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Physical Gold Shortage Worst In Over A Decade: GOFO Most Negative Since 2001
The last time there was an systemic physical gold shortage was in July 2013. It is then that, for the first time in 5 years, the 1-month Gold forward offered rate, or GOFO, went negative. We said:
Today, something happened that has not happened since the Lehman collapse: the 1 Month Gold Forward Offered (GOFO) rate turned negative, from 0.015% to -0.065%, for the first time in nearly 5 years, or technically since just after the Lehman bankruptcy precipitated AIG bailout in November 2011. And if one looks at the 3 Month GOFO, which also turned shockingly negative overnight from 0.05% to -0.03%, one has to go back all the way to the 1999 Washington Agreement on gold, to find the last time that particular GOFO rate was negative.
Fast forward to today, when as noted over the past week there has been a massive shortage of precious metals - most notably silver which as of this moment is indefinitely unavailable at the US Mint - as a result of the tumble in the paper price, and following 8 days of sliding and negative 1 month GOFO rates, today the physical metal shortage surged, as can be seen by not only the first negative 6 month GOFO rate since last summer's much publicized gold shortage when China was gobbling up every piece of shiny yellow rock available for sale, but a 1 month GOFO of -0.1850%: the most negative it has been since 2001!
Said otherwise, the physical shortage is the worst it has been in over a decade, even as the price of paper gold continues to drop!
And for those for whom the topic of GOFO inversion is new, here is how we described the situation last time:
* * *
What is GOFO (Gold Forward Offered Rates)?
GOFO stands for Gold Forward Offered Rate. These are rates at which contributors are prepared to lend gold on a swap against US dollars. Quotes are made for 1-, 2-, 3-, 6- and 12-month periods.
Who provides the rates?
The contributors are the Market Making Members of the LBMA: The Bank of Nova Scotia–ScotiaMocatta, Barclays Bank Plc, Deutsche Bank AG, HSBC Bank USA London Branch, Goldman Sachs, JP Morgan Chase Bank, Société Générale and UBS AG.
When are the rates quoted?
The means are set at 11 am London time. These are the rates shown on the LBMA website. To show derived gold lease rates, the GOFO means are subtracted from the corresponding values of the LIBOR (London Interbank Offered Rates) US dollar means. These rates are also available on the LBMA website.
How are the GOFO means established?
At 10.30 am London time, the Reuters page is cleared of all rates. Contributors then enter their rates for all time periods. A minimum of six contributors must enter rates in order for the means to be calculated. At 11.00 am, the mean is established for each maturity by discarding the highest and lowest quotations in each period and averaging the remaining rates.
What are some uses for GOFO means in the market?
They provide a basis for some finance and loan agreements as well as for the settlement of gold Interest Rate Swaps.
* * *
Unpleasant similarities with Libor and most other fixed (literally and metaphorically) rates aside, what is known is that under normal market conditions, GOFO is always positive, or in other words gold serves as a money-equivalent collateral for a pseudo-secured loan against paper fiat (USD in this case) hence the low interest rate.
Sometimes, however, normality inverts and the rate goes negative and as such serves as a useful indicator of gold market dislocations. Thus, while disagreements exists, one can safely say that what GOFO is, is simply a blended indicator of liquidity, counterparty or collateral (physical availability) stress in the gold market. Since it is next to impossible to isolate just which component is causing the indicated disturbance, it is prudent to be on watch for all three.
The best known example of a complete collapse in the GOFO rate, is the September 1999 Washington Agreement on Gold, which in brief, was an imposed "cap" on gold sales (mostly European in the afteramth of Gordon Brown's idiotic sale of UK's gold) to the tune of 400 tons per year. The tangent of the Washington Agreement is quite interesting in its own right. Recall the words of Milling-Stanley from the 12th Nikkei Gold Conference:
"Central bank independence is enshrined in law in many countries, and central bankers tend to be independent thinkers. It is worth asking why such a large group of them decided to associate themselves with this highly unusual agreement...At the same time, through our close contacts with central banks, the Council has been aware that some of the biggest holders have for some time been concerned about the impact on the gold price—and thus on the value of their gold reserves—of unfounded rumours, and about the use of official gold for speculative purposes.
"Several of the central bankers involved had said repeatedly they had no intention of selling any of their gold, but they had been saying that as individuals—and no-one had taken any notice. I think that is what Mr. Duisenberg meant when he said they were making this statement to clarify their intentions."
Of course, this happened in a time long ago, when the primacy of Fractional reserve banking was sacrosanct, when the first Greenspan credit bubble (dot com) was yet to appear, and when barbarous relics were indeed a thing of the past, only to be proven oh so contemporary following not one, not two, but three subsequent cheap-credit bubbles which have vastly undermined the religious faith in fiath and central banking, sending the price of gold to all time highs as recently as 2011.
