New From Paul Mylchreest

Thu, Dec 4, 2014 - 10:15am

Longtime Turdites will recall that Paul Mylchreest is an excellent metals analyst. His latest report explores in great detail the ongoing link between the price of gold and the value of the Japanese yen which, as you know, is a theme we've already been following here for months.

This is a lengthy and detailed summary and it is chock full of terrific information about the gold--yen link, the global gold "market" and GOFO/backwardation. Please take the time to scroll through it and thank you to Paul for sharing it!


Nikkei Gold Danger

About the Author

turd [at] tfmetalsreport [dot] com ()


Dec 4, 2014 - 11:48am

@ Pining 4 the Fjords

Could explain the rising OI in silver as price has fallen

Pining 4 the Fjords
Dec 4, 2014 - 11:56am

Excellent pont, Pining

Perhaps I can get an answer from Paul on this.

Dec 4, 2014 - 11:58am


You may be right, but again I am confused... Paul is arguing that it is the banks working this trade, right? So if they are taking out new contracts (longs) in silver to go long as a hedge against their gold shorts, when who takes the other (short) side of that trade? Every contract must have an issuer to go with a buyer, who is issuing all those silver contracts? The same banks who are supposedly going long? This makes no sense to me.

And again, wouldn't part of Paul's thesis be 1. big short pressure on gold, and 2. lots of longs in silver to hedge... and wouldn't the G/S ratio be falling due to this pressure, rather than rising as it has?

Still confuses me, I am clearly missing something here.

Edit- thank you TF! I would love to hear what Paul has to say, if you can get him to comment

Dec 4, 2014 - 12:04pm

It all makes perfect sense!

Move along. Nothing to see here..... LOL!

Also look to where the 5 year forward inflation expectation rate is now: 2.18%.

Aug 2010: 1.8%. Fed spigot opened. Oct 2011: 2.0%. Again. June 2013: 2.2% Again.

What're they going to do now?

Dec 4, 2014 - 12:25pm

Possible hedge in silver

This is Paul who wrote the report. Thanks for including me Turd. Let's also speculate whether the bank which is the ringleader in the Nikkei/Yen v. Gold trade is different to the one tasked with holding down the silver price. The former might be able to gradually accumulate a long in silver knowing that as long as it doesn't disturb the price, e.g. buys into weakness, the screen price of silver will be taken care of. This would help to explain the bloated OI versus gold and the rise in ETF silver holdings. Can't prove it though. Cheers, Paul

Dec 4, 2014 - 12:30pm

@ ThunderRoad

h/t for all the great stuff in this report and numerous previous ones I've read, thanks again!

Dec 4, 2014 - 12:34pm

My pleasure

My pleasure

Dec 4, 2014 - 12:44pm


45 minutes a member...Welcome aboard!!

I have read your reports for years and have got great value from them. As an fyi, I sent out the link to your article to our clients this morning. I have always found your reports insightful and well researched.

thanks for joining up to respond to questions

Hope you stick around, this is a powerful site with great dialog


Dec 4, 2014 - 1:02pm

Thanks and will do, although

Thanks and will do, although I will probably be several hours ahead of most of you guys

Pining 4 the Fjords
Dec 4, 2014 - 1:08pm

@ my friend Pining

Ask and you shall receive, I guess...

Thanks Paul for your contribution to the conversation!

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