutable commodity (unless everyone demands physical delivery at the same time) gold has seen investors around the world scramble to get their hands on the commodity, either in physical form or via ETFs. The World Gold Council has released its Q1 2010 update, according to which "Investors bought 5.6 net tonnes of gold via exchange traded funds (ETFs) in Q1 2010." This has brought the total amount of gold in monitored ETFs hit a new record of 1,768 tonnes ($63.4 billion worth of the shiny metal). Some more on the unquenchable demand for gold: "GFMS reports that the over-the-counter market saw a moderate increase in net demand during the first quarter. Meanwhile, previously existing long positions have generally continued to be very firmly held. Net long positions on gold futures contracts, a proxy for the more speculative investment, fell from the highs experienced in Q4 2009, but they remain high by historical standards." Despite the persistently high price of gold, and despite the strength of the dollar over the past quarter, demand for gold is not going away.
More details on the Investment Trends as repoted by the WGC:
Exchange traded funds
Investors bought 5.6 net tonnes of gold via exchange traded funds (ETFs) in Q1 2010, bringing the total amount of gold in the ETFs that we monitor to a new record of 1,768 tonnes, worth US$63.4 billion at the quarter-end gold price. ZKB Gold ETF and Julius Baer Physical Gold ETF, both listed on the Swiss Exchange (SWX), recorded the strongest inflows during the first quarter, adding 10.2 and 8.1 tonnes respectively, as interest in the Swiss-based securities continued. These funds remain small, however, compared to SPDR® Gold Shares, or GLD as it is known, listed on the NYSE Arca and cross-listed in Mexico, Singapore, Tokyo and Hong Kong with 1,130 tonnes (worth US$40.5 billion) in assets. GBS Bullion Securities (listed on the London Stock exchange) shed 7.8 tonnes in Q1, the largest net outflow of the ETFs we monitor.
GLD options
Trading in GLD options fell in the first quarter of 2010 to a total of 11.5 million contracts from 13.7 million in Q4 2009, but remained high relative to the historical average of 7.5 million contracts (from Q3 2008 to Q1 2010). Volumes sharply decreased from an average high of 283,072 contracts per day in December 2009 to a daily average of 143,168 contracts by March 2010. After retreating for most of January, call and put volumes spiked again on 5 February at 215,324 and 132,922 contracts respectively, the same day the yellow metal fell by more than 4.0% and reached the quarter’s low of US$1,058.00/oz, on the London PM fix. Subsequently, option volumes started to fall coinciding with the downward trend in gold volatility. At-the-money implied volatilities on the 3-month call and put options trended downwards during the quarter; implied volatility reached the high for the quarter on 4 February trading at 25.7%, finally retrenching back to 17.4% by the end of the quarter.
Gold futures
COMEX total non-commercial and non-reportable net long positions, a proxy for the more speculative end of investment demand, gradually fell over the quarter. The net long ultimately shed 7.1 million ounces to 20.8 million ounces by the end of Q1 2010, compared to the end of Q4 2009. On average, net long positions in the first quarter of 2010 decreased by 13.8% from 29.2 million ounces in Q4 2009. The net long fell for most of January and February, to later spike up back to 25.2 million ounces in March, as the trade-weighted dollar lost some ground from its peak in late February. This peak was short-lived, as the trade-weighted dollar gained momentum again (primarily on the back of continuing concerns surrounding fiscal and credit woes in Europe) and the net long position in gold fell back again. Overall, both long-only and short-only positions decreased over the quarter. Long-only positions fell by 13.7% on average during Q1 2010 relative to the previous quarter, more than offsetting a 3.0% reduction in short-only contracts during the same period. Whilst net long positions decreased on average during Q1 2010, the price of gold remained well supported throughout the quarter, as physical demand fl ows for gold appeared not to be driven by speculative trading. Nevertheless, net long positions on gold remain high by historical standards, as these kinds of investors also continue to see value in the gold trade.