Another subsequent negative GOFO episode occurred in early 2001, which coincided with what has been rumored to be a speculative attack and reversal of the futures market. However, while pushing 1 month rates negative, 3 month rates remained well positive.
Indeed, the only other time when both 1M and 3M GOFOs were both negative or almost so (3M touched on 0.05%) was in the aftermath of the AIG bailout following the Lehman collapse in November 2008.
Fast forward to today, when all GOFOs, from 1M all the way to 6M just went negative.
And while both Antal Fekete and Sandeep Jaitly, traditionally two of the most vocal pundits in the arena of gold backwardation and temporal and collateral gold market arbritrage, are likely come up with their own interpretations of what may be causing this historic inversion, the reality is that one can't know for sure until after the fact. It may be one of many things:
- An ETF-induced repricing of paper and physical gold
- Ongoing deliverable concerns and/or shortages involving one (JPM) or more Comex gold members.
- Liquidations in the paper gold market
- A shortage of physical gold for a non-bullion bank market participant
- A major fund unwinding a futures pair trade involving at least one gold leasing leg
- An ongoing bullion bank failure with or without an associated allocated gold bank "run"
- All of the above
The answer for now is unknown. What is known is that something very abnormal is once again afoot at the nexus of the gold fractional reserve lending market.
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Waiting for the price whiplash bitchez.
I don't
"since just after the Lehman bankruptcy precipitated AIG bailout in November 2011."
that should be "2008".
it was wrong in the original post and it is still wrong. how does this happen? who edits this stuff?
The negative gofo has nothing to do with phys shortages. It means collateral is tight, and gold is being plegded for that purpose.
Don't be surprised if there is some sort bank or fund failure in the near future. Somebody big is scrambling for unencumbered collateral.
Look east then.
The paper gold price could/will go to nothing as their true value becomes evident.
It will start mid December, I just can't quite get a handle on how long it will take,
maybe months, maybe overnight.
Would you rather eat Ayn Rand's dusty muffin or Jannet Yelen's yeasty muffin? Perhaps a little of both?
Good thing it is still early. I just might recover from this disturbing post before lunch rolls around.
Jam and clotted cream slathered ?
Goes great with the bottom of a shithouse door, on a mackerel trawler,or so I'm told.,
Well. Lunch is now officially scrubbed.
Chef Kessler is disappointed. Oh wait – it's Chief
Compared GOFO to the price of gold. No correlation. None.
GOFO is a MOFO.
I posted this comment earlier and it was erased. Strange.
Hey! Poolshark posted a list of PM sellers to rebut the 'shortage' meme and started a whole thread, and the whole thing's vanished. WTF?
mmm dusty yeasty muffins...it's what's for breakfast...
Who is this witless clown?
Damn Chief, A little of my breakfast came up with that comment...
I think that Winston could be right. After all the physical price is set by sales of paper. There is already no correlation between the paper price and things like physical supply or demand. Why would we expect that to ever change? It seems more likely that the paper price set on the COMEX will continue to drop until premiums get so high (due to intelligent people refusing to sell real physical at these fictional prices) that some sort of split occurs, and the COMEX price becomes irrelevant. We may even go through a time when there is no clear price - until some new mechanism emerges as the true physical price indicator. In my opinion, that seems more likely that some magical return to an honest market (I use the word return in jest). I think the real question is - how low can the paper price go before it become irrelevant to the pricing of physical metals?
that split will come from the shanghai gold exchange.
dupe
Why anyone needs physical when paper is available and is plenty. You can make photocopies( xerox) of it if you like and keep you cold home warm in case you don't find any thing to burn.
The market really needed this, when you think about it. The worst things the manipulators could do is keep gold and silver in a range bound trade and bore physical buyers out of the market.
I thought we were there with 20+ silver and 1400+ gold.
This will hopefully bring on mine shu
wow, the trolls are REALLY on this one. being as PMs are their sworn enemy, and they can't very well attack pieces of metal scattered all over the world they instead attack its value in the minds of the peasants.
it reminds me of the futility of spam email: those of us who know better simply ignore it.
I'm not a troll. I disagree because I've been watching this PM mania unfold for the last six years, since its bottom $9 after the bailouts.
Silver should have been $150 an ounce minimum, by NOW, according to all of these metal bulls. They added an extra zero to end of their forecasts.
Instead we get deflation and silver is down 70%. How is that preserving wealth? That's why they are talking about their mosin and spam cans, instead of talking about a new house they are building.
If one were to get a crappy "high yield" savings account at 0.9% they would have been better off than this rigged metals game.
As for "value in the minds of peasants" who do you plan on bartering your metals with? The Rothschilds? These guys operate in metric tonnes, they don't care about your silly one ouncers. "Peasants" are who you are going to conduct business with. These metalbugs cease to amaze me.
