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Gold Smash Leads to Surge in Demand For Coins, Bars Around World
Gold Smash Leads to Surge in Demand For Coins, Bars Around World
- U.S. Mint sees highest monthly gold eagle sales in over two years
- Indians take advantage of low price in a season not typically known for gold buying
- Chinese investors, disillusioned with stock market, are buying gold in large volumes
- Demand for coins from Perth Mint 37% higher in June and even higher for July
The manipulative smash on the gold price on Sunday night has once again led to a surge of buying of gold coins and bars across the globe. Both the Wall Street Journal and Reuters report on how bullion dealers are seeing a spike in demand for gold coins and bars in India and China and indeed Europe, Australia and the U.S.
The U.S. Mint - which ran out of Silver Eagles earlier in the month due to unexpectedly high demand - has sold 110,000 Gold Eagle one ounce coins so far this month according to Reuters. This compares with a mere 21,500 ounces sold in May and 76,000 in June. It represents the highest level of monthly demand in over two years - with more than a week to go till the end of the month.
In India, July is typically a quiet month for gold sales as farmers, who make up the bulk of the population, allocate their cash towards cultivation, according to the WSJ. However, the unusually low price has led to a surge of buying.
“Gold’s plunge to five-year lows this week has prompted a swift rise in demand from jewelry retailers in China and India, the world’s top consumers of gold, leading to a doubling of premiums paid on physical gold,” reports the WSJ via Marketwatch.
The article goes on to quote an Indian jeweller:
“Until now, the gold demand was very low because of the season. Demand has picked up noticeably as the common man thinks prices have bottomed out.”
Meanwhile, Chinese investors have been allocating money to gold following the bursting of China’s equity bubble.
Interest in gold “had waned in recent months as investors flocked to the soaring stock market.” The surge in demand has caused a doubling in the premiums paid for gold. Demand for investment type “gold biscuits” has “shot up” this week according to a Hong Kong based jeweller. “Our sales are up by 20% to 30% compared to average sales in previous months.”
The Perth Mint in Australia has also seen a sharp rise in demand for gold coins. In June, sales were up 37% on the same month last year with the mint clearing 21,962 ounces.
“Sales in July already matched that level earlier this week and appear to be gaining momentum,” said Ron Currie, sales and marketing director.
The Perth Mint sells coins and bars internationally and is seeing strong demand in the U.S. and EU.
With the price of gold being determined by paper contracts - often regardless of the supply and demand fundamentals of the actual metal itself - spot gold prices today are no longer a barometer of perceived risk in the system.
However, It is clear that many investors in the East and West are accumulating physical gold, the main benefit of which is financial insurance. This would suggest that a great many more people are cautious about the health of the financial system and indeed the global economy than the gold price may indicate.
The experience of the Greek people in not being able to access bank accounts and even cash in safety deposit boxes is also making nervous and leading to gold buying and diversification.
The risks posed by the gargantuan unpayable debt choking the financial system and the economies of the world along with simmering geopolitical tensions remain. We advise clients to hope for the best while planning for the worst by owning physical gold - history’s and today’s store of value.
Must-read guide to bail-ins: Protecting Your Deposits From Confiscation
MARKET UPDATE
Today’s AM LBMA Gold Price was USD 1,101.65, EUR 1003.69 and GBP 705.91 per ounce.
Yesterday’s AM LBMA Gold Price was 1,096.80, EUR 1002.468 and GBP 702.38 per ounce.
Gold fell $6.30 or 0.4% to $1,093.90 per ounce and silver was flat or down 1 cent to $14.80 per ounce yesterday.
Today, gold in Singapore ticked higher, prior to gold bullion in Zurich moved slightly lower.
This morning in European trading, silver for immediate delivery rose 0.6% to $15.00 an ounce. Spot platinum rose 1.1% percent to $995 an ounce, while palladium rose 0.8 percent to $635 an ounce.
Must-read bullion guide: Gold and Silver Storage Must Haves
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She's right.
Gold IS backed by nothing.
It's gold. It doesn't NEED to be backed by anything.
If Gold were backed by the full faith and credit of the U. S. Government "then" I would be worried!!!!!!!
Tuco
It is backed by history.
The liars are getting desperate.
And their desperation is proof of their lack of true faith in their fiat...If they really DID believe, there'd be no need to attack gold, they'd just laugh and let it be.
But they don't, because they have doubts, and our stacking reminds them of those doubts, and they want gold tied to the stake and burned as a lesson to any who would challenge their
Fiat God.
The FED has it in their by-laws that they can and will do whatever it takes to protect the currency.
The FED has historically said (Volker, Greenspam, etc) that they constantly worked against the gold price. Volker's one thought after the fact was that he did not fight gold hard enough.
So out of curiousity, because some of you have financial connections that I never will, who caused the flash crash of gold and a number of other commodities this past Sunday? We've already had the convesation rife with speculation, now how about some actual evidence pointing to the culprit(s)?
So I can write them a nice thank you letter for alowing me to add to my stack for less...
We killed Bin Laden again so they hammered the globex after hours.
I don't have any financial connections, but I DID stay at a Holiday Inn Express last night...
I'd say the flash crash was caused by 'shenanigans', and the commodity drops are probably part of a larger global trend of lowered consumption. Less stuff being bought means less raw materials needed to make said stuff.
I also think gold is part of that general commodity trend at the moment, precisely because it ISN'T considered money by most here in the West. So it will probably go lower, maybe even a lot lower, in the immediate short term, along with copper, iron, oil, pork bellies, whatever...
But I believe that at some point people are going to get scared about the economy, and there will be a 'run' on gold. I mean REAL gold, not those 'contracts' they are trading like crazy. The buyers will want the actual metal, in their hands. As soon as they do, all that paper will be worthless, and gold will explode...
Well, as I said, I'm not a 'finance person', but I DO know history, and I've seen this episode before. The storyline is pretty consistent...fiat comes and goes, but it ALWAYS ends with gold back on top. The fiat becomes worthless, each and every time. Of course there will be a new fiat at some point, but the only accumulated wealth that can segue between the old and the new currency is in the form of gold, or silver.
I think of those folks trying to escape Saigon, and the people with the old regimes currency were stuck, because no one would take it for passage. Only the ones with gold were able to get out quickly and fairly easily.
That's not going to be me, stuck somewhere with a pocketfull of worthless dollars, or a non-working plastic card...I will have gold.
Gold is NOT the same as pork bellies. Pork bellies are consumed and supply must be constantly met.
Gold is not consumed and if the price were right most of the 170,000 tons ever mined could come to market in a heartbeat.
It is the price that keeps physical gold in short supply, not mining activity.
Gold derivatives are just a form of fractional reserve banking.
My best single point analysis, no charge.
Paper gold is not worth the same as physical gold.
The pool of greater fools is growing exponentially smaller.
One must sell at the price they can get to cover margin calls in other equities.
It is not 'stock' so free to liquidate (supposition on my part) without facing execution.
Keep Stackin'
Keep Packin'
Demand is high while prices continue to drop. Who could ask for anything more?
Its because they are printoing so much of it ...
Until we stop naked shorts this will go on forever. Sell paper, collect the cash, buy physical. Rinse and repeat....