October, 2013

Theory of Interest and Prices in Practice

Medieval thinkers were tempted to believe that if you throw a rock it flies straight until it runs out of force, and then it falls straight down. Economists are tempted to think of prices as a linear function of the “money supply”, and interest rates to be based on “inflation expectations”, which is to say […]

Monetary Metals Supply and Demand Report: 27 Oct, 2013

On Tuesday, US payroll data showed a smaller rise than expected. The prices of the monetary metals shot up on the news. On Friday, CNBC ran a story that reiterated that Quantitative Easing will continue. It was enough to arrest and partially reverse dropping prices. As always, we want to know: what are the fundamentals? […]

Monetary Metals Supply and Demand Report: 20 Oct, 2013

On Thursday, the prices of gold and silver took off 50 dollars and 54 cents, respectively, on a statement by Dallas Fed President Dick Fisher. He declared that, “fiscal shenanigans have swamped QE taper prospects”. That was enough to light the fuse. As always, the question is: speculators or hoarders? Read on. We are interested […]

Monetary Metals Supply and Demand Report: 13, Oct, 2013

The prices of the monetary metals slid this week, especially on Friday. Gold ended the week 38 bucks lower than last Friday (-2.9%), and silver ended 42 cents lower (-1.9%). We are interested in the changing equilibrium created when some market participants are accumulating hoards and others are dishoarding. Of course, what makes it exciting […]

Monetary Metals Supply and Demand Report: 06 Oct, 2013

The “No Taper” announcement has faded. The new temporary obsession is the government shutdown and debt ceiling. Which way is the gold price supposed to go on these news items? No matter. The gold price ended the week down slightly from last Friday, and the silver price was flat. We are interested in the changing […]