BTW, I'm not anti-metals, I am anti doom and gloom pessimism BS garbage.
Well thanks for joining ZH two months ago so that you can share your intrepid observations of the PM market, Gloom, and Doom before it all happens... wait a minute.
All of the precious metals trolls out here were nowhere to be found when gold was going up but now they're all too cool for school and pontificating on the PM crash that was a 'sure thing' as long as they can share their diatribes with us after it all happened. And for the record, the guys in the PM community didn't start telling everybody to buy gold or silver when it was at $1,900 and $49. They started well before that.
All of the precious metals trolls out here were nowhere to be found when gold was going up but now they're all too cool for school and pontificating on the PM crash that was a 'sure thing' as long as they can share their diatribes with us after it all happened.
Y'all gotta stop treating this like a team sport, it's not us vs. you. Being bearish on gold doesn't automatically mean someone has a hidden agenda.
When something moves against expectation people go into denial and start coming up with excuses why. Doesn't matter if it's bonds, aapl, oil, whatever
Gold + silver remain plentiful, I can buy phyz 1.4% over spot per kilo at local dealer. Any time the price takes a drop people pretend there's shortage, maybe at the LCS but not in reality.
what is it about the mint running out of silver that fails to show you there are shortages. what is it about shanghai's holdings reducing 90% over the last year that makes you continue to beleive in abundance?
what is it about americas refusal to return germany's gold that makes you think the US govt beleives theres more than enough gold to go around
you got a wierd way of looking at the evidence, chum
Not disagreeing with what you are saying in terms of fundamentals (or I'd be playing the paper game). But like James_cole I'm also able to buy silver and gold online (yes even eagles) and pick them up next day if I want. I'm in Australia. There is absolutely no shortage (here at least) at this stage, so why people automatically hit the down vote on the dude is beyond me. The world is a big place and downvoters on this issue don't understand that.
Some of us are just pointing out it's bloody easy to get in our neck of the woods (Note: we are *not* saying this will continue, merely that's it's the case at the current time)
Cheers
Edit to add: he even stated the 1.x% over spot was for 1kg. so he wasn't talking about ya 1 oz's or fractionals. Seems reasonable to me.
yer, look, I too am in australia - but the ease with which we purchase is a function of being the worlds 2nd biggest gold producer (not sure where we are in silver). Ours is not a representative buying experience of most of the gold purchasing world
what is it about the mint running out of silver that fails to show you there are shortages.
Just because the mint ran out of silver doesn't mean there's an overall shortage of the stuff - it just means the mint failed to anticipate how many coins it would sell.
what is it about shanghai's holdings reducing 90% over the last year that makes you continue to beleive in abundance?
Do we know Shanghai's holdings are representative of how much silver is available in the world? How?
I'm a believer in metals (medium-long term) but I've been hearing this 'supply is running out' bullshit ever since I took an interest in the subject, 6 - 7 years ago. A lot of people have lost a lot of money because of the PM shills' breathless claims. OK, no one can predict where any price will go, but you wouldn't have known that listening to these fuckers.
Over at King World News - the Mecca of PM assclowns - they're running the following stories:
Worried About Gold / Silver Smash - This Is Truly Terrifying Today King World News is featuring a piece by a man whose recently released masterpiece has been praised around the world, and also recognized as some of the most unique work in the gold market. Below... This Will Trigger Collapse & Shockwaves In Global MarketsToday a 42-year market veteran spoke with King World News about the remarkable event that is going to trigger collapse and send shockwaves in global markets. Below is what Egon von Greyerz, who is... Panic Gold & Silver Selling Surprises Largest Dealer In U.S.
Today the man who owns the largest gold and silver dealer in the United States told King World News he was surprised by the amount of panic selling in gold and silver taking place at these levels.... Wild Trading In Global Markets Reveals Dangerous Trend
As global stock markets continue their wild ride, a troubling trend is now emerging! Pierre Lassonde’s Shocking Comments On Gold & Silver Plunge
On the heels of another plunge in the gold and silver markets, today legendary Pierre Lassonde stunned King World News when he openly discussed manipulation of the gold market. Lassonde also spoke... Shocking Facts About Today’s Smash In Gold & Silver
Today one of the top people in Hong Kong spoke with King World News regarding shocking facts about today’s smash in gold and silver. Hedge fund manager William Kaye, who 25 years ago worked for... Stunning Interview From Market Legend On Gold, Oil & Stocks
Today a legendary trader and investor, who recently called the bottom in the U.S. stock market with remarkable precision, gave King World News a stunning interview about what surprise action to expect... We’re Close To One Of The Most Dramatic Reversals In History
Today an acclaimed money manager told King World News that we are very close to seeing one of the most dramatic reversals in any market in history. Stephen Leeb also spoke about China, Russia, and the... 60-Year Market Veteran’s Predictions On Gold, Silver & Stocks
Today a 60-year market veteran sent King World News three absolutely incredible charts as we head into the end of 2014, and he also discussed his predictions for the major markets, including stocks,... Richard Russell Warns We Will See Violent Action Ahead
Today the Godfather of newsletter writers, 90-year old Richard Russell, warned that we will see violent action ahead. The 60-year market veteran also covered the Great Recession, the Bank of Japan,... As Gold & Silver Rout Continues, Physical Demand Is Stunning
With crude oil tumbling over $2 a barrel and the gold and silver rout continuing, today James Turk spoke with King World News about the ongoing smash in gold and silver and what is happening in the... Silver Is One Of The Greatest Opportunities In World History
Today a man who has been involved in the financial markets for 50 years told King World News that the silver market represents one of the greatest opportunities in history for investors. John Embry,...
