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Eric Sprott's Open Letter To The World Gold Council

Tyler Durden's picture


Authored by Eric Sprott of Sprott Global Resources,

Dear World Gold Council Executives;

As you very well know, the business environment for gold producers has been extremely challenging over the past few years. While demand for physical gold remains extremely strong, prices on the COMEX have fallen precipitously. This contradictory situation is the single most important obstacle to a healthy gold mining industry.

In my opinion, the massive imbalance between supply and demand is not reflected in prices because available statistics are misleading. It is not the first time that GFMS (and World Gold Council) statistics come under pressure from the investment community. In his now celebrated “The 1998 Gold Book Annual”, Frank Veneroso demonstrated the inconsistencies in GFMS gold demand data and proceeded to show how they grossly underestimated demand. The tremendous increase in the price of gold over the following years vindicated his conclusions.

For very different reasons, we are now at a similar pivotal point for gold. Over the past few years, we have seen incredible incremental demand from emerging markets. Indeed, so much so that the People’s Bank of China has announced that it is planning to increase the number of firms allowed to import and export gold and ease restrictions on individual buyers.1 In India, the government has been fighting a losing battle against gold imports by imposing import taxes and restrictions.2 Moreover, Non-Western Central Banks from around the world are replacing their U.S. dollar reserves by increasing their holdings of gold.3

But, demand statistics reported by the World Gold Council (WGC) consistently misrepresent reality, mostly with regard to demand from Asia.

To illustrate my point, Table 1 below contrasts mine production with demand from some of the world’s largest gold consumers. According to WGC/GFMS data, the world will mine, on an annualized basis, about 2,800 tonnes of gold for 2013.

But, I adjusted these figures to reflect mine production from China and Russia, which never leaves the country and is used solely to satisfy domestic demand. After adjustments, we have a total world mine supply of about 2,140 tonnes. On the demand side, I make some in-house adjustments to better represent demand from emerging markets. To proxy for gold consumption in China, Hong Kong, India, Thailand and Turkey, I use net imports of gold, as reported by their various governmental agencies. While imports might in general be an imperfect proxy for demand, those countries see very little re-export of what they import and keep most of it for themselves, so it is not unreasonable to assume that what they import they “consume”, on top of their domestic production. To this I add the demand, as estimated by the GFMS, from other countries and that of central banks. I annualized the year-to-date figures and found that for this year, annualized total demand is approximately 5,200 tonnes. On that basis, “core” annualized demand is approximately 3,000 tonnes more than mine supply.


Sources: GFMS data comes from the WGC’s “Gold Demand Trends” publications for 2013 Q1 & Q2. Chinese mine supply comes from the China Gold Association and is up to August 2013, the annualized number is a Sprott estimate.5 Russian mine supply comes from the WBMS (Bloomberg ticker WBMGOPRU Index) and is for 2012, 2013 statistics are still unavailable. Chinese data is taken from the Hong Kong Census and Statistics Department and covers the period Jan.-Aug. 2013 and is annualized to account for the 4 missing months to the year. Changes in Central Bank gold reserves are taken from the IMF’s International Financial Statistics, as published on the World Gold Council’s website for 2013 Q1 & Q2 and include all international organizations as well as all central banks. Net imports for Thailand, Turkey and India come from the UN Comtrade database and include gold coins, scrap, powder, jewellery and other items made of gold. The data is for 2013 Q1 & Q2. ETFs data comes from Bloomberg’s ETFGTOTL Index.

However, these figures also exclude what the GFMS dubs “OTC investment and stock flows”, which is a name for a simple plug because no one really knows what is traded in the OTC market. Also, to remain conservative and avoid possible double counting, I exclude the category “technology” from my demand estimate, which the WGC/GFMS estimates to be about 400 tonnes a year.6 Certainly, some of this demand is captured by the demand numbers for China, Turkey, India or Thailand, but it is near impossible to disentangle them. Nonetheless, it should be kept in mind that my demand estimate is conservative and probably understated by a few hundred tonnes.

Of course, another important source of supply is gold recycling, which the GFMS estimates at about 1,300 tonnes for the year. However, this number is questionable at best as gold recycling is hard to estimate. But, most importantly, a large share of it is probably done in India and China, which as mentioned before do not re-export their gold. In the context of my analysis, recycling from those countries should therefore be excluded from the total supply number.

The real incremental source of supply this year has been the flows out of ETFs. According to data compiled by Bloomberg, and as shown at the bottom of Table 1, ETFs have seen outflows of approximately 724 tonnes year-to-date. On an annualized basis, this represents an additional supply of 917 tonnes. But, this incremental supply is only temporary. As shown in Figure 1 below, ETF holdings of gold seem to have stabilized at around 1,900 tonnes after a rapid decline in the first few months of 2013.

The evidence presented here is clear, demand for physical gold is extremely strong and, in reality, without the massive outflows from ETFs (half of world mine supply), it is hard to imagine how this demand would have been met. Since ETFs have a finite size (about 1,900 tonnes left), these outflows cannot continue for much longer (see our article on the topic).7 All these observations point to a considerable imbalance between supply and demand (unless Western Central Banks decide to fill this void with what is left of their reserves). If recycling was reduced by one half (China, India and Russia) and the temporary sales from ETFs were excluded, demand could be as high as 5,185 tonnes versus supply of 2,140 tonnes. The supply-demand imbalance is obvious to all.

Source: Bloomberg

As was the case when Frank Veneroso first published his book in 1998, the GFMS methodology understates demand and the World Gold Council, by using data from the GFMS, misleads the market place.

To conclude, I urge the leaders of the World Gold Council, for the benefit of their own members, to improve the quality of their data and find alternative sources than the GFMS, which paints a misleading picture of the real demand for gold. This lack of quality information has certainly been one of the driving factors behind the lack of investors’ confidence towards gold as an investment. Gold has been one of the best performing asset classes since 2000, and the World Gold Council should be promoting it accordingly.


Eric Sprott


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Tue, 10/22/2013 - 22:40 | 4081641 Leonardo Fibonacci2
Leonardo Fibonacci2's picture


Tue, 10/22/2013 - 22:46 | 4081652 synergize
synergize's picture

Anybody who believes the WGC has gold's interests in mind is kidding themselves.  GATA is an organization truly dedicated to justice - the WGC is a joke.


If you are fed up with whats happening with the government - it all stems from one major thing: the government's control of our money.  We have placed in our government the ability to control the money supply and dish out new money to whomever they please (usually their cronies and the banks) and to spend and create that money in infinite amounts to SUPPRESS we, the People.

To break this system we have to bring back real money and thus limit government control over money and our lives.  We can break the system by overwhelming the physical markets and give a no-vote to their control over money - they key is the small silver market.

Join the Silver Pledge - an effort to change the system by having investors join up and buy physical silver - together we can break this market and take back our government.

You can read more here:

If you dont like it dont sign up - but for people who are sick of sitting and doing nothing at least lets work together to BREAK this silver market

Tue, 10/22/2013 - 23:05 | 4081703 DavidPierre
DavidPierre's picture

Speaking of Bill Murphy et al...

Wed, 10/23/2013 - 06:44 | 4082117 jbvtme
jbvtme's picture

local currencies local production equals freedom. gold is the hedge

Wed, 10/23/2013 - 09:17 | 4082366 Lewshine
Lewshine's picture

While we debate this useless article, the manipulators are doing their usual knee-breaking destruction on yesterday's up move...LIKE CLOCKWORK!!

Everything else is just noise!!!