Over-the-counter market
According to research carried out by GFMS on behalf of the World Gold Council, investor activity in the over-the-counter (OTC) market saw a moderate increase in long positions during the first quarter. Anecdotal evidence and preliminary analysis by GFMS suggest that this moderate increase reflects slower than expected commitment to gold from so-called ‘real money’ funds, partly on the back of dynamics between the gold market and global economic developments including the sovereign debt crisis in Europe. Meanwhile, GFMS believes previously existing long positions have generally continued to be very firmly held, with very little in the way of liquidations in recent months. Moreover, gold’s strong performance in 2009 coupled with other considerations such as its portfolio diversification and inflation hedge characteristics were likely behind the fresh wave of allocations that occurred at the beginning of 2010. Finally, GFMS finds evidence that most of the OTC activity has been on the form of “plain vanilla” rather than structured products, in particular in the form of allocated gold positions.
Bars and coins
The latest available data on coin and bar sales corresponds to Q4 2009 (comprehensive Q1 2010 data will be released in mid-May). Net retail demand for gold, which includes demand for coins, small bars, medals and imitation coins and other retail investment, remained strong during the fourth quarter. It rose by 14.0 tonnes to 187.9 tonnes in Q4 2009, an increase of 8.0% on the previous quarter. This largely reflected a recovery in investment demand primarily in the US— which experienced the single biggest infl ow during the quarter from 19.0 tonnes in Q3 to 37.3 tonnes in Q4 2009—followed closely by India, which increased by 15.6 tonnes. Overall, European investment fl ows also enjoyed solid gains during Q4 2009 adding 7.2 tonnes. Whilst bar and coin demand in Q4 2009 was not as strong for China relative to Q3, anecdotal evidence suggests that Q1 2010 experienced strong demand for physical bars which kept suppliers (including importers to SGE) fabricating gold bars till the last day before the Chinese New Year holiday (14 February 2010)—a peak season for both gold bars and jewellery demand. In the US, first quarter data on American Eagle bullion coin sales from the US Mint shows a more modest picture relative to a very strong Q4 2009. Demand for 1-ounce coins in Q1 2010 was 271,000 ounces (8.4 tonnes), compared to 362,000 ounces (11.2 tonnes) in Q4 2009. Overall demand, however, remains high by historical standards. Investors wishing to purchase gold coins or small bars can find a list of retail dealers on our website at: http://www.invest.gold.org/sites/en/where_to_invest/directory.
Lease rates
The implied gold lease rate is the difference between the dollar interest rate and the equivalent duration gold forward rate—the rate at which gold holders are willing to lend gold in exchange for dollars (also known as the swap rate). Of the two components, the 3-month US Libor started to rise to 0.30% by the end of the quarter from around 0.25% in early January. The second component, the 3-month gold swap rate, fell to a low of 0.16% by the end of January from 0.39% in end-December 2009, before rising modestly back to 0.22% by the end of the quarter. Consequently, the implied gold lease rate turned slightly positive in Q1 after being negative for most of Q4 2009.
Full WGC report:
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GLD bitches?
GLD (is for) bitches.
Amen, I thought I was alone. You should have here last week when I was attacked wholesale. I felt like a politican walking through a gay parade who didn't support their cause.
Around here, you pretty much are (alone that is).
GLD is paper, yip, not physical.
Pity you weren't here a few weeks back; you and MB could have been a tag team.
Most people would have taken the hint and left.
I guess such logic doesn't work for trolls who are paid to hysterically defend the corrupt and failing financial and monetary establishment, however.
You writhe, we laugh.
You're gay.
BOLD GITCHES!!!
The phrase "physical delivery" will be deemed an act of terrorism
+10
They'll be right up there with the "evil short sellers of stocks".
The flight to safety and fear of a fiat collapse leads investors to buy...Paper gold?