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with the usual suspects - Andrew Maguire, Eric Sprott, Egon von Greyerz. Richard Russel, all saying the same shit they were 6 years ago. I swear to God they are the most shameless hucksters. I don't recall ever reading an apology from any of these people for getting their calls so wrong.
I'll bet we're all here in 10 years saying the same shit, with gold languishing at $800 and silver bouncing around $9. We'll be sipping our $38.99 lattes and reading how the Fed are concerned about sub 2% inflation and how QE47 has been a smashing success and wincing every time we hear gunfire as the 'our' militarised police suppress the food riots.
You do realize gold and silver are a currency that is not fiat. The delusion is thinking you're better off trying to find a yield that is comperable to value in hand when black markets run the shit show.
Teams? There aren't any teams? of course their are. We know that governments around the world intentionally create confusion on topics important to them. These kinds of posts popped up all over the internet during the PM crash. Their is clearly a propaganda campaign against the ownership of PMs. There's no doubt in my mind that there are bankers' minions creating confusion on a variety of financial topics and one of the favorite places to go is the comment sections of financial blogs. So, yes, you're damn right there are teams.
My PM holdings are slightly in the red for now but my stock holdings are doing very well and have me well into the black overall. I don't own them (stocks) because I think that the economy is anything other than trash. I own them because the financial elites NEED them to go up so that they can finance their astronomical deficits with capital gains tax revenue. This of course amounts to the 'money fairy' hope for a positive outcome. Hopefully, I'll be smart enough to get out before the entire system implodes on itself. So there's no need to talk to me about 'denial' and 'excuses' but thank you for offering your wisdom. I've been in investing for a while and this isn't the first trade to have gone the wrong way on me. I have ZERO intention of selling any PMs as they serve a vital role that only they can manage... an asset with no counterparty risk and, in my opinion, if you've lived in the last few decades and don't see the need for that in a portfolio, it is you that's in denial. See, the biggest problem between those arguing these topics is that it seems to me that the 'teams' have gone all-in on either PMs or stocks, etc. There never seems to be a middle-ground guy who notes that one can own all of the above. However, I can guarantee you that if everybody owned 10% in PMs, the price would go ballistic. This is what they're trying to avoid. The market is so small that they need everybody to own zero; a tough dilemma.
Talking about shortages, there certainly aren't any now and my post had nothing to do with that fact. However, with even a slight demand for the stuff, a few smallish entities could buy up the worlds' supply. The market for PMs is tiny. This is why the propaganda campaign against them is so intense... but I suppose now you'll go Martin Armstrong on me and try to suggest that governments don't care or worry about precious metals and that they're irrelevant, right? Give me a break. It's the potential for shortages that is the largest problem.
I hold some physical for the same reason I grow my own food. Because it is mine and I can. No further reasoning would be required.
Silver stacking peasents is what made this country great. All it takes is a stack of silver and a militia worthy fire arm. You're invited. Otherwise join the Rothschilds fiat regimes without a stack and a gun. Your choice. The latter sounds like a trap.
and........ price continues to go down. Hum....... am I missing something?
In a centrally planned world the worst the shortage is the lower the price becomes.
Of course actually purchasing at that low price is near impossible. Remember the long lines for cheap TP in the Soviet Union?
There's no shortage. these minters are plays 3 card monte with yer haid Rufus!
Up is Down, 2+2=5 bitchez
yes. The Vampire Squid Firmly Attached To The Face Of Humanity is telling you to sell. Obey The Squid. Meanwhile, Negative GOFO times are interesting times
If the Squid is trying to get "Folks" to sell and they do because they're getting hungry, I'd say it's time for Calamari. Just as an appetizer. And go from there.
This is a paper world now. My Farmville farm is worth so much more than my Grandma's actual farm. Can't wait to get home and get my hands in the the 1's and 0's makes me feel alive.
Farmville - LOL.
I'm seeing lots of gold and silver coin "out of stock" signs on PM dealer sites.
What's "out of stock" are buyers.
