Randgold H1

Attending the Randgold analysts briefing at noon today.  In the meantime here’s Randgold’s own spin on the H1  and Q2 Highlights.  On the face of things a positive quarter!

STRONG FIRST-HALF PERFORMANCE POSITIONS RANDGOLD TO DELIVER ON 2017 TARGETS 
KEY PERFORMANCE INDICATORS FOR THE Q2 ENDED 30 JUNE 2017

• Profit up 21% quarter on quarter and 53% on corresponding 6 months of prior year

• Production up 6% quarter on quarter and 16% on corresponding 6 months of prior year
• Earnings per share up 20% quarter on quarter and 49% on the corresponding 6 months of prior year
• Total cash cost per ounce down 8% quarter on quarter and 13% on corresponding 6 months of prior year
• Net cash of $572.8 million up 11% during the first 6 months of the year, after paying $94.0 million annual dividend
• Loulo-Gounkoto delivers strong first half performance
• Morila performs in line with plan and completes Domba permitting
• Tongon production up 15% quarter on quarter and 38% on corresponding 6 months of prior year
• Process plant upgrades produce results as Kibali prepares for underground ramp-up
• Ongoing brownfields exploration highlights reserve extensions at Yalea, Gara and Kibali
• Exploration along Fonondara trend in Côte d’Ivoire extends mineralisation and leads a portfolio of targets with +5km strike lengths

Gold consolidates as dollar continues to fall

Gold Today –New York closed yesterday at $1,269.20. London opened at $1,266.75 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was almost unchanged at $1.1832 after the yesterday’s $1.1833: €1.

         The Dollar index was almost unchanged at 92.99 after yesterday’s 92.98

         The Yen was weaker at 110.78 after yesterday’s 110.47:$1. 

         The Yuan was weaker at 6.7253 after yesterday’s 6.7179: $1. 

         The Pound Sterling was stronger at $1.3223 after yesterday’s $1.3202: £1

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    8    2

     2017    7    1           

     2017    7  31

SHAU

SHAU

SHAU

/

275.29

275.85

Trading at 275.30

275.37

275.46

$ equivalent 1oz at 0.995 fineness

@   $1: 6.7253

       $1: 6.7179

       $1: 6.7282     

  /

$1,269.58

$1,270.12

Trading at $1,268.22

$1,269.06

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed at almost the same level as Shanghai’s yesterday’s close. London opened at $1.50 lower than Shanghai. All three global gold markets continue in sync. Because New York reached $1,275 at one point, it is clear that Shanghai is dominant as it started a small shift downwards.

Silver Today –Silver closed at $16.76 yesterday after $16.78 at New York’s close Monday.

LBMA price setting:  The LBMA gold price was set this morning at $1,266.25 from yesterday’s $1,267.05.  The gold price in the euro was set at €1,070.55 after yesterday’s €1,071.95.

Just before the opening of New York the gold price was trading at $1,268.00 and in the euro at €1,072.21. At the same time, the silver price was trading at $16.60. As trading continued gold rose back up through the key $1,270 level

Price Drivers

The gold price consolidated yesterday as the currency markets calmed down. The dollar index’s decline paused, but we expect it to continue down with pauses and corrections. Meanwhile gold is pausing in its rise as the key $1,290 and $1,300 levels are now in sight. In the past these price levels have proved effective resistance.

We look across to the equity markets and see that the Dow is just about to climb over the 22,000 level. While this is a record achievement, it brings to mind that above that level investors who buy there must believe that there is a profitable distance to go in  that index.

With the disappointing data coming out now we can see that our comments about the equity markets may be closer than most think. With President Trump now returning to his negative comments about China we could see pressures in currency markets coming with a high degree of uncertainty.

Likewise Alan Greenspan’s comments about bond prices ‘popping’ tells us that bond holders may well be asking what more is there left by way of profit in the bond market? The slightest hint of tightening could cause the bond market to ‘pop’!

Gold ETFs – The SPDR gold ETF holdings remain unchanged as no sales or purchases took place yesterday but in the Gold Trust purchases of 1.14 tonnes took place. The SPDR gold ETF and Gold Trust holdings are at 791.875 tonnes and at 212.01 tonnes respectively

This is the first sign  that U.S. investors are looking kindly on gold investments after the heavy month of sales from the SPDR gold ETF.

Julian D.W. Phillips 

GoldForecaster.com | StockBridge Management Alliance 

 

Further dollar weakening sees gold retain $1,270 level

Gold Today –New York closed yesterday at $1,273.40. London opened at $1,269.00 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was weaker at $1.1833 after the yesterday’s $1.1725: €1.

         The Dollar index was weaker at 92.98 after yesterday’s 93.50

         The Yen was stronger at 110.47 after yesterday’s 110.67:$1. 

         The Yuan was stronger at 6.7179 after yesterday’s 6.7282: $1. 

         The Pound Sterling was stronger at $1.3202 after yesterday’s $1.3122: £1

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    8    1

     2017    7  31           

     2017    7  28

SHAU

SHAU

SHAU

/

275.83

274.60

Trading at ……

275.46

274.79

$ equivalent 1oz at 0.995 fineness

@   $1: 6.7179

       $1: 6.7282

       $1: 6.7415     

  /$1,270.12

$1,261.93

Trading at ……$1,269.06

$1,262.81

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed $4.40 higher than Shanghai’s close on yesterday. London opened at the same level as Shanghai. All three global gold markets continue in sync.

Silver Today –Silver closed at $16.78 yesterday after $16.75 at New York’s close Friday.

LBMA price setting:  The LBMA gold price was set this morning at $1,267.05 from yesterday’s $1,266.35.  The gold price in the euro was set at €1,071.95 after yesterday’s €1,079.31.

Just before the opening of New York the gold price was trading at $1,266.20 and in the euro at €1,072.14. At the same time, the silver price was trading at $16.66. But after NY opened the dollar gold price moved up to back over $1,270 and silver to over $16.70 but the latter’s rise was looking a little weaker in comparison with that of gold.

Price Drivers

The gold price remained strong but has not yet broken higher, as it sits on support that was previously overhead resistance. We continue to expect more strength, shortly. The dollar price of gold does not reflect buying and selling of gold at the moment but the weakness of the dollar. The strength of the euro likewise does not reflect gold demand in Europe. Hence the fall in the euro gold price today seems to us out of line and likely to recover adding strength to the gold price’s rise.

The dollar’s weakness is heavy today against all currencies and not just against the euro. We repeat that this is not just due to the White House incidents or Trump’s family despite the media insisting that it is. Global currency markets and particularly the dollar would not move on such non-financial incidents.

The problem with the dollar is that it is expensive and other currencies are hurrying to take a chunk out of its dominance. The dollar is structurally weak. The post-election hopes of a re-invigorated USA have faded, so returning the dollar back to its pre-election fundamentals. This leaves the U.S. with negative yields.

Comments from Alan Greenspan, that the equity market is not yet a ‘bubble’ but the bond market is, comes as a stark warning to financial markets. When it does ‘pop’ everyone will be hurt he says. When that happens, you will see equity and property prices badly damaged too. Gold will become a haven for U.S. investors then too.

We reflect on the fact that at one time the euro cost $1.40.

Gold ETFs – The SPDR gold ETF and the Gold Trust holdings remain unchanged as no sales or purchases took place yesterday.

The SPDR gold ETF and Gold Trust holdings are at 791.875 tonnes and at 210.87 tonnes respectively.

Julian D.W. Phillips 

GoldForecaster.com | StockBridge Management Alliance 

Global demand driving gold prices higher.

Gold Today –New York closed Friday at $1,269.40. London opened at $1,266.45 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was weaker at $1.1725 after the Friday’s $1.1709: €1.

         The Dollar index was weaker at 93.50 after Friday’s 93.71

         The Yen was stronger at 110.67 after Friday’s 111.23:$1. 

         The Yuan was stronger at 6.7282 after Friday’s 6.7415: $1. 

         The Pound Sterling was stronger at $1.3122 after Friday’s $1.3090: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    31

     2017    7    28           

     2017    7    27

SHAU

SHAU

SHAU

/

274.60

275.15

Trading at 275.60

274.79

274.74

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7282

       $1: 6.7415

       $1: 6.7377     

  /

$1,261.93

$1,265.18

Trading at $1,269.06

$1,262.81

$1,263.29

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed $6.60 higher than Shanghai’s close on Friday with Shanghai catching up today. London opened $2.60 lower than Shanghai was trading at the same time. All three global gold markets are advancing as global demand is driving gold prices higher.

Silver Today –Silver closed at $16.75 Friday after $16.57 at New York’s close Thursday.

LBMA price setting:  The LBMA gold price was set this morning at $1,266.35 from Friday’s $1,259.60.  The gold price in the euro was set at €1,079.31 after yesterday’s €1.075.20.

