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Tag: Gold

Gaps are Appearing in the Gold Market

Gaps are Appearing in the Gold Market

The gold market continues to act as if the forces of supply and demand don’t exist. The number of claims per ounce of gold stored at COMEX’s vaults have reached a high of 110 per physical ounce. Meanwhile, record levels of physical gold have been flowing into Hong Kong and Shanghai. One of the biggest sellers of the yellow metal to Chinese buyers has been the well publicized GLD ETF, which has been selling off its physical holdings. Numerous other…

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Derivatives Market Reaches New High

Derivatives Market Reaches New High

A combination of fractional reserve banking, bank leverage, money printing, derivative manufacturing and government borrowing has been the reason behind much of the global GDP growth over the past 40 years. This market is now worth a staggering $1 + quadrillion,  that’s $1,000,000,000,000,000 of essentially worthless derivatives where buyers only need to put up a fraction of the purchase price. Add in $250 trillion of government debt around the world and things start to look pretty shaky. During 2012, the…

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COMEX Deliverable Gold Bullion Reaches a 10-year Low

COMEX Deliverable Gold Bullion Reaches a 10-year Low

Back in August, the number of claims per physical ounce of gold stored in COMEX warehouses reached 50. That’s 50 owners for every ounce of gold available for delivery. The physical gold rout has continued and the number of owners per physical ounce, now stands at 54.6, a level not seen since 2003. This comes at a time when the global demand for physical gold is rising, led by Asia where Chinese gold consumption is expected to grow 29% this year….

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Where has all the Gold Gone?

Where has all the Gold Gone?

The total amount of gold available for delivery on the COMEX has fallen to a record low. There are now up to 50 owners for every ounce of gold available for delivery. The total amount of gold available for delivery in COMEX warehouses currently totals around 774,000 ounces, or 24 tons; 29 tons were requested for delivery in July. With the August delivery date coming up someone should start getting worried. It would appear that buying gold nowadays does not…

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Gold is not an Inflation Beating Long Term Investment

Gold is not an Inflation Beating Long Term Investment

Gold is often quoted as being a long term inflation beating instrument. However, in reality it is far from that. Over the past 23 years since 1990, the price of gold has risen 74.8%, from an inflation adjusted price of $730 per troy ounce in January 1990, to July’s 2013s average price of $1276 per troy ounce. A compounded annual growth rate of around 2.57%. Furthermore, extending this study over 46 years, all the way back to January 1967, when…

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Gold Will Never be a Safe Haven Again

Gold Will Never be a Safe Haven Again

Gold futures  Tuesday morning, demonstrating that the fast-moving computerized marketplace is not isolated to the traditional equity securities world. Gold futures, the indicative price at which gold can be brought for at a certain time in the future, dropped $5 in one second on the 2nd of July as fast-moving computerized trading hit the traditional safe haven. Nanex, a provider of real-time data to traders, noted that 700 trades in 1,000 gold future contracts of gold for August delivery drove the price…

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Barrick Gold’s Mining Margins are Coming Under Pressure

Barrick Gold’s Mining Margins are Coming Under Pressure

Like the rest of the mining industry, the worlds largest gold miner by volume is going to be hit by falling margins the second half of this year. Actually, it is possible that these margins are going to fall so much that the company will actually be making a loss at some of is mines. According to Barrick Gold’s first quarter earnings release, these were the all-in costs of producing an ounce of gold in three of its key mining…

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CME Raises Gold Margins

CME Raises Gold Margins

Due to gold’s recent volatility and more importantly, fall in price, the CME has hiked the margin required on gold contracts by 25%. Seeing as the majority of the gold market is based on CME traded futures contracts with high levels of leverage, raising the margin required to trade during this period of volatility will surely increase the number of margin calls. More margin calls = more forced selling. It would appear that gold’s bear market could be just beginning….

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Gold is Getting Close to the Red Zone

Gold is Getting Close to the Red Zone

Rising costs have been the biggest headache for gold mining companies over the past few years. While the price of gold was rising, this was not a problem but now the price is falling this could start to cause some serious problems for the miners. All-in production cost of gold – full year guidance: Company All-in cost ($/oz) Goldcorp $1,000-1,100 Newmont $1,100-1,200 Barrick $1,000-1,100 Agnico $1,075 Kinross $1,100-1,200 Meanwhile, the price of gold could have further to fall… If the…

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