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Indian Silver Demand Leads to Supply Issues, Capacity Stretched, Higher Premiums - Asian Bullion Demand Remains Strong

Tyler Durden's picture




 

Submitted by GoldCore

Indian Silver Demand Leads to ‘Supply Issues’, Airline Capacity Stretched and Higher Premiums - Asian Bullion Demand Remains Very Strong

Gold is 0.4% higher in US dollars and is trading at USD 1,665.10, EUR 1,263.00 , GBP 1,082.80, JPY 127,651, AUD 1,764.90 and CHF 1,534.90  per ounce. Gold’s London AM fix this morning was USD 1,672.00, EUR 1,267.05, GBP 1,086.35 per ounce. Yesterday’s AM fix was USD 1,660.00, EUR 1,242.51, GBP 1,068.07 per ounce.

Cross Currency Rates

Gold has risen for a fourth day as investors bargain hunt and safe haven buyers continue to accumulate. The flight to cash trade seen recently, due to margin calls and sharp losses in other markets, appears to be over.

Gold’s resilience yesterday and again today despite sharp falls in equity markets on deepening concerns of banking and sovereign contagion is impressive. Physical bullion buyers remain focused on gold’s long term fundamentals and its value as a safe haven asset.

Gold’s short term correlation with equity markets has been seen on many occasions in recent years. What has happened is after an initial correlated sell off where gold falls alongside risk assets, gold recovers faster than other assets and displays an inverse correlation with riskier paper assets over the long term.

We expect to see that happening again on this occasion.

Especially due to massive continuing demand being seen from China, India and across all of Asia including in Vietnam.

Vietnam has seen robust demand for gold for months now but that demand appears to be accelerating as Vietnamese demand surges due to the continuing devaluation of the Vietnamese dong.

Vietnamese gold bullion imports are $1.5 billion so far in 2011 but astonishingly Vietnam imported $600 million worth of gold bullion in September alone, according to a report from the Tien Phong newspaper, citing the Ministry of Industry and Trade.

 
Due to gold’s still strong fundamentals - bullion banks, mints, refiners and dealers remain bullish despite the recent sell off and very few have lowered their price forecasts for Q4 2011 or for 2012.

Credit Suisse have raised their 2012 average gold price estimate to $1,850 from $1,540.

 
Those continuing to be bearish on gold and misdiagnosing a gold bubble (for a variety of simplistic and ill thought out reasons – see Commentary) are ignoring the deeply held belief in gold as a store of value of some 3 billion people in Asia.

They also ignore the small but growing number of buyers in the western world who are diversifying into gold leading to an increase in allocations to gold from a miniscule base. These buyers include hedge funds, banks, pension funds and most importantly central banks.

These buyers continue to rightly focus on gold’s value rather than its price.

SILVER

Silver has risen another 0.6% today as buyers continue to buy on this latest sharp dip.

 

Physical demand for silver remains high and is being reflected in a slight uptick in premiums. GoldCore have seen continuing coin and bar demand and physical buyers are not being deterred by the latest sell off on the COMEX market. Those buying silver continue to expect silver to rise to $50/oz and many expect silver to rise to over $140/oz which is the real record (CPI inflation adjusted) high from 1980.

Demand from western buyers remains minimal as buyers remain a contrarian few with the majority of investors and savers having no allocation to silver whatsoever.

However, this is not the case in Asia where both gold and silver are held in far higher esteem and appreciated for their wealth preservation qualities.

Indian demand has been very significant in months and has accelerated in recent days after the sell off and tentative signs of a bottoming.

 Heightened physical demand for silver from the Indian subcontinent is causing “supply issues” according to UBS this morning. UBS note that airline capacity  to deliver the precious metal is being “stretched” and premiums are unsurprisingly on the rise.

With gold having risen 17% year to date but silver flat so far in 2011, many in Asia are seeing silver as better value at these price levels. Also, many buyers in Asia cannot afford gold at these prices and thus are buying silver instead as silver again fulfills its roles as “poor man’s gold”.

The physical silver market remains tiny vis-à-vis equity, bond and currency markets and even a small increase in allocations to silver could lead to sharply higher prices. As ever buyers should focus on value rather than price and use silver as a wealth preservation tool rather than simply for capital gains.

For the latest news and commentary on financial markets and gold please follow us on Twitter

NEWS

(BusinessWeek) -- Gold Rises for Second Day as Greek Debt Spurs Demand for Haven
http://www.businessweek.com/news/2011-10-03/gold-rises-for-second-day-as...

