More on PAGE

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Sat, Sep 10, 2011 - 11:50am

Market action this week only further demonstrated the need for a new, global pricing mechanism for physical gold and silver. As stated by Ned Naylor-Leyland, the current system allows the "futures tail to wag the spot dog". I believe this collusive, manipulative nonsense will soon come to an end with the introduction of the Pan Asia Gold Exchange later this year. If you haven't already, please go back and read this before you continue:

https://www.tfmetalsreport.com/blog/2256/page-turning

After writing the note above, I was placed in contact with a very important gentleman through the serendipitous intervention of an internationally-connected Turdite. He asked if I'd "like to speak with one of the guys responsible for setting up the PAGE". I, of course, said "YES!".

Graham Newall of Power Capital Global was recently appointed Senior Vice President of the PAGE. Below is the complete text of the questions I submitted to him last week. Graham's responses are printed in capital letters, directly below each question. I hope that all Turdites find this information helpful in developing an understanding and appreciation of the impact the PAGE will have on the global precious metals markets in the years to come.

Hello, Graham. I hope you've had a nice weekend. I am looking for some fireworks when trading resumes on the Globex this evening at 6:00 NY time. It certainly appears that this will be another interesting week.
Thanks again for allowing me the opportunity to visit with you. I am very much looking forward to seeing the impact the PAGE will have on the international spot metals markets. I firmly believe that the LBMA/Comex/BullionBank system is outdated and that the PAGE is going to usher in a new era of transparency in price discovery.
I have a short list of questions below. Would it be OK to present to my readers the list of my questions with your answers? My hope is to continue to draw international attention to the PAGE and present it as a viable alternative to the LBMA status quo.


1) Graham, can you please describe your role and the role of PCG in building and/or managing the PAGE?

I HAVE BEEN APPOINTED SENIOR VICE PRESIDENT OF THE PAN ASIA GOLD EXCHANGE RESPONSIBLE FOR STRATEGY AND REPRESENTING THE EXCHANGE INTERNATIONALLY . POWER CAPITAL WILL BE THE FIRST MARKET MAKER IN THIS CONTRACT



2) PAGE is already trading a 10-ounce gold contract. Are there plans to issue a silver contract, as well?

THE 10OZ DEFERRED SETTLEMENT WILL START TRADING SHORTLY OF THE MOON FESTIVAL THIS MONTH. THE SILVER CONTRACT IS PLANNED FOR LATE 4TH QUARTER 2011


3) I understand that Chinese citizens can buy the 10-ounce contract through the Agricultural Bank of China. Do global retail and/or institutional investors have the same access to this contract? If not, will this access be allowed in the future?

CHINESE CITIZENS ARE REQUIRED TO LODGE MARGIN IN AN ACCOUNT WITH AGRICULTURAL BANK OF CHINA AND TRADE DIRECTLY WITH THE MARKET MAKER ONLINE. GLOBAL RETAIL/INSTITUTIONAL INVESTORS MAY TRADE THROUGH THE MARKET MAKERS APPROVED BROKER IN HONG KONG DETAILS OF WHICH WILL BE RELEASED SHORTLY



4) Many are anxiously awaiting the PAGE to begin trading their 90-day, rolling spot gold contract. Several questions here:
a) What are the key differences between the 10-ounce contract and the spot contract?

THE 10OZ CONTRACT ROLLS EVERYDAY AND IS A MARGINED TRADE. THE 90 DAY CONTRACT IS A RECEIPT FOR A PHYSICAL BAR OF GOLD WHICH WILL BE FULLY FUNDED AND ON MATURITY CAN BE "ROLLED" AND ANOTHER RECEIPT ISSUED OR EXCHANGED FOR THE PHYSICAL GOLD.

b) What is your best estimate for the date trading will begin?

I BELIEVE THAT THE CONTRACT WILL BEGIN TRADING IN EARLY DECEMBER

c) What regulations are in place to ensure 1:1 allocation of the gold behind the contract? Is the Chinese government the supplier of the physical inventory behind the exchange?

THE GOLD WILL BE HELD IN TRUST BY AN EXTERNAL ADMINISTRATOR WITH A CHINESE BANK REGULATED BY THE PEOPLES BANK OF CHINA ACTING AS TRUSTEE ENSURING THAT THE REQUIRED 1:1 ALLOCATION IS MET AT ALL TIMES

d) I imagine that global, institutional investors will be allowed to buy the contract. Will global retail be available?