What's "out of stock" are buyers of the paper PMs. FIFY
Physical sales just hit record highs.
At FIVE years lows in price!!!
YA'll naid ta avey rage in Rufis
Whats out of stock are those willing to sell at these prices.
For every buyer there must be a seller.
You went on spring break to gan pappy's cabin in the minney soda pines during Econ 101
Some dealers may be sitting on their stash. Either way, you are looking into a potential fizz shortage.
no "shortage" of silver or gold... in fact there is and OVERSUPPLY ... hence the PRICE drop...
...what I'm hearing you say is that you didn't read the article but wanted to post something pm-bearish coz that's how you do.
(unless I missed the sarc in which case +1...)
What you're hearing is a man grounded in fact. but since you're aren't so grounded keep dreaming of $1800.
perhaps he is grounded in fact. production in the last decades was not insignificant. though... did Germany get it's physical gold... back? or perhaps this price drop is... related? a good reason to blame Germany, isn't it?
Well it's either all Germany's fault, or the Jews....., and sometimes Russia. For a while there it was all the Greek's fault but they are out of the news cycle right now.
He ignored the memo. Gold's lost HALF it's FIFTEEN year gain and silver's price has been cut by TWO-THIRDS. The mental anguish has led him to make up billshit excuses.
Why would I want to pay more Fiat for the same amount of Gold?
$1800 is not in my dreams at all..
I dream about $20 Gold.
But this concept eludes you. It goes right over your head.
Of course you are so self absorbed that you believe that if you want currency then EVERYBODY ELSE wants currency. But that is not the case.
You think that a Gold Bug will sell the Gold to get currency.
But that is not anywhere near the truth.
We do not want your currency...PERIOD.
We have no faith in your currency.
We have no trust in your currency.
We have no confidence in your currency.
The price of Gold, measured in your currency, is rather meaningless to us.
Your currency is dying. It's death is foreshadowed by history. It is dishonest currency which is created by whim and not production.
The promises of a Nation are only good while the Nation exists.
Nations are born.
Then they ascend and grow.
Following that they reach a Zenith.
Afterwards they decline.
And finally they die.
The promise dies with the Nation.
Well Gold has seen the birth, ascension, zenith, decline and death of many Nations throughout Human History.
It is transitional wealth. It is generational wealth.
And it always remains as it is material. It has historically been valued throughout Human Civilization and, while past performance is not always a guarantee of future performance it generally is a excellent indicator.
Thus the value of Gold transitions through the death of one Nation and the birth of another. It sees you through the upheaval, turmiol and storm of the death pangs of a dying Nation.
The truth is that the United States and the Western Empire is in decline and DYING. The writing is on the wall. You can deny it to your own peril. But that is the case.
It deserves its demise and death because of the MURDER, Fraud, thievery and dishonesty of her citizens and thier overlords.
Why trust the currency of that?
Sell me that idea and I will abandon Gold.
But you cannot.
As I wrote you do not understand the mindset of the Gold Bug at all.
I don't think he does care about currency, TT; I think he cares about buying power.
I stack in the hope that it is the least risky way of storing deferred consumption (capital). I don't want gold for its own sake. I mean - some of the coins are quite pretty, but compared with a nice holiday or a new guitar, gold's 'use' is pretty far down my list.
So if gold drops from $1900 down to $1200 - all while other items are going up in price - I have lost a lot of buying power. Not that I bought at $1900, but I did buy some at $900, $1200, $1600 and $1400. So... I haven't lost my shirt, but I've certainly lost a couple of holidays, time I could have spent with loved ones building fantastic memories.
And we don't live forever. If gold prices remain below our purchase price in dollars (while everything else has risen) then when I am forced to sell my holdings (to make ends meet) I have lost capital.
You forgot GW's fault. With every event, there is a significant probability that it is caused by GW, which includes the shenanigans of Cheney and the rest of the "decider" crew.
Isn't Germany starting to gold?
The fact is that he didn't address any of the facts in the article. I'll leave it at that because I'm not here to feed the trolls.
It doesn't have to be 1800 .... 2000 is better...
$1800... like the phyz price in India now?
How much of that is tax?
Source?
DavidC
Supply and demand have no place in this financial fuckery.
Wake up.
(or add a sarc tag)
As always, there is no shortage of shills, but a shortage of people with real analytical skills and common sense.
In addition to the lack of retail sellers of coins that others have referred to, the mine owners are countering Wall St efforts of picking off the small/weak players and profit squeezes on larger players: the execs would rather send workers home and sit on the gold, than sell it at a loss.
It also means that China is being cut off from foreign supplies (if no one is selling), and will have to rely on its own gold mines.
144 tons looted from Libya. 33 tons transferred from Ukraine. Venezuela is next. Lebanon, unfortunately, also has a lot of gold.
Indian rupee attacked brutally to smash its gold-buying capability.
