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Adrian Ash  

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  • How Much Is Too Much for Gold-in-the-Ground? [View article]
    The juniors (say via) GDXJ should make a great leveraged play -- situation normal -- and the current flood of M&A cash accounts for their beating the majors recently. But I fear we're still a way from "normal" in the bigger picture, and over 1, 3 and 5 years now, miners on average have struggled to match gold, which smacks of deflation. Outperformance by the best managed funds (USAGX, TGLDX) also came in the front-half of the bull market to date. The producers face credit, management, input-cost and political risks that gold itself doesn't carry. Further out though (or perhaps right now for the brave) southern Africa ex-SA looks likely to join Latam and C.Asia as fast-growing producer.
    Sep 10, 2010. 02:18 PM | Likes Like |Link to Comment
  • How Much Is Too Much for Gold-in-the-Ground? [View article]
    Hi Tern - overall, Latam spat out around 490 tonnes in '09. Argentina accounted for less than 40t. Chart on slide 13 here:
    Sep 9, 2010. 04:59 AM | 2 Likes Like |Link to Comment
  • Emerging Economies Buying More Gold [View article]
    Dear Time2Work -- thanks for your comments, not sure I follow re: hedging. Tea leaves on gold better put than I could by SocGen's Dylan Grice this week:

    Dear HA65MPH -- outlook for silver to follow...
    Mar 24, 2010. 06:38 AM | Likes Like |Link to Comment
  • Gold: Still Cheap Despite New Record High [View article]
    Hi Screwloose,
    Sounds like you guessed my take on the "story". Our response to concerned clients has been posted on various blogs...


    On Nov 19 02:19 PM Screwloose wrote:

    Hi Adrian

    Another valuable piece - thanks.

    OK; be gentle, but what's your take on Rob Kirby's claim that plated tungsten fakes, in quantity, have penetrated the chain of accreditation?

    We could really use a whole article from yourself on that - covering things like; whether it's possible; the practicalities [how would
    you stamp anything into tungsten?] whether, to your knowledge, there has ever been a confirmed case and what do the professional metallurgists say about possible [acoustic?] screening methods to differentiate?
    Nov 20, 2009. 10:59 AM | Likes Like |Link to Comment
  • Gold's Big Secret - No One's Actually Buying [View article]
    Hi Screwloose -- there's a lot of wild comment doing the rounds about LBMA metal right now. I've seen the LBMA called a formal exchange (it's just an association), plus claims of "non-delivery" on the last day of the LBMA's Sept. futures contract (no such thing exists).

    To the very best of my knowledge (we talk to the market 3 or 4 times a day, using a variety of dealers) there are no shortages or delivery hiccups. There weren't any problems even amid the surge of physical buying this time last year, back when retail coin dealers faced genuine shortages and premiums doubled and more.

    Nor can you deal gold futures at the LME (a different organization altogether, but another mistaken claim online...), because the London Metals Exchange does NOT currently offer precious metal contracts. It's apparently been considering it though, perhaps spurred by the CME offering to clear loco-London forwards contracts. Far as I can see, London's wholesale dealers aren't much interested in that anyway.

    All loco-London trading is done buyer-to-seller direct -- typically by phone -- in unique deals. That's why there is no single spot price, just an average of different quotes offered by individual firms at any one time. The two parties to each deal are on the hook, by themselves.

    Yes, there are 5 market-making members, but that simply means they promise to quote two-way prices throughout London hours. The Good Delivery standards for LBMA-approved bars and storage make this OTC dealing more efficient than non-standard, unproven units would allow. LBMA membership makes for a network of high-repute, closely involved firms.

    LBMA's guide to OTC gold is well worth reading:

    We also get an occasional jolly, like next week's annual LBMA conference. But it was scheduled for Lima, Peru, and then down-sized to Edinburgh, Scotland, because the bank dealers were told they couldn't justify the expense to their bosses amid the crunch.

    Looking at bank profits now, you can see the respect gold dealers get, even with gold up four-fold in 10 years and even within their own organizations...

    LAURENCE -- we're certainly seeing fresh business from chunkier clients, but as with most BullionVault users, they buy the dips, not the spikes. I'd like to think "weak to strong hands" applies to scrap-gold vs. investment demand over the last two years.

    TOM -- if the Comex longs pull back by choice, I'm not sure the background would be urgent enough for physical demand to match what we saw after Lehmans collapsed. If they're forced out, on the other hand -- say by credit crunch part two, or even CFTC limits -- I'd expect real metal demand to jump on the dips once again.