Wed, 10/23/2013 - 11:20 | 4082753 boogerbently
boogerbently's picture

Fixing Mining:

1) Miners increase their prices.

2) The rest of the supply chain adjusts.

Tue, 10/22/2013 - 23:10 | 4081718 TwoShortPlanks
TwoShortPlanks's picture

Dear Mr Sprott,
Nice letter.
Please ensure to travel in your own private aircraft, operated and serviced by reliable and trustworthy professionals.
If you cast your mind back you will remember a certain Mr Obama whom had a close call with the "accidental mid-air deployment" of an emergency escape slide (Tail Section no less and "coincidentally"), prior to US Elections.
Kind Regards,

Tue, 10/22/2013 - 23:35 | 4081764 DaveyJones
DaveyJones's picture

GATA gets my vote.   

Wed, 10/23/2013 - 00:03 | 4081799 BLOTTO
BLOTTO's picture

Its hard to implement anything when these fucks have total control of whatever else it is they put in its re-place. Just a deception, yet again, and again and again...slowly drip by drop. 1000s of years...


No use picking off the poisoned pineapple chunks and sickly anchovies off the pizza if the dough is rotten to the core.

Wed, 10/23/2013 - 07:26 | 4082143 gavrilo princip
gavrilo princip's picture

exactly. here is something educational:

Wed, 10/23/2013 - 13:35 | 4083246 TheInformed
TheInformed's picture

I don't get the hostility.


I remember when the Nintendo Wii was almost impossible to purchase for 2 years.  That actually seems like Demand outpacing supply 2:1.  


Gold on the other hand, I can buy some right now, from dozens of different websites.  Coins or jewelry, whatever I want!


I feel like Sprott has HIS own interests at heart in this letter, not the 'gold community'.   


His stats are bullcrap.


Tue, 10/22/2013 - 23:37 | 4081769 SpykerSpeed
SpykerSpeed's picture

Or maybe the demand for precious metals is less than you think and the supply is greater than you think.

That's what happened with silver.  It turned out that while Sprott and others like him were trumpeting it as "going to $500 because of supply/demand imbalance", it was actually going to $23.

Yes, manipulation is possible.  But not for years on end.  And if silver really is worth $500, then you'd think the market would have baked SOME of that information into the price.  It hasn't.  It's not even halfway to $50.

Guys.  She's just not that into you.  Sorry.

Tue, 10/22/2013 - 23:43 | 4081779 DirkDiggler11
DirkDiggler11's picture

One question Spyker - For how many years did the banks rig the LIBOR rate ?

Wed, 10/23/2013 - 00:24 | 4081832 Professorlocknload
Professorlocknload's picture

"One question Spyker - For how many years did the banks rig the LIBOR rate ?"


When did they stop?

Wed, 10/23/2013 - 00:25 | 4081834 SpykerSpeed
SpykerSpeed's picture

The same number of years they've had access to the Federal overnight window at 0% interest, which is to say:  forever.

It's easy to rig the interest rates on a fiat currency.  But we're talking about silver, here, which is a physical commodity with supply and demand.  How do the banks rig that for years on end?  Even with all you silver bugs buying up the physical?

Wed, 10/23/2013 - 00:37 | 4081856 Bay of Pigs
Bay of Pigs's picture

How do they "rig it"? Seriously? Its been explained here hundreds of times before. And seeing you've been here over 3 years you should know how it is done.

GTFO clown.

Wed, 10/23/2013 - 04:08 | 4082014 zhandax
zhandax's picture

So herr SS, IOW, shut up and die?  Don't think so.  I will agree that the banker pirates can paper over the gold market until the cows come home, but I smell cowshit through the window now, pal.  You have an encore?

Wed, 10/23/2013 - 09:40 | 4082452 Keyser
Keyser's picture

Did you even read the letter? When production is lower than demand for any comodity and TPTB refuse to state such in their official reports, they are misrepresenting the truth. How simple can it be? PM's are being manipulated lower to keep people from fleeing the USD to PM's. All you have to do is review the charts for evidence. 




Wed, 10/23/2013 - 04:13 | 4082022 CHX
CHX's picture

What you seem to miss, SS, is that currently >99% of all Ag and Au traded are soiey paper claims. PAPER CLAIMS, not physical metal. As long as that's the case, THEY set the price where they want it. If every buyer bought the physical metal (and not some highly leveraged contract / paper vehical designed to win/lose some bucks quickly) then you'd get true price discovery. THAT day will come, someday. Good day to you. 

Wed, 10/23/2013 - 00:29 | 4081838 SpykerSpeed
SpykerSpeed's picture

double post

Wed, 10/23/2013 - 01:06 | 4081889 buyingsterling
buyingsterling's picture

Any commodity market that isn't cash and carry and which allows cash settlement in fiat which is available at 0% rates can be manipulated relentlessly, the only real barrier being production costs.

Wed, 10/23/2013 - 01:29 | 4081905 Ranger4564
Ranger4564's picture

ETF. No production cost.

Wed, 10/23/2013 - 07:51 | 4082166 kralizec
kralizec's picture

Credit multiplier, fantastic tool for manipulators.

Wed, 10/23/2013 - 08:15 | 4082217 SpykerSpeed
SpykerSpeed's picture

Then if silver and gold are so easily manipulated, isnt that a weakness of silver and gold?  How do you expect these things to become money if nobody cares to have the physical?

Wed, 10/23/2013 - 09:19 | 4082375 quasimodo
quasimodo's picture

I can see where it's a hard concept to grasp when you are so seduced by the safety and assurance of BTC never losing any value.

Wed, 10/23/2013 - 10:44 | 4082657 dark pools of soros
dark pools of soros's picture

And gold and silver haven't?

Silver to 200! Is all we heard, yet it can't crack 50 and BTC has seen 200 twice now

Gold to 5000! But can't crack 2000. BTC will hit 2000 before gold ever will.

You bugs are wishing for unicorns when you could have a pony. BTC is real and doing everything you little girls every dreamed a currency can do

Babies, all ya bugs are crying babies

Wed, 10/23/2013 - 10:09 | 4082529 superflex
superflex's picture

and out comes the Bitcoin trollolololol


Wed, 10/23/2013 - 06:31 | 4082104 Nothing but the...
Nothing but the truth.'s picture

Wasn't Spyker a failed high performance car maker from the Netherlands ?

Tue, 10/22/2013 - 23:56 | 4081792 DeadFred
DeadFred's picture


Wed, 10/23/2013 - 00:12 | 4081808 Element
Element's picture

Like every other metal, when price rises sharply the older uneconomic mines, that closed at the end of the last boom (think 1983), re-open and ramp production to make a killing on the price surge. Naturally production then shoots up faster than anyone can track, so price comes down until the least economic gold miners fail, the mines are mothballed, production falls, and thus price better reflects demand again (paper of course distorts that massively).

This will continue until mines run out of economically recoverable gold, then prices will go higher if demand remains high, until a more economically viable means of extraction kicks-in to supply even more gold from lower grade ores, or previously mined tailings.

The key point is there's ALWAYS more lower-grade resource than high-grade (several times more), so we're not going to see gold go out of production if price spikes to $2,500. Just the reverse, there would be a deluge of gold production to follow, and price would quickly soften again.

Every shovel of garden soil has some gold in it, as does every bucket of sea water, the question is, can you economically recover it at the current market price and make a profit? If the price is high enough for long enough you can.

Gold is not 'currency' kids, and it does not have magic powers, it's a metallic atom and that's all.

