17 January 2014

NAV Premiums of Certain Precious Metal Trusts and Funds - 'Someone Will Be Bleeding'

As a reminder the US will have a three day weekend, with the observance of Martin Luther King Day on Monday.

The rest of the world must try and carry on without its guidance.

There was some commentary about the thinness of gold available for delivery on the Comex on the Business News Network today.  There was an interesting discussion of the divergence between 'paper gold' and 'physical gold' as well.

As the news anchor noted, 'someone will be bleeding' if too many people stand for delivery in February, and prices do not incent the addition of more gold to the market.   I have no doubt that the gold cartel and the Comex will actively prevent any such pain to their own.  Assuming of course, one knows who 'their own' are these days.

This market structure seems to be dominated by big holders and bag holders.

And as a reminder, those who held their gold and silver in third party and unallocated claims through MF Global learned a lesson about fiduciary trust, guarantees, and the rule of law the hard way.