Author Archives: News

INDIA WATCH

The Asian Age/Sangeetha G

“Post-festive season, the bullion dealers and jewellers found an opportunity to replenish their stocks when the prices fell by around Rs 200 per gm from record high levels in the domestic market. Further, the last quarter of the calendar year usually sees a higher consumption. ‘Higher import in November makes sense as the prices have stabilised and the market expects the demand to return in the fourth quarter,’ an industry expert said.”

USAGOLD note: India likes to buy the dips.

Repost from 12-5-2019

The Alchemist/LBMA/December2019

“We reproduce here the speech which Rachel delivered on 12 September, 2019 at the reception to commemorate the centenary of the London gold price. Fittingly it was held at the fourth New Court, the offices of Rothschild & Co in the heart of the city, built on the site of the second New Court where the gold auction took place for much of the last 100 years.”

USAGOLD note:  An interesting history of the London gold market’s centerpiece – the AM and PM fixes now celebrating their 100th anniversary.

Repost from 12-3-2019

Courtesy of TradingEconomics.com

Related: Bloomberg/Emily Barrett/Traders already bracing for wild week ahead/12-7-2019

Financial Times/Neil Hume

“China’s state-backed Zijin Mining Group has agreed to buy Continental Gold for $1bn, as the industry’s consolidation accelerates.”

USAGOLD note:  The article points out that China’s mining companies are likely to make more acquisitions “given the metal’s strategic importance to Beijing.”  Ziijn MIning Group is state-owned.

Repost from 12-3-2019

INDIA WATCH

Bloomberg/Kartik Goyal

“The Reserve Bank of India’s efforts to support the flagging economy are turning out to be a bane for the rupee. The currency is the worst performer in emerging Asia this quarter, and analysts say that’s because the central bank is mopping up dollars gushing into local stocks and bonds.”

USAGOLD note:  None of this, of course, has been lost on the gold market when priced in terms of the Indian currency – up 17.5% thus far in 2019. There is much talk of gold imports declining as prices increase, but as long as the currency is in decline investors will add gold to their holdings to hedge against the possibility of it going from bad to worse.

Chart courtesy of TradingView

Repost from 11-3-2019

BNN Bloomberg/Yvonne Yue Li

“The gold options market saw $1.75 million in block trades betting the precious metal could almost triple in more than a year, surpassing the record. Around noon in New York, 5,000 lots for a gold option giving the holder the right to buy the precious metal at $4,000 an ounce in June 2021 changed hands. The bets were sold at $3.50 an ounce.”

USAGOLD note:  Under what extraordinary circumstances would gold go to $4000 by June of 2021?  Difficult to imagine what it would take in the way of market and economic turbulence . . . . . .

Repost from 11-29-2019

Financial Times/Joe Rennison

“More than 200 of the bonds in the Ice index are trading with yields more than 10 percentage points above equivalent government bonds — a commonly used definition of distress. That share now stands at 11.6 per cent of the index, the highest proportion since 2016.”

USAGOLD note:  And when the fabric begins to unravel in debt markets, things can come apart pretty quickly as we found out in 2007-2008 . . . . . . . .

Repost from 11-28-2019

Narodowy Bank-Poland

USAGOLD note:  This link goes to beautifully-rendered photographs of the gold Poland recently repatriated from the Bank of England at the website of Poland’s central bank. Click on each for the full-scale effect. . . . . . .

Repost from 11-27-2019

Asia & Pacific/Xinhua/12-3-2019

“Purchasing gold is said to be one of the key instruments for the Asian country’s central bank to increase its official foreign exchange reserves.”

USAGOLD note:  Mongolia has been adding to its gold reserves steadily over the past few years.

Chart courtesy of TradingEconomics.com

Financial Times/Joe Rennison/12-3-2019

“Investors clamoured on Monday to secure financing over the end of the year, snapping up $25bn of short-term loans offered by the US Federal Reserve in an attempt to insulate themselves from a potential spike in borrowing costs.”

USAGOLD note:  While attention is focused on trade clashes, there is another problem lurking in the background – cash liquidity in the repo market.

Bloomberg/Andrea Dudik and Radoslav Tomek/11-28-2019

“Gold is all that nationalist leaders in Europe’s east can talk about these days.”

USAGOLD note:  Though East European countries are featured in this update, Germany (2013), Austria (2015) and the Netherlands (2014) have also repatriated gold from London and New York. So it isn’t just Eastern European nationalists interested in keeping their national gold reserves within their own borders.