All the rest of the Gold blurb is the psychology of myths, lies and con games.


Now go press the red button.

Wed, 10/23/2013 - 00:39 | 4081858 Professorlocknload
Professorlocknload's picture

Got a feeling if the dollar spikes back to $800 gold, Ol' Yeller will find a much cheaper supply of paper and ink. Just wood fiber and indelible dye.

Wed, 10/23/2013 - 00:50 | 4081873 Seeking Aphids
Seeking Aphids's picture

The increasing scarcity of attainable gold combined with increasing consumption should result in higher prices going forward.....the idea that there is gold everywhere so we will see cycles of price increasing/decreasing with supply being brought on tap/reduced as a function of price does not take into account the fact that increasing scarcity/cost of production will force prices into an upwards new 'cheap' gold will likely be discovered and global demand will not dimish....

Wed, 10/23/2013 - 01:16 | 4081896 Element
Element's picture

What? Are you equating this with peak-oil? If the price is high enough gold gets produced. It's not a theory. The past 150 years of extraction is a story of improving technologies that incrementally recovered gold more efficiently, at lower and lower grade. There are often decades in between price surges, so mining tech moves along in giant bounds between the price surges.

There is no end in sight to this, and anyone simplistically telling you "they ain't making any more of it", as though that's meaningful and truthy, or implying there will be a supply constraint any time soon, is either lying, powerfully deluded, or do not understand a damn thing about gold, its ores, and its geological abundance.

The ocean floors are known to be covered in very large areas in high-grade metal ores, and these include gold and silver, and there's many times more of it in the oceans than has been mined on land. So put the price up high enough for long enough and someone will develop the technology infrastructure and the processes to go and get it, and flood the market (and vaults) with new gold product.

Wed, 10/23/2013 - 03:07 | 4081976 foxenburg
foxenburg's picture

But surely, if gold is ever trading at $50k an ounce it means that fiat currencies have crashed inversely. So miners will be paying $50k a week for labourers and £5k a barrel for oil. You're never going to be able to get your hands on future gold at todays price. 

Wed, 10/23/2013 - 11:38 | 4082819 Element
Element's picture

$1,300 to $50,000, what, in a nano second, or over 50 years?

You realise you've asked a completely rediculous and inapplicable hypothetical?

There is a sub-discipline specialisation in geology called "Economic Geology", which involves initial planning of mine sites, extraction processing, transport linkages, refiners, etc., to determin if an identified resource is mineable at current and/or projected market price. Numerous mineral and energy resources exist, that have been known about for well over a century, that have still not been mined, due to lower production prices, and market competion, that makes them uneconomic.

It can take literally centuries for market prices to rise high enough (due to falling production rates or rising demand) to where it makes an ore economic to finally mine it.

If prices rises, production follows, because a lot more of the resource base then becomes economic to mine. As production surges, oversupply occurs, demand drops, prices fall, so marginal and uneconomic mines close (even if they still have a stack of gold in them, and there's absolutely nothing wrong with them).

Formerly economic mines thus become uneconomic. But say a new road or train track is built near to a closed or else undeveloped mine proposal, and suddenly transport is cheaper to markets, and the mine becomes economic, with no change to price.

Gold deposits are identified and roughy mapped out in grade decades in advance, (so the owners can then tell if and when it'll become economic to extract), so miners then wait for the periodic price ramping cycles, in order to develop such mines, then mothball them again, fast, when price falls away again.

Ramp the price to $2,000 and sustain it, and production will rise to a new all-time production level in short order, until demand and price softens again, and some mines will the close again, but not because they don't have lots of gold in them.

So why are you asking bogus hypotheticals when they tells you zip the matters about intervening currency, economics and mining cycles in gold between $1,300 and $50,000? Then you finish up this hypothetical with a pure absurdity;

"You're never going to be able to get your hands on future gold at todays price."

You're asserting here that like US houses gold always goes up. I hate to break it to you but 'future gold' can be priced much lower than $50, if no one needs or wants it.

Wed, 10/23/2013 - 01:07 | 4081893 buyingsterling
buyingsterling's picture

Sounds easy, but it's not that elastic. Or did I miss a giant production spike while gold was trading at $1500 and up?

Wed, 10/23/2013 - 01:29 | 4081899 Element
Element's picture

Mining investments are very long term, while gold spikes are very short term. It's why I said raise the price high enough for long enough and you'll get a ramp of gold production. The past ten years of ramping price has basicly done that, so production expanded.

People don't invest in mines on the basis of an effing bubble though, especially one powered by fear of global depression from a GFC, they are in mines long-term on the basis of projected long-term returns, on a very large investment, from a very large economcially extractable resource, within a price range.

Which is why it's an extremely bad idea to game bubbles, higher and lower, in wild commodities swings. If you destroy the mining industry, via doing that, it takes many years to re-establish itself (just look at recent rare-earth production lead times, in the US and Australia, and mine-development time-table).

Wed, 10/23/2013 - 06:59 | 4082126 Ghordius
Ghordius's picture

element, you are missing a few forests while dissecting this "element" Au


- monetary systems go beyond the "money" and "currency" paradigms. then at the end, it's all about international trade

- gold has very often been used as a monetary metal because of it's high stock-to-flow ratio. even if you increase the new discoveries, there is still a huge amount already in stock. or, as Keynesians like to say, there will be never enough of it

- the whole discussion about gold is still about the aftermath of the Bretton Woods agreements. 1874, 1944, 1971. if you don't see it in the historic perspective of those three dates, I'm sorry but you will not understand what's all about this element

Wed, 10/23/2013 - 08:37 | 4082263 Element
Element's picture



"All the rest of the Gold blurb is the psychology of myths, lies and con games."


Pretty clearly stated, even for you I would have thought, but I shouldn't underestimate you in that regard.

Wed, 10/23/2013 - 06:43 | 4082116 lasvegaspersona
lasvegaspersona's picture

element said: 'gold  is not a  currency' is treated like a currency

Wed, 10/23/2013 - 10:35 | 4082448 Element
Element's picture

Not to be rude, but no shit Sherlock? It's a metal, I'm sorry if someone programmed you to think otherwise. The rest of it is the global con-game;

"All the rest of the Gold blurb is the psychology of myths, lies and con games."

This may be difficult to digest for some (though it really isn't people are just stuck in a mental trench) but gold is not magical, it does not have any special status, it is not anyone's savior. At best gold's an exchangeable physical asset, of questionable value (whatever you can get for it at the time) much like RE. Best you can say is gold does not depreciate physically like other assets. The system that was built on a 'special' status myth, is defunct, but the con lingers on, and despite claims to the contrary, this is not hard at all to grasp.

Too many people are wrapped psychologically in this bogus notion that gold is going to save the system or save individuals. It can't any more than the rock under you left foot.

The system will be rebooted by the actions of desperate people in combination with the resources and energy available at that time in those conditions. Chances are essentials will be so important to everyone that gold's value will be highly doubtful in purchasing access to resources, as for one thing, demand will be almost non-existent. Some will say it's not meant for petty exchange, that it's a store of wealth (i.e. access to tradeable future resources), assuming a gold market emerges again. OK, that's worth a risk.

But no good if you die in the interim and someone takes it.

It's much more likely resources will be the obvious (so bleeding obvious it goes unstated) mark of great wealth, and of 'backing' in trades, and this also acts as the thing that 'buys' or gains the resources owner access to other resource flows.

