Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
Stock Market Dow Long-term Trend Analysis - 16th Oct 19
This Is Not a Money Printing Press - 16th Oct 19
Online Casino Operator LeoVegas is Optimistic about the Future - 16th Oct 19
Stock Market Dow Elliott Wave Analysis Forecast - Video - 16th Oct 19
$100 Silver Has Come And Gone - 16th Oct 19
Stock Market Roll Over Risk to New highs in S&P 500 - 16th Oct 19
10 Best Trading Schools and Courses for Students - 16th Oct 19
Dow Stock Market Short-term Trend Analysis - 15th Oct 19
The Many Aligning Signals in Gold - 15th Oct 19
Market Action Suggests Downside in Precious Metals - 15th Oct 19
US Major Stock Market Indexes Retest Critical Price Channel Resistance - 15th Oct 19
“Baghad Jerome” Powell Denies the Fed Is Using Financial Crisis Tools - 15th Oct 19
British Pound GBP Trend Analysis - 14th Oct 19
A Guide to Financing Your Next Car - 14th Oct 19
America's Ruling Class - Underestimating Them & Overestimating Us - 14th Oct 19
Stock Market Range Bound - 14th Oct 19
Gold, Silver Bonds - Inflation in the Offing? - 14th Oct 19
East-West Trade War: Never Take a Knife to a Gunfight - 14th Oct 19
Consider Precious Metals for Insurance First, Profit Second... - 14th Oct 19
Stock Market Dow Elliott Wave Analysis Forecast - 13th Oct 19
The Most Successful IPOs Have This One Thing in Common - 13th Oct 19
Precious Metals & Stock Market VIX Are Set To Launch Dramatically Higher - 13th Oct 19
Discovery Sport EGR Valve Gasket Problems - Land Rover Dealer Fix - 13th Oct 19
Stock Market US Presidential Cycle - Video - 12th Oct 19
Social Security Is Screwing Millennials - 12th Oct 19
Gold Gifts Traders With Another Rotation Below $1500 - 12th Oct 19
US Dollar Index Trend Analysis - 11th Oct 19
China Golden Week Sales Exceed Expectations - 11th Oct 19
Stock Market Short-term Consolidation Does Not change Secular Bullish Trend - 11th Oct 19
The Allure of Upswings in Silver Mining Stocks - 11th Oct 19
US Housing Market 2018-2019 and 2006-2007: Similarities & Differences - 11th Oct 19
Now Is the Time to Load Up on 5G Stocks - 11th Oct 19
Why the Law Can’t Protect Your Money - 11th Oct 19
Will Miami be the First U.S. Real Estate Bubble to Burst? - 11th Oct 19
How Online Casinos Maximise Profits - 11th Oct 19
3 Tips for Picking Junior Gold Stocks - 10th Oct 19
How Does Inflation Affect Exchange Rates? - 10th Oct 19
This Is the Best Time to Load Up on These 3 Value Stocks - 10th Oct 19
What Makes this Gold Market Rally Different From All Others - 10th Oct 19
Stock Market US Presidential Cycle - 9th Oct 19
The IPO Market Is Nowhere Near a Bubble - 9th Oct 19
US Stock Markets Trade Sideways – Waiting on News/Guidance  - 9th Oct 19
Amazon Selling Fake Hard Drives - 4tb WD Blue - How to Check Your Drive is Genuine  - 9th Oct 19
Whatever Happened to Philippines Debt Slavery?  - 9th Oct 19
Gold in the Negative Real Interest Rates Environment - 9th Oct 19
The Later United States Empire - 9th Oct 19
Gold It’s All About Real Interest Rates Not the US Dollar - 8th Oct 19
A Trump Impeachment Would Cause The Stock Market To Rally - 8th Oct 19
The Benefits of Applying for Online Loans - 8th Oct 19
Is There Life Left In Cannabis - 8th Oct 19
Yield Curve Inversion Current State - 7th Oct 19

Market Oracle FREE Newsletter

Stock Market Trend Forecast Oct - Dec 2019 by Nadeem Walayat

Gold ETFs Shrink as New Platinum, Palladium Funds Draw Aggressive Buying

Commodities / Gold and Silver 2010 Jan 18, 2010 - 08:07 AM GMT

By: Adrian_Ash


Best Financial Markets Analysis ArticleTHE GOLD PRICE ticked higher for US and Euro investors early Monday but held inside a tight range while Asian stock markets closed the day 1% lower and European shares rose.