AS THE PRICE OF GOLD APPRECIATES THE CASH REQUIREMENT WILL PROVE PROHIBITIVE FOR MOST RETAIL INVESTORS MAKING A MICRO CONTRACT TRADING ALONG SIDE THE MAIN CONTRACT A PRACTICAL NECESSITY IN MUCH THE SAME WAY AS THE COMEX MICRO CONTRACT.

e) Can a global investor take physical delivery or must the gold be stored in China?

THE TRUST WILL HOLD GOLD STORED IN APPROVED VAULTS WORLDWIDE

f) Are there plans to issue a similar silver contract?

NOT AT THIS STAGE



5) This also seems to be a conduit through which the Chinese government is allowing the global distribution of renminbi. For example, if I buy gold in London for $ and sell it on PAGE, do I receive renminbi for my gold?

THE PROVINCE OF YUNNAN HAS BEEN DESIGNATED AS A FREE TRADE ZONE OF RMB. THE RECEIPT MATURES IN RMB.



Again, Graham, thanks in advance for any assistance you can provide. My readers and I greatly value your input. TF

I HOPE THIS IS USEFUL PLEASE EMAIL ME ANY TIME IF YOU HAVE FURTHER QUESTIONS - I WILL KEEP YOU INFORMED AS THE FINAL DETAILS ARE WORKED OUT.
Best regards
Graham


​Out of respect for Graham's time, I'd tried to keep the list of questions relatively short. However, as you can see, Graham has graciously offered to answer follow-up questions, as well. Again, I will not inundate him but, dear reader, if you have a burning question for Graham, please include it in the comments below and I will pass a few along to Graham early next week.

Thanks again to Graham and all Turdites everywhere for your contributions to TFMR!

TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  278 Comments

austrian12874 Stormdancer
Sep 10, 2011 - 2:31pm

@stormdancer

If the PAGE contract for silver is margined and speculative with no physical delivery, then how different is this silver PAGE contract compared to the comex silver contract? With the recent price action of silver compared to gold these days, would it not be safe to assume that gold will outperform silver if gold experiences true price discovery due to gold being allocated on PAGE (but silver not being allocated). If gold takes off, there is no guarantee that silver will take off in it's footsteps. WTF. What is going on? I really fuckin hope I didn't buy the wrong metal. I have 7100 ounces of silver at 33.

Stormdancer L13
Sep 10, 2011 - 2:32pm

@ Leeroy "Once all wheels are turning"

Combine your post with Silver Wealth's "beginning of the end" and I think we've defined the battlefield. And I don't see how LBMA and the rest of the gold cartel can afford to let this first shot go unanswered.

As far as the trust issue goes, I think the Chinese can be trusted to serve their own interests...period...by hook or crook. The question isn't can you trust them, but which do you trust more, LBMA or PAGE.

Once those other depositories for PAGE are set up in international gold hubs, I wonder how much "official" or even institutional gold will be moved "across the street".

It won't take much of that movement to blow LBMA wide freakin' open.....

exiledbear
Sep 10, 2011 - 2:35pm

The bullion coin market is different

Most of the coin dealers use the spot price discovery to make their bid-ask spreads, but they don't strictly have to do that. I suspect it's mostly a convenience for them - price discovery is hard work :P Most coin dealers may not have a choice though - their workload is only going to go up from here.

I suppose you can use Ebay as a means of price discovery too, although it's not a very convenient way of doing that. There's no real way to query Ebay for the prices that coins settled for.

If PAGE lives up to its promises, it will act to keep the other exchanges more honest. It depends on if the gold you get from delivery on the COMEX can be sold into the PAGE or if gold from the PAGE can be used as backing for selling contracts in the western world. If that's the case, the arbs will be all over this like white on rice.

If not, they're more or less going to live in parallel universes, not really affecting the other except for the price quotes. If that's the case, you'll see wide discrepancies occasionally between the two until the spread gets wide enough for someone to arb it back into sync.

meegoreng1
Sep 10, 2011 - 2:43pm

Thank you Turd!

Thanks Turd for the info that you pour out in here. I look forward to your updates regularly. In this 'upside down' world we live in, this kind of TA and news is vital so we can make wise decisions on our investments. It's great to know that while you share the TA, you base your fundamentals on that fact that our markets (including gold and silver) are rigged by the EE.

While I am disappointed to hear your view of 911, I understand your position to state the way you want to in public.