(MarketWatch) -- More physical gold to serve as collateral: CME
http://www.marketwatch.com/story/more-physical-gold-to-serve-as-collater...

(Reuters) -- World stocks tumble on banks' Greece exposure fears
http://www.reuters.com/article/2011/10/04/us-markets-global-idUSTRE77L0A...

(Reuters) -- Gold to regain glitter, say bankers to the rich
http://www.reuters.com/article/2011/10/03/us-wealth-summit-gold-idUSTRE7...

(Mineweb) -- Silver price to average $36.11/oz this year, $39/oz in 2012-TD Securities
http://www.mineweb.com/mineweb/view/mineweb/en/page32?oid=136765&sn=Deta...

COMMENTARY

(Zero Hedge) -- Is The CME's 150% Hike In Gold Collateral Just A Ploy To Increase Amount Of Legally Confiscatable Gold?
http://www.zerohedge.com/news/cmes-150-hike-gold-collateral-just-ploy-in...

(Congressman Ron Paul) -- Ron Paul: The Fed twists, the market shouts
http://paul.house.gov/index.php?option=com_content&view=article&id=1915:...

(King World News) -- London Trader - Physical Demand for Gold has Been Insatiable
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/3_Lo...

(Wall Street Journal) -- A Golden Age For Gold Loses Some of Its Luster
http://online.wsj.com/article/SB1000142405297020461250457660896269910067...

(Financial Times) -- Gold bugs beware – the bubble is finally bursting
http://www.ft.com/cms/s/0/cb07c11c-edac-11e0-a9a9-00144feab49a.html#ixzz...

 

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Tue, 10/04/2011 - 07:42 | 1736421 GeneMarchbanks
GeneMarchbanks's picture

Goldcore! Where have you been? BTFD I presume?

Tue, 10/04/2011 - 08:16 | 1736507 MillionDollarBonus_
MillionDollarBonus_'s picture

Forget gold. Have you seen the discounts on financials and retail stocks!? I've been picking up BARGAINS this week. Congress has proven time and again that they have what it takes to guide us through tough times. The same courage and perseverance that our politicians and Federal Reserve officials demonstrated in the 1930s will serve us well into this economic turmoil. This cycle of crisis followed by courageous resolution by congress and our economic leaders has repeated throughout history, and savvy investors who understand this will be able to profit greatly.

Tue, 10/04/2011 - 08:23 | 1736520 Eeyores Enigma
Eeyores Enigma's picture

robo-troll

Tue, 10/04/2011 - 08:26 | 1736524 snowball777
snowball777's picture

Not your best work; it lacks the sheer zany quality of your pro-Krugman posts.

No one will get the inside joke about the future "earnings" of financials.

Tue, 10/04/2011 - 08:27 | 1736525 Fred C Dobbs
Fred C Dobbs's picture

Please tell us what you bought, when and at what price.  

Tue, 10/04/2011 - 08:43 | 1736571 MillionDollarBonus_
MillionDollarBonus_'s picture

I have a well diversified portfolio consisting of US equities with an emphasis on retail. The returns up untill now have been dissapointing but that's not the point. If history repeats, and congress is able to kickstart this consumer economy by boosting aggregate demand, then I will eventually be a winner. Savvy investors like myself think ahead and plan for the future, and if that means I have to endure constant mocking and insults by arrogant libertarian bullies, then so be it.

Tue, 10/04/2011 - 08:46 | 1736588 Fred C Dobbs
Fred C Dobbs's picture

I thought so.  thanks.

Tue, 10/04/2011 - 09:22 | 1736696 Calmyourself
Calmyourself's picture

Good stuff, good advice don't let these bears get you down.  Congress has a sterling record of creating demand, jobs and overall economic health.....

Tue, 10/04/2011 - 09:32 | 1736743 Stuck on Zero
Stuck on Zero's picture

To sharpen up your portfolio in core American companies may I recommend Citi, AMR, and Bank of America?

Tue, 10/04/2011 - 09:52 | 1736839 Long-John-Silver
Long-John-Silver's picture

You forgot Netflex (NFLX). It's a bargain right now. /sarc

Tue, 10/04/2011 - 12:47 | 1737628 Whalley World
Whalley World's picture

Hey, you forgot JPM, if ever there was a sterling corporation with ethical management and a well managed hedge book it's JPM.

Hell, they even kicked in a few mill to help the NYPD beat the shit out of all those pesky protesters.

