Best news in years for PM physical pricing mechanism
derryb
Posts: 36,779 ✭✭✭✭✭
End is near for London Bullion Market Association.
Is the COMEX next?
New Basel 3 regulations will make it uneconomic for banks to continue to run bullion trading desks.
"Basel 3 is on course to regulate the LBMA out of existence. And with it will go all the associated arbitrage business and position-taking on Comex, because most bullion bank trading desks will cease to exist. The only supply to buy-side speculators of gold and silver contracts will be producer hedging."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
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This could potentially be a very big deal. But it is not yet certain if it will be fully enacted, apparently.
We should know by the end of the year, I suppose.
Two edged sword, if implemented, which btw, I doubt.
"As it is unwound, the withdrawal of synthetic supply has enormous implications for future precious metals prices by transferring pricing power to physical markets, now dominated by China."
someone could come in to fill that void. china certainly has already started their own spot price fixings. they are on the kitco home page.
I'm showing paper spot at $27.57, physical spot is anywhere between $25.89 and 39.67 depending on what you're moving and where you're trying to move it. Of course moving without the middleman and moving that of the most liquid always yields the greatest return. THANKS!
Reddit Silver Gang interviews Andrew McGuire
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Basel 3 pushed back until 2023
https://www.fsb.org/work-of-the-fsb/implementation-monitoring/monitoring-of-priority-areas/basel-iii/
Good news is we can stack for about another year...Maybe
My Saint Set
Update on the link in the OP:
The end of paper gold and silver markets
"The conclusion is that unless the BIS has an ulterior motive to trigger a chaotic financial reset of some sort, it is a case of regulators not understanding the market consequences of their actions."
LBMA and World Gold Council Warn Bank of England that Basel 3 rules will wreck gold price suppression.
The LBMA and the World Gold Council complain that the “Net Stable Funding Ratio” provision of the Basel III regulations would require the London bullion banks (the manipulators on the London futures exchange) to hold funds offsetting 85 percent of the value of the unallocated gold they hold for customers, and the banks could not afford this.
Oops there goes another Ponzi Scheme. Removing obscene leveraging from any form of finance is a very good thing.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Basel III's impact on PM's:
It requires banks, including bullion banks (who control the precious metal futures market where spot price is determined), to deleverage their lendings by holding a very much higher amount in actual assets of what they are lending out. On June 28th, a new regulation will be set in place that disvalues unallocated gold paper contracts held against lendings. At the same time, physical Gold changes its spot from a Tier 3 asset to a Tier 1 asset. It will count as a 100% reserve asset. This move is highly positive for physical gold and silver.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
derryb....apparently, judging by the current price of gold or silver, the PM market does not agree with your scenario. My personal gut feelings are, sos or business as usual. With luck, we may even breach last years highs.
I just find it strange that those who believe in this grand conspiracy that the banks, comex, lbma etc. are all working so hard to suppress the price of PMs are the ones always complaining about it. If you truly believe the conspiracy you should be grateful that they are continuing to allow you the opportunity to buy metals at these suppressed prices.
If you dig deep enough you will find that those who continuously push the lie are the same ones who are trying to sell you more metal and news letters.
This statement should be read as opinion, and not fact.
Knowledge is the enemy of fear
surely you are not referring to this lie,
or this one,
or this one.
Appears the Department of Justice is nothing but liars. LOL
Almost forgot, here's another of their lies.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Fact is bullion banks conduct the majority of precious metals trading on both the LBMA and COMEX exchanges. Their trading in precious metals futures is what ultimately determines spot. This is the basis of all successful Department of Justice action (documented in my previous post) against them for manipulating the price of precious metals.
Labeling facts that you don't like as being opinion does not turn facts into opinion. Again you attempt to misdirect, your typical modus operandi.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
You mean the banks that trade on behalf of thier clients? Or the miners that hedge positions?
Yout arguement is akin to saying Ribinhood manipulated GME.
My modis is rooted in fact. Yous is in supposition.
Dont whine because a false narrative gets misdirected.
Knowledge is the enemy of fear
Bullion banks have their own trading desk where their traders conduct actual trades on the futures exchange and they have been prosecuted for controlling price while making those trades (spoofing). While they conduct trades for large clients they also trade their respective bank's accounts, a huge profit making operation for the banks with a big incentive to manipulate prices. This incentive is no longer a tin foiler's imagination, it is documented in the four links above.
Robinhood does not have its own traders, it simply provides a trading platform where outside traders make their trades. Apples and oranges. Again another attempt to distract from the facts.
I finally figured it out. You are what poses today as a journalist.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Perhaps they were "spoofing" the price higher? The tinfoil club always claims they are suppressing the price. I mean JPM is the largest holder of physical silver on planet earth. Yeah I'm sure they want their assets to depreciate. lol
You don't think that JPM has and continues to stockpile that big stack of physical silver at artificially low prices? Best believe when the time is right they will explode the price. Best to hang on to that gutter metal.
Their bullion desk sends them massive paper profits on both the ups and downs in price. They play the currently profitable side of metal trades that they have been proven to manipulate.
You need to sign up for coho's newsletter.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Is it free? Link? Thanks!!!
More misdirection and personal attack from derryb.
Hold me derryb
BTW---we still be waiting for evidence of the huge JPM stack. And "control of the precious metals futures market".
