The continuing flow of gold from West to East alone could see serious shortages of physical metal develop in the West and this, together with other potentially positive factors could have a huge impact on the market.
Author: Lawrence Williams
Posted: Wednesday , 29 Jan 2014
LONDON (MINEWEB) -
Maybe we are building too much reliance on this, but it does seem that the rundown in stocks of physical gold in the West and the build-up, for the most part, into stronger hands in the East, has to lead to a severe supply imbalance in the availability of gold bullion. If this flow continues at anything like the current rate – and there’s no evidence yet that it is slowing significantly – then the ensuing short squeeze on physical gold could be devastating for that part of the gold trade which is heavily short gold.
Chinese demand alone seems to be running at somewhere close to the global total of newly mined gold. Gold which can be sourced from the big gold ETFs, assuming there are still any willing sellers ...