Disclosure: I own mega option contracts March 2012 puts at strike $20.  Already up 75%

Thanks Max Keiser

Tue, 10/04/2011 - 09:49 | 1736821 Smiddywesson
Smiddywesson's picture

Yes and all of the past stimulus found its way into the pockets of retail customers?  How are retail stocks going to rise with no jobs?

Inquiring libertarian bullies would like to know.

Tue, 10/04/2011 - 10:12 | 1736915 MillionDollarBonus_
MillionDollarBonus_'s picture

Did you not hear about Obama's new JOBS BILL!? When these nasty republicans finally come around, we will create tens of thousands of jobs with this bill alone. I dare say there are plenty of jobs programs to come following our President's reelection and retail stocks are set to SOAR. This is the most cunning way to play aggregate demand.

Tue, 10/04/2011 - 10:14 | 1736938 mick_richfield
mick_richfield's picture

No, MDB.  We haven't heard of that.  Can you tell us more about it?

Tue, 10/04/2011 - 11:35 | 1737290 pupton
pupton's picture

"Congress has proven time and again that they have what it takes to guide us through tough times." What planet have you been living on guy???  You sound like a government propagandist shill, do you know that?

You must be part of that 6% that still "approves" of the job Congress is doing.  And the "Jobs Bill" is being held up by nasty Democrats like Harry Reid, not Republicans, because even dirty Harry knows it sucks.  Oh, and it's not going to create any jobs (or save any pretend jobs). It is a tax bill.  The government does not and can not "create" jobs, only take productive money from the private sector and redistribute it toward unproductive waste, regulate and stand in the way.  A real jobs bill would undo the damage done by years of uncertainty resulting from failed Obamanomics, anti-bunsiness propaganda, and abusive over regulation.  Let the market create jobs and STFU.

Tue, 10/04/2011 - 12:10 | 1737467 LudwigVon
LudwigVon's picture

tens of thousands

 

lol !

 

 

Tue, 10/04/2011 - 11:55 | 1737380 Black Friday
Black Friday's picture

"returns up untill now have been dissapointing" 

"If history repeats"

"Savvy investors like myself think"

 

Ouch.

Tue, 10/04/2011 - 08:27 | 1736527 Snidley Whipsnae
Snidley Whipsnae's picture

MillionDollarBonus... Arrived on planet ZH a couple of weeks ago...After less than rigorous training at 'Troll School For Beginners'...

Evaluation report by overseers: student failing to convince anyone of anything, student has a weak grasp of subject matter, prospects of success as a troll...slim to none.

Tue, 10/04/2011 - 10:11 | 1736922 mick_richfield
mick_richfield's picture

I wonder if English is his first language?   Note misspelling of "dissapointing".  OK, that's not proof -- but then the use of ALL CAPS emphasis -- who does that?  Also complete lack of banter /  humor.   A foreigner, or a really old kind of mentally fading sort of in-duh-vidual ?

 

 

Tue, 10/04/2011 - 10:15 | 1736947 cynicalskeptic
cynicalskeptic's picture

Bt he did well a few yewars back with Lehman Bros ........   I bet his great-grandfather was sure about Imperial Russian Bonds too.  I mean how much more stable could a country be?

 

Tue, 10/04/2011 - 12:12 | 1737478 LudwigVon
LudwigVon's picture

Idk sounds like Hamy 2 me, I lol'd. I like the posts, ultra sarc, educated.

Tue, 10/04/2011 - 14:52 | 1738157 akak
akak's picture

Yes, he could be HamyWanger, although his syntax and vocabulary are rather more refined and erudite than those of Hamy.

On a side note, I guess the original model for Hamy, good ol' James Kostorhyz, I mean Harry Wanger, finally finished his study on "the psychology of utopian permabears".

Tue, 10/04/2011 - 08:37 | 1736560 Accidental Farmer
Accidental Farmer's picture

Yes; Oh God Yes! Let's trust our Politicians who definitely have our best interest at heart to fix this crisis that is a result of their policies. What we need to fix the problem is more trust in our leaders.

By the way, sounds like you would camp out on the sidewalk over night to give the congress and fed folks rim-jobs.

Change your user name to "Obvious Shill"

Tue, 10/04/2011 - 08:52 | 1736609 Doctor sahab
Doctor sahab's picture

Lol. Thanks! I needed the levity. Got a busy day with a full office and couple of surgeries today.

Tue, 10/04/2011 - 09:07 | 1736645 DosZap
DosZap's picture

MillionDollarBonus_

Your either an agent provcacateur,or a shill/empolyee for the Fed, no one can really be as stupid as your rantings prove.