THANKS TURD! You're AWESOME!

Stormdancer
Sep 10, 2011 - 2:56pm

@austrian12874

Friend, I don't believe you have a thing in the world to worry about. Right now, it appears to me that they don't intend to deliver silver becuase it's too precious and too hard to get in quantity. I believe ANY silver china gets within its' borders is going to be hoarded with a fervor that would make Scrooge blush. They're not going to stir that pot just yet because the physical silver market is already so tight you couldn't drive a ten-penny nail up its' butt with a sledgehammer.

Silver, with a few historical exceptions has always traded like gold's red-headed step-sister. But we're nearing a juncture where silver will begin to trade on its' own fundamentals. And those are more bullish than any time in human history. It won't last forever, but I guarantee you when gold takes off silver will not be far behind. And once it hits its' stride the percentage gains in silver will beggar those of gold.

UNLESS! Gold is actually tapped to serve as backing for some new currency. In that case forget the moon for gold and start thinking intergalactic. Silver's gains might not be more than interstellar :)

Either way, silver is going to do just fine....

Edit: I forgot to answer the first part of your question. If I'm correct about silver delivery (lack of it on PAGE), there won't be a whole lot of difference between a PAGE margin contract and a COMEX or HKMEx contract except size. Which is exactly what they want if my thinking is correct. This contract will be valued in a range that a couple hundred million people INSIDE China can afford. If the margined contract is backed by an unallocated pool of metal, all the Chinese are doing is mobilizing hundreds of millions of renmimbi in private capital to be used to chase real silver in the global market, bringing that silver into the eternal control of the PRC because none of it will be delivered to the speculators.

Just my early reading on incomplete info....clarity will come as rules are released..

Edit II: The gold contracts....now those are a completely different animal. The margin contract is NOT the same as a pure futures contract because it's price at PAGE will be determined by the deliverable contract. Being roped securely to deliverable (spot) gold makes all the difference in the world as compared to COMEX which ropes LBMA gold prices to the PAPER price.

FogHorn LegHorn
Sep 10, 2011 - 2:57pm

PAGE

I look forward to PAGE, because it alters the status quo, the too close, too often, self serving relationship of the bullion banks and the exchanges. The foxes, gaurding the hen house! The current set up allows, a "thumb on the roulette wheel." Anything that removes that "thumbs pressure", is Ok in my book. PAGE, will add competition to the Anglo/American exchanges, and offer RMB exposure to retail investors. The ongoing accumulation of gold tonnage by China, seems to make the exposure to RMB intriguing, notwithstanding political risks. AT the very least, it will make price discovery less dependant on the bullion banks and J Dymon's paycheck will decrease. The latter makes Me smile, well worth the PAGEs creation costs.

Much4Him
Sep 10, 2011 - 3:04pm

Are there plans to issue a similar silver contract?

Q: Are there plans to issue a similar silver contract?

A: NOT AT THIS STAGE

I am curious as to why it is they haven't considered this. Would it be too popular too quickly?

Bay of Pigs
Sep 10, 2011 - 3:10pm

This is fantastic news

Great post Turd. It seems that since the GATA conference in London that things are really heating up. That Ned Naylor-Leyland interview with Turk was something else. PAGE could be the game changer we've been looking for.

After all these years of watching JPM and others pervert and distort the PM markets, I couldn't be happier to see the fraud and corruption finally getting exposed for what it is.

There was a time when very few were listening to the Tin Foil Hatted Conspiracy Nuts. ;o)

Times have indeed changed. Our numbers are growing and Turd Ferguson's loyal Army of Turdites will be a force to be reckoned with. Congrats to our leader/hero. You da man!

ReachWest
Sep 10, 2011 - 3:11pm

1:1 Allocation is the Key

From my limited understanding and perspective, the key to this PAGE thing is the 1:1 allocation​ and the ultimate price discovery that will result.

We know that the COMEX and LBMA do not have 1:1 - at best, they may have 100:1 (i.e. each ounce of PM in a contract is only backed by 1/100 oz of actual PM). So if there is a new exchange, such as PAGE, that actually offers a true 1:1, then the value of a contract on that exchange is necessarily going to be much higher than a contract on the COMEX or LBMA with the 100:1 allocation. Ultimately futures players are going to want to gravitate to the 1:1 exchange because if the "music stops" they stand a better chance of actually holding real metal.

This is from my limited understanding as a pure stacker. Let me know if I'm out to lunch.

Gramp
Sep 10, 2011 - 3:16pm

From the Peanut Gallery...

Yup that's me!

Anyway, as for the P.A.G.E., competition is a Healthy thing right!

Americans will have access to the PAGE?

On another note, Asian markets have added strong buying competition to several types of US seafoods, boosting prices.

Markets truly are Global now.

Canadub
Sep 10, 2011 - 3:19pm

@exiledbear

"There's no real way to query Ebay for the prices that coins settled for."

Please forgive me if your referring to an automated software solution that query's all the results and spits out an average using specified parameters, but there is an easy way to see what price each auction settles for... Simply click on "advanced search", check the "completed listings only" checkbox, then search your subject. All the final sale prices are listed in green, unsold listed in red.

I defiantly think ebay is a legitimate price discovery mechanism for the coin market. It's more or less the only "free market" for price discovery left, because its actually what one individual is willing to pay another for a product, period. No leverage, no futures, no BS. What will you pay me for my product, right now. Just like the good old days (or so i've heard).

Haole
Sep 10, 2011 - 3:19pm

@Much4Him

Being just your average dummy, I'd suspect that they know they can't get their hands on enough physical silver to make a market of it and if they could why would they want to trade it unless they can create a fractional reserve scam out of it like COMEX, SLV, JPM, etc? They'd rather put it into solar, etc... Infrastructure and technology, hoarding in general. I think the Chinese realize what a critical metal silver is to their future prosperity whereas gold is primarily just a monetary metal.

Moral of the story I guess is keep buying metal at whatever the price and welcome the RMB as the new global reserve currency, or a large constituent of it. Nigeria selling oil for RMB, Russia selling oil for RMB... Hmmm. ;)

Great thread, thanks Turd et al!

alpha monkey austrian12874
Sep 10, 2011 - 3:23pm

@austrian12874

WTF. What is going on? I really fuckin hope I didn't buy the wrong metal. I have 7100 ounces of silver at 33.

It's not too late to exchange it. I was trying to hold my silver in the hopes of a better G:S ratio, but I kept watching it separate and decided what I read on FOFOA and The Gold Trail had more validity than I thought. So, I went all in on gold and haven't looked back.

Even Max Keiser doesn't sing the praises of silver as much, his tone has changed from "Gold is too Expensive!" to "Gold is going waaay up in price!"

So, yeah.

FogHorn LegHorn ReachWest
Sep 10, 2011 - 3:39pm

@reachwest 1:1 allocation @Gramp

I think You cut to the chase with that point. The gold will be allocated in 10 ounce bars and be deliverable, according to Richard Poulden the private investor Turk interviews on PAGE. The private investor RP said Q1 2012 his company will allow access to other countries. US investors can invest in nonmargined deliverable within 28 days settlement contacts by law if I recall. If I were a PAGE creator, I would try to make policy to allow US retail investors elligable.

NW VIEW
Sep 10, 2011 - 3:40pm

More On China

What is wrong with just stacking your own as has been written on for decades??? Is the gold that they will pile for you behind the Great Wall more secure than in your hiding place? Will their gold be more valuable than ours? China is slurping up all of the mines from around the world ASAP including rare earths ( we know that - look at RSA). It appears that they keep the P.M. within their country. Has anyone seen a major exporter of gold from China??? I can see that the investment community is really jumping into this new Eastern way of buying P.M.'s. I'll wait and see if Mr. Ponzi and Mr. Madoff are on their board of directors. How quickly we forget the history of nations. It is almost as if they have come to the place where they will help out the investors of the world because of their benevolent change toward mankind. Sorry to be negative, but General Custer should have evaluated the ways and strengths of the Indian Nation before he jumped in so quickly. jmo

Fulgurite
Sep 10, 2011 - 3:47pm

Contrarian

Just to offer a bit of a contrarian point of view here, but what if the Chinese merely want to copy/paste the Western currency manipulation system with PAGE?

I'm frequently in China for work, and so far I am NOT very impressed with Chinese ingenuity with regards to problem solving. As a matter of fact, the Chinese SUCK at problem solving.

They need a textbook, manuals and procedures for just about EVERYTHING. Once they lack the correct textbooks, manuals and procedures, things quickly go array and end up in a huge 'face saving' excercise.