The war for the barbarous relic never ends.
Good point there! Ukraine's gold was the absolute first thing taken out after the western sponsored coup. Anyone would have thought that the west already had this gold transfer planned! But Kiev can no longer get it's physical gold, but no doubt has paper promises of access. For what paper is worth!
Any state the west targets for take over, like Libya, the first thing the west grabs is gold. This is no coincidence, it is part of the plan, they want clients goldless!
No doubt also got free access to GS wizards who would point out many ways that Paper Gold is better than the real thing...
As if anything from GS is ever free...
...and don't forget those pesky terrorists in Mali who forced the French to intervene. It is only coincidence Mali produces about 8T/Yr.
The intent in stealing gold from countries is not to increase US reserves, but to prevent those countries from establishing their own gold-based currency OR to allign with other countries with gold-based currencies.
(Also, in emergency financial conditions where the US (West) is in dire peril, and hence, under martial law, all gold held in private hands will be confiscated. The use of gold for barter will be prohibited.)
The intent in stealing gold from countries is not to increase US reserves, but to prevent those countries from establishing their own gold-based currency
No, it's to enable the 100:1 paper games to carry on.
But do we know for a fact that Libya and Ukraine no longer have their gold?
OR to allign with other countries with gold-based currencies.
There currently are no 'gold-based currencies'.
Bullshit, physical demand especially in Asia is low (see Shanghai rates)
Link?
DavidC
about those shanghai rates: https://www.bullionstar.com/blog/koos-jansen/the-mainstream-media-versus...
thanks koos!
"gold demand in China, measured by withdrawals from the vaults of the Shanghai Gold Exchange (SGE),was exceptionally strong in recent weeks"
- Koos Jansen: The Mainstream Media Versus Gold
Come on, nobody wants that stuff. Can't eat it, doesn't pay interest, hard to store, not liquid, not a currency. Please...
In the early 2000s someone said almost exactly that when I started buying at $330 - I'm still buying - small amounts each month, but still buying.
DavidC
Yeah, those peeps always make me laugh.
LOL, everyone knows the COMEX doesn't have enough gold to deliver on all their contracts.
GOFOr it Mr Finkelstein
MOFO
Yeah, yeah, yeah. Gold to the moon. USD to zero. Equities wipe out. Hyperinflation any minute.
What a waste of a private education by mummy and daddy for zee troll.
you're very smug about it all. But on even a sober analysis of Japan's current 10-15% inflation, with its new QE
Japan will be in the middle stages of hyperinflation (CPI at 100% or over) by this time next year, and the rest of the world will follow by 2020 if it doesnt reverse its QE madness
When the BIS stops using gold as the method of trade amongst its member banks, then I'll stop caring about gold.
The problem with fiat is that's just like bitcoin. Backed by nothing now.
Might as well use a stock index as money because multinationals have some intrinsic values and can't all go to 0.
The show must go on and they need to keep skimming money off the commissions on the ponzi. Dow 50K is certainly within imagination as without it, the whole house of cards comes tumbling down.
"multinationals have some intrinsic values and can't all go to 0. " -- unless they actually allow defaults and real bankrupcies to occur again of course.
We are where we are because of market and financial suppression/repression and an implicit guarranty to rape the remaining taxpayers in order to bailout any failure. Yeah, those multinationals might have real assets to sell in default, but no way in hell you will see dollar one.
Remember, when fraud is the status quo, possession is the law.
Even if you hold the shares in your hand, the DTCC has 5 times the float outstanding in failures to deliver. Stock certificates are still just pieces of paper at best.
Exactly if the gold was of no use to the CB, why they don't sell it all on the market !!!!!
Not the paper, but the real stuff ...
Currency war ends when the CB can no longer devalue against each other in a "see-saw" manner, then they will all simultaneously devalue against gold .. that is the only way they can meet their inflationary kensian agenda ...
The current neo-classical economists and academics are blind to any other approach by the virtue of their education .... until the train hit them in the face, they know no other way but to follow "kensian rails" ..
It would seem that there are still many people that don't think it is a barbarous relic. Oh, and there is probably a looming currency crisis. Ah, and that the paper price isn't at all reflective of the Real price. In any case, it is clearly a big FU to the FED and the federal government. the demand for shiny metal stuff is a direct result of their abject wantonness
Probably because boating accidents are high. Storms brewing !
Gold Bitchez....I pick up pennies
Ever notice how a bull market always goes parabolic just prior to a crash?
The reverse is true also.
It would be hilarious if the US Mint was honest and wanted to do a good job so filling the big demand it had for Silver. To do so it bought a crapload of Silver futures and took them into delivery.
Can you imagine the phonecalls the head of the Mint would receive from above when everyone on the COMEX realised they were going to hold their long position into delivery?