In which case gold will not be tradeable, except at appallingly high discounts. Because needs and must have resources, but no one needs or must have gold. Thus the fiat situation since 1971 is based on resources and cred. And given the US had just walked on the moon in 1969, their skills, science, materials and capacities cred were all very high. This is no longer so evident, but it is still quite high, and is why the US will still bounce back from currency collapse, to a lower level, sans the petro-dollar printing endless debt option.

People so heavily invested the gold psychologically, and in the lingering smorgasbord of myths have trouble facing this fairly obvious thing. It's scarey and disheartening. Boo-hoo - get over it. As Faber said a couple of weeks back there are no safe havens, get over the con-game, and diversify, because if you're in too deep with gold, you're going to wish you did, and at just the wrong time. 

What do you think it actually means when people say, "the longer this goes on the worse the collapse will become."? 


Answer the question

Wed, 10/23/2013 - 09:46 | 4082465 F22
F22's picture

This is an excellent blog post.... It points out that gold in the form XAU/USD trades $240B per day on the forex.

It seems to me that this in and of itself is the reason for the seeming disconnect with the physical market.

Wed, 10/23/2013 - 08:17 | 4082221 Agstacker
Agstacker's picture

"Like every other metal, when price rises sharply the older uneconomic mines, that closed at the end of the last boom"


And it costs more and more to get less and less gold.

Wed, 10/23/2013 - 10:34 | 4082589 Element
Element's picture

Not so, gold price progressively ramped and gold production recovered (with the usual development lag) and ramped also, and price went soft. If there was more demand than supply since 2011, gold price would not be softening. CB's in Asia are buying it prolifically, but no more steady rise. So there's no supply constraint. Instead mines that can produce have closed because price slumped too low. i.e. too much supply capacity was developed to quickly.

As recoverable grade falls the quantity and diversity of ores available for extraction exponentially rises. And it's quite an assumption to state costs will necessarily rise when cumulative mine technology consistently pushed price down, even as volume increased from lower-grades of ore. Look at the first graph in this link, and at its long-term trend.

Today and in the recent past gold is produced at rates higher than at any other time. If people want gold it's there to be mined, and the potential extractable resource is many times larger than what we've already extracted. The only question is do we want it - not can we get it? Because we can definitely get it if there's a significant price ramp and profit to go after it.

Wed, 10/23/2013 - 03:00 | 4081972 Notarocketscientist
Notarocketscientist's picture

Suggest you read the first 18 pages of Grant Williams comprehensive explanation of how gold is manipulated

Sorry it can't be conveyed in a Tweet .... but if you are too busy watching Dancing with Stars then NM.... just continue on in your delusional world lead by nose by the people in the MSM

Come on - you know you want to say it.................. Say it...........

YOU CAN'T EAT GOLD!   Feels better ya?

Wed, 10/23/2013 - 04:32 | 4082032 bozzy
bozzy's picture

Spyker man - just saw your little hickey contribution after watching the pigs flying past the condo windows ... Put up the numbers please if you want to troll seriously - otherwise you are as entitiled to your own opinioin as much as my dog, but yours will count for less.

Wed, 10/23/2013 - 05:33 | 4082069 greatbeard
greatbeard's picture

>> demand for precious metals is less than you think

I seem to recall you having a hissy fit about folks dissin' bitcoin.  A bit of the old pot/kettle/black, wouldn't you say?

Wed, 10/23/2013 - 09:29 | 4082422 exartizo
exartizo's picture

Good point SS.

Sprott has his own axe to grind and his numbers look just as shady as any I see coming out of COMEX.

Cheers for having some balls buddy.

Wed, 10/23/2013 - 00:39 | 4081860 whirlybird rules
whirlybird rules's picture

Sorry room for a free market in the new normal.

Wed, 10/23/2013 - 01:29 | 4081906 Blackfox
Blackfox's picture

Loo paper made of 22-carat GOLD goes on sale at £825k for those who fancy throwing their money straight down the toilet


 And check out this...For those looking to take their obsession with bling to the next level; boxes of 24kt gold pills that promise to 'turn your innermost parts into chambers of wealth'.

The sparkling capsules, measuring 2cm long, can be found on the Citizen:Citizen website priced at $425 (around £262).

After digesting the three gold-leaf tablets, claims consumers will find flakes of pure precious metal decorating their excrement.

Now thats throwing money down the toilet.

Wed, 10/23/2013 - 10:59 | 4082697 GoldenGeezer
GoldenGeezer's picture

That thing would rip the hanger off the wall and I bet it's not very absorbent either.

Wed, 10/23/2013 - 12:10 | 4082925 auntiesocial
auntiesocial's picture

when do I get to be the man behind the curtain? IT'S MY TURN!

Tue, 10/22/2013 - 22:40 | 4081643 NoDebt
NoDebt's picture

Eric, this may be one of the few price dislocations that the "average Joe" can take advantage of.  Why not just shut up and take advantage of it?

Tue, 10/22/2013 - 23:04 | 4081700 Teddy Tenpole
Teddy Tenpole's picture



Exactly!  Hey Eric, STFU and get back to nailing the intern...

Tue, 10/22/2013 - 23:09 | 4081712 Melin
Melin's picture

Consider conducting yourself honorably.

Tue, 10/22/2013 - 23:21 | 4081734 Teddy Tenpole
Teddy Tenpole's picture



Ya Eric, you heard this gentleman -- nailing young college interns in the arse, sheeesh.

Wed, 10/23/2013 - 00:27 | 4081837 Bay of Pigs
Bay of Pigs's picture

Always room for a new PM troll here at ZH. Welcome aboard douchebag...

Tue, 10/22/2013 - 23:09 | 4081711 Harbanger
Harbanger's picture

"Why not just shut up and take advantage of it?"

Then he would be no different than the average banker.

Tue, 10/22/2013 - 23:50 | 4081785 CunnyFunt
CunnyFunt's picture

+ banger

Wed, 10/23/2013 - 01:36 | 4081914 Ranger4564
Ranger4564's picture

No advantage in price fixing at lower prices when you're all in as an investor and anticipating higher prices. He wants higher prices.

Wed, 10/23/2013 - 03:10 | 4081978 Kirk2NCC1701
Kirk2NCC1701's picture

Hmm, could it be because gold funds seeing too many sells by clients, and this Fund billionaire is richer than you are because he's better at looking after his own interests than yours?

Tue, 10/22/2013 - 22:41 | 4081644 zorba THE GREEK
zorba THE GREEK's picture

Dear World Gold Counsel: Gold is money, everything else, not so much.

Tue, 10/22/2013 - 23:12 | 4081724 Debtonation
Debtonation's picture

I like the way you spelled Council, it lives up to what the WGC really is.

Tue, 10/22/2013 - 22:59 | 4081668 CunnyFunt
CunnyFunt's picture

Sprott isn't going to save you.

Only YOU can save YOU.

Don't buy his fund, buy the physical.

Tue, 10/22/2013 - 23:12 | 4081720 Jorgen
Jorgen's picture

GoldMoney is a better physical gold investment option than Sprott's PHYS, imho.

Tue, 10/22/2013 - 23:35 | 4081727 CunnyFunt
CunnyFunt's picture

Same shit, different name.


Might as well believe in ... (turn it up)

Wed, 10/23/2013 - 01:07 | 4081892 Tim_
Tim_'s picture

Why is Eric Sprott Selling PSLV Shares Fast and Furiously? (April 8th, 2013)

"But something strange happened in the last few weeks. See, The Sprott Foundation has been selling PSLV shares at a rapid clip (data from SEDI.CA)."

"This is strange, because PSLV is no longer trading at a big premium to Net Asset Value. In fact, recently, the premium has been below 2%, and has even approached zero percent."

"Why, then, is Eric Sprott, On behalf of the Sprott Foundation, selling PSLV shares so rapidly? The Foundation has sold 3,089,445 shares (out of their total 4,642,070 shares held at the start of the period) since March, 21, 2013, and has been actively selling PSLV shares in the market every single day during since 3/21/13."

"Sprott Foundation sold another 700,000 PSLV on 4/8/13 and 4/9/13"

"Anyway, Eric Sprott (via Ed Steer) is claiming that 'a bunch' of the PSLV units were sold to 'meet obligations' from the charitable foundation… You can interpret that however you want, but we’re talking about more than $ 35MM notional of PSLV that was sold… Those are some big obligations the charity had to meet, eh?"

Wed, 10/23/2013 - 01:52 | 4081898 CunnyFunt
CunnyFunt's picture


Too fucking right, mate, too fucking right. I'm glad at least you're awake to his scam.

Rick Rule, Eric Sprott, & Co. = scammers

Might as well buy SLV.

Don't expect to "claim" your metals from these fucks since they don't have them.

Any "shareholders" in PSLV should demand to see their "holdings".

Why pay fees to these sheisters when you can hold the physical at an equal-or-less-than premium than these fucks are charging?

Sprott & Co. talk a good game, but the individual can do better.

As far as ten-bagger miners are concerned, don't believe the hype. I'd as soon drop my fiat in FB.

Really, put your fiat into the physical and sleep well at night knowing that you have a REAL piece of the action.

Wed, 10/23/2013 - 03:17 | 4081986 Kirk2NCC1701
Kirk2NCC1701's picture

Spot on! The mine execs are not getting their bonuses or "golden parachutes" any more, and the industry is ripe for massive consolidation at these prices.

If your portfolio has 10-20% in PM, you should spend additional "disposable income" into other investments and life priorities.

Wed, 10/23/2013 - 05:47 | 4082078 greatbeard
greatbeard's picture

I'm no Sprott fan for several reasons, but:

>> Don't expect to "claim" your metals from these fucks since they don't have them.

Bull Shit.  I've seen nothing to suggest the Sprott Funds don't have exactly what they say they have and will produce physical as per agreement when requested.    The ability to take delivery is one of the prime reasons Sprott's funds are still bringing a premium while CEF is trading at a significant discount.

>>  you can hold the physical at an equal-or-less-than premium than these fucks are charging?

More Bull Shit.  I can trade PSLV all day long for a pittance.  Try that with physical.

Why don't you just shut the fuck up and sit down.

Wed, 10/23/2013 - 08:33 | 4082259 philosophers bone
philosophers bone's picture

I agree with your rebuttal.  I listen to Sprott because he put his fucking money where his mouth is 15 years ago and became a billionairre.  Should have listened to him a lot sooner.  You can't criticize him for "talking his book" - the guys gone "all in" on PMs, so of course he's talking his book!  In terms of his funds, yes I prefer physical, but you are correct - if you want to have bullion exposure in a registered account or have the ability to liquidate on a moments notice without dragging your silver to the coin shop, it can be OK.  I'm not saying the fees are the cheapest, I understand that they are not.  However, the funds do own the bullion.  Downside is that it's stored at the Royal Canadian Mint which although secure is not in your hands if the government tries to do something.

Anyways, Sprott and Schiff are totally credible to me.  Faber I kind of like, but he's all over the map and I'm not sure everything he's said re: inflation / deflation is consistent.

Wed, 10/23/2013 - 08:38 | 4082266 philosophers bone
philosophers bone's picture

And last point - we don't know the details re: the sale of PMs by his "Foundation" so don't assume.  A foundation probably has an independent board of trustees that is determining the cash needs of the foundation and they probably do their own assessement of markets, etc.  I don't read too much into the fact that a foundation he established sold some PMs - don't assume Sprott told them to sell the PMs because he's changed his thesis or saw a market downturn coming.

Wed, 10/23/2013 - 20:37 | 4084689 MeelionDollerBogus
MeelionDollerBogus's picture


For 1000 shares of PSLV I could easily just get 100-200 OUNCES of silver, like maples, and put the rest of the fiat into AGQ calls for 2015 jan or later (when available) at a decent strike price. That'll take care of the fiat 10x itch and put ounces in my pocket immediately. Conservatively I'd call that 200 maples + 22 contracts and I'd estimate when AGQ slams up to 100 to 180 in that time frame... all will be well & more ounces can be had. Yes, a steep price THEN for ounces but you'll have the fiat to burn.

Tue, 10/22/2013 - 23:05 | 4081704 Teddy Tenpole
Teddy Tenpole's picture



Dear Gold Council, rot in hell you cunts!


fixed it fer ye

Tue, 10/22/2013 - 23:07 | 4081707 Melin
Melin's picture

The April smash started me thinking they were aiming for the mines themselves. 


Tue, 10/22/2013 - 23:19 | 4081739 Teddy Tenpole
Teddy Tenpole's picture



Maybe not such a good idea for you to think about things too much.

Wed, 10/23/2013 - 00:52 | 4081876 indygo55
indygo55's picture

They've owned the mines for centuries.


Tue, 10/22/2013 - 23:08 | 4081710 Teddy Tenpole
Teddy Tenpole's picture



Dear Eric:


Thank you for voicing your concerns, rot in hell you cunt!





Tue, 10/22/2013 - 23:14 | 4081725 SpykerSpeed
SpykerSpeed's picture

Eric Sprott was saying silver was massively undervalued when it was trading at 38 bucks an ounce and now it's around 23 dollars.

Forgive me for being skeptical.

Tue, 10/22/2013 - 23:41 | 4081773 jeff montanye
jeff montanye's picture

add to this the price action to date and the reverse head and shoulders looks pretty impressive.

and 37 will look pretty cheap in a decade or so.  maybe less.

Tue, 10/22/2013 - 23:43 | 4081777 SpykerSpeed
SpykerSpeed's picture

"Reverse head and shoulders"???

You buy into this crap?  I'm not denying that silver is probably cheap now.  I'd feel safer owning silver than USD.  But geez, there are so many better investments out there.

Tue, 10/22/2013 - 23:53 | 4081788 Harbanger
Harbanger's picture

Yes.  I like calculated risk.  Money is made in all bubbles.  The idea is not to be left hanging.  That's one reason the sheep hate RE now.  Are you sharp enough to bail at the right time? and into what do you bail except physical assets?

Wed, 10/23/2013 - 00:15 | 4081816 NidStyles
NidStyles's picture

Yet, all of them are only valued in dollars and are highly inflated in their worth.


Unless you really think 120 acres of land is worth $3.8 Million just because some guy in the past 10 years grew soybeans on it. If that's the case, then I have to question what sort of idiot are you?

Wed, 10/23/2013 - 08:08 | 4082201 bozzy
bozzy's picture

Name some

Wed, 10/23/2013 - 08:18 | 4082223 SpykerSpeed
SpykerSpeed's picture


Wed, 10/23/2013 - 09:22 | 4082396 Mad Mohel
Mad Mohel's picture

HAHAHAa What a dick!!!!

Wed, 10/23/2013 - 20:31 | 4084680 MeelionDollerBogus
MeelionDollerBogus's picture

FAIL. Failtonium warhead landed directly on you.


