Basic Reports

Silver Scarcifies, 27 July

On 23 July, we said “Well, it’s complicated.” The action on 27 July was not.     Notice the big drop in basis starting around midnight (London time). It falls from over 7% to under 2%. To refresh: Basis = Future(bid) – Spot(ask) For the first two and half hours, the spot price is not […]

One of These Silver Days is Not Like the Other, 23 July

Yesterday, the price of silver spiked about 10%. We wrote that it was driven by: “…buying of physical metal.” And we added: “This is a pretty good signal that a bull market may be returning to silver. Let’s watch the basis and price action closely and see how it develops, before we join the pack…” […]

About that Spike in the Silver Price… 22 July

The price of silver has just spiked up about $2.00—that’s about 10%. All the usual suspects have been calling for silver to skyrocket. With some amusement, we have been watching ads from a guy known for savvy junior mining stock investments, who has been calling for gold to go up for a while. And recently, […]

Dear Bullion Banks, Please Come Back! Market Report, 13 July

One of our colleagues recently wrote an open letter to Ted Butler. The point was that Monetary Metals gold leasing is a different kind of activity than what is called “gold leasing” in the institutional bullion market. We make it possible for gold owners to lease their metal to gold-using businesses, and thereby earn interest […]

Defaults Are Coming, Market Report, 22 June

We are reading now about possible regulations for air travel. In brief: passengers might be forced to spend hours at the airport. Authorities will perform medical checks, including possibly needles to draw blood, no lounges, no food or drink on board the plane, masks required at all times, and even denied the use of a […]

Growing Dollar Demand, Silver Weirdness, Market Report, 15 June

The Federal Reserve has become more aggressive again, after several years of acting docile. As you can see on this chart of the Fed’s balance sheet, it has very rapidly expanded from a baseline from (prior to) 2015 through 2018, of about $4.4 trillion. After which, it had attempted to taper, getting down to $3.8 […]

When Is a Capital Gain Capital Consumption? Market Report, 25 May

The price of gold dropped a few bucks this week, but the price of silver jumped about half a buck. The drumbeat for the gold bull market is well underway, and it is beginning now for silver. So let’s do a quick update on the supply and demand fundamentals. Here is the graph of the […]

How to Maintain a Bull Market after Coronavirus, Report 11 May

Everyone thinks they know the cause and effect of the Federal Reserve’s response to crises such as 2008 and 2020. The Fed prints money to buy assets. This increases the quantity of money. And this causes prices to rise. The Fed wants this, because it thinks that inflation eases the burden on debtors. The mainstream […]

Gold and Silver Markets Start to Normalize, Report 4 May

The price of gold dropped $29 and the price of silver dropped $0.27. We’ll get back to where we think the prices are likely to go in a bit. In recent Reports, we’ve looked at the elevated bid-ask spread in gold (though not nearly as elevated as some goldbugs would have you believe) and the […]

It’s Only Paper, Market Report 27 Apr

The response to the virus has added a new mechanism of capital consumption to the many we have documented over the years. Businesses are shut down, yet they continue to incur expenses. There is a popular misconception out there that this is merely a paper loss. One can almost picture a neutron bomb that somehow […]