Commodity Trade Mantra

Posts Tagged ‘Gold Markets’

The Major Catalysts That Influence Gold Prices

Physical gold had its best quarterly gain in 30 years during the first quarter, and year-to-date, even with its recent swoon, physical gold is higher by roughly $200 an ounce. Gold has firmly reestablished itself as being in a bull market. The factors that move gold prices are largely unknown or overlooked. Let’s have a look at the seven most common factors that influence physical gold prices.

Gold Remains a Mandatory Portfolio Asset

Can the US financial system endure normalization of interest rate structures? No. Gold will remain a productive portfolio-diversifying asset until the process of debt rationalization is allowed to proceed in the US. Given implications for declining intrinsic value of US financial assets, as well as ongoing Fed efforts to debase outstanding obligations, gold remains a mandatory portfolio asset.

Recycled Gold has met 60% of Indian Gold Demand on High Gold Prices

India has traditionally been one of the largest gold markets on the planet, second only to China. But, the high gold prices are threatening India’s status as a leading importer of gold. So much recycled gold has come into the system in the past few months that it has met 45% to 60% of the local gold demand. However, demand for gold in the US has risen 27% this year.

Divide Global Money Supply by Global Physical Gold = Correct Gold Price

It’s true that there’s a limited quantity of gold. But there’s always enough gold to support the financial system. It’s also important to set its price correctly and there can be a debate about the proper gold price. Just take the amount of money supply in the world, the amount of physical gold in the world, divide one by the other, and there’s the gold price. It’s not complicated mathematics.

Physical Gold Demand Drops But Gold Prices Soar

Gold prices are looking strong again this week. But the most surprising finding is that physical gold demand was incredibly weak during the first quarter of this year. With overall physical buying down 23.8% as compared to Q1 2015 to 781 tonnes, down from 1,025 tonnes last year. While India’s physical gold purchases dipped 65%, China’s buying dropped 27.3% YoY.

Time to Get Back into Gold Stocks? The Answer will Surprise You

Ask yourself – How many times since 2011 you’ve heard: “Now is the time to jump back into gold stocks.” It may be very tempting to get into gold stocks now. After such a big move recently, this could be the beginning of a major bull market. And when there’s a bull market in mining stocks, you can really make a lot of money. But its better to be late than sorry.

Peak Gold and Silver May Have Come and Gone

Newly mined supplies of gold and silver will decline in 2016 and beyond. The main culprit is low prices. In 2015, gold and silver prices spent most of the year trading below miners’ all-in production costs. Primary silver production is already on the decline in the major producing countries. Holders of physical gold and silver would be wise to hang on tight to it & keep a long-term perspective.

Gold Miners And Regulators Deathly Silent after Gold Price Attack

I find it laughable that something like the recent attack on the gold price could happen & the World Gold Council had nothing to say about it! There don’t seem to be major investigations into these gold price raids. The mining industry is worthless, not so much because of the attack, but because its own shareholders and executives are content to die quietly.

Central Banks and Our Dysfunctional Gold Markets

The love-hate relationship between governments and gold is complicated. It is because gold is a competitive national currency that, if allowed to function in a free market, will determine the value of other currencies, the level of interest rates and the value of government bonds. Hence, central banks fight gold to defend their currencies and their bonds.

Gold Is a ‘Barbarous Relic’ but These Are ‘Barbarous Times’

The rupee is losing ground against the dollar by around 9% per year. Indian price inflation runs at around 9% per year as well. Yields are clearly too low to maintain purchasing power. Without rising asset prices, stocks and real-estate fail to protect purchasing power. This leaves gold as an alternative destination for savings.

The Rehypothecation of Gold, and Why It Matters

Why keep the nation’s gold reserves so mysteriously secret? Maybe rehypothecation isn’t the reason; then what is? Fear of precisely what? Isn’t gold supposed to be a foolish relic? What’s the danger in letting people look at the foolish relic and count the bars and note the serial numbers on the bars? What’s the risk in that?

IMF’s Gold Depositories- Nagpur & Shanghai: Indian & Chinese connections

The IMF holds the equivalent of US$27.5 million in gold with Reserve Bank of India in Bombay. IMF has received a letter from the Reserve Bank stating that it has recently opened an office at Nagpur, which is situated about 520 miles from Bombay in the interior of the country & contains a special vault for storing the Bank’s stock of gold.

Gold: The Year Ahead For Gold Investors

After some three years of disappointment, 2015 promises to be a good year for gold investors. A number of factors, some interrelated, will drive gold prices higher. Here’s my short list of the top gold-price drivers I expect will combine to reestablish the long-term uptrend in the yellow metal’s price.

A Close Look At The Chinese Gold Lease Market

Current participants in the gold lease market are commercial banks, gold miners and jewelers. The Shanghai Gold Exchange also provides a crucial role in gold leasing. The SGE’s block trading system is the trading platform used by gold leasing participants; the SGE also provides transfer and settlement services.

American Financial Markets Have No Relationship To Reality

The price of gold is determined in a speculative futures market in which bets are placed on the direction of the gold price & not the physical market. The divergence of markets from economic reality disturbs neither public policymakers nor economists, who promote the interests of the government and its allied interest groups.

Get Your Money Out of Banks & into Something Tangible: GOLD

The most important factor right now is the physical shortage of gold. The declining amounts of gold in Shanghai storage suggest we are getting close. So I expect something to happen in the physical gold markets soon. When people finally decide they want to buy gold, there probably won’t be any gold.

Silver And Gold Are Breaking Out Again

CFD unwinds will pressure gold & silver futures prices higher & spot prices will likely be dragged higher also, as we know the physical demand has been high. And perhaps most importantly, supply destruction is starting to bite. The end result, far less supply even as demand continues to rise.

Stocks And Precious Metals In Extreme Territory

The S&P 500 is relentlessly climbing to all time highs, driven by monetary bazookas of central bankers around the world. On the other hand, the precious metals have only been recovering from a disastrous year (2013) and are in search of a solid bottom. So now what do we look forward to?

Gold likely to reach Four-Year Low in 2014

Metals Focus Consultancy: Gold prices have probably peaked this year and could sink to their lowest since 2010 at $1,100 an ounce as the US economic recovery gathers pace. Western investors tend to set the price, while physical markets react to it. Also expect silver prices to average just under $20 an ounce this year.

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