Where did you get that article above from, Skol? I don't think the author knows much about goldmining, because the numbers are well out. The rest of the text is dubious too
The author teaches finance risk management and capital markets at Boston University School of Management and is a former senior commodities trading floor executive. lol
The author teaches finance risk management and capital markets at Boston University School of Management and is a former senior commodities trading floor executive. lol
Mark T. Williams is a risk management practitioner and academic with two decades of experience. Since 2002, he has been on the Finance & Economics Faculty at Boston University and currently holds the academic rank of Executive-in-Residence/Master Lecturer. Prior to teaching, he worked as a senior trading floor executive, a bank trust officer and as a bank examiner for the Federal Reserve Bank. He is particularly experienced relating to risk management in the energy trading, banking industry and derivative matters involving the capital markets. In addition to his teaching duties at the graduate as well as undergraduate level, his expertise is called on frequently by national media. He has also been a guest columnist for Forbes.com, Reuters.com and the Boston Globe. In 2010 he published Uncontrolled Risk (McGraw Hill), a book examining the root causes of the financial crisis and the rise and fall of investment banking giant Lehman Brothers. Outside of academics, he conducts risk management seminars, has provided consulting for various Fortune 500 companies, and is a senior advisor at the Brattle Group. On several occasions, he has also been an expert witness in various corporate cases involving risk management matters.
So he's been in the University system for 11 years, and he's had fleeting experience on the trading floor, but it's unknown if this involved gold, or if he has been checking how the higher price of energy and exploration costs may have impacted on gold miner profits. He also omitted to mention that some countries, like China, have doubled their buying of gold over the last 6 months.
He can look at the price of it all he likes. What matters is the demand, in the end. It suits the US banks to have the gold price lower, they need to buy some in, to repatriate it. At the moment their down-ramping is working. It's also helping China increase their gold holdings.
So he's been in the University system for 11 years, and he's had fleeting experience on the trading floor, but it's unknown if this involved gold, or if he has been checking how the higher price of energy and exploration costs may have impacted on gold miner profits. He also omitted to mention that some countries, like China, have doubled their buying of gold over the last 6 months.
He can look at the price of it all he likes. What matters is the demand, in the end. It suits the US banks to have the gold price lower, they need to buy some in, to repatriate it. At the moment their down-ramping is working. It's also helping China increase their gold holdings.
The flash-in-the-pan Aunty buying probably accounted for most of China's purchases, but that's all over. Herd behaviour that's now ended given China's economic problems and it's a fact that the US is leading the world recovery and China is sinking fast. The best performing markets are US bourses.
Why do the US banks want a lower gold price? Like Bernanke they probably couldn't care less about the gold price.
I'm certain Williams is not that far removed from the real world, you don't have to be a genius to work out that gold's been a massive bubble that's now deflating, you just have to read the newspaper.
This what it says in a book I have here printed in 2012:
'A large gap between the cost of mining and production (around $600 an ounce) and the actual selling price of gold ($1,900) points to overspeculative gold prices.'
The flash-in-the-pan Aunty buying probably accounted for most of China's purchases, but that's all over. Herd behaviour that's now ended given China's economic problems and it's a fact that the US is leading the world recovery and China is sinking fast. The best performing markets are US bourses.
Why do the US banks want a lower gold price? Like Bernanke they probably couldn't care less about the gold price.
I'm certain Williams is not that far removed from the real world, you don't have to be a genius to work out that gold's been a massive bubble that's now deflating, you just have to read the newspaper.
This what it says in a book I have here printed in 2012:
'A large gap between the cost of mining and production (around $600 an ounce) and the actual selling price of gold ($1,900) points to overspeculative gold prices.'
Skol, that post is full of half-truths. I don't think that the Chinese small retail gold buyer sentiment will change quickly, it could collectively take years. I'd expect there will always be more buying on any price dips. The best performing bourses are also the ones most propped up with QE. How much of it is real?
The banks want a lower gold price because they have to get their hands on some actual real gold, to give it back to the rightful owners. And it's a lot of gold compared to annual production. They'll come unstuck because the lower gold price is mothballing mines.
The true average cost of getting gold out of the ground, averaged all over the world, has to include exploration and capex costs, restoration costs. This has been covered properly by many people, experts in this area. It's way above $600 an ounce. These so-called experts of yours, who look at a gold miner's annual report to see only the raw cost of gold extraction at their mine(s), have the wrong figure. Which they then use to incorrectly inform their readers of a rort by miners.
What happened when gold got to $1800 an ounce briefly, was that mining companies realised that perhaps they could make a sensible profit, after all the hard graft. At the moment it's looking doubtful, until the US and other banks find enough cheaper gold to hand back to the real owners. The propaganda war continues.
Skol, that post is full of half-truths. I don't think that the Chinese small retail gold buyer sentiment will change quickly, it could collectively take years. I'd expect there will always be more buying on any price dips. The best performing bourses are also the ones most propped up with QE. How much of it is real?
The banks want a lower gold price because they have to get their hands on some actual real gold, to give it back to the rightful owners. And it's a lot of gold compared to annual production. They'll come unstuck because the lower gold price is mothballing mines.
Give the gold back to the rightful owners? What a load of codswallop, banks don't need gold any more than a fish needs a bicycle, gold belongs to whoever bought it. If they need gold they only have to contact the SPDR Gold Trust ETF that's shedding 2 tons every day of the year.
Almost every day I read a post by some deluded soul who says 'the bottom's in'.
But it's not, far from it.
Have a look at this, maybe you can see something in it, but I can't, gold's a bottomless pit.
The SPDR Gold Trust has sold 8 tons since last Saturday, punters are liquidating gold, no one wants it.
Another reason not to own gold. The amount of gold investment, if you can call it that is currently being sold off, as evidenced by the dramatic fall in ETF gold in trust.
Another reason not to own gold. The amount of gold investment, if you can call it that is currently being sold off, as evidenced by the dramatic fall in ETF gold in trust.
The SPDR Gold Trust is shedding about 175, 400oz bars per day. If anyone wants some gold there it is.
910 tonnes to go.
I couldn't find the chart you mentioned there Skol. However my faithful Wikipedia mentioned that:
The Trust’s allocated gold bullion is kept in the form of London Good Delivery gold bars (400 oz.) and held by the Custodian, HSBC Bank USA, in its London vault or in the vaults of sub-custodians.[6] The ETF pays an annual expense charge of 0.40% per annum.[6] The ETF has been criticized by Catherine Austin Fitts and Carolyn Betts for its extremely complex structure and prospectus, possible conflict of interest in its relationships with HSBC and JPMorgan Chase which are believed to have large shortpositions in gold, and overall lack of transparency.[7] Some critics compare the ETF with mortgage-backed securities and collateralized debt obligations.[7] These problems with SPDR Gold Trust are not necessarily unique to the fund, however; as the dominant gold ETF, the fund has received the most extensive analysis.
In May 2013 they had about 2400 tonne of gold bars.
It's just possible that I multiplied by 2.2 when I should have divided, I will concede Skol
But that weakens your argument, as if Germany wants 300 tonnes back, the massive SPDR has only sold 390 tonnes, because as investors pull out of their fund they sell gold. It has gone somewhere, probably to smaller hoarders all around the world. Not back to Germany.
And what about the USD? It can't seem to make up its mind. It's in a runaway resonance mode. I think that's a new TA term.
The endless conspiracies about the German gold are just that, conspiracies. The Germans don't want their gold back all at once it's that simple, but gold bugs can invent conspiracy theories out of thin air.
Originally Posted by elZorro
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