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Albert Sung is the author of the Katchum Macro-Economic Blog, monitoring breaking economic news from a day to day basis. He started investing in 2008 because of the economic crisis and holds a masters degree in chemical engineering. Previously, he worked several years as a process engineer at... More
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  • Shanghai Gold Premium Hits New High 5 comments
    May 23, 2013 11:49 AM | about stocks: GLD, SLV

    One of the most important features of the Katchum Macro-Economic Blog is that you get real time alerts on important data.

    One of those data is the premium I see on the Shanghai precious metals market. And today we see a huge increase in premium in gold (Chart 2). Gold premiums to London bullion price have reached 2.6%, the highest since I monitored it. Silver premiums also shot up to 3.8% (Chart 1).

    That's a bullish sign.

    (click to enlarge)

    Chart 1: Silver Premium Shanghai to London

    (click to enlarge)

    Chart 2: Gold Premium Shanghai to London

    Stocks: GLD, SLV
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Comments (5)
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    , contributor
    Comments (301) | Send Message
    Please explain why the premium is so important to you ...
    23 May 2013, 05:29 PM Reply Like
  • Katchum
    , contributor
    Comments (615) | Send Message
    Author’s reply » First off, it's important to me to watch this, because I haven't found any other site that displays these premiums, so this is groundbreaking data. Which can be used in the future to find other possible correlations.


    Second, it shows that the take down of gold is all found in the paper market, while the physical market stays strong. See James Turk's interview: http://bit.ly/133fjbg
    24 May 2013, 11:47 AM Reply Like
    , contributor
    Comments (301) | Send Message
    Wouldn't a flat rate minting and handling charge increase percentage wise as the spot price decreased ???
    24 May 2013, 03:10 PM Reply Like
  • SMaturin
    , contributor
    Comments (2268) | Send Message
    Your question reflects the problematic assumption that gold money and paper money are interchangeable.


    For a different perspective read what this fellow has to say about the difference:


    24 May 2013, 03:28 PM Reply Like
    , contributor
    Comments (301) | Send Message
    The article points out that the market is not between the producers of products but is full of middle men , be them wall street investment bankers or the federal government , skimming their handfull from the exchange of goods without putting in the effort to produce those same goods .
    24 May 2013, 06:06 PM Reply Like
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