Tue, 10/04/2011 - 09:52 | 1736834 mick_richfield
mick_richfield's picture

Forget what?

You are ABSOLUTELY RIGHT!  There are such BUYING OPPORTUNITIES in financials now!  In fact, I expect NOTHING but MORE and BETTER BUYING OPPORTUNITIES in financials FROM HERE ON OUT!

 

Tue, 10/04/2011 - 11:32 | 1737281 Fuh Querada
Fuh Querada's picture

@MDB

Ha Ha.....Urggghhhhh (sound of pork fried rice luncheon being regurgitated).  I can't decide whether you are the court jester here or simply a right royal pain the the ass.

Tue, 10/04/2011 - 08:34 | 1736541 Top_Kill
Top_Kill's picture

#OccupyCFTC #OccupyComex #Occupy LBMA #OccupySILVER

Tue, 10/04/2011 - 07:44 | 1736426 Mr. Fix
Mr. Fix's picture

Buy silver!

Tue, 10/04/2011 - 08:10 | 1736486 Mike2756
Mike2756's picture

Yeah but, at much lower levels. Dollar, bitchez!

Tue, 10/04/2011 - 07:45 | 1736428 Snidley Whipsnae
Snidley Whipsnae's picture

Keep the faith... We will overcome the paper hangers!

Tue, 10/04/2011 - 09:54 | 1736844 Long-John-Silver
Long-John-Silver's picture

One notable Paper Hanger murdered 6 million people before he was overcome.

Tue, 10/04/2011 - 07:47 | 1736430 ubergaster
ubergaster's picture

Interesting info. Would i buy the "dip" based on this info? Frosted hell no!

Tue, 10/04/2011 - 07:50 | 1736437 Snidley Whipsnae
Snidley Whipsnae's picture

Your participation isn't needed... The Asians, Indians and others are buying for you.

Tue, 10/04/2011 - 09:54 | 1736828 Pegasus Muse
Pegasus Muse's picture

Count me as one of those "other".  

=====

October 3, 2011 

London Trader - Physical Demand for Gold has Been Insatiable

With gold above the $1,650 level and silver near $31, a trader out of London told King World News, “The hedge funds I have spoken to were saying they have lost so much money on their stocks, that they were selling the only assets which were in profits and that turned out to be their gold and silver holdings.”  

 

“They were not happy about taking the only good performing asset they had, in order to offset the losses on their common stocks.  This was done for the purpose of end of the quarter window dressing.  The indication was that they wanted to get back in as soon as possible and we may be seeing some of that reflected in today’s action.

With regards to silver, you are back to commercial short interest levels last seen when silver was trading in the $9 range.  The interesting thing is there was a lot more liquidation after the COT cutoff on silver, so the levels should be even more extreme. 

The commercials have been covering off of the longs, but recently they have also been covering into fresh shorts by speculators and other traders who believe silver will continue to drop.  This is what you normally see after a washout.  Gold and silver will begin to rise with the least amount of people on the long side.

The Asians have been buying like crazy, all through this takedown they have been buying.  We have seen massive premiums and bottlenecks in supply, they simply cannot get enough physical metal as the prices have dropped.  The demand has literally been insatiable.  As I have stated before, the central bank gold, which was used to sell the market down, has gone to vaults in Asia.  That’s a one way trip, it doesn’t come back into the market.... 

“There is also strong demand from India.  If we get a pit close above $1,705, there are a massive amount of shorts that will be tripped up and be forced to cover.  This will give additional impetus to the upside. 

So the Western central banks got together, leased out some gold and the bullion banks sold the gold.  The central bank gold being unloaded by the bullion banks is not to get the best price, but to smash the price.  The smartest way to sell the gold would be to do it in the liquid sessions.  But the pattern during the decline was they were selling it in the overnight session when things are quiet.  This was no different than what we saw at the end of April, beginning of May on that coordinated smash.

You have to ask the question, why would anyone sell at the most illiquid times?  It is not to get the best price, it is to move the market in the direction you want to move it.  The commercials are now competing with funds that are coming in to buy and they are continuing to compete with the physical buyers and those buyers have been accumulating in size during the entire decline since gold dropped below $1,775.

As it stands today, there are an unbelievable amount of physical orders that have not been filled.  Some of the buyers might have believed there would be more downside action.  When gold was briefly down at $1,530, almost no one got any physical gold.  No one was even getting fills at $1,585 on the second and third dip, the orders down there were not filled.  Those physical buyers are watching right now and if they lose patience, they may very well move their orders higher.  If that turns out to be the case, it will put even more pressure to the upside in gold.”

KingWorldNews.com

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/3_London_Trader_-_Physical_Demand_for_Gold_has_Been_Insatiable.html 

Tue, 10/04/2011 - 11:31 | 1737276 Chaffinch
Chaffinch's picture

Bullionvault silver customers are buying the dip. Their holdings (for a whole load of little guys and gals) are now over 7 million ounces of silver (30th Sep daily audit on their website 228,000 kilos = 7.3 million ounces). On 8th Sep their holdings were 6.7 million ounces - an 8% increase in 3 weeks.
(physical in your hand is the best solution, but in the UK they make you pay 20% VAT on silver, so I am OK taking the risk to let someone else vault it)

Tue, 10/04/2011 - 07:56 | 1736449 Kina
Kina's picture

One certain thing in the current world is that there are banksters everywhere corrupting and manipulating markets. I trust they will all legally swing at the end of a rope for treason one day when the people reclaim rule of law, that regulators and authorities refuse to enforce.

 

They have already lost and now fighting a losing battle. It seems many in the USA have already fingered the banksters/Wall Street as the resident evil of the USA.

Tue, 10/04/2011 - 07:57 | 1736451 Enkidu78
Enkidu78's picture

Gold is currently having a massive take down....   I might buy some more!!

Tue, 10/04/2011 - 08:01 | 1736462 Snidley Whipsnae
Snidley Whipsnae's picture

Massive take down = .27% ??? lol

http://finviz.com/forex.ashx

Tue, 10/04/2011 - 08:05 | 1736473 Enkidu78
Enkidu78's picture

I know I was on the wind up... I have a coin in my shopping basket im just waiting for the best price... Sell that paper Gold you weak heads.

Tue, 10/04/2011 - 07:58 | 1736454 Schmuck Raker
Schmuck Raker's picture

Tyler, "...Airline Capacity Stretched and Higher Premiums" ??

Wanna fix that?

Tue, 10/04/2011 - 07:59 | 1736456 RobotTrader
RobotTrader's picture

New lows in GDX/GLD ratio now assured.

Tue, 10/04/2011 - 08:11 | 1736489 SheepDog-One
SheepDog-One's picture

RearViewTrader...so then you at some point SOLD your 'sizable gold portfolio' then? 

Tue, 10/04/2011 - 09:08 | 1736646 Richard Head
Richard Head's picture

He's like those dumbshit newsletter writers that spew 100 different opinions, then take credit for the handful that turned out to be right.

Tue, 10/04/2011 - 10:53 | 1737110 Temporalist
Temporalist's picture

He's worse than that he's Captain Hindsight.

Tue, 10/04/2011 - 14:55 | 1738179 akak
akak's picture

More like Captain Blindsight.

Tue, 10/04/2011 - 07:59 | 1736457 PulauHantu29
PulauHantu29's picture

You can't eat silver some say.....

Tue, 10/04/2011 - 08:01 | 1736464 EL INDIO
EL INDIO's picture

You can't eat toilet paper (cash) either.

Tue, 10/04/2011 - 08:04 | 1736469 PulauHantu29
PulauHantu29's picture

You make a powerful argument Indio. I concede.

Tue, 10/04/2011 - 10:20 | 1736966 cynicalskeptic
cynicalskeptic's picture

Can't really use it as toilet paper even..........

http://www.freakonomics.com/2008/12/18/freak-shots-when-money-goes-down-...

Tue, 10/04/2011 - 08:12 | 1736491 SheepDog-One
SheepDog-One's picture

Cant eat bonds or stocks either, I think a lot of people are realizing that as well.

Tue, 10/04/2011 - 08:28 | 1736530 snowball777
snowball777's picture

Long seeds and fertilizer.

Tue, 10/04/2011 - 08:00 | 1736460 EL INDIO
EL INDIO's picture

Gold is safe even if it goes down, Hell I hope it goes down a lot more so that I can load up some more.

Silver is a very dangerous beast, I'd wait until i see more money printing.

Tue, 10/04/2011 - 09:25 | 1736707 Calmyourself
Calmyourself's picture

Disagree, once silver is once again seen as poor mans gold in the U.S. the upward swing will be monumental.  There is no other outcome possible, they must print, so buy now.   Tick tock, tick tock...

Tue, 10/04/2011 - 09:58 | 1736866 Long-John-Silver
Long-John-Silver's picture

With copper getting hammered mines will back off production which will cause Silver production to drop precipitously. Peak Silver is here, now, and for at least a decade. 