Just before the opening of New York the gold price was trading at $1,268.35 and in the euro at €1,081.10. At the same time, the silver price was trading at $16.78. 

Price Drivers

The week has started on a strong note with gold prices re-attacking the $1,270 level. We expect prices to rise today as the dollar weakness continues to be the main feature of the gold market. But the dollar weakness is not the sole factor, because the gold price is also rising in the euro.

Toppy developed world financial markets

A lifetime of experience in global financial markets has taught us to recognize when a market is over extended either way. It has also taught us that it can stay over-extended for a long time.  The clear signs are when a market has discounted a very rosy future and expected returns are small relative to the price of assets.  But in a climate where prices are very high, fund managers have to decide if the reasons are because they are over-bought, or if the money used to buy them is depreciating in value.

Right now equity prices relative to fixed interest rate returns are not excessive. But the prospects of higher rates that will change this have been put off, allowing equities and other assets to remain too high for longer. Indeed the temptation this brings is that prices can go, unjustifiably, quite a bit higher. But this brings into view that when markets eventually do turn down they will fall precipitously. In such a climate ‘stop loss’ protections should be replaced with short positions. Once that happens on a large scale interest rates will become irrelevant and permit markets to fall precipitously simply because markets are falling. What will trigger such a change will simply be slowing momentum on the rise followed by sellers seeing the turn. We are very close to that in developed world equity market right now. Institutions are taking measures to guard against that now, which warns us that the turn when it comes will be fast and furious.  

Another lesson we learned over a lifetime in the markets is that it is always wise to leave the last few percent of rises and falls to someone else.

The attraction of gold when  other markets fall

At that point profit seekers, wealth protectors and safe haven seekers will run to gold. The weakness of the dollar and the realities that no other currency provides a safe haven will push investors into gold and silver. Bear in mind the gold and silver markets are very small relative to other financial markets, so such a change in outlook could produce extraordinary rises in their prices.

A look at global gold markets shows that each of these market’s fundamentals are different. In China, gold is bought for wealth protection and financial security. In Europe gold is bought to protect wealth owners from the unforeseen events that attack wealth, almost as a hedge against financial crises. In the U.S. gold is bought when it begins to rise because there is a profit to be made.  [Perspicacious investors in the U.S. buy for the long term.]

For all these to converge at the same time is rare, as we have seen in the sales of over 71 tonnes of gold over the last few weeks in the U.S. The net result, when all are added together, is that gold is not an alternative to equities any more [the U.S. perspective], the safe haven aspect has not kicked in yet, but the gentle flood of gold demand in China [and after September in India] is driving gold prices higher and will keep doing so as the country’s middle classes continue to grow. Hence the risk reward ratio for gold is very attractive.

Gold ETFs

We do expect U.S.investors to return fairly soon to the precious metals markets as they have sold off almost their entire 2017 purchases already. It seems that the institutions responsible for the buying are seeing greater profits in the U.S. financial markets still. We believe that, that will change in the relatively near future.

The SPDR gold ETF and Gold Trust holdings are at 791.875 tonnes and at 210.87 tonnes respectively.

 Julian D.W. Phillips 

GoldForecaster.com | StockBridge Management Alliance 

Silly Money Printing, Negative Real Interest Rates, Restricted Supply – a “Great Scenario for Gold”

Moneymetals.com’s Mike Gleason interviews Frank Holmes

Mike Gleason: It is my privilege now to welcome in Frank Holmes, CEO and Chief Investment Officer at U.S. Global Investors. Mr. Holmes has received various honors over the years, including being named America’s Best Fund Manager for 2016 by the Mining Journal. He is also the co-author of the book The Goldwatcher: Demystifying Gold Investing. And is a regular guest on CNBC, Bloomberg, Fox Business, as well as right here on the Money Metals Podcast.

Frank, welcome back and thanks for joining us again today. How are you?

Frank Holmes: Outstanding.

Mike Gleason: Well, I’m looking forward to getting into some of these questions with you today, and to start off, I know you’ve had a lot to say about gold here recently in following your market commentaries and your Frank Talks like I do. Now before we get into some other stuff, including the exciting new gold fund that you’ve just launched there at U.S. Global Investors, let’s talk first about where we are in the metals right now. We saw prices heading higher earlier in the year, and then correcting lower more recently, but gold has really hung in there over the last month or so and it’s seemed to have found strong support in the low $1,200s. What do you make of the market action here recently in the metals, Frank?

Frank Holmes: Well, I think a big factor is real interest rates, and what’s happening in the bond markets around the world. A, debt levels are going through record highs. We saw money supply in EU, they jumped 5% in a month. It doesn’t matter, they’re just printing this money, but it’s stimulating their economy and that’s all they care about. And I think that you’re seeing this witness of this proliferation of paper money. You are witnessing that they’re manipulating real interest rates to be negative, and that is always good for gold.

You’re then seeing in the U.S. that even with rising interest rates, the dollar had one of its biggest declines last quarter, up over 3%. So, gold is rising in U.S. Dollar terms for different reasons than the rest, but it is to me, a real positive factor. We have global growth is being ignited from Europe, it’s good in Japan, and this is also good for the backend of gold. Then, I think the supply side is being restricted, and this silly tax in Tanzania of over hundreds of billion dollars. It’s just outrageous what these countries are doing.

You see it in Latin America and you see it in Mongolia and now it’s in Africa. They want money to come into these countries, they move the goalposts. There’s no fiscal stability, there’s no tax regime that’s disciplined for at least 10 years so you’re trapped capital. So, I don’t think you’re going to see supply coming onsite, so I think the world anticipates supply is actually peaking. We look at the gold production of the mines today, and you’re seeing that no more capital is going to come into these high-risk countries, no fly zone, and you’re seeing this continuous printing of money and negative real interest rates. It’s all a great scenario for gold.

Mike Gleason: Expanding the point here on the Fed specifically, the FOMC is meeting again this week. Janet Yellen is taking a more dovish posture, but lots of people still expect another rate hike or two before year end. What are you expecting here, Frank? Is the Fed basically done in your view?

Frank Holmes: Yes. The Fed is done, and in fact, I thought it was interesting that it just recently came out hot on the wire today that the Fed is going to be more about getting rid of some of those bonds they own in the marketplace, rather than raising interest rates now, to de-risk their balance sheet. But I think that they have to be very sensitive on that. So, I don’t think it’s really going to happen to any great degree, because you would have rates rise for anyone who’d want to buy those bonds, and the financial market itself. So, I think we’re in a very precarious situation.

President Trump believes a weak dollar is good for exports, and that’s what we’re seeing. The exports are pretty attractive in the U.S. Anytime you have a weak dollar’s fantastic for Boeing. Have you looked at Boeing’s chart? I mean, it’s a beautiful 45-degree angle, so the world is going to be buying Boeing, and it makes it more competitive against the Airbus. And I think this is so important because they’re high paying jobs and their export business is picking up.

Mike Gleason: Speaking of the dollar, metals should be getting some help from the weakness in the U.S. Dollar. The DXY index peaked in December and has been trending lower ever since. We now sit at the lowest levels in two years, but metals on the whole aren’t really reflecting that trend, at least not yet, or not in a meaningful way, or as much as you’d expect. What are your thoughts on why and what do you see in store for the dollar in the months ahead?

Frank Holmes: Well, I think the big concern is the infrastructure spending. President Trump has not been able to get through many things in the beltway, and he’s up against the beltway party, which is all the government agencies, along with all the lobbyists. And so, this is real evident from Obamacare which they all wanted to make changes to and they couldn’t get their act together twice. The only thing I’ve seen where he’s laid off, they fired 200 government workers in the VA Department, just terrible employees. But that seems to be the only agency that’s taken place that’s taken place with.

There’s been no streamlining except for he’s passed a law that you have to cancel two for opening one new law, but I think that maybe slows down what was on steroids, was every government agency putting through so many regulations and rules which was stymieing the economy. So, I think that this infrastructure, if we get the infrastructure bills passed, and that’s what he should have focused on in the beginning in my opinion, and not personal tax but corporate taxes, because they’re not lightning rods for lots of negative publicity.

Personal income taxes, the rich versus poor debate comes up in the media, and so that just makes it more difficult. But corporate taxes to be globally competitive, that would be easier to float. And I think the infrastructure spending would be easier to float. The last big boom in infrastructure spending was China, with great Gorges Dam, and other projects throughout their country, but there’s nothing of significance that would be beneficial to all the metals and resources like we had from 2001 to 2007.

Mike Gleason: Another potential catalyst for higher gold prices may be the theater surrounding the hiking of the debt ceiling in Washington. Congress is going to wrestle over whether or not to raise the borrowing limit again soon. Do you think we may actually see a real fight or will the Republican leadership manage to push the hike through without much fuss? And then as a follow-up, what kind of market reaction should we expect in gold?

