Lift-Off Not (Yet) - Precious Metals Supply And Demand

June 19, 2018

Wrong-Way Event

Last week we said something that turned out to be prescient:

This is not an environment for a Lift Off Event.

An unfortunate technical mishap interrupted the latest moon-flight of the gold rocket. Fear not true believers, a few positive tracks were left behind. [PT]

The price of gold didn't move much Mon-Thu last week, though the price of silver did seem to be blasting off. Then on Friday, it reversed hard. We will provide a forensic look at the intraday action on Friday, and our usual picture of the gold and silver fundamentals. But first, here is the chart of the prices of gold and silver.

Gold and silver priced in USD, as of the end of last week

Next, this is a graph of the gold price measured in silver, otherwise known as the gold to silver ratio (see here for an explanation of bid and offer prices for the ratio). It fell most of this week, recovering to unchanged by market close on Friday.

Gold-silver ratio, bid and offer

Here is the gold graph showing gold basis, co-basis and the price of the dollar in terms of gold price.

Gold basis, co-basis and the USD priced in milligrams of gold

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Keith WeinerDr. Keith Weiner is the CEO of Monetary Metals and the president of the Gold Standard Institute USA.  Keith is a leading authority in the areas of gold, money, and credit and has made important contributions to the development of trading techniques founded upon the analysis of bid-ask spreads.  Keith is a sought after speaker and regularly writes on economics.  He is an Objectivist, and has his PhD from the New Austrian School of Economics.  His website is www.monetary-metals.com.

Due primarily to the California Gold Rush, San Francisco’s population exploded from 1,000 to 100,000 in only two years.