Bitcon = massive fail

At least if someone piped in with medicine, growing your own food, reloading your own ammo, forging your own rifled barrels for whatever gun you have, etc., that would qualify.

Tangibles are made of physical elements, shiny rocks for example.

Everything else is GARBAGE. Your bitconz won't work when the grid goes down and my GOLD AND SILVER WILL, as will the food garden.

Wed, 10/23/2013 - 08:21 | 4082233 Agstacker
Agstacker's picture

"But geez, there are so many better investments out there."


Yea, like netflix and apple.


<sarcasm off>

Wed, 10/23/2013 - 08:45 | 4082277 philosophers bone
philosophers bone's picture

So on this logic, someone who told you to sell the S&P at the beginning of the year was dead wrong because now it's up.   If you are not a trader and you are investing and holding long term (say 10 years) and I had the choice of buying $38 silver or the S&P, I would take the silver hands down.  But... no point in arguing - why don't we just mark our calendars and check back then.

Tue, 10/22/2013 - 23:15 | 4081726 edwardo1
edwardo1's picture

Sprott is a shill to be sure

His motives don't strike me as pure

The man's got an itch

Don't be Eric's bitch

Cause his pitch is just so much manure


Wed, 10/23/2013 - 00:48 | 4081869 Professorlocknload
Professorlocknload's picture

He's not a shill. He's a good businessman, selling his wares. Who doesn't talk their book?

Wed, 10/23/2013 - 08:47 | 4082282 philosophers bone
philosophers bone's picture

I see Limerick King has nothing to worry about....

Tue, 10/22/2013 - 23:29 | 4081751 ChaosEquilibrium
ChaosEquilibrium's picture

China DUMPING DOLLARS tonight!:):).....will the slope steepen???

Tue, 10/22/2013 - 23:30 | 4081754 Trampy
Trampy's picture

Sprott may be threatened with securities fraud for hyping his funds and luring investors with promises of high returns.

That letter could be a CYA to shift blame for all the people who bought his expensive funds at high premium to NAV and have seen large losses in the last two years.

Tue, 10/22/2013 - 23:37 | 4081758 devo
devo's picture

Sprott sold his silver.

Anyone taking this guy seriously is a sucker.

Tue, 10/22/2013 - 23:38 | 4081771 jomama
jomama's picture


Wed, 10/23/2013 - 00:51 | 4081874 Bay of Pigs
Bay of Pigs's picture

Sold his silver?

His silver trust has almost 50M ounces worth over a billion dollars.

Wed, 10/23/2013 - 01:45 | 4081921 devo
devo's picture

He sold PSLV shares to buy mining stocks, so he says.

Tue, 10/22/2013 - 23:36 | 4081765 jomama
jomama's picture


Tue, 10/22/2013 - 23:42 | 4081776 SlvrBull
SlvrBull's picture

So many Sprott haters, WTF???!!!
Anyone with the guts to stand up in the MSM spotlight and champion the ownership of PMs to the clueless masses is doing a favour to anyone who wants to remove the primary advantage ($USD) of TPTB who effectively seek global enslavement of us.
Think before you slander!!

Tue, 10/22/2013 - 23:50 | 4081784 Teddy Tenpole
Teddy Tenpole's picture



This required little thought actually, you sir are a douche bag (not quite super douche status like akak but maybe in time...

(let me guess, silver bull?)

Wed, 10/23/2013 - 02:01 | 4081937 akak
akak's picture

Don't you have some zit cream you should be applying right about now?

Wed, 10/23/2013 - 03:10 | 4081969 James
James's picture

For the record. that silver Sprott sold last spring was originally bought @ $4.00 or less an ounce and as mentioned above was sold to meet Corp. liabilities.

He did'nt bolt from Silver @ all. He made a decision to sell a small fraction of his holdings in his ongoing business endeavors.

He roughly made $20.00 p/oz. Would you sell any of your stack for that amount today. I would if needed.


Tue, 10/22/2013 - 23:43 | 4081778 adr
adr's picture

Why buy gold when you can buy unbelievably cheap stocks.

Did you know stocks that trade only 20 times earnings are so cheap that it's scary. I mean how can any growth company trade at only 20 times forward earnings, insane. Cramer says so. Even 400 P/E stocks are still cheap. There is so much global growth ahead, corporations will be printing money. Forget that 2.1% growth used to be called stall speed. 2.1% is like what 20% growth used to be. Even with government debt adding 2% to the number.

Buy stocks, they'll never go down. You missed out on 400% rallies in a year on dozens of stocks. Don't miss out on the next 400%.


This concludes your daily Wall Street indoctrination session.

Tue, 10/22/2013 - 23:52 | 4081787 alfred b.
alfred b.'s picture



Wed, 10/23/2013 - 20:28 | 4084670 MeelionDollerBogus
MeelionDollerBogus's picture

piling into GOOG and TSLA as we speak! I don't want to miss the BIG POP!

Is it too late to get into some tasty BRE-X and MFG?

Tue, 10/22/2013 - 23:56 | 4081794 IridiumRebel
IridiumRebel's picture

nothing like a gold post to bring out the dicks


Wed, 10/23/2013 - 00:11 | 4081809 Teddy Tenpole
Teddy Tenpole's picture



glad you could make it :)

Wed, 10/23/2013 - 00:17 | 4081820 NidStyles
NidStyles's picture

Not glad you haven't left yet...

Wed, 10/23/2013 - 00:26 | 4081835 Teddy Tenpole
Teddy Tenpole's picture



Double negative aside, er, umm, I'm still here?

Wed, 10/23/2013 - 00:24 | 4081833 IridiumRebel
IridiumRebel's picture

{winks at self after looking in mirror}

Wed, 10/23/2013 - 00:09 | 4081805 ebworthen
ebworthen's picture

The cocksuckers on Wall Street and in Washington don't want to hear it (and that is a hat-tip to real cocksuckers).

They are so slathering at the mouth to debase anything that is not their fiat stock market Ponzi scheme they can't help themselves.

The only value they want to be seen is in a 401K or I.R.A. statement with a "diversified portfolio" of dream stocks propped by FED gravy slathered all over their loins (collecting fees and ready to crash it).

God forbid people should ask for delivery or expect a 4% annual return with reasonable fees for investing in the crony capitalist bubble stock intangible dream factory companies and the lost dream of the nation that was.

Fucking wankers - they will fuck over real people until it all collapses and nothing is left.

Buy physical, hold physical.

Wed, 10/23/2013 - 00:12 | 4081811 magne13
magne13's picture

Not sure what Sprott is  upset about, he should realize by now that it is a rigged game and its fiat money vs real money.  Until the FED is dismantled and or the Chinese start really backing the Yuan with gold, the price of gold and silver can never match the price of equities.  in fact with the SP500 at 1750, Gold should be right around $1285 per oz.  This is the last 30yr avg ratio that I have for the price of Gold per the price of SP500 nominal.  Meaning for every $100 rise or fall in gold the SP500 will rise or fall by around 132 pts. The inflation from QE (printing money) is not affecting the gold price as many would believe, because the velocity of money is not a factor because it is zero or negative.  As long as banks stock pile reserve balance and recycle it into asset purchases, Gold will not be able to compete.  Secondly until the cost of capital (repo rates) exceeds the 10yr yield equities will never move down. PERIOD, So as much as I agree with the frustration from Sprott, he is a moron considering he still believes it to be a level trading field.  