Little economic news was due for release as US markets stayed closed for Martin Luther King Day.

Government bonds were flat across the board. Commodity prices dropped 1% on average, as crude oil held below $79 per barrel and foodstuffs fell.

"Gold and silver were driven up by platinum and palladium," says one Tokyo dealer of the overnight action, noting "aggressive buying" of platinum-group metals after last week's launch of exchange-traded PGM products for US investors.

Attracting $100 million on their first day, ETF Securities' new "physically backed" platinum and palladium funds – which waited 8 months for regulatory approval – are "almost like a warehouse receipt" according to founder and chairman Graham Tuckwell in an interview with

"I am hearing of US and European dealers buying these metals but I haven't seen Chinese buyers," said Standard Bank's Yuichi Ikemizu in Tokyo, speaking to Reuters.

Compared to current demand for gold ETFs, "The outlook for platinum and palladium looks quite bullish," he added.

New York's SPDR Gold Trust, the world's largest gold ETF, has reduced the volume of gold backing its shares by 1.9% so far in 2010 – some 20 tonnes.

"Private investors have remained on the side-lines in the first [few] days of 2010," says Wolfgang Wrzesniok-Rossbach in his Precious Metals Weekly for German refining group Heraeus.

"Although there is demand from this sector, it is at a relatively low level. Additionally, in Europe as well as the Far East, increased supplies from scrap-gold came to the market, which is probably why gold today is 2% below its year's high."

Speculative traders playing gold futures and options on New York's Comex exchange last week increased their "net long" to the equivalent of 945 tonnes, the largest level since the start of December and 2.6% greater from the week before.

The total "open interest" in Comex gold contracts grew by 2.5%, as did the gold price over the same period.

"Considerable amounts of cash have been funneled into speculative gold trading and not created any physical value for the economy," said the State Bank of Vietnam last week.

"This [money] should have been invested in more productive activities."

Some $108 million in commercial Vietnamese bank lending has gone into gold derivatives, the Vietnam Investment Review estimates.

The government in Hanoi has ordered all leveraged gold markets be shut by March 31st. The typical position across Vietnam's twenty gold futures markets is leveraged 13 times over, local press report.

Today the Banking Regulatory Commission in China – now the world's largest private consumer of physical gold – warned the country's commercial banks to improve their risk controls, targeting new lending to the "real economy" after credit supplies swelled by 32% in 2009.

"Banks should pay high attention to changes in the property market and strictly implement relevant credit policies to enhance supervision...of property loans," the CBRC says in an official statement.

Back in Europe, the government of Iceland may collapse according to ratings-agency Standard & Poor's, after the president vetoed repayment of $5.5 billion owed to Dutch and UK bank depositors earlier this month.

"The risk is there that the [International Monetary Fund's $4.6bn loan] will fall apart and with that, the downside risks would increase very considerably," said S&P's managing director for Europe, the Middle East and Africa, to Bloomberg by phone.

Across Western Europe, withdrawing the massive central-bank and fiscal stimuli of 2008-2009 may prove "more difficult than the crisis itself," according to a report from Moody's Investors Service, warning that much of the Eurozone will not return to pre-crisis growth rates.

"Greece faces a problem which is endemic through [the Eurozone]," says Standard Bank strategist Steven Barrow today. "Namely that without enough fiscal, monetary and exchange rate levers to pull in times of crisis, the gap between the stronger nations and the weaker ones just keeps on increasing.

"The consequence of this that the economic convergence, that was required for countries to be a part of [the monetary union], gets destroyed."

Gold jewelry exports from Italy – the world's third largest fabricator after China and India – fell 20% by value in 2009, leading industry figures said this weekend at the country's top jewelry fair, the VicenzaOro First which opened and Saturday and runs until Thursday.

"The 'mini recovery' that the markets are revealing is uncertain and its real consistency and duration are today still unknown," said Roberto Ditri, the Fair's new president, in his opening speech.

"The only certainty is the tangible recovery in some market areas: China, India and Brazil have got off again to a decisive start. But it is not automatic that they will trigger an equally strong recovery in other economies.

"In this context, the jewelry sector must react and it must be supported to do so."

Consolidation amongst Italy's jewelry producers continues apace, says, with major player Rosato buying another privately-held fabricator, Calgaro, last week.

By Adrian Ash

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
Formerly City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2010

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

(c) BullionVault 2010

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules