Thursday, June 12, 2014

Did I Lose $10 Million From the Barclays Gold Take Down?



I spend alot of time looking at the physical markets. I would reference back to an article I wrote in 2012 which asked: Do Western Central Banks Have Any Gold Left?

My analysis suggested that boy, these guys have got to be suppressing the price of gold, and they can’t have much left. I think they were getting very close to being out of gold, and that’s why they had the raid in 2013, they took 900 tons of gold out of the various ETF’s in the world, which was of course consumed, and it shows the amount of physical consumption vs. supply.
Supply is something like only 2700 tons from the mines, maybe 1300 tons from recycling, we had the 900 tons from the ETFs, and it all got consumed. Of course it all got consumed by the Eastern countries.

There are various people (myself included) who suggest that Chinese demand is equivalent to all Western mining. Between what they produce for themselves and import, both through Hong Kong and directly into China, it just looks like they are almost consuming all of global mining production!

Which begs the question- where is the gold coming from, and where is the silver coming from?
We’ve seen data from Switzerland now that shows where the imports come from, and they come from the UK, & the US. The UK produces no gold, so whose gold is it that the UK is exporting to Switzerland?

The US is exporting WAY BEYOND what they produce- so where’s that gold coming from?
Of course its always been my conclusion that the Western Central Banks continue to find gold somewhere.
We’ve had various commentators stating they must be getting down to the bottom of the vaults because the bars are backdated back to the 60′s.
Whenever I look at demand, I think man, there’s more demand than there is supply, yes you can mess around with COMEX all you want until someday somebody asks for delivery, and they’re not going to get delivery.

I’m quite impressed by the demand for the metals on all fronts, and you can even include Platinum and Palladium in there! All the metals really look like there is a shortage, it just hasn’t been able to manifest itself because of the control of the futures markets.

We’ve seen by the Barclays example what you can do in the futures markets.
I might point out Doc, that one of the things I find interesting is that Palladium, which doesn’t have futures trading, is within about 3% of its all-time high.
I think if it goes to a new high, it will tell you what a non-futures market can do, and should do.
Both Platinum and Palladium are both screaming that there has to be a shortage. Unfortunately in Platinum there is a futures market, and the commercials have gone massively short to keep things under control. I’ve always speculated that some day there will be that failure.

So the demand seems to be there, the reasons to own gold get better by the day, there is no economic recovery.
The former Chairman of the ECB said that we live in a fictional financial system. That’s what we live in!
We live in a fictional financial system! There is no recovery! We spent trillions and trillions of dollars buying bonds- what did we get for it? We got hardly anything for it!

The middle class is just getting ROUTED here because of the serious inflation that they have to face- whether its education, healthcare, food costs- everything is going up. Its not 2%, we know that, and the wages don’t go up by even 2%.

We have a very great environment for gold to go higher, it has not been allowed to go higher.
It has not been allowed to go higher because anyone in their right mind knows that printing money is vastly irresponsible, and the irresponsibility will show up in a higher gold price.

Meanwhile we have everyone saying, oh, the market’s going up, there’s no inflation, everything’s fine, and everyone is staying calm, but the day is coming when they won’t be staying calm because of all these forces that are at work today.

There are so many things going on today that are all gold positive, but gold isn’t allowed to rise….yet.
But it will.




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