Tue, 10/04/2011 - 10:57 | 1737133 Temporalist
Temporalist's picture

Good observation LJS.  If copper and Zinc (as I heard there are mines being slowed and exports being reduced) mines start to reduce production there will be even less Ag.

http://www.foxbusiness.com/industries/2011/10/03/lme-week-base-metal-pri...

Tue, 10/04/2011 - 08:04 | 1736468 sudzee
sudzee's picture

Must be tough if you are Chinese. Making yuan like there is no tomorrow. Inflation out of control. Stock market down from 6000 to 2350. Bonds paying negative rates. Exports to other than the US about to implode on currency weakness thus massive layoffs in the near future. No where else to stash wealth but gold and silver. Must be tough to be wealthy in China.

Tue, 10/04/2011 - 08:09 | 1736483 Snidley Whipsnae
Snidley Whipsnae's picture

The world today = a gigantic, colorful, swirling, paper blizzard...

Many will be swept away by the blizzard...

Some will be saved by anchors of PMs...

Tue, 10/04/2011 - 08:09 | 1736484 Esso
Esso's picture

"Stock market down from 6000 to 2350."

Just like the NASDAQ.

Tue, 10/04/2011 - 08:18 | 1736510 rokka
rokka's picture

"These buyers continue to rightly focus on gold’s value rather than its price."

Is it a new type of investor to whom the price doesn't matter any more? :)

Tue, 10/04/2011 - 08:30 | 1736540 snowball777
snowball777's picture

Depends on how that "price" is denominated and the likelihood that said denomination will be more useful as wallpaper than currency in the not too distant future.

Tue, 10/04/2011 - 08:31 | 1736547 Snidley Whipsnae
Snidley Whipsnae's picture

"Is it a new type of investor to whom the price doesn't matter any more? :)"

'''''''''''''''''''''''''''''''''''''''''''''''''

Yes, they are called soverign wealth funds, soverigns, and Asians/Indians/Mid Eastern individuals that are wealthier than most can imagine.

Oh, and some are called central banks...

Tue, 10/04/2011 - 08:38 | 1736556 TGR
TGR's picture

I would agree that price is still a prime motivator - many in China becoming aware of PMs (and there is still a deep pool to be tapped) are being chanelled into paper gold and unallocated gold accounts, simply due to the ease and speed of internet banking, and the products on offer via the big banks in China.

Plus, I don't believe silver benefits from the misplaced notion that 'gold is too expensive, therefore people will turn to silver'. In China gold is quoted by the gram, and for gold trading accounts and unallocated accounts (specifically USD-denominated accounts), buying can be in increments of 0.01 oz. Hardly going to break the bank of most, and not much of a price deterrence to turn to silver instead.

Tue, 10/04/2011 - 09:22 | 1736694 Snidley Whipsnae
Snidley Whipsnae's picture

TGR... " many in China becoming aware of PMs "

This typifies American/Western thinking. The Chinese were 'aware' of PMs at least 4,800 years prior to the existence of 'The United States'...

The Spanish silver dollar was popular the world over and circulated in China just as it did in the American Colonies.

You need to do some homework before commenting on 'Chinese awareness of PMs'...

Tue, 10/04/2011 - 09:53 | 1736824 TGR
TGR's picture

Nah, I've done my homework - but it sounds more like you, with due respect, are prone to gobbling up every little bit of 'analysis' on anything to do with the Chinese mentality from armchair experts in your neck of the woods.

I base my statement on being in China, now and for the past 14 years, trading gold here, buying gold here, and talking to a diverse crowd of people at all levels of society in China who will entertain a conversation on the topic. And that's a hell of alot of people over the years. I can assure you without a shadow of a doubt, I have heard the most retarded comments on gold from wealthy and supposedly highly educated people in China. Sure, there is a much stronger awareness of gold in China than in many countries, but stocks and housing have by a huge shot far outweighed thoughts of gold over the past decade.

I have yet to meet one single person in China, other than my girlfriend, who has bought, or planned on buying, gold. Sure that doesn't mean there aren't a hell of alot of people buying regardless, but given the fact gold was virtually banned from the 50s to only earlier this decade, there has been somewhat of a dearth of interest - specially relative to stocks and apartments - and gold is not in 'the blood' as many would have you believe.

Yep, China has a long history of gold use, and silver, but that doesn't automatically mean that the notion of PMs as sound money was passed down from generation to generation in a hushed tone. If that were the case, citizens of nearly all countries could be deemed to be highly aware of PMs, as even as little as 40-odd years ago - silver was circulating as money in, oh I don't know - at a guess, where you live?

