A Bear Market in GoLD

326
Tue, Apr 30, 2013 - 10:47pm

Everyone's favorite faux depository reaches a dubious milestone.

As you know, we've been keeping track of the depletion of the GLD. Today, let's use CNBS' favorite metric, the 20% decline, to characterize the "inventory".

On 1/2/13, the GLD showed an alleged "inventory" of 1,349.92 metric tonnes of gold. As of this evening, the GLD "inventory" is listed as 1,078.54 metric tonnes following another drawdown today, this time for 2.10 tonnes.

So, year-to-date, the GLD "inventory" is now down 20.1%...thus the title of this post. What does this mean? How much gold is this? At what rate is gold exiting the GLD? Here are some random bullet points:

  • Down over 20% means that for every 5 bars that the GLD allegedly held 4 months ago, it now holds only four.
  • GLD has shed 271.38 metric tonnes YTD, that's about as much as the entire holdings of Austria and more than the combined holdings of Brazil, Denmark, Australia and Indonesia. https://en.wikipedia.org/wiki/Gold_reserve
  • Using the same source as above, even after this 20% decline YTD, the GLD still holds as much gold as the country of Switzerland. Rrrrright....uh-huh....
  • It took over two months for the GLD lose it's first 100 tonnes for 2013. The "inventory" fell to 1,243.05 on March 7.
  • It then took just six weeks to lose the next 100 tonnes, reaching 1,145.92 on April 16.
  • Three weeks ago tonight, just days before the massive, two-day beatdown of paper price, the "inventory" stood at 1,200.37. Again, this evening, it stands at 1,078.54. That's nearly 122 metric tonnes (over 10% or roughly the size of the total holdings of Mexico) in just the past three weeks alone.
  • In contrast, the SLV has seen its "inventory" rise YTD. It began 2013 at 10,084.96 metric tonnes. As of this evening, it allegedly holds 10,407.44. Up 3% since the first of the year. Now Bob Pissonme would have you believe that the drop in GLD "inventory" is related to simple investor liquidation and re-allocation. If that's the case, how do explain this change in the SLV? <crickets>

So, let's have some fun and attempt to put all of this into context. Again, the GLD has now shed 271.38 metric tonnes in just the first four months of 2013. This is:

  • 8,725,069 troy ounces OR
  • 21,813 London "good delivery" bars OR
  • If you stack those bars onto pallets holding 192 bars a piece, it looks like this:

Yes, that's 114 pallets of gold, each holding 192 bars, each bar weighing 400 troy ounces. Gone. But, to where? Back to Authorized Participant vaults for safekeeping until "investors" begin to accumulate shares of GLD again? That's what Bob Pissonme would have you believe but is that really the case? Perhaps something else is going on, instead? We shall see, now won't we...

It certainly is an interesting time to be alive.

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  326 Comments

PeterLemonJello
Apr 30, 2013 - 10:49pm

Just keep buying relentlessly

Don't stop...just keep stacking.

TheGreatKD
Apr 30, 2013 - 10:51pm

Babe Ruth

############ ??????????????/

PuraVida
Apr 30, 2013 - 10:51pm

Miss Lube Rack

For the win?

Holy crap. Two firsts in a week? Something very strange is about to happen.

FEED THE TURD!!!!

twippers
Apr 30, 2013 - 10:52pm

Go Canucks Go

Beat the sharks and buy more silver with the winnings

CLE807
Apr 30, 2013 - 10:53pm

Collapse

Collapse doesn't happen gradually, every dumbass in the world wakes up one morning and says what the hell happened.

hawkeye
Apr 30, 2013 - 10:53pm

Just one bar.............

so much gold, so little time.........tomorrow is May Day........get some silver........bury the cartel........

The Watchman
Apr 30, 2013 - 10:59pm

Price Disconnect

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American Eagle realizes $86,654 in auction

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By Paul Gilkes-Coin World Staff | 04-08-13
Article first published in April 22, 2013, Market Updates section of Coin World

A collector paid a record $86,654.70 to acquire this PCGS Proof 70 Deep Cameo 1995-W American Eagle silver dollar in an online GreatCollections auction March 31. PCGS has assigned the grade to just eight examples.

A collector paid a record-setting $86,654.70 on March 31 to acquire a Professional Coin Grading Service Proof 70 Deep Cameo 1995-W American Eagle silver dollar in an online auction conducted by GreatCollections.

