Bitcoin is an easy way for people to swap out of yuan. Goldman Sachs analysts estimated earlier this year that 80% of bitcoin volume is exchanged in and out of the Chinese yuan. Once converted to bitcoin, the owners can then swap back into other fiat currencies and indeed physical gold.
In an interview on CNBC's "Trading Nation," the Gloom, Boom & Doom Report editor revealed he may not be as bearish as some may think and that he is actually a “great optimist.”
Dennis Gartman, author of the institutionally well followed ‘The Gartman Letter,’ has asked questions about gold’s peculiar price action last week and raised the question as to whether there was official central bank manipulation of gold prices.
Gold is up 3.1% in October and had even larger gains in other currencies. Entering gold’s “seasonal sweet spot” in November, December, January and February.
A bursting of property bubbles in London and New York would be expected to have an impact on national economies and indeed on national property markets. Sentiment would be badly impacted. Caution should be the order of the day.
Gold will also be vulnerable towards the end of an interest rate tightening cycle as was the case in January 1980. Today, central banks including the Fed are having difficulty raising interest rates in even a small nominal way.
In the event of a systemic European banking crisis, however, laws could be changed at the stroke of a pen and “bail-in” mechanisms could become fully operational. Also, the comforting guarantee of €100,000 ($100,000 or £80,000) would likely be reduced in such a crisis.
Butler believes that since the end of the Bretton Woods monetary system, there is a strong case for having higher allocations to physical gold. He warns of the risk inherent in gold ETFs due to the levels of legal indemnifications.
Gold in euros rose sharply to the highest in three months after the European Central Bank signaled it will likely engage in more QE and may even move to negative interest rates. Draghi's comments are gold bullish - particularly in euro terms.
The weaker US dollar, the probability of near-zero interest rates for the remainder of the year and a seasonal increase in demand is underpinning the positive potential for gold.
The LBMA wants to boost transparency and invited the market to suggest improvements including considering a new electronic platform that may lower trading costs and improve efficiency.
Audio - There were some very interesting insights and we believe high net worth and institutional investors and indeed all listeners will get useful information with which to protect and grow their wealth.