    On Oct 27 10:23 AM Screwloose wrote:

    > Adrian
    > Very valuable piece of analysis - thanks.
    > What's you view on the state of LBMA physical stocks? There have
    > been various strange occurrences of late that could be explained
    > as hiccups in the supply chain - have you heard of anything similar?
    > (I see Da Boyz are busy bashing today - anyone would think it's options
    > expiry day.......)
    Oct 28, 2009. 11:28 AM | 2 Likes Like |Link to Comment
  • If Housing Were Priced in Gold [View article]
    Long-term charts here....back to 1968...1963...and 1890...
    Sep 25, 2009. 06:36 AM | 1 Like Like |Link to Comment
  • Gold Doesn’t Care If It’s IN-flation or DE-flation [View article]
    Jastram's book is back in print. Seems Wiley didn't want it -- maybe not noticed the gold market's hunger for historic data and analysis? UK's Edward Elgar Publishing worked with Jill Leyland (former WGC advisor) to update and re-issue it:
    Jun 24, 2009. 11:48 AM | 3 Likes Like |Link to Comment
  • The Price of Gold in Top 10 Currencies [View article]
    Glen -- the GDP weightings are changed each year in line with IMF data. So yes, for 2008 those are the numbers used, but with the 16 Euro economies added together to take the No.2 spot. The idea is to refine the World Gold Council's G5 gold index (scroll to the bottom here: ). Still applies GDP weights from 10 years ago!

    Chartflow's a great site, thanks for the link. For major crosses -- live and historic -- hard to beat HIFX:
    Jun 5, 2009. 05:17 AM | Likes Like |Link to Comment
  • Gold vs. Housing: 80 Years of U.K. Data [View article]
    Data's problematic, but just posted charts (and explanations) here:

    On Apr 30 09:45 PM jambo wrote:

    > I would like to see a similar study using U.S. housing market data.
    > Anyone have the charts?
    May 2, 2009. 06:02 AM | Likes Like |Link to Comment
  • NYSE Runs Out of Gold Bars: What Happens Next? [View article]
    V.interesting, thanks! Compared to dealing loco-London, we've always found physical New York gold hard to source from wholesale dealers, esp. in 100- and 400-oz units. Indeed, arranging NY storage back when BullionVault was launched 4 years ago proved one of the biggest hurdles.

    Nobody could understand why our users would want metal instead of paper...

    Since then, our users have chosen not to hold gold in New York anyway. NY storage accounts for less than 2% of current 16.1 tonnes total. More than 90% of US-owned gold at BullionVault sits in Zurich, Switzerland.

    You can see the difference in volume (plus the range of NY bar sizes compared to the 400-oz good delivery bars held in London and Zurich) on our Daily Audit here:
    Mar 27, 2009. 05:25 AM | 11 Likes Like |Link to Comment
  • Gold, T-Bonds, and Russia's Tu-160 Bombers [View article]
    Not sure! Initial coverage Weds pointed to 30-years, but I also saw 7-10 cited on Thurs. WSJ amongst others repeated "long bonds", and FOMC statement says "longer-term" -- no? Either way, UK's Bank of England buying 5- to 25-year gilts...which just screwed a new short-dated auction:

    On Mar 19 03:02 PM Tetrapod wrote:

    > Interesting article. Thanks!
    > One minor correction: I don't believe the Fed is buying 30-year
    > treasuries. Their statement indicated that they were going for 7
    > and 10 year issues. If you know otherwise, please let me know :-)
    Mar 20, 2009. 05:41 AM | Likes Like |Link to Comment
  • Gold, T-Bonds, and Russia's Tu-160 Bombers [View article]
    Hi Paul: Thanks for your comment, sorry for hiding the punchline. I'm saying that gold offers much more than just a shiny yellow way to try and hedge against inflation. It's clearly political, belligerent even, against anything but the most benign financial backdrop. Central-bank purchases never make good news. (More here: goldnews.bullionvault....)

    Reminds me of gold's "mistaken identity" c.2002-2008, when it was confused for a happy-hedge-funds leverage play (see John Hathaway writing in mid-06: Strong buying by China/Russia would mean they're hunkering down. Announcing it would be saber-rattling, not dollar diversification.

    What can me and you do about it? No idea. Lots of analysis for surviving deflation/inflation right now (see SocGen's James Montier this week: goldnews.bullionvault....). But I've yet to read any serious analysts beyond Marc Faber wondering how to defend wealth against war or revolution.

    On Mar 19 03:16 PM paultaut wrote:

    > Adrian: I like your Articles. Back on Sept. 7th 2008, you wrote about
    > "Super Dollar?". I said I checked your Credentials.
    > The Article above drew my attention because I couldn't/can't figure
    > out what the Rumor is...
    Mar 20, 2009. 05:32 AM | Likes Like |Link to Comment
  • Gold, T-Bonds, and Russia's Tu-160 Bombers [View article]
    Paul - we're not a tipsheet, BullionVault is a live physical gold market where private investors buy/sell in real time. I'm not in paper (either way) but I am in gold...
    Mar 19, 2009. 11:36 AM | 1 Like Like |Link to Comment
  • Interest Rates Rising, Gold Declining: What Am I Missing? [View article]
    If higher interest rates were good for gold, it wouldn't have doubled in response to the Fed's "deflation scare" of the last half-decade. The key factor is the REAL rate of interest instead. It hit 9% before gold backed off at the start of the '80s. It went negative between 2002-05. Whether you think bonds are now a buy - and gold's a sell - depends on how you view the official CPI data. Maybe bond investors are only now getting round to asking if there's something amiss at the Dept. of Labor.
    Jun 14, 2007. 10:23 AM | Likes Like |Link to Comment