Huh? The term ironic would be an understatement. The end all event would mean people just through their money in the furnace buying these ETFs
Yip, never heard of physical paper?
Yes...the intelligent and astute investors among you dumass goldbugs have invested heavily in it.
I have a vast stockpile of rubles in my bugout bag and I'm moving to the USSR when TSHTF here.
CASH IS KING
And who will take your cache? Visa? Maybe, but how many credits do you want for all those rubles?
I think paper FIAT monie will be like a traumatic injury to our collective.
Amen Trav7777 amen.
Your name says it all what is there to say? My screen name means nothing, no my name isn't carl.
Dullards in the ETFs, it's the same as shorting Au. That is actually a gelding manuver. /seriously/
The magic number seems to be 5.6. Is this IMF "gold"?
"LONDON: The International Monetary Fund sold 5.6 tonnes of gold in February under the second phase of its gold sales programme, the World Gold Council said on Monday."
http://economictimes.indiatimes.com/news/international-business/WGC-says...
++
I'm expecting it to jump this week back to 1226 but they are playing so many freaking games it's rediculous. People are just going to have to set their own sell price and stop "listening" to the market.
How about this? Gold holdings of central banks rising: IMF
Money pours into gold. Prices stable.
I don't get it. Yeah yeah, price manipulation and that but how long can this last or am I missing something?
It will last forever. Gold is the only asset that cannot be in a bubble, as it is shiny, pretty, and you can hold it in your hand.
That's why it's manipulated, because it only goes up all the time. In fact, "they" just want you to sell your gold so that "they" can buy it all.
And why not? The United States will be Zimbabwe in three months, and we'll all be masturbating with our bullion and eating canned ham while the rest of society goes to oblivion!
Join me, my brutha, in saying that "this time is different." Join the goldbug religion and leave common sense at the door!
We were right about it hitting 2000 by the summer, so the next target will be 5 or 6000. Hell, who knows? Why stop there? It might even hit 60000! Gold is the only asset the goes up all the time in the history of history!
GOLED BITCHEZ!!
Your sarcasm will lead directly to your impoverishment. Enjoy your serfdom.
No it won't. I'll just rob you and steal your gold when SHTF.
"this time is different."
Your historic timeline is pretty short. A product of U.S. public education? Gold is cranking it's way back to the price it's always been. The "this time is different" moment was at the low price for gold. That was the (reverse) bubble in the historic timeline.
How's this for a history lesson.
Gold was 850 an ounce in 1980. Then, the economy got well again.
Gold was 250 an ounce by 2001, even after all the inflation.
You're saying that the economy will never recover? That's the only thing that will keep gold rising indefinitely.
Of course, HISTORY shows that the economy will recover again. HISTORY shows that when the economy recovers, goldholders become bagholders.
Johnny Bravo: Member for 5 days 15 hours
FNG
That matter so much dipshi@. Is this a fraternity you have to pledge? Go away with your gold guy.
yipcarl: Member for 1 week 5 days
I'm detecting a pattern here. Better trolls please.
Somebody's Mom didn't let them watch Fight Club?
I've been here a lot longer than you, homey. My old handle is MB, and I've been here about a year or longer now.
Not that that matters. All that matters is that your logic sucks. Disagreeing with your bad logic doesn't make me a troll. It makes you illogical.
Once a gold-hating gold, always a gold-hating troll.
Why the visceral hate for an inanimate metal, MasterBates?
Oh, Johnny!
So, ye donned a disguise and rejoined the brigade?
duplicated, erased.
Straw man your arguements much? I am sure the reason you think gold is in a bubble is because currently it takes a lot of fiat pieces of papers to buy it. But that doesn't not mean its expensive. It will be expensive when it takes you more time to work per unit of labor than it does to just get it out of the ground yourself.
Until then it is cheap imho.
I think it's in a bubble because the dollar is down 33% while gold is up 500%. (Two guesses who I am!)
The rest of the run up in gold is not tied to inflation, but rather the fear of it. It's speculative, and not fundamentally sound from a valuation perspective.
It will crash when fears about the economy are eased.
LOLOL. You bet! Everything else is manipulated BUT Gold ain't! It sounds so good bouncing off my forehead.
I'm thinking one of these gold bugs should design a machine that melts their gold bars and coins down to usable pieces. Then another gold bug can invent a machine people that can be used to test the purity of these pieces of gold. Goldbugs should get right on it. If you believe gold is all there is then why not make some money on these much needed devices.
What concerns me is someone is going to respond saying their in their garage now attempting to create one. LOL.
Patent app. 23111.4555.8999.1
No, gold's manipulated DOWNWARD, see. It should really be at 6000 today, but since JPM has been manipulating it, it's only at 1150 or whatever.
Just wait until the next day gold is down 10 bucks. OH SHIT there'll be conspiracy theories everywhere!
Not missing anything. Gold and silver are set for an explosion. I'd expect it before the end of the year, absent some new miracle/abomination.
The indexes will track gold and gold will track at a 10%-15% clip (ontop of inflation) heading into the fall when miners get done and say, "So, we didn't get much of the stuff, again, and we sold our hedges last year, so you banksters will have to make do with what you got." At which point the banksters go, "Hmmm, so we do not have as much gold as we needed to leverage this bitch of an economy up like we wanted. Either we go 200-1, or we start a war." Another bankster says, "What if we tell the truth?" All the other banksters laugh. They tell us gold is worth $1815 on December 21th.
There's too much force on it. It will gradually go up rediculously slowly and then just crack but how long it takes it to crack is the problem. If they left it alone it would go up and back down like the 80's but I just can't see how it's ever going to see less than 5k an ounce post crack judging by how much correction the current system needs. Of course obliterating the current system makes all those valuations null and void.
If the oil producers get back control of the supply chain it will track oil prices pretty good. But we still haven't seen downturn 2.0. Which is going to be brutal. I'm going to have to say the gold explosion is a 2011 event but I think we'll get a pretty good jump this year.
"I just can't see how it's ever going to see less than 5k an ounce post crack"
You mean after you're done smoking crack, or what? LOL.
Hephasteus, I like you, and I don't wanna seem disrespectful, but I disagree.
-MB
They are set for an explosion downward when the ending diagonal is broken.
Based on supply and demand I'm guessing that white will be the new gold (silver, palladium, platinum). But gold is the backbone of my holdings.
+1
Good point. Picking platinum before gold rockets up would be a great move considering how scarce platinum is.
Yes, Pt at nearly the POG in 08 was the buy of the century in metals.
I'd love me some Pt but the spreads are whack on the 1ozers
Plat will crash with the system, just as it did in 08. If you want to buy it cheap, just wait.
+1 It's a precious jewelry/commodity metal...
i like plat. but...
as soon as they created paper plat... that investment is also going the way of GLD. it may take time, but its creation and timing cannot be an accident. no sooner do folks move to a more substantial (less manipulated) market, it then becomes a target of the PTB...
sadly, with a market as huge as the fake GLD market out there has become, it *does* effect the physical market, because it distorts perception. just try to convince the 7 zillion GLD holders that your physical is worth more than their ETF.
until TSHTF, the perception game is going to prevail. and the folks driving that game know it.
until TSHTF, the perception game is going to prevail. and the folks driving that game know it.
Management of Perspective Economics: Wall Street's gift for the new decade.
Yeah, GLD and all the other paper investments are going to keep on behaving just like they have for the last 30 years --
until they don't.
Bought some today.
This will put a lid on the gold pot for now. Must be why the IMF sold some gold to ETFs, bastards.
Interestingly we all know what happens when the status quo is the truth; you must have gold in physical posession or else you do not own it. This will be like turning the heat on under an active volcano. Kaboom.
