Commodity Trade Mantra

Posts Tagged ‘Physical Gold Market’

Investors Must Own Physical Gold & Ignore Paper Gold Volatility

As the world enters a period with risk exponentially greater than in 2006, the reasons for holding physical gold as wealth protection are more compelling than ever. The failure of the paper gold market could happen at any time. When this happens there will be no physical gold available at any price (even at multiples of the current price) until there is equilibrium in the physical gold market.

China’s Monetary Ascension Is Paved with Gold

When the Chinese yuan becomes an SDR currency, that could be the inflection point for a new multi-polar currency regime that sees the US dollar decline in stature. Could gold also begin to emerge as a leading currency in world trade? Over time, it certainly could. But the more immediate implications for gold’s monetary role center on its increasing accumulation by central banks such as China’s.

An Inside Look at the World's Biggest Paper Gold Market

Here’s an infographic that tells the story about gold’s foremost trading hub, as well as the paper gold market in London. To put that in perspective, Jeff Desjardins notes that more gold is traded in London each day than what is stored at Fort Knox (4,176 tonnes). On a higher volume day, amounts closer to total U.S. gold reserves (8,133.5 tonnes) can change hands.

Physical Gold in Your Portfolio is the Ultimate Insurance

Physical gold might be the best form of insurance you can buy. Since 2011, the strong dollar has been a drag on the U.S. economy, harmed exports & imported deflation from around the world. It’s defeating the Fed’s efforts to create inflation. The US cannot have a strong dollar for much longer, and that ultimately means a higher dollar price of gold – much higher.

Gold In 2016: "The Economic Power Is Shifting"

In the near-term, paper gold is extremely oversold, reflecting the expression of western establishment sentiment in the paper markets. Compared with the situation at the time of the Lehman crisis, gold is significantly cheaper today, which is wholly at odds with the continuing systemic risk to fiat currencies from under-capitalised banks, unprepared for the prospect of markets normalising.

China chooses her Weapons after IMF statement on SDR regarding Yuan

China is not so much devaluing the yuan, but causing a dollar revaluation upwards relative to international trade prices. She is aware that the US economy is in difficulties and that the Fed is worried about the prospect of price deflation, so lower import prices are the last thing the Fed needs. Now China’s currency move begins to make sense.

Gold Investor Sentiment Remains Negative But Physical Demand Robust

These are extraordinary times for gold and silver. The mainstream financial media continues to shun precious metals anticipating lower prices while investors recognize the attractive buying opportunity. The paper gold market continues to be heavily pressured by extraordinary levels of institutional short selling, while the physical gold market is heating up with robust investor buying.

Paper Gold Market Seem Completely Disconnected From Physical Gold Market: Why?

The paper gold market is telling one story. But the actual physical bullion market is telling quite another. It’s not clear exactly who is suppressing precious metals or why, but it is quite apparent that prices on paper exchanges are completely disconnected from reality, as retail buyers are taking this opportunity to scoop up gold and silver at prices that are 50% or more off their highs.

Russians Buy More 25 Tonnes Of Gold Bullion Again In June

Russia puts great strategic importance on its gold bullion reserves. While its gold reserves may not be on a par with western nations it is worth noting that neither is Russia’s debt. In the event of a new global debt crisis and an international monetary crisis, Russia is less fragile than many debt-laden western economies.

Opposing Forces At Play In Gold, Silver (Precious Metals Complex)

Good news for gold bulls is the bottom of the trading range has been tested a thrice so far & the price action looks encouraging for gold. But silver & the miners have broken through major supports. Its fair to say there is a mixed picture in the precious metals complex. Here are the possible triggers that may reverse the gold downtrend.

Russia Buys 18.6 Tonnes Of Gold In June - Currency Wars Intensify

The Russian central bank officially increased its gold holdings by 16.8 tonnes to 1,094.8 tonnes in June, the IMF’s International Financial Statistics report showed. In ounce terms, Russia increased its gold holdings by some 500,000 ounces, to 35.197 million ounces in June from 34.656 million ounces in May.

We believe that a more transparent & reliable fixing could lead to higher gold prices as we suspect that prices are artificially low at this time and do not reflect the delicate supply demand balance in the physical gold market. Nor do they capture the degree of systemic & geopolitical risk in the world today.

Gold Trade Numbers In 2013 Broke All Records

In 2013 we’ve experienced the kind of extreme buying power China is able to unleash on the physical gold market. Chinese wholesale demand in 2013 was 2200 tons & this excluded PBOC purchases. Let’s have a look on what actually happened & how much gold was distributed across the globe.

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