It’s been awhile since we made an addition to the Hall of Shame, but Reuters just made the cut. It an epic hit piece on gold released over the weekend, the intro begins:Gold: Storeable, durable, trade-able, and best of all, wearable, but now that you’ve slumped to your lowest price in 30 years, here’s a look at the new safe havens around the world.

While gold is off nearly $600 from its highs over $1900 set in late 2011, it hasn’t even traded to levels seen 3 years ago, much less 30!
Epic blunder by Reuters, or simply massive MOPE against gold they hoped knowledgeable investors wouldn’t pick up on? 
You be the judge…

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1 oz Silver Buffalos As Low As $1.99 Over Spot

  1. It looks like silver has decoupled from gold to the downside the last days/weeks. What could be going on? Is this a premonition of another smash on the HSBC china (slowdown) release tomorrow? Or is it a pure technical play on the gold/silver ratio? (Or will be see a recoupling to the upside when gold moves up stronger like usual? So far the gold recovery is already pretty strong though).
    What do you guys think?

    • Random thought.
      Perhaps the long-term mining contracts in the silver market are relatively large compared to those of gold. In the silver market, they are used to having underpriced long-term contracts. But because silver is a by-product anyway, they make it work to deliver as promised. When such contracts run out, the game changes for said mines.
      So a violent price drop in silver may not make the big guns worry too much. Their supply may be guaranteed for years to come.
      In gold, with the most powerful of buyers (CB’s) buying all they can get their hands on without triggering war, I could see that in the short-term buyers don not want to miss out on any gram. Silver is to use, gold is to keep. If silver gets scarse and overpriced, that’s for everyone, so competitive pricing is not endangered much for end users. In gold, it’s a race to have enough of it before it’s too late.
      That all said, it’s just futures markets setting “price”. For now, retail silver premiums on actual inventory are way higher.  No-one knows how much bulk silver is out there to be had at spot. I just know there is demand outside of mainstream markets. I have classifieds adds for in-stock silver, and I was approached by an agent of a non-EU client that needs 5000kg (5 metric tonnes) and wanted to know a price. You would think that a €3mln customer would know how to get themselves some futures contracts, or how to walk into the LBMA office and get some over the counter? Perhaps the game is not so easy any more.

    • @XC_Skater
      Looking at the netdania data, silver volume is almost non-existing(!) today (while gold looks normal). What is going on here? Is there a silver-only comex default happening? Or am I missing something totally obvious? As a follower of netdania daily/hourly I have to say this looks odd, but I don’t wanna blow to much smoke here… perhaps it’s a “computer-glitch” 🙂

    • @widget
      1000 contracts (5mln ounces) may seem like not a lot for a whole minute of trading. But not too long ago that would have been hefty volume. Maybe a status quo of sorts, traders all going to their insider trading contacts for the latest expectations.
      If some are deciding to gamble for delivery (which they normally never do), they may keep a low profile and gather the required cash position to make it happen. Not everyone’s cash account can handle hefty margin hikes over 500 tons in gold futures…

    • I think gold is money… and silver is an industrial metal.  Demand for money is strong.  Demand for industrial metals is not.  As the global economy crashes, silver will continue to take a nose dive, sending more to the gold side than the silver side.   Many of you mention outrageous premiums, but other forums indicate this appears to be a mostly US based phenomenon, while in other countries silver can be gotten with relatively normal premiums.  That’s my take, but, if you can’t tell by my moniker, I’m biased toward gold.  FOFOA and the Gold Trail readings have made the most persuasive arguments for the ownership of gold to me, and I have yet to see/hear anything close in regards to silver.

  2. I read a comment by somebody named ‘Richard’ in response to the following article, and thought that it was apt:
    “The adventure of Gold continues,over 4000 years the merchants of monetary ignorance have tried to replace Gold with dreams,demons and death! Fallacious financial minds and the fraud they doctrine always ends in tragedy, the ransom is due!”

  3. I think we should be tracking the zinc and copper markets to realise the price of silver. I think there is a slump in copper with the news in the China slow down. Gold being the evil toxic thing that it is, is mined just for itself. Gold is going to go higher, I think it might touch £1000 by Monday. Silver, may go to £16, just by proxy.

    BLSBS announces 2013 GDP growth hits 3%. A  New index, chicken manure futures,  contributed $500 billion to this unexpected growth rate increase
    In another Reuters story it’s reported that Bruno Iskil, the London Whale, was rehired by JPM to hand the Chicken S*** derivatives book trading on the Chinese Gong Feng Cluck Market.  This is explosive news.  Methane futures go sky high. I’m now long on Colonel Sanders.

  5. Surely this is a piece of propaganda, but……Look at it from a different angle. In 1981 the price of gold was ~$733 according to this source. If you recalculate $733 in todays prices based on this calculator:
    you get this: $733 (1981) = 1,602.39 US Dollars of 2013. Surely the price over that period of time fell lower, but they can still make the case that if you invested in gold in 1981 by now you lost money, since the gold was trading today at around $1318. Just another look at the news. 

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