I know the treasury mints coins and sells them to the Federal Reserve banks at face value. They are NOT issued against debt like Fed Reserve Notes. Does anybody know if they sell the Fed US gold and silver coins at face value?
The Treasury maintains possession of all coined gold/silver/platinum bullion coinage. It sells them thru a few qualified dealers for later sale to collectors. The proof coinage is sold directly by the Mint to retail buyers. The Fed does not take ownership of gold or any other precious metal coinage. They are just not equipped to handle the distribution/sales. It does distribute all other coinage to the Reserve Banks. What little seigniorage there is with PM coinage stays with the Treasury. There are some sales deviations, but it is coin-specific, not an iron-clad policy of the Mint/Treasury.
GLD is just a way to deflect money away from actual physical gold, which would be over 3000 if all the money going to this fraud GLD was going to physical.
GLD actually have any gold? How do we know?
Another screenname that says it all. You right you right. LOLOL.
Try putting a something under your pillow tonight maybe you'll wake up with some gold there eh?
YIP, You come to our place to insult us? Teenage punk or shill find where you can be happy. GO there.
Hasn't it occured to you that making fun of goldbugs makes us happy?
It's like laughing at the retarded, only, I wouldn't laugh at the retarded because they don't know any better.
Goldbugs should know better.
Welcome back Master Bates. Still selling the plummeting gold bullshit. Who's buying it?
Hey, you know that I always liked ya.
I'd still say that there's more likelyhood of gold plummeting than it going to 2000 or 5000!
Don't know if I made it obvious it's me, but you are definitely correct about me being MB.
Have a good night.
Noted MB. And I still say that this fiat and fractional reserve system is going down!
Don't forget the impact Peak Oil is going to have on the system...
Oh no way. Fractional reserving works best in an increasing environment. Which is why it worked so wonderfully in rome while they were clawing tons of the crap out of the mountains with explosives. It works great when you switch it over to oil and keep increasing supply of oil. It doesn't work at all in a declining or steady state condition of new supply to cover old bullcrap.
So you are absolutely right. The system is soo screwed.
So a negative lease rate means what, that holders were paying those with cash to borrow their gold? WTF
So a negative lease rate means what, that holders were paying those with cash to borrow their gold? WTF
Yes, and yes. Say hello to central banks who hate gold and a rising price.
This is obviously affecting silver as well. Supplies have dried up here in the bay area. Getting harder by the day to find physical supplies.
I have a potential scenario based on when BRK took delivery of that huge silver position. BRK made a silver position a few years ago taking 6 months to scrounge up enough physical delivery to meet their contracts.
If any giant fish (Soros, Buffett, or China) take delivery of a huge position it's going to dramatically affect the price. I can park alot of money in GLD or SLV to have price exposure to the metals while slowly building a physical position (so as not to make a tidal wave of price all at once). Owning the paper ETFs could be a way to hedge, betting that the world won't end (counterparty risk) short term. In the end, they'll be selling out of the GLD and SLV during the mania (to John Q Public) who will get stuck in the cash settlement endgame.
It's like a spagetti western showdown! Everybody is afraid to move too quickly lest they cause the situation to spin out of control. Seems like that's what's going on to me.
This may sound arcane, but lease rates in gold may remain stubbornly higher than the discount rate, and eventually the policy rate.
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/paul...
It was a rate inversion of short term rates over long term rates which preceded the onset of the financial crisis by many months. I am assuming that the collapse of the gold derivative short position will be when lease rates make it impossible to hold on to that trade any longer.
That's funny. Over the weekend, we took a trip to go play with our gold. Then we came home and ate spiral-sliced honey baked ham. Coincidence? I think not...
But seriously, the premiums on physical gold will likely increase, cuz of supply concerns at least. London can say any price they want, but actually getting your hands on it is a separate issue.
Demand physical delivery immediately or be prepared to accept payment in script.