Look, we all want $200 silver, even JPM by your account, but why the need to create such narratives? Silver will go when investors and speculators deem its time, just as they did with the cryptos. There was no need for conspiracy or manipulation or "them" narratives.
Knowledge is the enemy of fear
your troll is showing. lol
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Basel III and the New Role For Gold
"physical gold will go from being the price taker to the price maker."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Free? No. Cheap? Yes.
Get it here.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Well even though you meant it as a joke your link is actually probably more reliable than that zero hedge crap you seem to gravitate towards. Guess since I'm such a cheapo I'll just stick with the free forum newsletter version. THKS!
Here is, I think, the most important quote from that article:
"Think of it this way, in a world where debt assets are failing and new private forms of custodial assets are rising in mindshare [Bitcoin, for example], what’s the only real weapon the central banks have to maintain credibility ?
Their gold reserves."
"...central banks credibility"
Now that's funny!!!
"expect greater price volatility in gold and silver, but ultimately far better price discovery"
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Central banks have nowhere near enough gold to cover the currency.
How does one draw credibility from that?
Now that it is a tier one asset, banks can use their physical holdings to increase their lending capacity.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
From the article/advertisement...
"Trading will tighten and clearing costs will rise to match the wider bid-ask spreads as gold and silver becomes less liquid, which could make institutional investors less interested in precious metals for no other reason than liquidity will be harder and spreads wider"
So better price discovery will result from reduced liquidity, increased costs and wider spreads? WT?
Knowledge is the enemy of fear
Now that it is a tier one asset, banks can use their physical holdings to increase their lending capacity.
That's not the entire picture. Only physical gold (allocated gold) is considered Tier One. Unallocated gold is no longer allowed as a lending asset, as it was previously. This means that only physical gold is eligible in meeting their reserve requirements for lending, instead of allowing the banks to use leveraged paper as lending reserves.
So better price discovery will result from reduced liquidity, increased costs and wider spreads? WT?
He said "greater price volatility", and ultimately (but not instantly) it will result in a more honest price discovery when there's no incentive for banks to rehypothecate other people's unallocated gold as their own assets for lending purposes.
The article discusses the possibility of price declines due to lower liquidity, but at the same time, gold's value has already been determined to be higher on a relative basis. The only things we don't know are: how much higher relative to other assets, and when. Oh, and whether or not private individuals will be "allowed" to own gold still.
I knew it would happen.
Relative to what basis has gold been determined to be higher?
Knowledge is the enemy of fear
Relative to what basis has gold been determined to be higher?
Relative to its pre-Basel 3 basis.
I knew it would happen.
Ok...and so are potato chips.
Knowledge is the enemy of fear
Ok...and so are potato chips.
The master of red herring diversion strikes again. I wasn't aware that Basel 3 addressed potato chips.
I knew it would happen.
Basel 3 gutter down. Should of invested in the Pogey bait. Glad I got gold. THKS!
Basel 3 gutter down. Should of invested in the Pogey bait.
Got an English translation?
I knew it would happen.
The problem with the whole premise of Basel 3 is "if", it's implemented. Not when or how.
And you didnt address what gold performed relative to. It was a simple question, but one you couldn't answer, or refused to answer because you knew the answer wasnt very conpelling.
Knowledge is the enemy of fear
So, for the present time.... blitzdude is correct, in my opinion. It is stacking time. I've seen guys stack more aluminum beer cans, than silver. Then they make a semi annual drive to the recycler , cash in and pay for another case of beer. Each to their own.
Sure. Potato chips are outperforming silver. RGDS!
you didnt address what gold performed relative to. It was a simple question, but one you couldn't answer, or refused to answer because you knew the answer wasnt very conpelling.
My reply was stated in Plain English. Should I be responding in potato chip language? It appears that way.
I knew it would happen.
Plain indeed. You have no idea what you wrote. Nor what i wrote.
You said gold did well relative to itself.
Thats the same as saying you are pretty smart compared to yourself.
Some eat fish and some eat cow chips.
Knowledge is the enemy of fear
https://www.kitco.com/news/2021-07-12/The-LBMA-dodged-the-Basel-III-bullet.html
Loves me some shiny!
London protecting its own. Too bad the rest of europe is not so lucky, but they will likely figure out a way to follow suit.
The primary purpose of Basel III is to make banks more stable and prevent a repeat of the financial crisis of 2008-09. Basel III is but just another warning of what's coming. Looks like British banks prefer the continued risk over stability. Greed at work; crisis not averted.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Oh well so much with basel 3 at least the conspiracies will live on. lol
Relative to what basis has gold been determined to be higher?
Relative to its pre-Basel 3 basis.
You said gold did well relative to itself.
That's the same as saying you are pretty smart compared to yourself.
No, that's not the same and I suspect that you know it very well.
Basel 3 changed the basis for gold valuation as a Tier 1 Asset, compared to it's pre-Basel 3 valuation as a Tier 3 Asset.
You mischaracterized what I said, but what I said is quite accurate, so I'm not clear about what you think you are saying.
Investigate the meaning and usage of the word "relative" in most any comparative context.
In this case, gold has been revalued higher in relation to its pre-Basil 3 basis.
You can also look up "basis" in a financial context and it might help your understanding.
None of this matters too much if the bullion banks got a carve-out and don't have to comply to the same rules as other banks.
I knew it would happen.