Frank Holmes: I think the same conservative Republicans will be as disruptive as they were for Obamacare as they are for budget. They are very rigid and I was at a conference and I was hearing Alex Green speak, and his comments were that the different between Democratics and Republicans is that Republicans want to have freedom of your money and economics, but they want to control your social and personal agenda. Whereas the Democrats want to have freedom of social personal life, but they want to control your economics. And the fringes on both sides of that is what seems to be dictating or controlling the policies that are frustrating to mainstream America. I thought that was well put.

Mike Gleason: Switching to gold stocks here, and before we get into your new fund, Frank, are we entering a new rally phase after having successfully held above the key $21 support level on the GDX?

Frank Holmes: Well, two things. We’re in the seasonal pattern where gold starts its rally through the summer and rallies with down dips and corrections, but it’s usually from here up to the Chinese New Year, a succession of higher highs. But you can still get these gyrations taking place and downdrafts. So, that’s important to witness, but I think the wind is at your back, not in your face. Two, is the GDXJ, at the end of March, was like collectively with the triple, Direxion, bull and bear, and the GDX, and GDXJ, you add them all up, they were like 17 billion dollars or some big number. And they fell to 12 billion dollars.

You talk about five billion dollars blown out of the gold stocks, and I think the GDXJ has been extremely disruptive to the gold stocks around the world, especially the small mid cap. And it’s hurt financings, it’s hurt confidence and sentiment. I was speaking at a conference in Vancouver and they just couldn’t understand what was going on and I explained to them and then “ah-ha” the lights went off that it was all fund flows. And GDX has been a wonderful success but what’s happening in the psychology of investors is they don’t want to go and buy, give to an active fund manager. And even though last year we won these awards for our performance in the GDX and GDXJ, they want to go and trade the GDX and GDXJ, and what money would normally be distributed amongst 10 different gold fund managers all went to one fund which is then going to own 20 companies owning more than 20% of them.

So, that triggered all these compliance rules so then they had a blowout of three billion dollars in six weeks. So, what took a year for five billion to go in, three billion gets blown out in a very short period of time, and I don’t think a lot of investors are aware that the GDXJ owns a big slug of the GDX. I think it’s its biggest investor. It’s sort of like the movie “Deliverance.” It’s hillbilly time here of cross ownership. And so, the movement of these gold stocks has nothing to do with fundamental factors. It has to do with factors of just fund flows, and they have to buy a basket of names.

So, that was the reason why we launched our GOAU, GO Gold, which is an intelligent set of factors based on 8,000 hours of research of seeing what is the best factors for picking gold stocks as a gold analyst. And then also doing a lot of work on the new buyers in the capital markets, which are the quant funds. And they look for different factors, so we wanted to try to identify what do quant funds look for when they’re picking stocks, in particular the gold space?

And we’ve been able to embed that with a set of rules that are dynamically adjusting and adapting every quarter based on results, and when we back tested going back over 10 years, that particular index that we traded outperformed the GDX/GDXJ 95% of the time in rolling 12-month periods. So, I think that we’ve tried to deal with that as a solution to a problem in the capital markets for gold investors that just want to play the ETFs.

Mike Gleason: Yeah, and doing research on that new fund in advance of this interview, I was very excited about a lot of the things I was reading in there, the U.S. Global GO Gold and Precious Metals Miners ETF… Frank it looks like you have a big emphasis on the streamers and the royalty companies in that fund. Talk about that, and then also talk about how people can maybe get involved in that if they wish.

Frank Holmes: Sure. Well, it’s listed on the New York Stock Exchange. It’s a simple symbol, GO Gold, GOAU. The element symbol for gold is AU, and I think that we went for the streamers because the streamers have more volatility in revenue, and so we found the stocks that have lower volatility in their revenue and their cash flow get a better rating in the capital markets by any industry. Doesn’t matter what the industry is. Other parts that we found what the ratios, when we looked at revenue per employee. When we looked at all the gold stocks and put them all together, et cetera, and we did a test, which if you go to GOAUETF.com, there’s information there. Or go to US Funds(.com), you can get the information of all the research.

And what we found was that they outperformed. If you just take the best 10 names, a mutual fund of any type has to have at least 21 names. It’s a very important factor, is this revenue per employee. So, when you look at great firms like Goldman Sachs, has over a million dollars of revenue per employee, and Newmont has $300,000 of revenue per employee, and Barrick has almost $400,000 of revenue per employee. But interesting enough, Franco-Nevada – which has royalties on those two gold mining stocks’ mines in Nevada – it has 17 million dollars of revenue per employee.

So, it has a much more efficient cost of capital, and so with that, the royalty companies have outperformed the GDX and GDXJ. The other part was that GDXJ which really shocked us in our analysis, is that in the past four years, they’ve been issuing so much stock and financings. Over 100% dilution of issuing shares, but they’ve not grown the reserves per share or the production per share. So, they’ve been issuing shares at a rate of 25% a year, so what does that mean to an investor? That would mean that either the price of gold goes up 25% a year, which it’s not, or their production rises 25% a year, which it’s not, or the reserves per share are rising at 25% per year, and it has not.

So, those stocks are very vulnerable to downdrafts, whereas the royalty companies when they’ve done a financing immediately buy a cash flow. And it shows up that they’re just a safer bet. And the last thing is that the little micro-cap stocks, there’s a housekeeping seal when a Franco-Nevada or a Silver Wheaton or a Royal Gold buys a royalty in those assets, they’re sending their metallurgists, their engineers, their geologists, their whole intellectual brain trust to go and re-vet those assets. It’s like a good housekeeping seal, and for us, it was a way to play a lot of small-caps but they were vetted by those three royalty companies.

Mike Gleason: Yeah, very exciting. There’s certainly some flaws in those other indexes and I think yours is going to be a great one for people to take part in if they want to get exposure to that space. Real quick follow-up, in your view, do we see the miners lead the bullion or the bullion lead the miners? What’s your thought there?

Frank Holmes: I think the miners are going to lead. I think that those companies in particular that can show growth and revenue per share, production per share, cash flow per share, rising price to book, those are going to be the stellar performers. But I think the reasons for that is that the supply of gold coming out of the mines is going to continue to become more scarce, and shrinking supply has always been a catalyst for higher a commodity price. And the runaway printing of money I think that’s going to be just a factor of the continued consumption of gold by China, India. We also see the Russians are continuing to be buyers of gold, because they’re witnessing the currency devaluation with this money printing globally. So, I think that that’s going to be a key factor.

And then when we look at these cryptocurrencies. To me, they’re so fascinating – not so much about them having taken off, although a couple of them have, in particular, Ethereum and Bitcoin, and Bitcoin has been spectacular – but it’s really much more about the paper printing of the other countries. Since these digital currencies have landed in the marketplace, if you take a look, they’re limited in the supply that they can issue. However, the G20 countries have been printing money at an incredible rate, and their balance sheets with buying back their own bonds.

I mean, they’re the biggest buyer of their own bonds and it’s been brilliant to see what the Swiss have done, and the Japanese. They’ve been issuing this money at zero interest rates, and they turn around and take money, they create and print money themselves, and they go buy their own stocks. So, the biggest shareholders in Japan, South Korea, I believe, and also in Switzerland are the central banks. It’s unheard of. Because they recognize that this cheap money has to buy real assets. So, I think that the phenomena of these digital currencies is more a reflection of the lack of confidence in governments that are just printing money as sort of a silly behavior. And I think that the gold market is going to have its point where it just spikes to another level. So, I feel very positive regarding gold.

Mike Gleason: Well, we’ll leave it there. That’s fantastic stuff as usual Frank. We appreciate your insights and it’s always great to hear your thoughts and we really appreciate your time once again. Now, before we let you go, please tell listeners a little bit more about your firm and your services and then also plug the wonderful Frank Talk blog if you would, because this is an absolute must read for anyone listening to this podcast.

Frank Holmes: You’re so kind. I thank you very much. It’s USFunds.com. Subscribe to Frank Talk and Investor Alert. It’s won many awards. When we go up for competitions in the fund world against Fidelity and the Vanguards, which most people know of. It (the Frank Talk blog) is written by portfolio managers, and edited by journalists who are internal. We’re very proud of what we create, and it helps us. It helps me, I’m traveling around the world to relate to investors what I’m seeing and what I think some of the economic benefits are, and risks are. Because we always believe at US Global, in all of our prospectuses that, that government policies are a precursor of change, and it’s important to recognize what those policies are.

So, with that, just go to USFunds.com. I’d love to see you become subscribers, and if you have any ideas or thoughts, please feel free to send it into us.

Mike Gleason: Well, excellent stuff. Thanks as always for your time, Frank. Congratulations on the launch of the GO Gold and Precious Metals Miners ETF. Continued success there, and keep up the good work with those great market commentaries. I hope you enjoy the rest of your summer and I look forward to catching up with you again sometime in the fall. Take care.

Frank Holmes: Take care.