 

 

Tue, 10/04/2011 - 10:03 | 1736881 Snidley Whipsnae
Snidley Whipsnae's picture

and I say you are totally full of crap...

If you had been in China for 14 years or even 14 days you would know better than to make comments like 'the Chinese are beginning to become aware of PMs'...

I lived in Japan 4 yrs, China for 2 1/2, Viet Nam for 3 and can assure you that all of these cultures are more aware of PMs and their past performance as a store of value.

I have met Asian families that own the same silver now that has been in their families many generations...and, it isn't kept in banks or paper PMs. Some of them still have Spanish Silver Dollars.

You know squat and sound more like a shill for the Fed/bullion banks than an investor.

BTW, I still have practically worn out gold eagles that I purchased in 1968 for ~ $65... Were you even alive in 1968? I also have a lot of silver coins from that era... not all bought into fiat then...or now.

Tue, 10/04/2011 - 10:18 | 1736954 TGR
TGR's picture

Fuck me, this place really has gone down hill.

Did you even read what I said before? I never said 'Chinese are beginning to become aware of PMS..' I said many "who are becoming aware of PMs are being channelled into paper gold..."

You can doubt all you want if I am China or not, but I have absolutely no need to bullshit about it, that would be somewhat retarded, wouldn't it? It's not like I post regularly here or care about an online persona. Lol.

You have met 'Asian families'. What the feck does that mean? Which country? I am talking about China, where I live and have lived for 14 years.

I'm sorry, but I don't think you could get anyone more bullish on gold (and silver to a lesser degree) than me, that is why I believe it is still worthwhile mentioning some points from my perspective here on the ground. The reality is, there is still a a huge pool of Chinese buyers yet to come into the market, and they will. That is the bullish aspect.

Dude, if you seriously think I am full of shit - I am quite willing to go down to the corner store, buy a RMB90 pre-paid sim and post the number (hint: it will be a Chinese number) on here for you to call. Quite happy to talk rationally on the phone, but if you call BS on facts, it becomes pointless to have a conversation on here.

Tue, 10/04/2011 - 11:09 | 1737192 Temporalist
Temporalist's picture

Actually your post says "many in China becoming aware of PMs"

 

Just pointing out if you're going to rail against someone you should know what you said...it's only a couple of posts above.

Tue, 10/04/2011 - 11:18 | 1737222 TGR
TGR's picture

True. What I actually said was "- many in China becoming aware of PMs (and there is still a deep pool to be tapped) are being chanelled into paper gold", which means 'many who are becoming aware of PMs in China re being channeled into paper gold'. It does not mean "Chinese are beginning to become aware of PMs", and I never insinuated that.

 

Tue, 10/04/2011 - 11:17 | 1737224 Snidley Whipsnae
Snidley Whipsnae's picture

Go pound sand, troll. Your cover is blown. This place hasn't gone down hill but if would improve with a few less liars.

I have no interest in conversations with trolls...and, your 'girlfriend' comment was really over the top. Most Chinese girls, those with a strong family ties, which is the vast majority, have no interest in relationships with westerners. Same in Japan, same in Viet Nam. Because of the emphasis placed on sons vs daughters, marriagable age Chinese women are in great demand and can pick/choose among well off Chinese men... What the hell would one want with a Western compulsive liar?

If you really lived in China, you would know that... or, perhaps your girl is a pay as you go deal?

In any case, you are still full of crap. Adios... and, I don't need you to go to the trouble of contacting a mailing service to try and impress me.

Tue, 10/04/2011 - 11:33 | 1737259 TGR
TGR's picture

Lol. Cover blown my ass. It's a shame you are a deluded chicken shit with his head so far up his own rectum that you aren't going to take me up on my offer - telling someone they are a right cunt on the phone would be so much more pleasing than on a message board.

But I digress, it's not the fact you are clearly and utterly full of shit about knowing even the slightest about China and the gold market in this region, you clearly have never even been remotely near the place, as you'd know full well stocks and property have been the prime investment among Chinese over the past decade. As for your bizarre admission that you never got laid (assuming for one second you had ever been to anywhere in Asia) by anyone other than whores, I hope for your sake you are as full of shit as I know you actually are in reality.

Oh, and learn to fucking read please and don't twist my words to suit your own agenda, cunt.

