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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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  • Run On GLD ETF Starting? 0 comments
    Apr 18, 2014 4:42 AM | about stocks: GLD

    It is very odd that Shanghai demand is now receding.

    Today the SGE withdrawals of gold fell again 16% from last week to only 21.4615 tonnes. See chart below, courtesy of Koos Jansen: In gold we trust. So demand for gold in China is really dropping fast as premiums between China and London are still at zero, indicating that demand for gold from China is very unnaturally low.

    (click to enlarge)

    However, the GLD ETF had something interesting to tell. The GLD physical stock finally started dropping hard since yesterday, while I had thought it would start increasing.

    (click to enlarge)

    GOFO rates are now very negative historically hitting new lows. Maybe this tells us that GLD is finally having a run on gold due to supply tightness. Because China isn't buying, so who is actually taking delivery from GLD now? Maybe the retail investors themselves, demanding for the physical. I'm just guessing around, could also just be storage fee payments.

    Stocks: GLD
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