Just by the sheer numbers and volume, China has been very successful in setting up an export based economy (which is still very poor and primitive by Western standards) by merely copying western ideas and products (either legally or by actively counterfeiting them) so I'm just wondering if we're not giving them too much credit...

Why would the Chinese go through the trouble of setting up a gold, silver, commodity backed RMB, when they might just as well initially copy the Bretton Woods system, which they then later can give up (als Nixon) once they have established the RMB as the reserve currency?

PAGE is IMHO just there so that the Chinese can also join the club of superpowers who can manipulate gold and silver prices for when a (partially?) gold/silver backed RMI is the world's reserve currency.

Bracing for incoming... ;-)

austrian12874
Sep 10, 2011 - 3:49pm

should i change my silver for gold?

I bought into the hype of silver going to 500. But the manipulation in silver has shown the negatives of holding silver in such a thin market like silver. I think i will wait 4 more years or silver 120.....whichever comes first. Any thoughts?

¤
Sep 10, 2011 - 3:54pm

More doors swinging open for TF

Excellent post as usual!

That's a huge coupe' in getting the low down on PAGE right from the source.

I wrote a post a few weeks ago on the subject of TF's industry stature becoming so much larger then he may have ever thought possible. Or maybe even bigger then he ever wanted it to be.

Some thing's are bigger then the person themselves, and destiny takes care of the rest.

More doors are getting ready to swing open for our TF imho.

If TF was a PM stock he would be the "sleeper " junior that already produces large nuggets on a daily basis with the tip of the mother-lode barely exposed. He's about to become the next big thing during this unprecedented PM frenzy that's going to happen. Every man leaves his mark during periods of high drama or action. I'm pretty sure this lead up to the PM's exploding will be one of those periods.

I'm pretty sure at some point that TF is going to give us a thread or post from Tanzania while he is checking out Santa's Tanzanian Royalty Exploration (TRX). That's what I see.

What do you think TF, sound good to you? Having a tall, cool one with Santa in Tanzania while he's showing you a piece of gold ore?

https://seekingalpha.com/article/289154-tanzanian-royalty-commences-dril...

Stormdancer
Sep 10, 2011 - 3:57pm

austrian12874 "should i change my silver for gold?"

You should do whatever allows you to sleep at night. I personally feel holding some of both gold and silver is wise. The two metals are NOT the same. Different end games will have differing effects on both, but in a worst case situation one will rise less than the other. Neither is going to hurt you.

If you think $500 silver is hype sell before you get there. Starting at $33 you're doing pretty well already. I've deeply studied the fundamentals of silver for quite a few years and I don't believe $500 is hype at all. There are scenarios where it won't make that, but many more where it will make or exceed that figure.

But, you have to deal with your comfort level as bounded by your knowledge. Keep increasing that knowledge and comfort levels may change :)

Biochar
Sep 10, 2011 - 4:11pm

By being non-manipulative/corrupt PAGE will

ensure itself a bigger and bigger piece of the action, the go-to exchange. Will need some time to establish a track record and credibility, but the way things seem to be speeding up globally, might not take too long.

@ austrian12874... the USGS sees silver as being one of the first metals to become "extinct" ~ a few of us here at TF think silver will achieve platinum level pricing 15-20 years from now because of its many industrial uses...

Silver has the highest electrical and thermal conductivity of all metals. Every computer, server, monitor, cell phone and switch must have silver. Lasers, satellites, solar panels, high-tech weaponry (tomahawk cruise missiles use 500 oz) and robotics, all require silver. Digital technology and telecommunications need silver. There's silver in every TV, washing machine, wall switch and refrigerator. Conductors, switches, contacts and fuses use silver because it does not corrode or cause overheating and fires. Silver is used heavily in photography and in prints. Batteries are now manufactured with silver alloys. Lead-free silver solder is used heavily for joining materials and producing leak-tight joints. Silver is also widely used in silk-screened circuit paths, membrane switches, electrically heated automobile windows, and adhesives.

Silver achieves the most brilliant polish of any metal and has the highest reflectivity of light of all the metals, allowing it to be used in mirrors and in coatings for glass, cellophane or metals. Double layers of silver on glass reflects away 95% of the hot rays of the sun. Silver has a variety of uses in pharmaceuticals as silver kills bacteria. Hospitals use silver coated devices in surgery to eliminate contamination and infection. Skin care products now use colloidal silver as it has been found to be a healing agent and disinfectant. Silver sulfadiazine is the most powerful compound for burn treatment. Catheters impregnated with silver eliminate bacteria. Silver is increasingly being tapped for water purification, silver ions used in pools and spas. To prevent growth of germs and fungus on surfaces silver ions are used in paints and coatings.