"Can you imagine the phonecalls the head of the Mint would receive from above when everyone on the COMEX realised they were going to hold their long position into delivery?"
Those guys would never want phizz silver...they are paper trader people. Ag is just a thing they trade. Paper traders would shit if they had to find a place to put the thing they trade...like vault leases...tank leases for oil and silohs for grains...on and on. And there in lies the problem.
So, somebody is desperate to borrow gold and they are willing pay old Yeller's funny money for it.
How long before the Central Banks demand that the Governments make owning Gold illegal AGAIN?
Hold on to Physical with both hands.......Keep it out of safety deposit Boxes and rent a boat for a short trip across a lake...
like I did in an Inflatable that lost air and I couldn't swim with the extra weight......Trust no-one.
Hitler and Franklin Roosevelt did...
Most people would just laugh them out of the room. Come here, let me give you a noogie; now get outta here ya knuckle head. lol
"How long before the Central Banks demand that the Governments make owning Gold illegal AGAIN?"
When they need it to be...it will be.
Alls I know..is that something stinks out there...the 1230 am dumps of paper....then the flatline all day long....it just seems programmed to me...If I was a Japanese I would be buying it as fast as I can....same thin in China....anywhere where the paper money is being played with...and that is pretty much everywhere now...with the Cental Banks printing trillions of new pieces of paper..you are going to see Art works sell for a billion soon....and real estate hitting new highs in the tourist markets...money chasing tangible assets...gold and silver are one of those..but for some reason..they want to keep them down in the dumps....I think Gold should be $5,000 and OZ now..easy...
Physical shortage, prices going down? How in the fuck does that make any fucking sense?
Let me say it again, get long black markets and sharecropping now and beat the rush. Governments and central bankers (and their political puppets) are losing control.
+1. Anything tied to the system or having to interact with the system is going to be conduit through which desperate governments will screw everyone.
Own a house? Pay up or lose it.
Own a car? Want to actually use it? Pay up.
Need insurance? lol. Pay the fuck up.
Etc. and so on. Oh boy... it will really get good when pensions start rolling over.
Pensions are already being backstopped with printing new cash at ZERO cost. Another reason why interest rates CANNOT go up, period.
Truth.
Look to Japan.
Pensioners produce no goods of value.
Fail.
In my city: train fares, utilities, parking, prop tax, recycling tax and user fees for any other *service* are all slated to go up 5% a year for the next three years just to make the budget. Living rural and working urban via a stealth camper van is looking like a smart move so far.
Writing is on the wall for sure. Just like the collapse of Ancient Rome. Government will loot the masses to preserve itself. And when that starts to fall apart, the Public unions will pick up the slack.
My point here is that the coming crisis is not a destination. It is a journey. People who go "all in" on PMs might get run over. Conversely, people who do not hedge might wind up screwed at some point. In short, there is a time to buy and sell for any asset class.
Couldn't agree more Dogger. If it wasn't for the Mrs. I'd be there already. May have to rethink this whole marriage idea.
Great, another precious metals article on ZH. In 2008 when all the big banks were going to fail if we did not bail them out overnight before first thing in the morning, and the systemic fallout from this failure would collapse all economies on the planet and render us call cavemen heading for the stone age, I bought gold and silver.
Fast forward six years, and my ability to purchase goods and services to keep a roof over my head and food in the refrigerator, has been cut in half. Add to that, the cost of living and the dilution and destruction of the currency, and the banksters almost got it all.
It appears, regardless of what I do, the banksters and their algo's know exactly what to do to extract the most wealth from the most people at just the right time, and the BS and media propaganda to motivate us to give them all we got.
Nowadays, up is down and down is up, fundamentals, supply and demand, asset classes, stores of value, all mean nothing. I really feel fucked no matter what I do.
I can only tell you one thing. If you have physical, you will never have a problem exchanging it for the fruit of another's labor or the "fiat du jour".
There are now multiple "markets", the "official" government/central bank-sponsored one, and numerous "under the table" ones. Plenty of avenues and opportunities for getting shit done.
interesting times.
well whatever you do...don't sell your PMs
The trend of rising costs is just getting started. The middle class wipe out isn't even warmed up yet... in my opinion.
I agree. 7+ billion people (and growing) all competing for the remaining resources that make a higher standard of living possible. The math is what it is....
If you truly bought in '08 then you are a happy man today.
It's really simple. Buy low, sell high.
FWIW, neither greed nor fear will be on our side in this era. Only common sense and self-preservation. As I noted last night while discussing the fact that an ounce of gold a month is STILL a soldier's wage, as it was under Julius Caeser.....
Maintain diversification but adjust return expectations downward to ZERO REAL RETURNS over time for ALL ASSET CLASSES. Then, and only then will you be on firm footing. That is the price of corruption, and the masses tolerating/celebrating corruption. If everyone figures this out, consumer spending will fall by 10% or so to make up the losses from theft, fraud and other criminal enterprises in NY/DC. Simple math really. All asset classes will be raided, in rotation, in bizarre and unexpected ways. So, what are you gonna do about it? Stay diversified, stay pissed off at the right people, but be realistic.