Mike Gleason: Well, that will do it for this week. Thanks again to Frank Holmes, CEO of U.S. Global Investors, and manager of the new GOAUX gold fund. For more information, the site is USFunds.com. Be sure to check out the previously mentioned Frank Talk blog while you’re there for some of the best market commentary you will find anywhere on gold and other related topics. Again, you can find all that at USFunds.com, and you can also go to GOAUETF.com

Gold holds firm despite GLD sales

Gold Today –New York closed yesterday at $1,260.00. London opened at $1,260.00 today. 

Overall the dollar was stronger against global currencies, early today. Before London’s opening:

         The $: € was stronger at $1.1709 after the yesterday’s $1.1728: €1.

         The Dollar index was stronger at 93.71 after yesterday’s 93.50

         The Yen was almost unchanged at 111.23 after yesterday’s 111.25:$1. 

         The Yuan was weaker at 6.7415 after yesterday’s 6.7377: $1. 

         The Pound Sterling was weaker at $1.3090 after yesterday’s $1.3138: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    28

     2017    7    27           

     2017    7    26

SHAU

SHAU

SHAU

/

275.15

272.64

Trading at ——

274.74

271.95

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7415

       $1: 6.7377

       $1: 6.7506     

  /

$1,265.18

$1,251.19

Trading at $……..

$1,263.29

$1,248.01

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 We cannot establish the price at which Shanghai was trading today. New York was $3 lower than Shanghai yesterday, with London closing at a level that is closer to Shanghai’s price than we have seen until yesterday, when it opened at just $2.50 below Shanghai’s trading level yesterday. Shanghai continues to lead the way higher and to import as much gold as it can to meet Chinese demand.

Silver Today –Silver closed at $16.57 yesterday after $16.45 at New York’s close Tuesday.

LBMA price setting:  The LBMA gold price was set this morning at $1,259.60 from yesterday’s $1,262.05.  The gold price in the euro was set at €1,075.20 after yesterday’s €1.077.11.

Just after the opening of New York the gold price was trading at $1,263.25 and in the euro at €1,075.41. At the same time, the silver price was trading at $16.73. 

Price Drivers

On what is usually the busiest day of the week, with two days of no markets at the weekend, the gold price has held the $1,260 level. Will it rise from here? We will have to wait and see.

As you have seen, the selloff of over 71 tonnes of gold recently from the SPDR gold ETF, while the gold price was rising was a failed exercise, as it did not lower the gold price. Indeed we are certain that the gold sold is now on its way to Shanghai via Switzerland. It is in the nature of U.S. investors to  ‘buy on the rise’, so we are watching to  see if the U.S. bears attack again, or has their ammunition been spent and they are turning long of physical gold. We do expect their actions now to have a direct bearing on the gold price. If they attack we expect to see a pattern similar to the last few weeks seen in gold. If they are ongoing buyers we expect the gold price to rise accordingly.

With all the chatter about the timing of rate hikes or trimming the Fed’s Balance Sheet, one very, very important factor is being overlooked in the U.S. If inflation continues at lower or lowering levels and the recovery stalls followed by a downturn, the Fed has almost no more tools with which to combat the falls. As it is rates continue to be so low that any lowering will have little to no impact [unless they go negative] on stimulating the U.S. economy. Likewise, trimming the Fed’s Balance Sheet, we feel, will have little to no impact on the U.S. financial world. If they go that road and there is a downturn in the U.S. further stimulation is likely to crack confidence in the dollar, something that the Fed cannot afford! Certainly little could be more positive for the gold price. Despite their positive demeanor, Fed officials must be very disturbed by the downturn in inflation.  

Gold ETFs –Technically the gold price showed it has surmounted resistance and is now sitting on that, which is now support. Without knowing the individual customers, it would seem that a fund committed itself to the gold price falling back from $1,260 below $1,250, but the Technical picture is now failing, as Asian demand continues to lift western gold market prices higher.

The SPDR gold ETF and Gold Trust holdings are at 791.875 tonnes and at 210.87 tonnes respectively.

 Julian D.W. Phillips 

 GoldForecaster.com | StockBridge Management Alliance 

Gold’s resilience remarkable as GLD holding falls further

How much further can SPDR Gold Shares (GLD), the world’s largest gold ETF, continue to bleed gold without adversely affecting the metal price?  It has shed a hair over 75 tonnes since its 2017 peak some 6 weeks ago, 61.8 tonnes in the past month alone and over 162 tonnes in the past year.  It is now at a level not seen since March 2016 when its holdings were rising sharply, yet the gold price over the past week or so has been trending upwards.  This is a huge contradiction in the yellow metal’s normal price movement.  We are either heading for a very sharp price reversal – or if the current price level around $1,260 holds – a very significant turning point leading to significant gains if the current falls in the GLD holding are reversed.

What makes the GLD performance even more anomalous is that the other large U.S. gold ETF – the much smaller iShares Gold Trust (IAU) – has actually added around 2.5 tonnes of gold over the past month while GLD has been moving sharply in the other direction.  Year to date IAU has added 14.7 tonnes to its gold holdings, which stand at 210.87 tonnes, while the GLD holding, currently 791.88 tonnes, has dropped by a little over 30 tonnes over the same period.  The performance differences are hard to explain given they are both serving the same investor market.

Yesterday in an article on the www.sharpspixley.com website we included the following quote from Ted Butler in trying to explain the big fall in the GLD gold holdings “”The most plausible and, in fact, only explanation I can come up with is that some large entity is converting shares into physical metal for the purpose of preventing share ownership from rising to or above reporting levels. When a big shareholder converts shares of SLV or GLD into metal, the shares no longer exist and, therefore, don’t need to be reported to any regulator. Likewise, direct physical ownership of silver or gold needn’t be reported to anyone no matter how large the position may grow. (This is another major factor behind why JPMorgan decided to buy physical silver). Again, a large entity amassing a large physical position in silver or gold on the sly is not bearish for price.” (See: GLD bleeds 71.58 tonnes of gold in just over a month).

What else could be behind the fall in GLD gold?  We have also noted on the Sharps Pixley website that the major Swiss gold refiners, which dominate the global remelting and re-refining market are, anecdotally, struggling to source enough physical gold to meet demand as gold out of them continues to flow very heavily to Asia and the Middle East – See: June Swiss gold exports: 90% moving east).  They have to be sourcing their gold from somewhere and they exported some 162 tonnes of gold in June alone – 90% to Asia and the Middle East.  Now maybe there are enough ‘friendly’ holders of GLD gold shares to lean on to supply them with bullion when physical gold is in short supply. The UK was the biggest source of Swiss imported gold in May, although was superseded as the biggest exporter of gold to Switzerland in June by the USA, but most GLD gold is vaulted in London.  Perhaps we will see the UK as being again the biggest exporter of gold to Switzerland this month which is when most of the GLD falls have occurred when the next Swiss announcement comes out in late August?  Certainly bullion coming out of the world’s biggest gold ETF could well be a principal source for all this gold heading East.

Gold and silver surge despite more big sales out of GLD

 Gold Today –New York closed the day before yesterday at $1,248.40. London opened at $1,262.00 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was weaker at $1.1728 after the day before yesterday’s $1.1654: €1.

         The Dollar index was weaker at 93.50 after the day before yesterday’s 93.97

         The Yen was unchanged at 111.25 after the day before yesterday’s 111.25:$1. 

         The Yuan was stronger at 6.7377 after the day before yesterday’s 6.7506: $1. 

         The Pound Sterling was stronger at $1.3138 after the day before yesterday’s $1.3031: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    27

     2017    7    26           

     2017    7    25

SHAU

SHAU

SHAU

/

272.64

274.40

Trading at 275.00

271.95

273.84

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7377

       $1: 6.7506

       $1: 6.7504     

  /

$1,251.19

$1,259.36

Trading at $1,264.49

$1,248.01

$1,256.78

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 The reaction to the Fed’s inaction not just on rates but on the timing of the contraction of the Fed’s Balance Sheet, interrupted the gold price relationship between global markets. New York closed at the same level as Shanghai yesterday, but London opened at just $2.50 below Shanghai’s trading level this morning. The price differentials between the global markets were nearly eliminated on the back of the Fed’s inaction. We look today to see just how global markets interact and to see if they are really narrowing their differences.

If you had been following our commentary in the Gold Forecaster newsletter on China and the shift of pricing power to the east, you would not have been tempted to sell your holdings of gold or silver!

It is clear that it is now necessary to understand what drives each gold market across the world if one is to understand the gold price and where it is going. To focus on just the U.S. market, as if it is the only gold price driver, is to make yourself vulnerable to grave portfolio mistakes on gold. One cannot be this parochial any more, as the U.S. lost that pricing power a while ago.

To ignore the deep fundamentals driving each market would do the same. To ignore other global gold markets would do the same too.

Silver Today –Silver closed at $16.45 the day before yesterday after $16.40 at New York’s close Monday.

