Professor Tom Fischer has written three papers about gold backwardation and arbitrage. Across these three papers, he makes a case against the ideas of Professor Antal Fekete. I write this response solely on my own behalf. I do not speak on behalf of Fekete or his New Austrian school of Economics. I have two motivations […]
Tag Archive for: backwardation
The Monetary Metals Supply and Demand Report is the only accurate picture of the fundamentals of the gold and silver markets. We released a video that presents some of these ideas in an engaging format. We provide a weekly letter based on data and analysis of the monetary metals: gold and silver. This article is […]
The December gold future went into backwardation today, July 31. Below, we show the dates when previous gold contracts went into backwardation. As you can see, it is creeping farther and farther out. This is a picture of gold availability to the market drying up. – Apr first backwardated Feb 15, 30 trading days before […]
I coined the term temporary backwardation in March of last year. This is what I said: But in the “new normal”, post 2008, the expiring gold or silver future often flirts with or even slips into backwardation for a period before expiry. This is anything but normal. It’s not a sign of imminent financial Armageddon, […]
The October gold future went into backwardation today, July 8. Below, we show the dates when previous gold contracts went into backwardation. As you can see, it is creeping farther and farther out. This is a picture of gold availability to the market drying up. – Apr first backwardated Feb 15, 30 trading days before […]
I recently released a video about the Internet-based currency, Bitcoin. I asked the question: is Bitcoin money? In brief, I said no it’s an irredeemable currency. This generated some controversy in the Bitcoin community. I took it for granted that everyone would agree that money had to be a tangible good, but it turns out […]
Gold is in Backwardation!
With all the discussion on the Internet, some of it confusing, we thought a picture would be worth a thousand words. Backwardation is when there is a profit to decarry the metal. This is the simultaneous sale of metal in the spot market and purchase of metal in the futures market. Selling is on the […]
Since late January, the February gold contract has been in backwardation. This means that one could make a profit by simultaneously selling a gold bar and buying a February contract. One would still have one’s gold plus a little extra. I coined the term “temporary backwardation” (https://monetary-metals.com/temporary-backwardation-the-path-forward-from-2008-3/), to describe this curious and very recent phenomenon. […]
Professor Antal Fekete has written several pieces discussing gold backwardation, and arguing that this is the red alert signal for the coming financial Armageddon, when the tower of unpayable debts collapses. In this paper, I delve deeper into this topic. My goal is to make this topic approachable by the layman and describe what I […]
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