Monetary Metals Supply and Demand Report: April 21, 2013

The Last Contango Basis Report The “coordinated smashdown of gold and silver” was on everyone’s mind this week, but is it true? Did the price of paper gold (futures) divorce from the price of physical gold? One thing is for sure, the dollar gained from 21g to over 22g of gold on Friday. A 5% [...]



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9 replies
  1. theoolik says:

    It sure would be nice if you and Chris Martenson would have either a conversation or an email exchange. Something along the lines of here are the 10 things that we agree about and here are the five things we disagree about. The things that you agree about are important but the things that you disagree about are the most interesting. He cites his evidence of massive trades during periods of very thin trading in the early morning markets in his recent report.

  2. wmbates says:

    Provocative, as always. The only problem I see with the decarry example is counter-party risk, real or perceived. Selling physical now for a future later works if you are 100% sure you’re going to get the physical back when later comes. With the rumors swirling around about the Comex, I don’t know.

  3. Keith Weiner says:

    theoolik: if someone had physical metal and a not-for-profit charter, they could sell metal during times of thin volume and suppress the price. If they did not have metal, then they would be doing it with futures and that would be visible as a sharp and large move into backwardation.

    wmbates: Oh, I agree there will come a time when people will repudiate gold futures and the paper dollar! But not today. You may be interested in my paper When Gold Backwardation Becomes Permanent (http://monetary-metals.com/when-gold-backwardation-becomes-permanent-3/).

  4. srdolla says:

    Why is the silver cobasis more positive than gold and why did the silver cobasis go into backwardization before gold (end of Feb for silver vs beginning of April for gold) ? I noticed that silver cobasis never dropped below 0 in the recent price drop. Does industrial demand combine with silver as money to contribute to the greater degree of backwardization ? Just trying to understand

    • Keith Weiner says:

      srdolla: That is the May silver contract whereas in gold we are showing June. Temporary backwardation is like a black hole, sucking each contract in as it gets within the event horizon (typically a couple three months from First Delivery Notice day).

  5. icm63 says:

    ONLY ONE ISSUE, do you really think the COT data us TRUE, if they can fool around with LIBOR they can fool around with COT. After all its the same bankers in both cases

  6. Hollmark says:

    World War 3 is on. Watch what you believe. If your consciousness level is above 200—–arm test the question—-“Will Gold and Silver be good Investment Depositories right now?

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