LBMA price setting:  The LBMA gold price was set this morning at $1,262.05 from yesterday’s $1,245.40.  The gold price in the euro was set at €1,077.11 after the day before yesterday’s €1.074.68.

Just after the opening of New York the gold price was trading at $1,263.52 and in the euro at €1,078.78. At the same time, the silver price was trading at $16.78. 

Price Drivers

The Fed decided not to raise rates, as expected but only said they would start lowering the Fed’s Balance Sheet, relatively soon. This disappointed markets including the global gold markets that are taking the gold price above previous resistance levels into the $1,260 region.

But once again the biggest feature of the day was the softening dollar. It has confirmed it is in a ‘bear’ market and will decline over the next few years. More and more analysts including major institutions are now talking the dollar down, over the long term.

Bear in mind the analogy that the currency world has had the dollar, almost as the tree trunk, while other currencies have been the branches of that tree. If the trunk withers what will happen to the branches? The only way to save the tree is to replace it with several trunks. These will come from the main trading blocs of the world. The euro will be joined by the Yuan [which now accounts for just under 2.00% of global trade pricing – it could be more if we include oil] with the dollar in a diminished role.

Gold will then become the facilitator between currencies to reinforce confidence in them.

Gold ETFs – In the last two days we have seen sales of 14.20 tonnes of gold from the SPDR gold ETF (GLD) sales of 0.99 of a tonne from the Gold Trust (IAU). The SPDR gold ETF and Gold Trust holdings are a 785.424 tonnes and at 210.87 tonnes respectively.

Despite these ongoing, heavy, persistent gold sales from the SPDR gold ETF the gold price has risen through more levels of heavy resistance. There is no doubt in our minds that if the gold price holds above $1,260 and rises, these investors will return to gold and drive gold prices higher.

With U.S. sales of gold now greater than has been acquired in 2017 and accounting for longer term holders of gold, we believe that U.S. gold investors are now close to being sold out.

Since January 6th 2017 No tonnes of gold have been added to the SPDR gold ETF and the Gold Trust. In fact, in this year 2017 the level of gold in those funds is now -6.168 tonnes.

Julian D.W. Phillips 

GoldForecaster.com | StockBridge Management Alliance 

Sales out of GLD continue but with little gold price effect

Gold Today –New York closed yesterday at $1,257.20. London opened at $1,253.00 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was slightly weaker at $1.1654 after yesterday’s $1.1650: €1.

         The Dollar index was slightly stronger at 93.97 after yesterday’s 93.94

         The Yen was weaker at 111.25 after yesterday’s 110.76:$1. 

         The Yuan was almost unchanged at 6.7506 after yesterday’s 6.7503: $1. 

         The Pound Sterling was slightly weaker at $1.3031 after yesterday’s $1.3041: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    25

     2017    7    24           

     2017    7    21

SHAU

SHAU

SHAU

/

274.40

272.40

Trading at 274.60

273.84

272.69

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7506

       $1: 6.7503

       $1: 6.7697     

  /

$1,259.36

$1,246.55

Trading at $1,260.22

$1,256.78

$1,247.88

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed $0.50 higher than Shanghai on yesterday with London opening $7 lower than Shanghai. This keeps open arbitrage opportunities with Shanghai. Once again Shanghai is pointing the way higher for New York and London.

Sales from the SPDR gold ETF become available for shipping to Shanghai implying that should U.S. investors want to return to physical gold they will have to pay up for it.

Silver Today –Silver closed at $16.40 yesterday after $16.48 at New York’s close Friday.

LBMA price setting:  The LBMA gold price was set this morning at $1,252.00 from yesterday’s $1,255.85.  The gold price in the euro was set at €1,074.68 after yesterday’s €1.078.45.

Just after the opening of New York the gold price was trading at $1,252.65 and in the euro at €1,071.74. At the same time, the silver price was trading at $16.46. 

Price Drivers

The gold price continues to consolidate just above support at $1,250. Last time it was here it struggled to hold or move higher. It was at this level that it was attacked and knocked down. The difference this time is that dollar weakness has gained momentum and will contribute to gold’s strength. In addition Chinese demand and the new London based LMEprecious arbitrage market with Hong Kong is letting London feel Chinese demand directly, in  addition to the big banks in China doing the same in London. So we are watching to see where the gold price will go today.

As you can see below sales from the SPDR gold ETF continue unabated because of the perception that the Fed will not do anything until the end of the year so equities appear more attractive. You will note that the amount of gold acquired into U.S. gold ETFs since the beginning of the year, has dwindled to only 9 tonnes.

The Fed is deliberating that very matter tomorrow. The market expects Janet Yellen to make an announcement on tapering the Fed’s bloated Balance Sheet today. The market is sensitized to this and will react no matter what she says.

 

Gold ETFs – Yesterday saw sales of 4.14 tonnes of gold from the SPDR gold ETF but, again, no change in the Gold Trust. The SPDR gold ETF and Gold Trust holdings are at 809.619 tonnes and at 211.86 tonnes respectively.

In the last week heavy persistent gold sales from the SPDR gold ETF have had absolutely no impact on the gold price as it soared up from the bounce straight through the $1,250 “Golden Cross’”.

We expect these sales to halt this week as the gold picture looks so positive.

Since January 6th 2017 9.022 tonnes have been added to the SPDR gold ETF and the Gold Trust.

 Julian D.W. Phillips 

 GoldForecaster.com | StockBridge Management Alliance 

Gold up through resistance and consolidating

Gold Today –New York closed Friday at $1,254.30. London opened at $1,254.00 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was slightly stronger at $1.1650 after Friday’s $1.1657: €1.

         The Dollar index was weaker at 93.93 after Friday’s 94.09

         The Yen was stronger at 110.76 after Friday’s 111.69:$1. 

         The Yuan was stronger at 6.7503 after Friday’s 6.7697: $1. 

         The Pound Sterling was stronger at $1.3041 after Friday’s $1.3001: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    24

     2017    7    21           

     2017    7    20

SHAU

SHAU

SHAU

/

272.40

271.44

Trading at 273.90

272.69

271.36

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7503

       $1: 6.7697

       $1: 6.7549     

  /

$1,246.55

$1,244.87

Trading at $1,257.05

$1,247.88

$1,244.50

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed nearly $8.00 higher than Shanghai on Friday with London opening only $3 less than Shanghai. If this persists this week with the differentials narrowing as they are, then we will have confirmation that arbitrageurs are proving successful in smoothing out the differences between the global gold markets.

This is a structural change in the global gold market and allows a considerably greater influence of the physical gold market [primarily Shanghai] to impact the gold price and diminish the impact of the ‘paper gold markets of COMEX and the ‘paper’ side of the London gold market, across the world.

We have highlighted in the Gold Forecaster newsletter of ours that while 90+% of gold-linked transactions go through London and COMEX over 90% of physical gold transactions go through Shanghai. With the impact of the arbitrageurs bringing global gold prices together, we will see, at last, the fundamentals of demand and supply impact the price.

An analogy of this is seen in the sea where the surf and waves have the loudest impact, but the current dominates the ebbing and flowing of the sea itself.  The current is now taking control whereas the surf and waves appeared to have it before.

Silver Today –Silver closed at $16.48 Friday after $16.30 at New York’s close Thursday.

LBMA price setting:  The LBMA gold price was set today at $1,255.85 from Friday’s $1,247.25.  The gold price in the euro was set at €1,078.45 after Friday’s €1.071.61.

Just after the opening of New York the gold price was trading at $1,256.50 and in the euro at €1,078.73. At the same time, the silver price was trading at $16.54. 

Price Drivers

The gold price has broken through overhead resistance and is now consolidating on that resistance which is now support. Today, we expect and are seeing a dollar rally back to overhead resistance before resuming its downward path. The media is blaming the Trump family for the fall, but as we said last week,   the dollar bear market has begun in earnest! Once this rally subsides, we do see rallies in the dollar but the trend is lower now. We cannot blame the Trade deficit as this has been negative yearly since the seventies something the world has accepted as the U.S. ‘exorbitant privilege’ [where the U.S. paid for goods with freshly produced dollars]. That it could be a factor now could only happen if this monetary system of ‘dollar hegemony’ was ending, or has ended. We do believe that that system is changing to a multi-currency one. Consequently, we see the dollar weakening for several years now.

Gold ETFs

Friday saw sales of 2.366 tonnes from the SPDR gold ETF but no change in the Gold Trust. The SPDR gold ETF and Gold Trust holdings are at 813.759 tonnes and at 211.86 tonnes respectively.

In the last week heavy persistent gold sales from the SPDR gold ETF have had absolutely no impact on the gold price as it soared up from the bounce straight through the $1,250 “Golden Cross’”.

We expect these sales to halt this week as the gold picture looks so positive.