If you need a million bucks to retire, counting home equity, and 10% should be in gold.....how many people have $100K in gold? What's the plan to acquire it?
Greed and fear feed the enemy. Fuck them and fuck greed and fear.
Best of luck, and may God preserve what remains of our Republic.
Yep. Good post.
+1. Nicely put.
I'd call that a power post. Very grounded.
+1 knowshitsherlock
It would seem that the law of supply and demand has been turned on it's ear. How is it possible that despite a shortage of silver and gold the prices have been driven down to such an extent... even below the cost of production?
Even a cursory knowledge of the demand supply curve shows that as price drops demand increases and as price rises demand falls until equilibrium is reached... unless the price is manipulated, as in rent control. Therefore, if I were a producer of solar panels or other product that requires silver or gold as an input, I would scoop up as much as possible at these low rates.
Manipulation of markets is the most pernicious form of corruption.
the zh line is that pm prices are down due to strong demand. lulz
To add insult to injury the manipulation is being done in plain sight.
We're reaching a point where words and numbers only mean what the user wants them to mean.
Deliberate disorientation and deliberate confusion reigns.
When the panic starts and the stampede takes hold, it will dreadful.
"Can you imagine the phonecalls the head of the Mint would receive from above when everyone on the COMEX realised they were going to hold their long position into delivery?"
Panic time for the COMEX because they never had this happen.
The banks want to push the PMs down because it's betting against the debt.
Okay, contracts are dumped into the market at 3:00 in the morning. Someone has to buy that, right? The price dilutes but settles as someone buys. Robotz buy...Robotz sell...
Are there any humans I guess is what I am wondering...
Gold is necessary I necessary because bankers can't be trusted - they know this best and that's why they hold gold.
GOFO RATE AND $2.50 will get you a ride on NYC Subway
No shortage of EFT gold though.
The linkage between the EFT variety and the physical stuff needs to be smashed.
Central planning is bound to fail due to the complexity of todays world. It is just a question of time until unintended consequences gain momentum. Those shitheads are trying to do gods work while serving the devil.
Sorry guys, I've been stocking up lately.
Me too. Just got a shipment in last night. $100 bag of Morgan's. Me like the shiny....
Sorry duplicate...
We understand, it was your enthusiasm for the shiny that got cha'!
demand through the roof yet the robots keep selling paper price........moronic.
Gold and Silver are anti-debt. Those performing irresponsible printing and having unsustainable debt levels see the PMs as a threat because they normally reveal the real value of fiat.
Barter
they will never tell the truth until 1 second after it is too late.......They will LIE OR DIE
The banksters make sure there is infinite paper gold to short the physical.
Game between the paper and real.
https://www.youtube.com/watch?v=0_pN-X7Gew8
What perfect timing for something catastrophic to occur?...
Like this, or this, this, this, or maybe this!
Buckle your chin straps and guard your "bung hole" for the upcoming turbulence through one or all of these diversion(s) in order to cull and keep the remaining "desirables" in line!...
Fiat lies, daily. Is history even taught in schools? Debasing coins/"money" was a death penalty, now it is habit.
Drop out, tune in and turn on! Join the FSA now!
I read yesterday that producers / mints are beginning to "allocate" (ration) silvuh and gold. They want to hang onto it and drive the price up and only sell at a price that makes sense for them.
I think access to the physical is going to tighten pretty much, unless and until the price goes back up.
Wish my stack was a lot bigger than it is now - but wishing doesn't make it happen.
Exactly what the diamond industry does.
The price of phys vs paper is no more connected that the real value of (pick your stock) stock vs physical anything. The PTB want to be able to just print more of something for more personal gain. That works until it doesn't. Wish I had a crystal ball....
There's no shortage in my stack!
there is no physical gold shortage Tyler(s).
I'm sad that you see fit to Grind The Gold Axe my friend(s).
http://www.providentmetals.com/2014-1-oz-canadian-gold-maple-leaf.html
If there is no physical shortage, then why not get back on Bretton Woods at $35.00 an ounce?
WOW, That's fantastic - there's no shortage, Provident metals has maple leafs in stock! Hey China, you know that 100 tons you're looking for this month? Good news, Provident Metals has maple leafs, you can just go there and order 3,200,000!
Thanks Bud.
This report does not reflect the market price. Gold is manipulated.
What you talking about there's plenty paper gold and silver.
yes yes yes, buy the paper for a fraction of it cost you to buy gold and sell when the heard comes around, and repeat. No need to own gold, just own the paper.
I've only got the wedding band on the finger of my left hand to worry about!