Ian Russell, president and founder of GreatCollections, said April 1 that the unnamed collector who purchased the coin was not seeking to complete a collection of Proof silver American Eagles. The collector had waited years to find a premium example of the key date for the entire Proof American Eagle silver series and was willing to pay what it would take, Russell said.

“This is what happens when you have an extremely popular series,” Russell said. “This collector was determined to win it.”

The winning bidder was one of 21 bidders who placed a combined 104 bids during the auction. The final closing bid was $78,777. The addition of the 10 percent buyer’s fee brought the final purchase price to $86,654.70.

“The 1995-W is the ultimate key to the series with the lowest mintage and is notorious for imperfections, explaining the low percentage graded at the perfect Proof-70 DCAM grade,” Russell said. “In addition to the technical points about the coin itself, the general market for silver Eagles continues to grow at a fast pace ... probably faster than any other coin series at the moment.”

Eight coins have been assigned the grade Proof 70 Deep Cameo by PCGS, with another almost 1,600 coins graded Proof 69 Deep Cameo by PCGS. The Proof 69 Deep Cameo coins regularly sell for between $3,500 and $4,000 each, Russell said.

The previous record for any silver American Eagle, also a Proof 1995-W coin, according to Russell, was $40,000 paid for a PCGS Proof 70 Deep Cameo coin offered in a Teletrade auction that closed March 15, 2010.

Part of a set

The Proof 1995-W American Eagle silver dollar was available only in a five-coin 10th Anniversary set. The set also included Proof 1995-W 1-ounce, half-ounce, quarter-ounce and tenth-ounce gold American Eagles.

The five-coin set was offered at the same price, $999, that was being charged by the Mint for the four-coin gold Proof American Eagle set. Mint marketers promoted the silver dollar as a bonus to collectors who had previously purchased gold Proof American Eagles.

However, some collectors of silver American Eagles voiced complaints about the silver coin from the West Point Mint being made available only in a set that they could not afford. The complaints mostly focused on the point that their collections, inexpensively maintained as complete through 1994, were no longer complete because they could not pay the original or secondary prices for the special coin.

A total of 30,125 of the five-coin sets were recorded sold by the U.S. Mint. In contrast, the Mint sold 438,511 Proof 1995-P American Eagle silver dollars at a price of $23 each.

How many of those 1995 sets remain intact is unknown, as sets have been broken apart over the years, with the gold and silver coins dispersed separately.

At the time of release in 1995, purchasers who acquired a five-coin set solely for the Proof silver American Eagle it contained paid a net cost of roughly $200 for the silver coin. At the time, the gold coins were worth not much more than their melt value of roughly $800.

Although some collectors of silver American Eagles at the time might have been rankled over the net cost of the 1995-W coin being nearly seven times that of the regular Proof 1995-P silver American Eagle, those who paid the price then have reaped the benefits since.

For more information, email Russell at ian[at]greatcollections[dot]com or contact Russell by telephone at 949-679-4180. ■

AlexCojones
Apr 30, 2013 - 11:01pm

Took Me Several Minutes to Scroll Past All of These -

Of course I scrolled slooooooooooowly.

Turd loves these Gold pallet images as much as I love my girl-in-gold-bikini photos.

PeterLemonJelloThe Watchman
Apr 30, 2013 - 11:07pm

I have to say.....that was

I have to say.....that was damn interesting. I don't normally read all of the posts. Thank you.

DeaconBenjamin
Apr 30, 2013 - 11:09pm

Man caught with unregistered gold at Athens airport

A man traveling with 15.7 kilos of unregistered gold was detected by customs officials at Athens International Airport on April 26. The gold, hidden in Easter candle boxes, was destined to Germany. According to initial reports, the shipment was being exported by a company operating in the precious metals sector based on the Dodecanese island of Kalymnos, in the southeastern Aegean Sea. Sources said the gold had been purchased from pawn stores and did not carry regular documentation. A similar case surfaced on April 12 when customs officials at the same airport arrested a 32-year-old German national, an employee of Greek exporting company Elyros SA, after finding him in possession of 470 kilos of silver, 7 kilos of gold and 293,000 euros in cash. Prior to his arrest, the company was being investigated for issuing bogus checks. ekathimerini.com , Tuesday April 30, 2013 (10:21)

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Key Economic Events Week of 10/14

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