Since January 6th 2017 13.162 tonnes have been added to the SPDR gold ETF and the Gold Trust.

 Julian D.W. Phillips 

 GoldForecaster.com | StockBridge Management Alliance 

Randgold ‘problem child’ gold mine coming right.

For any other mining company, the Tongon gold mine, owned and operated by Randgold Resources, might be deemed a great success.  But for Randgold, which likes to stick to its production projections for all its operations in West and Central Africa, it has been something of a problem child underperforming against its scheduled output targets due to a succession of technical issues.  But even so it has still been a significant producer of the yellow metal at the kind of levels that would still be the envy of many other mid-sized gold mining companies.

Randgold CEO, Mark Bristow, on the occasion of a visit to the mine and to its host country ahead of the company’s second quarter results, due out the first week of August, has told the media in Cote d’Ivoire’s capital, Abidjan, that Tongon  continues to ramp up production as it tracks its 2017 target of 285,000 ounces of gold, making it a globally significant gold producer, but with a relatively short four year life remaining.  But Bristow went on to say that with Tongon now operating to plan, its focus had shifted to finding additional reserves and resources to replace depleted ounces and extend the mine’s life beyond its four years remaining.  The chances are that Randgold will be able to achieve this as the area around Tongon is seen as highly prospective for smaller satellite orebodies – and the company has a good track record of eking extended lives out of its Malian gold operations – notably at Morila which is still producing gold despite originally being due for closure some years ago.

Bristow also confirmed his long held view of Cote d’Ivoire’s exceptional prospectivity and its positive attitude towards foreign investment in the gold mining sector.

Elsewhere in the West African nation, Bristow commented that Randgold’s exploration programmes have defined a large target at Boundiali in the Fonondara corridor, which he described as ‘potentially the most exciting gold prospect in West Africa’.  The company has just completed its annual review of its exploration targets, which Bristow said had also highlighted very positive results from its other holdings in the country.

As to Tongon itself, and its contribution to the Ivorian economy, Bristow commented that last quarter it declared its second dividend, of which the government’s share, including taxes, was US$20 million (FCFA 12 billion).  In total, Bristow claimed that the Tongon mine has contributed just under $1 billion (FCFA 520 billion) to the Ivorian economy in the form of royalties, taxes, dividends, salaries, payments to local suppliers and community investments since it started production in 2010.

We will presumably get a further update on Tongon when Randgold delivers its Q2 results on August 3rd when Bristow himself will also deliver an update to London analysts and media on the company’s overall performance so far this year and its future prospects.  Randgold has, unlike most of the other large global gold miners, managed to keep itself debt free and cashflow positive through maintaing some very strict new mine investment criteria.

Gold breaches $1,250 level as dollar enters bear market

 Gold Today –New York closed yesterday at $1,243.70. London opened at $1,247.00 today. 

Overall the dollar was much weaker against global currencies, early today. Before London’s opening:

         The $: € was much weaker at $1.1657 after yesterday’s $1.1532: €1.

         The Dollar index was much weaker at 94.09 after yesterday’s 94.77

         The Yen was stronger at 111.69 after yesterday’s 111.94:$1. 

         The Yuan was weaker at 6.7697 after yesterday’s 6.7549: $1. 

         The Pound Sterling was slightly weaker at $1.3001 after yesterday’s $1.3033: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    20

     2017    7    19           

     2017    7    18

SHAU

SHAU

SHAU

/

271.44

271.41

Trading at 273.6

271.36

271.17

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7697

       $1: 6.7549

       $1: 6.7481     

  /

$1,244.87

$1,245.99

Trading at $1,252.06

$1,244.50

$1,244.88

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed only $0.80 lower than  Shanghai yesterday and has been trying to follow Shanghai all the way up, with London opening today at a discount to Shanghai’s trading today of $5.06 an narrower discount than  we have seen this week. Both London and New York are being pulled up by Shanghai. With this strong Chinese demand the chances of both London and New York breaking through $1,250 were greatly increased.  In the event gold did breach the $1,250 level.  The question is whether it can maintain this.

Today, the U.S. dollar weakened heavily after Draghi of the E.C.B.’s announcement.

Silver Today –Silver closed at $16.30 yesterday after $16.27 at New York’s close Wednesday.

LBMA price setting:  The LBMA gold price was set this morning at $1,247.25 from yesterday’s $1,239.85.  The gold price in the euro was set at €1,071.61 after yesterday’s €1.074.72.

Just after the opening of New York the gold price was trading at $1,249.75 and in the euro at €1,072.93. At the same time, the silver price was trading at $16.43. 

Price Drivers

The gold price is attacking overhead resistance in the $1,250 area. If it maintains its strength it will have broken overhead resistance.

Draghi was more dovish than the markets expected, basically saying that there will be no change in the stance of the E.C.B. We expected that that would slow or halt the rise of the euro, but not a bit of it. The euro is stronger again today, with a gold price in the euro that is slightly lower, while the gold price in the dollar is strong. As with the U.S. inflation is just not rising as the central banks want and need it to. Both the U.S. Fed and the E.U.’ E.C.B. will hold back tapering incentives until they see inflation and wages rise. We expect that will take a long, long time still.

Of very great significance is the dollar index. We now call the dollar bear market which has begun in earnest! We see the dollar weakening for several years now. We believe the world’s monetary system is confirming that it has entered a multi-currency system from the dollar hegemony system it has been in since the early 1970’. This means that gold will gather a far more significant role in the global monetary system as a reserve asset. Over time, from now on gold will improve its investor attraction considerably. Silver will follow it.

We expect the euro gold price to rise as Europeans are not selling gold, but we see them increasing their demand for gold. Gold continues to hold higher levels in the euro, which shows real demand for physical gold in the E.U.

Gold ETFs – Yesterday saw sales of 5.323 tonnes from the SPDR gold ETF and purchases of 0.45 of a tonne in the Gold Trust. The SPDR gold ETF and Gold Trust holdings are at 816.125 tonnes and at 211.86 tonnes respectively.

The U.S. selling from the SPDR gold ETF persists with very large sales of physical gold as the gold price rises. Clearly these investors are seeing the gold price being turned back at these levels. Yes, there may be institutional attempts to break the gold price down, but so far this week they have failed to do this. Chinese demand is strong simply because the economy and middle class are growing and is likely to continue to do so. We see the sellers halting sales if the gold price confirms it has broken overhead resistance and rises. Then we expect to see U.S. demand come in strongly. We do not underestimate the demand from LMEprecious arbitraging gold into Hong Kong. Gold price differentials between London and China are already narrowing!

Since January 6th 2017 15.528 tonnes have been added to the SPDR gold ETF and the Gold Trust.

Julian D.W. Phillips 

 GoldForecaster.com | StockBridge Management Alliance 

Gold rise pace slowing down

Gold Today –New York closed yesterday at $1,242.10. London opened at $1,239.00 today. 

Overall the dollar was stronger against global currencies, early today. Before London’s opening:

         The $: € was stronger at $1.1532 after yesterday’s $1.1559: €1.

         The Dollar index was slightly stronger at 94.77 after yesterday’s 94.64

         The Yen was stronger at 111.94 after yesterday’s 112.44:$1. 

         The Yuan was weaker at 6.7549 after yesterday’s 6.7481: $1. 

         The Pound Sterling was slightly stronger at $1.3033 after yesterday’s $1.3026: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    19

     2017    7    18           

     2017    7    17

SHAU

SHAU

SHAU

/

271.41

270.20

Trading at 271.95

271.17

270.16

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7549

       $1: 6.7481

       $1: 6.7704     

  /

$1,245.99

$1,222.72

Trading at $1,247.22

$1,244.88

$1,223.59

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed $2.78 lower than Shanghai’s close yesterday, with London opening today at a discount to Shanghai’s trading today of $8.22, a slightly widening discount to Shanghai. But London is being pulled up by Shanghai. Chinese demand is sufficient to lift prices there, despite the slower rise in the gold price in London. This bodes well for more rises in London and New York.

Today, the U.S. dollar recovered slightly, a normal market correction that does not deviate from its downward path. With the E.C.B. meeting tomorrow traders are now cautious and prefer to wait before taking new positions in the euro.

Silver Today –Silver closed at $16.27 yesterday after $16.12 at New York’s close Monday.

LBMA price setting:  The LBMA gold price was set today at $1,239.85 from yesterday’s $1,237.10.  The gold price in the euro was set at €1,074.72 after yesterday’s €1.070.25.

Ahead of the opening of New York the gold price was trading at $1,239.85 and in the euro at €1,075.51. At the same time, the silver price was trading at $16.23. 

Price Drivers

The gold price is slowing its rise towards $1,250 and may struggle in the $1,240 area until after the E.C.B. meeting and the effect the meeting has on exchange rates thereafter.