Wed, 10/23/2013 - 05:06 | 4082054 Squid-puppets a...
Squid-puppets a-go-go's picture

"As long as banks stock pile reserve balance and recycle it into asset purchases, Gold will not be able to compete."

not quite correct. When the primary dealers start to feel the water level rising to the posh compartments on the titanic, one will break rank in self preservation and throw that fiat hard into PM. Then the others will follow.


Wed, 10/23/2013 - 00:13 | 4081812 Teddy Tenpole
Teddy Tenpole's picture



I too tip my hat to the real cocksuckers of the world!

Wed, 10/23/2013 - 00:31 | 4081842 Bay of Pigs
Bay of Pigs's picture

That that dick out of your mouth, I can't hear you very well punchie.

Wed, 10/23/2013 - 00:57 | 4081882 Teddy Tenpole
Teddy Tenpole's picture



Yes Bay of Pigs, we know you are here too.  The other boys think you're funny but sometimes they just don't say it.  It's okay becuase Mommy loves you.  Nighty night.

Wed, 10/23/2013 - 02:04 | 4081938 akak
akak's picture


Wed, 10/23/2013 - 02:35 | 4081956 Teddy Tenpole
Teddy Tenpole's picture



Awe, I knew you were still reading all my posts, thanks! 

Been waiting all day for this one, "look, up in the sky... it's a bird, it's a plane... no... it's super douche".

Wed, 10/23/2013 - 00:34 | 4081850 Crazed Smoker
Crazed Smoker's picture

Yes i like this guy too.  But i struggle with fact that Billionaires imo have an intense knack for being on the winning side of financial interactions.  That doesn't make them more believable but rather less.  If they are promoting a trade its because they are already knee deep in it.  Also, you will be the LAST to know when they have turned bearish because they won't tell you until they have sold it all.  

Wed, 10/23/2013 - 00:35 | 4081851 TWFTG
TWFTG's picture

Watch out !! Sprott was the guy who said he? could not get silver now he is dumping it !!

There? is nothing wrong selling silver ...except when you are talking every single? day about buying silver, scarcity, shortages and telling everyone in getting into silver !!

This is fraud, misleading,etc ...remember big banks telling investors to buy bad mortgages meanwhile they were dumping it and betting its default... Sprott is the new impostor with sheepskin !!

Wed, 10/23/2013 - 08:17 | 4082220 Mi Naem
Mi Naem's picture

Where's your evidence? 


I understand that Sprott holds physical to match the PM holdings in his ETFs (unlike JPM and COMEX for example). 

Is he selling more than the positions being exited by his clients? 

Wed, 10/23/2013 - 00:38 | 4081857 Herkimer Jerkimer
Herkimer Jerkimer's picture




I think Mr. Sprott just called the Gold Council and the rest of them, a bunch of liars.



Wed, 10/23/2013 - 01:04 | 4081885 ken
ken's picture

Hey guys!!!


Wed, 10/23/2013 - 01:04 | 4081886 ken
ken's picture

Hey guys!!!


Wed, 10/23/2013 - 01:36 | 4081915 Kina
Kina's picture

Sprott and most others obviously know what is really going on in the metals / fx arena and how gold and silver are leashed by TPTB.

Everybody knows it, but until you can bring out the hardest black and white evidence, tapes and the bodies, smoking gun, one of the major players swaps sides etc etc.... they can all make believe there is nothing going on, really.


Sprott and others can only find ways to highlight the BS that is going on.... especially the BS of gold demand/supply -v- gold price on the CUMEX.


When these people write long letters that include data analysis I wish they would write a short summary, or some dot points at the beginning saying what they are about to show, request.

Wed, 10/23/2013 - 04:19 | 4082025 lakecity55
lakecity55's picture

I would say Au and Ag are being Lashed by TPTB!

Take that, you Eagle! Take that, kangaroo!

Wed, 10/23/2013 - 01:57 | 4081929 WTFUD
WTFUD's picture

Teddy Ten did i not warn you where i'd stick that Pole? Teddy have you ever been within 5000 miles of a silver/gold or any other mine? You have a lot to say, more thann anyone else with zero substance therein.
Couple of facts from direct experience; New mine grades piss poor and no way economical even at 50% above current prices. Old mines ( 4km down in earths crust ) and hell of an expensive to secure.
For some reason the natives are not friendly to the canadians, merikans, brits etc and want better conditions and increases in salaries; even sabotaging mines; sometimes ambushing.
Lastly, i could go on, they don't want paid in fiat Rand; cfa francs, pesos or dwollars but only in gold/ silver. Catching my drift?

Wed, 10/23/2013 - 02:30 | 4081953 Teddy Tenpole
Teddy Tenpole's picture



Threats aside for the moment, but thanks, I'm not sure that you have read any of my posts regarding gold?

Here is an actual fact for you.  It comes from a recently updated survey of public company gold producers.  $1,300/ oz is now what it takes on average to break even.

On a personal note, you can replace all of the above babbling and use my cost comment as it essentially encapsulates all of your anectdotal evidense.

Hope this helps.

peace out

Wed, 10/23/2013 - 04:58 | 4082050 WTFUD
WTFUD's picture

Teddy your nothing if not a rascal.
I spend my time in the Bush with geologists and engineers and not reading up on glossy surveys submitted by bankers & corps.
Trust me the gold/silver and other precious minerals being produced Now and for the forseeable future will require break even margins of at least a 50% minimum above this current faux price.

So babble on.

Wed, 10/23/2013 - 02:30 | 4081954 evernewecon
evernewecon's picture




The Government's own chart shows 

housing construction a pittance

compared to pre-financial crisis

levels, still, now 5 going on 6

years after the original flop.



Also, newsprint's been quasi

obsolete for several years now.


So why are paper prices so high?


(I don't know, but I noticed this:)






Wed, 10/23/2013 - 04:32 | 4082033 Azannoth
Azannoth's picture

2800t = ~85mil oz.

so if only 85million people bough 1oz. per year the supply would be gone! There are say 500million people on the planet who could easily afford 1oz of gold a year

Wed, 10/23/2013 - 09:44 | 4082458 Al Huxley
Al Huxley's picture

Exactly.  The same goes for silver, by the way - net available for investment (after the industrial demand, jewelry demand, etc... was 160 million oz. in 2012.  Even if you count the 92 million oz in coins as 'investment demand' you're still at 250 million oz.  There are a lot more than 250 million people on the planet who can afford $25/yr for an oz of silver.


Paperbugs better hope that the current situation is the first time that 'this time its different' and that it turns out 'with REAL SMART guys like Bernanke and Mrs Debtfire at the helm, this exponential debt curve can be managed to infinity, without ever raising prices'. 


Oh, and also that 'those Wall Street guys get a bad rap - they're really not the lying cheating self-serving dishonest pricks they've been made out to be - they really do have the general public's best interests at heart in everything they do'.  I've known a bunch of them over the years, and it hasn't been my experience, but hey, maybe I was just in with the wrong crowd.

Wed, 10/23/2013 - 04:40 | 4082039 Quinvarius
Quinvarius's picture

Sprott's data will always be better that the WGC's data for the same reason Schiff's insights will always be more accurate than the mainstream bankers insights.  They live or die on the data and cannot afford to be willfully ignorant.  They are not trying to create a farce, they are trying to identify and deal with one.

Wed, 10/23/2013 - 06:08 | 4082089 johnnyarrowmaker
johnnyarrowmaker's picture

You know Sprott must be onto something when the spiker trolls come out with their "nothing to see here" posts.

Perhaps the FED is preparing to use another commodity to back the dollar rather than precious metals, I don't know, maybe it's Big Mac$ or iphone$ or some other worthless piece of crap.



Wed, 10/23/2013 - 09:35 | 4082444 banzai401
banzai401's picture

Is there anybody on this forum that OWNS GOLD ETF? I don't think so, that's a sucker given.

Have your 5% of gold stashed away for 'end of the world scenario', but its not going to happen,

We have now entered the stage 5 of the MASLOW recovery, denial is passe', now its times for MEN to pull the dicks out of their ass and mouth and fix the fucking world,

The World of OBAMA Metro Sexual gimps is over, ... there has NEVER been a better time for real men to step forward and take over DODGE.

Wed, 10/23/2013 - 06:26 | 4082100 Brazen Heist
Brazen Heist's picture

Hence why the "paper" gold market exists - to soak up all the excess demand in real gold and trick people in believing that paper gold certificates are as good as gold, when they are not. 


For example, in today’s gold markets, gold corporations and mints issue unallocated gold certificates, which are noting but promises to pay the bearer real gold if redeemed. It is not the same as purchasing allocated gold or taking physical delivery of real gold. The fact that many people are foolish enough to see gold certificates as good as gold is what perpetuates the suppression of the physical (real) gold price. By issuing much more gold certificates, or “claims” on real gold, this acts to dilute demand for physical gold and redirects it onto a demand for paper gold, essentially causing the price of real gold to be lower than it should be if gold certificates were not in place.



Wed, 10/23/2013 - 09:31 | 4082430 Ckierst1
Ckierst1's picture

I suspect that it also absorbs much gold investment demand that would have otherwise have been directed I to precious metal equities, ergo their current doldrums.

Wed, 10/23/2013 - 06:30 | 4082102 JPMorgan
JPMorgan's picture

Sprott is wasting his time apart from making an very public point that official figures are a load of horse shite.

Wed, 10/23/2013 - 06:46 | 4082119 Bob Bercy
Bob Bercy's picture

Another Gold Bull crybaby: "In my opinion, the massive imbalance between supply and demand is not reflected in prices because available statistics are misleading." What a lot of horseshit - if the demand is there it will be seen in prices. You can manipulate the market for a day or a week, but you can't do that over a protracted period. If he is a genuine bull he should be happy with this "artificially created" buying opportunity.

Wed, 10/23/2013 - 08:27 | 4082245 Agstacker
Agstacker's picture

"You can manipulate the market for a day or a week, but you can't do that over a protracted period."


Like, from 1933 to 1971?

Wed, 10/23/2013 - 12:30 | 4083005 Bob Bercy
Bob Bercy's picture

Yes, you are right of course and my post was carelessly worded - my point was that you can't manipulate a global market for long simply by publishing false statistics about supply and demand. The average Indian and Chinese buyer of gold is not reading the WGC monthly stats.  Gold has little intrinsic value, its price is simply a function of supply and demand and those will end up being reflected in the price.

Wed, 10/23/2013 - 19:38 | 4084551 MeelionDollerBogus
MeelionDollerBogus's picture

Yup. 8 tards slammed you down but people are still getting delivery of gold & still at prices not exponentially growing % over quoted spot in each currency.

Wed, 10/23/2013 - 07:07 | 4082129 Sufiy
Sufiy's picture

September Nonfarm Payrolls Huge Miss - Gold Spikes Up, Data Leaked Again

We have September Nonfarm Payrolls with the Huge Miss and Gold Spikes Up immediately. Data was leaked yearly again with Gold printing: +$5 at 8.28 and  +$18 at 8.33      "Cowboys" shorting the Gold market, according to Eric Sprott, must be in a serious trouble now. The yearly trade on October 15th has amounted to 640 million and Gold was Sold at 1270 - 1250 levels. Now with CFTC out of hibernation can we expect at least some kind of investigation?   There are more and more calls about the US Dollar loosing its Reserve Currency of Choice status now. Default was avoided, but the damage is done.
  All FIAT currencies are based on trust. The geopolitical shift is making its way to mass media and we are witnessing the groundbreaking developments in the Gold market. Nobody can manipulate it all the time and China will be busy writing "Thank You Cards" to the FED and related Cartel members at LBMA and BIS, buying all the physical Gold available for Delivery at this levels.   We can forget about the Taper until mid 2014 now and Janet Yellen will be following the new FED's playbook written by Michael Woodford. Peter Schiff has dissected for this situation very well.

Wed, 10/23/2013 - 07:30 | 4082146 swabeyjw
swabeyjw's picture

Storage of value (in happy times):

Kids > gold > other hard assets > where you live > bitcoin > fiat

(Note: I can not see the math of fiat working by itself on a finite peaceful planet). Simply, if we each choose not to go to war there will be no war - I do not see that fiat allows this choice.

Currency (ten years out):

(Also, in happy time - order to fluctuate with the extreme of "last glass of water in the desert")

Reputation > perceived assets (perhaps not in Russia) > bitcoin > gold > fiat > hard assets

As gold is both a store of value and currency, the price in fiat "is what it is". With regards to perception and law, best I recall, a store of value is the "tail on the dog" when much of the going ons is under what amounts to executive order.

Yet, Eric's argument is a just topic and deserves further analysis and a detailed response by the GFMS.

I know nothing of the structure or credibility of the GFMS.

Wed, 10/23/2013 - 08:00 | 4082182 Izznogood
Izznogood's picture

Sprott may have to reconsider his thoughts on China. I think the Chinese are spending their gold holdings on buying .. COFFEE ..

Wed, 10/23/2013 - 08:51 | 4082285 bozzy
bozzy's picture

to Spyker Tenpole et al...

Nice looking TIC report this week!

The US is just about to vacate centre stage, and it worthless promises are about to wide wide wide. Makes me smile listening to you diss gold, when Bernanke and those sociopaths who are busily destroying your retirement are also successfully winning the competitive devaluation EUR 1,21 2012 heading for 1,38 right now....

Can't wait to hear the music telling us it was all an unintended outcome.

Nothing to do with America squidding on the rest of the planet to pay for its 100 year party of course.

Of course - the Chinese will Never have expected that.



Wed, 10/23/2013 - 09:11 | 4082326 Hubbs
Hubbs's picture

Sounds like Sprott is getting a little nervous. If phys gold is so great, he should just shut up and stack.

Wed, 10/23/2013 - 09:31 | 4082431 banzai401
banzai401's picture

Well you just hit the fucking nail on the head,

Most of these squirrels want out of GOLD, but they need to get the suckers amped to BUY.

A better question is why does ZH always put these same gold-pimps on the ZH OP?

Certainly there is somebody out there with some street cred that isn't a GOLD PIMP?

The problem with GOLD is everybody that had money did buy, and now with rampant out of fucking control inflation folks have to sell their gold ( deflation ) to eat.

Money is getting THIN, and and I see that everywhere.

All these DOOM&GLOOM fuckheads cater to the hairlip class, and they have no money.

Asian's have bought all they can for the past 5 years, but now they're 'full of gold'.

I think the insiders are terrified of 'holding the bag'.

But again Sprott is just a low class gold whore, ... move along.

Wed, 10/23/2013 - 18:39 | 4084393 MeelionDollerBogus
MeelionDollerBogus's picture

I'm not done.
I want at least 2 more ounces of gold & 50 more ounces of silver before the next price rise.
And I have agq calls for the short-term rise. No bag-holding for me, just some math to guide my choices.
We'll see if they turn out profitable.

For those that can get entire tubes full of gold maples or gold eagles, good for you - I'm not that rich.

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