Gold ETF Adds a Little Metal to Its Inventory

It's funny that, for about four or five months earlier in the year, news outlets like Reuters would cite any changes to the inventory at the SPDR Gold Shares ETF (NYSEArca:GLD) in their morning report on the gold market, sometimes in the headline.

That doesn't happen much anymore for reasons that should be clear in the chart below.
The "tonnes in the trust" did tick up yesterday, the 6.1 tonne addition being the biggest increase in over a month, following an addition of 4.9 tonnes four days ago.

Maybe this is the start of some serious "catching up" for the world's most popular gold ETF as the holdings now sit at the same level as when the price of gold was almost $200 lower.

Comments

[USisCorrupt:]

What difference does it make anyway? The Gold in the ETF is paper anyway. It has long since been loaned out or promised to someone else. All the US Equity markets are just one Giant Ponzi Scheme. If you want the REAL thing BUY it and HOLD it yourself. Or be another Bag Holder!

Nov 10 08:58 AM

[kohalakid:]

Yeah, yeah, yeah..and the moonwalk was done on a sound stage in Culver City, CA and the pope is really a Martian.

You have no basis for such a statement.

On Nov 10 08:58 AM USisCorrupt wrote:

> What difference does it make anyway? The Gold in the ETF is paper
> anyway. It has long since been loaned out or promised to someone
> else. All the US Equity markets are just one Giant Ponzi Scheme.
> If you want the REAL thing BUY it and HOLD it yourself. Or be another
> Bag Holder!

Nov 10 10:22 AM

[Harry Tuttle:]

They don't need to buy gold because the price goes up or down. It is suppose to hold as much gold as they have shares out. Whether or not they do it is another story.

Nov 10 11:16 AM

[FDNY RET:]

SURE!! And Madoff was supposed to have all those stock certificates!!.
Suppose the same bean counters are certifying the vaults??.
It doesn't always just happen to the other guy!.

Nov 10 12:34 PM

[CJWalker:]

You're both right. Here's how I see it. If you're looking to *trade* gold, to profit from its ups and downs in the market, the ETFs are great. It also makes sense to have some percentage of your overall investment portfolio in a gold or silver ETF. But don't put all your eggs in one basket. "Paper gold" is inherently more risky than holding physical bullion yourself.

For your *savings*, you should own (and take posession of) some gold coins and bullion bars. There's no counterparty risk - you know it exists and you know where it is.

Just as you should not invest *all* your money in stocks, or keep all your money in a savings account, you need to find a balance you're comfortable with. ETFs are a convenient and relatively cheap way to own some gold. But do not count on them exclusively or you could get burned.

Nov 10 01:57 PM

[eromanga:]

Yeah, but it just doesn't make sense that we can have trading days of up to 20m GLD shares over the past six months and yet an impossibly few new ounces of the yellow metal are going into the vault. When you compare the rapid build up of inventory in the six months leading up to March, it just doesn't add up.
And the GLD mouthpiece(s) say nothing, which only goes to encourage wingnuts such as the guys above who suggest that the gold in the vault is just someone's imagination.
GLD should explain WTF is going on. I can well imagine that gold bears are creating short positions in the ETF by borrowing stock to short GLD. Should this be allowed. These people are just "creating" gold or printing money.

Nov 11 01:36 AM

[kohalakid:]

In the last week or so, Open Interest in Dec COMEX gold has fallen by about 20,000 lots, representing 2 million ounces.
That means rising prices have seen shorts cover positions by buying from willing sellers and that this rally is NOT being driven by fresh retail buying, but is merely translating the dollar's decline into higher spot gold prices, pushing shorts to cover.
That seems to mirror what is happening at GLD. The retail buyers aren't buying, so there's no need for the market makers to create new GLD shares by delivering gold to the vaults.


On Nov 11 01:36 AM eromanga wrote:

> Yeah, but it just doesn't make sense that we can have trading days
> of up to 20m GLD shares over the past six months and yet an impossibly
> few new ounces of the yellow metal are going into the vault. When
> you compare the rapid build up of inventory in the six months leading
> up to March, it just doesn't add up.
> And the GLD mouthpiece(s) say nothing, which only goes to encourage
> wingnuts such as the guys above who suggest that the gold in the
> vault is just someone's imagination.
> GLD should explain WTF is going on. I can well imagine that gold
> bears are creating short positions in the ETF by borrowing stock
> to short GLD. Should this be allowed. These people are just "creating"
> gold or printing money.

Nov 11 09:33 AM