We do expect that if Draghi is more dovish than the markets expects, the rise of the euro may halt, for now. If he is the slightest bit hawkish, we would expect to see the euro rise further. With inflation and wages performing less than expected we would expect him to caution against too many expectations concerning the withdrawal of stimulus measures too soon. He may well send out a similar message to the one Janet Yellen is sending out. Either way we do expect him to have a distinct impact on global financial markets, including gold and silver.

Gold continues to rise in the euro, which shows real demand for physical gold in the E.U.

Gold ETFs 

Yesterday saw sales of 5.662 tonnes from the SPDR gold ETF but no change again, in the holdings of the Gold Trust. The SPDR gold ETF and Gold Trust holdings are at 821.448 tonnes and at 211.41 tonnes respectively.

These sales are substantial enough to move the gold price down, but they didn’t as the gold price continued to climb. We suspect that the physical gold being sold is being snapped up and on its way to China. The new ability to arbitrage between LMEprecious and Hong Kong is seeing high volumes right from the start. They may be responsible for the physical gold being arbitraged to Hong Kong. If that is true, we would expect not only the differential between London and Shanghai to narrow considerably, but for the lifting of the gold price in Shanghai to feed through to London quickly!

Since January 6th 2017 20.401 tonnes have been added to the SPDR gold ETF and the Gold Trust.

Julian D.W. Phillips 

GoldForecaster.com | StockBridge Management Alliance 

Gold and Silver continue on upwards patgh

 Gold Today –New York closed yesterday at $1,234.00. London opened at $1,237.00 today. 

Overall the dollar was much weaker against global currencies, early today. Before London’s opening:

         The $: € was much weaker at $1.1559 after yesterday’s $1.1457: €1.

         The Dollar index was much weaker at 94.64 after yesterday’s 95.21

         The Yen was stronger at 112.14 after yesterday’s 112.44:$1. 

         The Yuan was much stronger at 6.7481 after yesterday’s 6.7704: $1. 

         The Pound Sterling was weaker at $1.3026 after yesterday’s $1.3066: £1.

Yuan Gold Fix

Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    17

     2017    7    13           

     2017    7    12

SHAU

SHAU

SHAU

/

270.20

267.54

Trading at 271.00

270.16

267.99

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7481

       $1: 6.7704

       $1: 6.7821     

  /

$1,236.31

$1,222.72

Trading at $1,244.10

$1,236.13

$1,223.59

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York closed $2 lower than Shanghai’s close yesterday, with London opening today at a discount to Shanghai’s trading today of $7.10, the same discount to Shanghai we saw yesterday. But London is being pulled up by Shanghai. Shanghai  in  turn was pulling back today from its high as the Yuan strengthened, bringing Shanghai’s gold price to the same differential as it had yesterday.

We see the dollar now in a ‘bear’ market so we expect gold to continue to rise in dollar terms, alongside currencies. This is a time to be long in dollar terms, as opposed to the euro or other solid currencies.

Silver Today –Silver closed at $16.12 yesterday after $15.95 at New York’s close Friday.

LBMA price setting:  The LBMA gold price was set today at $1,237.10 from yesterday’s $1,229.85.  The gold price in the euro was set at €1,070.25 after yesterday’s €1.071.03.

Ahead of the opening of New York the gold price was trading at $1,237.75 and in the euro at €1,071.65. At the same time, the silver price was trading at $16.17. 

Price Drivers

The gold price continues to rise towards $1,250 at which point we may see it turn down or break through higher. That is a key level for gold. At the moment we look at the euro price of gold to see what the underlying behavior of gold really is. With the dollar weakening so much, the gold price in the dollar reflects the falling dollar not the gold price. Technically it has risen above its 200-day moving average.

You will see that in the euro it fell a euro at the fixing in London. However it continues to rise in the Yuan as the Yuan itself, rises against the dollar.

Gold ETFs

As you can see below the sales from the SPDR gold ETF are tapering off. They are now not large enough to impact the gold price.

ECB

All eyes are on Draghi of the E.C.B. They are waiting to see if he raises rates [which we doubt] or delays the peeling back of the Bond buying program. Inflation figures in the E.U. are doing the same as they are doing in the U.S.A.

Meanwhile the markets are discounting an earlier unwinding of stimulus from the E.C.B. But the E.U. is seeing falling inflation, just as is being seen in the U.S. and likely for similar reasons. Wages are not rising as they should be in healthy economies. Artificial intelligence is decimating jobs there too, so the quality of jobs being gained is not such that workers can push for higher wages.

It may be that Draghi therefore, expresses caution when discussing the tapering of stimuli, sending the equity markets higher and the euro slowing the pace of its rise against the dollar.  

Gold ETFs

Yesterday saw sales of 1.775 tonnes from the SPDR gold ETF but no change in the holdings of the Gold Trust. The SPDR gold ETF and Gold Trust holdings are at 827.067 tonnes and at 211.41 tonnes respectively.

Since January 6th 2017 26.063 tonnes have been added to the SPDR gold ETF and the Gold Trust.

 Julian D.W. Phillips 

 GoldForecaster.com | StockBridge Management Alliance 

Russia collusion claims a diversion; Gold has a positive week; China and Europe top performing markets

By Frank Holmes – CEO and Chief Investment Officer US Global Investors

Gold got a boost Friday on weaker-than-expected inflation and retail sales figures, casting doubt on the Federal Reserve’s ability to continue normalizing interest rates this year.

Consumer prices rose slightly in June, at their slowest pace so far this year. The consumer price index (CPI), released on Friday, showed the cost of living in America rising only 1.6 percent compared to the same month last year, significantly down from the most recent high of 2.8 percent in February and below the Fed’s target of 2 percent. Much of the decline was due to energy prices, which fell 1.6 percent from May.

consumer prices continued to expand in june yet at a slower pace
click to enlarge

As I’ve explained elsewhere, CPI is an important economic indicator for gold investors to track. The yellow metal has historically responded positively when inflation rises—and especially when it pushes the yield on a government bond into negative territory. Why lock your money up in a 2-year or 5-year Treasury that’s guaranteed to give you a negative yield?

portfolio manager samuel paleaz poses near equipment in macraes the largest gold mine in new zealand

But right now the gold Fear Trade is being supported by what some are calling turmoil in the Trump administration. Last week the Russia collusion story took a new twist, with emails surfacing showing that Donald Trump Jr.; Jared Kushner, the president’s son-in-law and now-senior advisor; and former Trump campaign manager Paul Manafort all agreed to meet with a Russian lawyer last summer under the pretext that she had dirt on Hillary Clinton.

Whether or not this meeting is “collusion” is not for me to say, but the optics of it certainly look bad, and it threatens to undermine the president’s agenda even more. For the first time last week, an article of impeachment was formally introduced on the House floor that accuses Trump of obstructing justice. The article is unlikely to go very far in the Republican-controlled House, but it adds further uncertainty to Trump’s ability to achieve some of his goals, including tax reform and infrastructure spending. I’ll have more to say on this later

A Contrarian View of China

A new report from CLSA shows that Asian markets and Europe were the top performers during the first six months of the year. Korea took the top spot, surging more than 25 percent, followed closely by China.

asia and europe are the top market drivers so far this year
click to enlarge

Despite persistent negative “news” about China in the mainstream media, conditions in the world’s second-largest economy are improving. Consumption is up and household income remains strong. The number of high net worth individuals (HNWIs) in China—those with at least 10 million renminbi ($1.5 million) in investable income—rose to 1.6 million last year, about nine times the number only 10 years ago. It’s estimated we could see as many as 1.87 million Chinese HNWIs by the end of 2017.

According to CLSA, global trade is robust, with emerging markets, and particularly China, driving most of the acceleration this year. In the first three months of 2017, global trade grew 4 percent compared to the same period last year, its fastest pace since 2011.

“Indeed the early months of 2017 have seen China become easily the biggest single country driver of Asian trade growth,” writes Eric Fishwick, head of economic research at CLSA.

A lot of this growth can be attributed to Beijing’s monumental One Belt, One Road infrastructure project, which I’ve highlighted many times before. But according to Alexious Lee, CLSA’s head of China industrial research, a “more nationalist America” in the first six months of the year has likely given China more leverage to assume “a larger global, and especially regional, leadership role.”

This comports with what I said back in January, in a Frank Talk titled “China Sets the Stage to Replace the U.S. as Global Trade Leader.” With President Donald Trump having already withdrawn the U.S. from the Trans-Pacific Partnership (TPP) and promising to renegotiate or tear up other trade agreements—he recently tweeted that the U.S. has “made some of the worst Trade Deals in world history”—China has emerged, amazingly, as a champion of free trade, a position of power it will likely continue to capitalize on.

The country’s overseas construction orders have continued to expand, with agreements signed since 2013 valued at more than $600 billion.

business is booming for china
click to enlarge

 

Emerging Europe Expected to Remain Strong

Another recent report, this one from Capital Economics, shows that the investment case for emerging Europe remains strong in 2017. Russia is expected to strengthen over the next 12 months, while Poland, Hungary, the Czech Republic and Slovakia are likely to remain attractive.