In the face of all these industrial uses there will be less silver available, plus, the unique properties of silver restrict its substitution in most applications. More silver will be used than can be produced. Despite established economies in recession/depression many areas of the earth will continue to modernize. Mining and recycling are falling short of providing the necessary silver and it will get more problematic.

¤
Sep 10, 2011 - 4:11pm

CA

Without getting into the mechanics of the physical and paper etc. on the new PAGE system and how it might differ (or not) from the current system.

I think above all else, the emotional or psychological belief aspect of it will be the biggest thing going. Total trust and faith was put into the USD after WWII on the premise/belief/hope/fear that we would keep our word and nothing more when you think about it.

If the USD is overtaken at some point by the Yuan it will be because a huge emotional or psychological breach of trust and confidence was shattered and exposed. The exact opposite might be felt or hoped or believed by everyone else in the future that China is "different" then the US was and that China will honor their currency or gold because they have so much and are willing to do so because they have the worlds largest reserves and have 1,000's of tonnes already stockpiled etc.

At some point if the USD collapses from a lack of trust or confidence then the alternative might be seen as very reliable just based on hope/fear and China's willingness to back their currency with their existing PM stockpiles. Not to mention everything they still have locked up within their boundaries that is still unearthed but a resource reserve nonetheless.

The country with the most credibility and a willingness to back their currency with 1,000's of tonnes of stockpiled PM's will end up being the reserve currency of the future.

It's the credibility and believability part that will count the most.

mezzrow
Sep 10, 2011 - 4:15pm

a hymn of praise to our host...

just substitute the magical words "Turd Ferguson" for "Ed Sullivan" Enjoy.

Great work, Turd. If you haven't done it lately, FEED THE TURD!

Bye Bye Birdie Ed Sullivan Original Broadway Recording
¤
Sep 10, 2011 - 4:17pm

(raising hand) My one burning question about PAGE

Is he aware of any Western Banks interfering in or trying to delay the start of PAGE, whether it be political pressure or uncooperative behavior, possibly even sabotage on some level?

FogHorn LegHorn Fulgurite
Sep 10, 2011 - 4:18pm

Inflation protection re contrarion

QE, the race to debase, exports inflation to all growing economies ie. all brics, gold promotion by China does two things, it protects Chinese savers holdings from rampant inflation and allows a decoupling of the RMB from the POSX. I would prefer by far trusting Our government to protect Us, a few more Ron Pauls, effective oversight of "Big Money", a sound money policy, would go a long way to solving what ails Us. Its pretty sad to have to rely on China to force these policies on Our Leaders. China is looking out for China, do I trust them, not so much, is PAGE going to let the air out of fractional reserve gold markets, Yes.

Woody Mornings Canadub
Sep 10, 2011 - 4:19pm

99% agree.....

"There's no real way to query Ebay for the prices that coins settled for."

Please forgive me if your referring to an automated software solution that query's all the results and spits out an average using specified parameters, but there is an easy way to see what price each auction settles for... Simply click on "advanced search", check the "completed listings only" checkbox, then search your subject. All the final sale prices are listed in green, unsold listed in red.

I defiantly think ebay is a legitimate price discovery mechanism for the coin market. It's more or less the only "free market" for price discovery left, because its actually what one individual is willing to pay another for a product, period. No leverage, no futures, no BS. What will you pay me for my product, right now. Just like the good old days (or so i've heard)."

.....as long as you factor in people tend to overpay due to the ebay bucks incentive.

austrian12874 ¤
Sep 10, 2011 - 4:21pm

stormdancer

i exclusively bought silver only to maximize my profits because i truly believe that silver will outperform gold. There was a fofoa blog article on may 7. the article seems to bash silver and now i seem to be having second thoughts about silver. Whats with that fofoa article.......any thoughts?6

Watcher
Sep 10, 2011 - 4:29pm

@NW View I agree. Those who

@NW View

I agree. Those who trust China will regret it in the end. Best to buy and stack your own. The good thing about PAGE is that it should increase the POG to its true dollar worth.

Ferd Torgerson
Sep 10, 2011 - 4:40pm

A Few Questions on PAGE

Having read a few articles on PAGE, read the answers to Turd’s questions and a few posts by some of the bright people on this page doesn’t make me an instant expert. But, I have a few concerns/questions of my own. Maybe I’m missing something but I don’t see this exchange being all that some believe it might be.