GLD is nonsense. There isn't enough gold in the solar system to cover that. Let's say Sprott, CEF,Zurich gold funds have claims on physical metal too. There's no way GLD is anything but a synthetic,hyperleveraged sham.
GLD is more like an ETN than an ETF. It's tracking GOLD but essentiallyis being to used byt he system to marginalize gold, manipulate gold and increase gold/money supply like a fiat currency.
Where the F were all these people last week? I got HAMMERED by dozens of gold lunatics and now their gone? How quickly retards disappear as i expected. Wait till gold hits 500, no goldbugs going to be around to laugh at. Sad. I take pleasure in laughing at Arrogant people with big mouths=(most)Goldbugs.
Run along now. Master Bates is calling you -- or is that your mother?
Goldbugs have been right for a long time.
Gold the decade's best investment
Nadler is this you with a new name?
No FREAK, that raccoon can tell you who I am. LOL.
However FREAK I will give you that gold has preformed phenomenally over the last decase. I bought at 400 and sold just over 1000. I can't pick the top or the bottom but I can tell you this, I don't buy at 100 year highs and I HATE goldbugs. Please don't come at me with inflation adjustments and this adjustment or that adjustment.
Hey Racoon, seems your a bit outnumbered today.
Hey are you part of the gay movement as well? Enjoy some ass lately? You seem to be the type.
pathetic
Poor argument, or in your case NO argument, usually degrades to ad hominem tactics.
Congratulations, your logic has become a bubble. Trade that.
Really you little coward? You talk about my mom, I stand up for myself then you accuse me of attacking you? People wonder why I hate spinless jellyfish like you. Lucky you got your computer screen and your far away from me you little pussy.
"Because gold is honest money, it is disliked by dishonest men."
(Ron Paul, The Case for Gold)
You're gay.
"Because gold is shiny and pretty, it is hoarded by lunatics that believe the sky is falling."
- Your mom, last night.
Here is one of the most telling graphs I've seen in a while:
The performance of gold in bull markets.
http://i42.tinypic.com/mmzsc1.jpg
It has not even begun to form a "bubble".
Nadler? I forgot that dork exists. Where is he?
I hear that there are five or six people who still read the daily gold-bashing Kitco screeds of the financial establishment's official court jester --- why, I cannot imagine.
You cannot imagine... because you're gay?
yip, seen a mirror lately?
Oh? You talking about my mom? That's not an Ad Hominem attack? LOL, you are true asshole. I'd LOVE bitch slap you and I swear to you that's exactly what I'd do.
That chart is awesome, nice work buddy. Your picture says it all.
I am sorry to hear about your self esteem issues.
Is there anything anoyone can do to help you?
Guess what moguls I ride bitches, yessir they are in my friggin yard and I did take delivery and they are buried there in jars and yes my friggin guns are loaded too.
C'mon and fuckin try to take my moguls.
ahem,,, ok
nice weather today.
Where you live tough guy?
How de we start the physical delivery stampede? Any one individual tries to pull ten bars out of GLD and they get mighty nervous.
Ok everybody repeat after me!!
Take delivery yah!
Take delivery yah!
We shall overcome!!!!! (oops wrong crowd)
ah yes - even the threat of topling those british antigold bitches makes me horny.
Asia is pulling back hard, gold heading for support. Great action in silver! Silver spiked before retreating as well. First support is at $1145, we will see if it holds. I expect it to hold until friday, where we will see $1135 tested. After friday I think gold is heading by $1160 and into the $1180 range. I expected this pullback with massive treasurie selling and Op/Ex. It will be a down week. The White Witch was out today, shaming the bankers. I find it funny that they have a harder time keeping a lid on things than they do propping it up at this point. Bubblicious! Hyperinflation bitches!
http://www.kitco.com/charts/livegold.html
Dude, don't front. You know it's dropping because it's manipulated.
Also, I think that it's going to shoot through the 1180 range, and go to 6000, by summer.
*wink*