Monetary Metals Supply and Demand Report: May 5, 2013

Sometimes not a lot happens. The dollar fell this week about 0.1g, which means gold “went up” $8. The gold bugs may be feeling somewhat better, but what is the basis saying? First, here is the graph showing the prices of the metals in dollar terms. As with last week, there was some up and down [...]



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8 replies
  1. petter_w says:

    You say that silver does not look like its basis will fall unlike gold yet you are caution on silver priced in gold. Aren’t these statements contradictory or are you expecting that silver will fall out of backwardation?
    Another thing that confuses the hell out of me is that you are tracking the temporary backwardation due to contract rollover. The data to track this is and ‘non temporary backwardation’ is the same right? Wouldn’t it be more appropriate to say that you track backwardation but to explain short term movements with the contract rollover?
    Then you say that there is a new post 2008 reality? Was there no temporary backwardation pre 2008 due to contract rollover?
    An answer is very much appreciated.

          • JR says:

            You guess wrong. An obligation can trade at a discount & gold futures surely will.

            My scepticism stems from the simple fact that $ are junk & have been for decades already. That central bank credit trades ‘money good’ is irrational. You cannot rationalise i.e. measure, the irrational. Central bank credit is the South Sea Company, Mississippi bubble, tulips & tech stocks all rolled into one & injected with steroids & then some nitrous.

            There are also some who claim, or at least have claimed, that the basis “foretells all”. Which is patently bullshit.

      • petter_w says:

        The basis/cobasis is recognized as the most sensitive indicator there is in the gold/silver market and are definitely not useless but worthwhile to read,

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