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Peter Hambro: "It's Virtually Impossible To Get Physical Gold In London"
Submitted by Koos Jansen via BullionStar.com,
Just after my colleague Ronan Manly wrote a very extensive article on how much gold is left in London (not much), Petropavlovsk Chairman and Co-Founder Peter Hambro discusses gold at Bloomberg Television. He, like Manly, concludes there is very little physical gold left in London. From Mr Hambro:
My baseline is they [the Chinese] have been buying and the Indian have been buying in enormous quantities. It’s virtually impossible to get physical gold in London to ship to those countries. We get permanent requests from Russia, would we please sell our physical gold to India and China. Because there is no physical, only endless promises. And I really worry that the market, that paper market, could be stamped on and people will say “sorry we’ll have a financial close out”, and it’s all over.
Perhaps this quote explains why UK gold export directly to China in June was not a net outflow from the UK – because there is little gold left in London (Manly, Hambro) and thus the UK had to ramp up import from the US in June to send forward to China.
The Financial Times reported on similar gold shortages in London. From the FT (2 September):
The cost of borrowing physical gold in London has risen sharply in recent weeks. That has been driven by dealers needing gold to deliver to refineries in Switzerland before it is melted down and sent to places such as India, according to market participants.
“[The rise] does indicate there is physical tightness in the market for gold for immediate delivery,” said Jon Butler, analyst at Mitsubishi.
I’ve also asked BullionStar CEO Torgny Persson in Singapore what he’s currently seeing in the precious metals markets. He replied there are shortages in both the gold and silver market. From Mr Persson:
I just got off the phone with A-Mark which is one of the world’s largest wholesalers. They are reporting that they have no gold and silver at all live available, that they have stopped taking orders for Silver Maples and Silver Philharmonics altogether and that Silver Eagles are available first in the end of November. For Pamp, there is similarly long delivery times for all minted gold bars.
We still have most products in stock because we stocked up as massively as we could in the last weeks but for many products, we are unable to replenish as of now when we run out.
Big squeeze with shortages starting now both on the wholesale/retail level and at the bulk level… Unless the paper price is reverting up, it may not subside this time around and then the paper fiat mess (including paper prices of gold and silver) is in trouble. If it goes to the point of shortages at the bulk level like 1kg gold bars and 1000 oz silver bars, the emperor will stand without clothes.
To be continued…
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I personally had a record month in August in terms of bullion sales, with the 5gram unit marching out the door. 2 weeks into September and I have already surpassed August sales. Geographically the largest volume of sales is to Canada and the UK, but there is a lot of product going to India also albeit the smaller weight units. Everyone is taking delivery!
www.teamramgold.com/about-us
Your web site says that QE and ZIRP is damaging the monetary system. This is not true. If is putting off the inevitable collapse of a debt based ponzi scheme. The so-called monetary system in inherently unstable.
@nobillsofcredit... you are indeed correct and I concur with you. However, not all of my website audience is as learnered as your good self (and other ZH readers) meaning therefore I have to be a little less technical to be understood. I spent my nights giving lectures about PM ownership and I am sorry to say but the level of economic understanding is woeful among the general public. The reason I promote my website on ZH is that the readers here are extremely aware of the actual workings within the financial world. We am steadily building up a team of ZH'ers who have the same idea as me to help educate ordinary Joe's about PM ownership and perhaps help a few of them get thru the oncoming collapse you referred to. We earn some commission for our trouble in the process.
get in touch with me if you want to get to know what I stand for; I'd be delighted to have the opportunity to work with you.
Yet more fearmongering from a bullion dealer article. Well I don't know about London, but the place I use in Birmingham, UK could deliver tomorrow if I chose - but I will resist the urge until it's below $850, thanks.
What place? Please tell us.
type "birmingham gold bullion" into google and take your pick from the first few results.
The US knows the Chinese are aquiring gold to back a gold backed currency, something the US visciously opposes. Yet they continue to supply gold to them? This makes no sense....unless the US has some other devious, covert reason for doing so.
What was I thinking! The US devious and covert?.....Never!.....Hey! there goes one of those flying pigs!
Gold backed currency? Once it crashes, what fool would fall for the currency instead of coin trick again? I do have a question. Do you know what currency is?
Do you know what currency is?
I'll take a shot at that.
Currency is one of many forms of money. It is a piece of paper with a denomination on it stating the value of an in-process trading promise.
Other forms of money besides currency are checks, credit card balances, bank balances, coins, treasury bills, treasury notes, industrial and government bonds, and who knows how many other simple and complicated instruments.
Trading promises are made by traders. They get these certified and those certificates then circulate as the most valued object in every simple barter exchange. When they deliver on their promise, the certificates are returned and destroyed. They enable simple barter exchanges over time and space.
Everyone who has ever bought a house or anything else on time has made such a promise and gotten it certified. The certificates (or record of payment) go to the seller. The buyer then returns certificates as scheduled in the promise (i.e. delivers) and the certificates (records) are destroyed (reversed).
If the trader fails to deliver on his promise, he defaults. DEFAULTs (in a properly managed MOE process) are immediately recovered by equal INTEREST collections. This "guarantees" zero inflation by the relation: INFLATION = DEFAULT - INTEREST.
Our MOE process manager, the Treasury and the Fed, have purposely maintained a leak (INFLATION related to in-process trades) of 4% in their 100 year history. They even claim a 2% leak is ideal. This allows the government to finance itself when it can no longer tax. It allows the banks to take a pound of flesh out of each trading transaction (i.e. legally demand: "stand and deliver").
Under a properly managed MOE process INFLATION is guaranteed to be zero, all the time and everywhere. INTEREST load on responsible traders is zero. Money (freedom to make new trading promises) is always in free supply. Demand and supply for the MOE itself is in perpetual perfect balance.
We give up all these features when allowing our MOE process to be co-opted and purposely mismanaged by governments and bankers.
Physical not available, eh?
That ought to be worth a $20 drop right there. Pretty soon none will be available at all. Should drop to zero then.