 

 

 

Tue, 10/04/2011 - 11:42 | 1737321 Piranhanoia
Piranhanoia's picture

If your statement about the orient just now discovering metal as currency is the basis of your argument,  you have shot your foot off.  Your statistical sample appears to be a small fraction of .00001% of the population, and everything you say is based upon your opinion, and something you believe because you heard it.    

This is how governments operate, you can smell the whimsy from almost anywhere.

Tue, 10/04/2011 - 11:51 | 1737367 TGR
TGR's picture

Errrm, are you talking to me? Unbelievable if so, as in no way did I ever insinuate the "orient just now discovering metal as a currency", far from it - so your strawman argument has no basis whatsoever. Metals have been valued for eons in Asia.

 

Anyway, I now find it amusing if you and your sock-puppet aliases want to accuse me as a shill or government or whatever - not sure I follow the logic, and couldn't be further from the truth...whatever.

Tue, 10/04/2011 - 08:47 | 1736591 The Deleuzian
The Deleuzian's picture

The banksters are caught in a catch 22...They can't let the PM's go up when equities tank...But the low prices will clear out any remaining physical...Seems to me the long awaited 'divorce from paper' moment is near...

Tue, 10/04/2011 - 09:01 | 1736631 apberusdisvet
apberusdisvet's picture

There is an interesting geological argument that indicates that silver's scarcity will be more pronounced going foward.  When the earth's crust was formed, silver the lighter metal among the base metals rose to the top; thus the easy "finds" have already been discovered.  The manipulators of the price may succeed in their efforts for a little longer, but the end game (easily within a decade) will see silver at astronomical prices.

Tue, 10/04/2011 - 09:29 | 1736732 Snidley Whipsnae
Snidley Whipsnae's picture

Few pure silver plays are left. Most silver is recovered in mines that are primarily seeking gold or other metals.

As far as I know the recovery ratio of silver : gold is still ~ 16 : 1

So if that ratio is correct silver should be priced at well above $100 today. Of course it is being stymied by paper manipulations... but that will pass.

Patience is a virtue.

Tue, 10/04/2011 - 11:45 | 1737337 Piranhanoia
Piranhanoia's picture

saw something they other day where it said current production is about 9:1 now. Anyone else see that?  Probably here!    This would seem to indicate 40:1 is not market based, nor realistic.  yeah,  Patience!

Tue, 10/04/2011 - 09:50 | 1736827 HungrySeagull
HungrySeagull's picture

I think the inflation adjust value for silver is two times 140.

A figure large enough to make me leak....

Tue, 10/04/2011 - 10:53 | 1737111 Tadross
Tadross's picture

Kingold (KGJI) looks like an inexpensive way to play the China gold-demand story.  Assuming the financials are accurate (an ex US-SEC guy heads their audit committee), the company has no debt and is trading at half of tangible book value and liquid net worth (current assets less current liabilities).  The later is an important criteria for Warren Buffett.

Tue, 10/04/2011 - 11:09 | 1737194 jjsilver
jjsilver's picture

Contract, print, contract, ease. Wash, spin repeat. Control your reality, deflation, inflation. Spoon feed you your reality. Price action does not prove reality when you have criminals controlling and manipulating everything, and I mean everything you see and hear. Critical thinking skills and discernment are a must when living in the Matrix!!!!!!

Tue, 10/04/2011 - 11:42 | 1737320 Fuh Querada
Fuh Querada's picture

Current delivery time of my coin dealer for 1 oz silver Vienna Philharmonics is out to 16-21 days. Price €26.52.  1 kg Perth mint silver Dragon coin-bar 14 days delivery at € 851,22. Silver premiums are about 19% over the spot price but this includes 7% value added tax. 1 oz gold coins in stock, currently € 1267 (Australian nugget). Premium only 4% over spot price.

Tue, 10/04/2011 - 12:22 | 1737529 fiddler_on_the_roof
fiddler_on_the_roof's picture

Goldcore has bad data. when Gold price increase in Asia, they just buy less Gold with same money, but not silver.

Tue, 10/04/2011 - 12:31 | 1737553 TGR
TGR's picture

Careful, you'll upset that snidley troll with any hint of truth about buyers in Asia - then he'll start wailing like the limp-wristed fairy that he is who has never left the confines of his trailer park. Doesn't matter how much gold or silver you have, he'll get all narky on you for making sense.

Tue, 10/04/2011 - 12:41 | 1737600 Caveman93
Caveman93's picture

If silver is trash then why was there ever Exectutive Order 11110? Silver is money...b!tchez!

Wed, 10/12/2011 - 12:31 | 1766190 karmete
karmete's picture

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