Bloomberg/Benjamin Stupples

“This will be IBV’s sixth location, and it’s hardly the only such firm fielding queries from the wealthy. From London to Switzerland to parts of the U.S., the rich are looking to store precious metals, cash and cryptocurrency. For some, it’s the threat of a global recession. Others are avoiding bank deposits as negative interest rates force lenders to charge for holding cash. Many are concerned about natural disasters.”

USAGOLD note:  The move to safety has become a flood of activity among the very wealthy, according to this Bloomberg article.

Image courtesy of Visual Capitalist

Repost from 11-20-2019

G4S International Logistics/11-28-2019

“Over the past few months, 8,000 gold bars – 100 tonnes – were carefully transported from the Bank of England’s vaults in London to Poland. How did G4S’s International Logistics division (G4Si) manage one of the biggest movements of gold between banks in the world?”

USAGOLD note:  The inside story on the shipments from the company that made it happen – “We’re humbled to play a part in gold history with this operation.”

World Gold Council/Alistair Hewitt, Louise Street, Mukesh Kumar and Ray Jia

“More than two-thirds of retail investors believe that gold is a good safeguard against inflation and currency fluctuations. Almost as many (65%) believe it won’t lose its value over the long-term and report that it makes them feel secure (62%). It is no surprise then, that with so much global economic uncertainty, 61% of retail investors trust gold more than fiat currencies. Because of this, gold is typically used as a strategic asset by retail investors, with the majority using it either to protect their wealth or to generate returns over the long-term.”

Emphasis added.

USAGOLD note:  Some surprising and very positive findings from the World Gold Council on the global public’s affinity for gold – a survey of 18,000 investors worldwide.

Repost from 11-14-2019

BNN Bloomberg/Misha Slavic

“‘I think we’ll continue doing that because of what we see in which direction the crisis in the world is moving,’ Vucic told reporters in Belgrade on Tuesday. He cited slowing growth in the euro area, Serbia’s top trading partner and main sources of investment.”

USAGOLD note:  Though a minor player in the official sector dash for the gold, Vucic’s rationale echoes that of the rest of the group.

Repost from 11-19-2019

Bloomberg/Katia Dmitrieva

“As America’s fiscal deficit nears $1 trillion for the first time since the financial crisis, the House Budget Committee held a hearing on Wednesday seeking answers to a crucial question: Does it pose a clear and present danger to the economy?”

USAGOLD note:  Of course not.  ‘Deficits don’t matter,’ in case you may have forgotten.

Repost from 11-2019

Financial Times/Gideon Long/11-25-2019

“Despite two decades of anti-US rhetoric from Venezuela’s ruling socialist party and concerted efforts to move the economy’s axis away from the US and towards China and Russia, the dollar is increasingly part of the fabric of Venezuelan life.”

USAGOLD note: Gold is a popular holding as well, and with the inflation rate running at 39,113.80% annuallized (according to TradingEconomics), it is not difficult to understand why.  As the chart shows, Venezuela should count its lucky stars.  The current inflation rate is down from 350,555% in February.

Chart courtesy of TradingEconomics.com

TheJapanTimes/JiJi

“Sized the same as the conventional Jinsei Game, the new version features a board and car-shaped pieces all made of pure gold. Miniature buildings and the roulette on the board are made of platinum, with sliver used to make pins depicting human characters.”

USAGOLD note:  The total gold weight of the game set is 12.4 kilograms which puts it at a value of just under $600,000 (USD) not including, of course, the artisanal premium.

Repost from 11-20-2019

Bloomberg/Marek Strzelecki and Dorota Bartyzel/11-25-2019

“‘The gold symbolizes the strength of the country, [central bank Governor] Glapinski told reporters on Monday. Poland could generate ‘multi-billion’ profits if it sold its holdings but has no plans to do so, he said.”

USAGOLD note: News from Poland that coincides nicely with the Jan Nieuwenhuijs article linked above.

Bloomberg/Saleha Mohsin/11-21-2019

“Judy Shelton, one of President Donald Trump’s most recent picks for the Federal Reserve board, challenged an article of faith regarding the U.S. central bank in private comments to a bank executive last month: that it should operate free of political influence.”

USAGOLD note:  Not sure that we agree with Ms Shelton on this point, but one thing is clear – if she ever gets a seat on the Fed’s Board of Governors, she is likely at some point along the way to shake things up. According to this article, Republicans on the Senate Banking Committee have spoken against her nomination because she “once advocated a return to the gold standard.”