If I understand it, the mechanism won’t be useful to most retail traders outside of China. That suggests any foreign involvement will be mostly larger commercials and institutions that might play in this space. And, having already seen comments to the effect that this doesn’t look that different from the current COMEX scenario, what would be the benefit of playing?

Already, we have daily challenges regarding whether or not the actual gold and silver backing GLD and SLV are really in the London vaults as they should be. Under PAGE, the metals will apparently be dispersed across several depositories (worldwide?). Harvey Organ will have to hire several assistants just to TRY to keep track of the inventories across several vaults. How will contracts be tracked and reported on? How will CNBC know where to send Bob Pisani to look for the bars that are supposed to be in inventory? What will make this exchange immune from the same suspicions already leveled at the others?

Not trying to make light of this whole thing but I see PAGE as essentially nothing more than a means for China to scoop up the wages paid to their citizens making cheap goods for Wal-Mart and using those funds to chase PMs wherever they can find them. With the funds they collect from their citizens and any outsiders they draw into the exchange, they’ll be flush with funds to bid up the prices of PMs, to the disadvantage of citizens of other countries. With the different currencies coming in, they can choose which to use for their purchases at any one time, depending upon exchange rates. So, on the one hand, you’ll have the industrious citizens of China holding real money (gold and silver). Should the average citizens in other countries ever get wise to the need to hold PMs, they’ll be paying much higher prices in the debased currencies of their own countries.

That’s where we will get price discovery – people outside China will discover they can no longer afford the high prices of gold and silver. Vis-a-vis those of other countries, the citizens of China will evolve into the richest populace on earth.

I won’t feel insulted if anyone disagrees with my viewpoint as maybe I’m not seeing the whole picture. Many thanks for any well-thought out and polite comments.

Ferd

atarangi
Sep 10, 2011 - 4:46pm

The silver trend is your friend

Regarding silver versus gold. Don't get caught up in the popular misconception that gold is where the action is. Silver has been outperforming gold for years and the gap continues to widen in silvers favour. The numerous fundamentals supporting silver suggest that relative to gold, silver will continue to outperform at an ever increasing pace. Never forget " the trend is your friend". Don't let short term volatility shake you out. Also now is the time to turn away from all paper forms of silver ----- this whole thing could blow as soon as next year. When she blows all paper will turn to dust.

Bstone
Sep 10, 2011 - 4:47pm

Hey Turd!

Turd,

If I buy gold and silver (physical) and put it in a vault and start selling contracts for the amount I have in my vault, "can I start my own neighborhood exchange". You know how people have block parties, well I was thinking of hosting a Gold party in which I would sell (current) spot price contracts to all my neighbors, and use the fiat they give me to buy more for all of us and especially when we get the next dip and then we can all sit back and watch the banks collapse while all of us are stacking more and more gold.

A lot of details I am leaving out but neighborhood "gold parties" could be pretty interesting. Just think if 10% of developments in the nation started banding together to buy physical as a team and how well off you would be to protect each other in an economic collapse.

Just a thought. lol

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3/19 10:00 ET Factory Orders (Jan)
3/20 2:00 ET FOMC Fedlines
3/20 2:30 ET CGP presser
3/21 8:30 ET Philly Fed
3/22 9:45 ET Markit PMIs
3/22 10:00 ET Existing Home Sales
3/22 10:00 ET Wholesale Inventories (Jan)

Key Economic Events Week of 3/11

3/11 8:30 ET Retail Sales (Jan)
3/11 10:00 ET Business Inventories (Dec)
3/12 8:30 ET CPI (Feb)
3/13 8:30 ET Durable Goods (Jan)
3/13 8:30 ET PPI (Feb)
3/14 8:30 ET Import Prices (Feb)
3/14 10:00 ET New Home Sales (Jan)
3/15 8:30 ET Empire State Manu Index
3/15 9:15 ET Cap. Util. & Ind. Prod.

Key Economic Events Week of 3/4

3/5 9:45 ET Markit and ISM services PMIs
3/5 10:00 ET New home sales (Dec)
3/6 8:30 ET Trade Balance (Dec)
3/7 8:30 ET Productivity and Unit Labor Costs
3/8 8:30 ET BLSBS
3/8 8:30 ET Housing starts (Jan)

randomness