“Russia’s economy has pulled out of recession and growth in the coming quarters will be stronger than most anticipate,” the research firm writes, adding that its central bank’s loosening of monetary policy should support the recovery even further.

To be sure, the region faces strong headwinds, including a rapidly aging population and the loss of an estimated 20 million skilled workers to foreign markets over the past 25 years, according to a July 11 presentation from the International Monetary Fund (IMF).

But I believe that as conditions in central emerging Europe countries continue to improve, many of those workers will be returning home. Life in the region is not the same as it was 10 or 20 years ago, when good jobs might have been scarce. Firms are now growing at a healthy rate and hiring more workers. As you can see below, unemployment rates in Poland, Hungary and the Czech Republic have been falling steadily since at least 2012 and are now lower than the broader European Union.

emerging europe countries hard at work
click to enlarge

This strength is reflected in emerging Europe’s capital markets. For the 12-month period as of July 12, Hungary’s Budapest Stock Exchange is up 38 percent. Poland’s WIG20 is up more than 43 percent. Meanwhile, the STOXX Europe 600 Index—which includes some of the largest Western European companies—has made gains of only 17 percent over the same period.

Markets Still Believe in Trump

As we all know, the mainstream media’s criticism and ire aren’t reserved for China alone. Ninety-nine percent of the media right now is against President Trump, for a number of reasons—some of them deserved, some of them not.

Markets, however, seem not to care what the media or polls have to say. The Dow Jones Industrial Average continues to hit new all-time highs. Even though it’s stalled a few times, the “Trump rally” appears to be in full-speed-ahead mode, more than eight months after the election.

Back in November, I wrote about one of my favorite books, James Surowiecki’s The Wisdom of Crowds, which argues that large groups of people will nearly always be smarter and better at making predictions than an “elite” few. Surowiecki’s ideas were vindicated last year when investors accurately predicted Trump’s election, with markets turning negative between July 31 and October 31.

For the same reason, I think it’s important we pay close attention to what markets are forecasting today.

The White House is under siege on multiple fronts, which, as I said, has been positive for gold’s Fear Trade. But equity investors also seem to like the direction Trump is taking, whether it’s pushing for tax reform and deregulation or shaking up the “beltway party,” composed of deeply entrenched D.C. lobbyists and career bureaucrats. Just last week, the president made waves for firing a number of bureaucrats at the Department of Veteran Affairs (VA), long plagued by scandal and controversy. Since he took office in January, Trump has told more than 500 VA workers “You’re fired!”

The Fundamentals of “Quantamental”

Of course, we look at so much more than government policy when making investment decisions. We take a blended approach of not only assessing fundamentals such as market share and returns on capital but also conducting quantitative analysis.

It’s this combination that some in the industry are calling “quantamental” investing. At first glance, “quantamental” might sound like nothing more than cute wordplay—not unlike “labsky,” “bullmation” and other clever names we give mixed-breed dogs—but it’s rapidly replacing traditional investment strategies at the institutional level.

Business Insider puts it in simple terms: “Quantamental managers combine the bottom-up stock-picking skills of fundamental investors with the use of computing power and big-data sets to test their hypotheses.”

See my Vancouver Investment Conference presentation, “What’s Driving Gold: The Invasion of the Quants,” to learn more about how we use quantitative analysis, machine learning and data mining.

Wall Street: The Birthplace of American Capitalism and Government

moments after closing bell june 29

The concept of quantamentals helps explain our entry into smart-factor ETFs. As most of you already know, members of my team and I visited the New York Stock Exchange (NYSE) three weeks ago to mark the launch of our latest ETF.

While there, Doug Yones, head of exchange-traded products at the NYSE, gave us a short history lesson about the exchange and surrounding area.

Most investors are aware that the NYSE, which is celebrating its 225th anniversary this year, is the epicenter of capitalism—not just in the U.S. but also globally.

moments after closing bell june 29

What many people might not realize is that on the site where the exchange now stands, Alexander Hamilton, the first U.S. treasury secretary, floated bonds to replace the debt the nascent country had incurred during the Revolutionary War.

Right next door to the NYSE is Federal Hall, where George Washington took his first oath of office in April 1789. The building today serves as a museum and memorial to the first U.S. president, whose statue now looks out over Wall Street and its passersby.

In this one single block of Wall Street, therefore, American capitalism and government were born. Here you can find the essential DNA of the American experiment, which, over the many years, has fostered our entrepreneurial spirit to form capital and to create new businesses and jobs. Growth, innovation and competition run through our veins, and that’s largely because of the events that unfolded centuries ago at the NYSE and Federal Hall.

Gold and silver: Mood changing for the better

Gold Today –New York closed yesterday at $1,228.40. London opened at $1,230.00 today. 

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

         The $: € was weaker at $1.1457 after yesterday’s $1.1402: €1.

         The Dollar index was weak at 95.21 after Friday’s 95.75

         The Yen was stronger at 112.44 after Friday’s 113.03:$1. 

         The Yuan was stronger at 6.7704 after Friday’s 6.7821: $1. 

         The Pound Sterling was stronger at $1.30.66 after Friday’s $1.2927: £1.

Yuan Gold Fix
Trade Date     Contract Benchmark Price AM 1 gm Benchmark Price PM 1 gm
      2017    7    17

     2017    7    13           

     2017    7    12

SHAU

SHAU

SHAU

/

267.54

268.39

Trading at 270.30

267.99

268.58

$ equivalent 1oz at 0.995 fineness

@    $1: 6.7704

       $1: 6.7821

       $1: 6.7995     

  /

$1,221.97

$1,222.72

Trading at $1,236.77

$1,224.03

$1,223.59

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

 New York rose higher than Shanghai’s close on Friday, with a premium to Shanghai of $4.40 with London opening today at a discount to Shanghai’s trading today of $6.77, a marginally lower discount to Shanghai than we saw on Friday. We see this difference between London and New York because London is the western world’s center of physical dealing and New York a financial market not a physical gold market.

With the dollar weakening to dangerously low levels on the index, we are on the brink of a dollar ‘bear’ market  while, after  strong economic growth of 6.9% for the last month, the Yuan is strengthening [with a little help from the P.B. of C.] But the fall of the dollar is against all currencies.

Silver Today –Silver closed at $15.95 Friday after $15.92 at New York’s close Thursday.

LBMA price setting:  The LBMA gold price was set today at $1,229.85 from Friday’s $1,221.40.  The gold price in the euro was set at €1,072.70 after Friday’s €1.071.03.

Ahead of the opening of New York the gold price was trading at $1,234.85 and in the euro at €1,076.73. At the same time, the silver price was trading at $16.16. 

Price Drivers

At the moment gold continues to see a rebound after its fall from $1,250. We would expect more of that today. This is despite the ongoing selling from the SPDR gold ETF on Friday. What does this tell us about U.S. gold investors ‘net’ opinions? It tells us that the view of U.S. investors continues to see gold as falling after the rebound, but dealer’s opinions are different in the shorter term as they lifted prices higher.

The Fed

Janet Yellen’s comments Friday were followed by the publication of the latest CPI numbers which showed that the belief that the poor data, issued on Friday, which led the Fed to say it was a temporary setback, looks like turning out to be more permanent. With this in mind and indeed if this proves to be so, we may not see another rate hike in 2017. Equity markets have not yet discounted this, but it is being reflected in the dollar’s exchange rate. Once it is factored in, we expect more ‘bubble’ rises in U.S. equities [albeit against better earnings results from the corporate sector] as the prospect of better yields in these markets, for much longer, attracts funds.

ECB

Meanwhile the markets are discounting an earlier unwinding of stimulus from the E.C.B. boosting prospects in Europe likely ahead of those we see in the U.S.

We see all of the above as a changing of the mood in financial markets. The dollar is getting to dangerous levels in its weakness, as Chinese demand rises alongside a robust economy continuously bringing the new rich into the gold market on an ongoing basis.  Expectations in the E.U. and China are getting stronger [for the euro as well] and are getting weaker in the U.S.A. They are now affecting foreign exchange markets directly and, by extension, the gold market. You saw the strength of the euro reflected in the earlier, almost unchanged euro gold price. But ahead of the opening of New York, we saw the euro gold price begin to rise too.

We are around six weeks away from the start of the ‘gold season’ so the time in which the bears can attack is reducing by the day.

Gold ETFs

Friday saw sales of 3.549 tonnes from the SPDR gold ETF but no change in  the holdings of the Gold Trust. The SPDR gold ETF and Gold Trust holdings are at 828.842 tonnes and at 211.41 tonnes respectively.

Since January 6th 2017 27.838 tonnes have been added to the SPDR gold ETF and the Gold Trust.

Julian D.W. Phillips 

GoldForecaster.com | StockBridge Management Alliance