Haynes - Gold & Silver Buyers Outpacing Sellers 50 to 1

ksammut

Haynes - Gold & Silver Buyers Outpacing Sellers 50 to 1

DeepCoin

Supply and demand would suggest that if buyers outpaced sellers 50 to 1, then the price of metals would be going up, not down as we have seen over the past year or so. This is just marketing hype.

bronco2078

<< <i>Supply and demand would suggest that if buyers outpaced sellers 50 to 1, then the price of metals would be going up, not down as we have seen over the past year or so. This is just marketing hype. >>



I don't know how accurate the 50 to 1 number is but I believe he is talking about physical.


I could sell a million ounces of physical today out of my garage and it wouldn't move spot.


There are no shortages of paper to pass around . No premiums on paper commodities.

s4ny

At the White Plains NY show yesterday there were buyers looking for 90% silver, not
as many sellers.

derryb

<< <i>Supply and demand would suggest that if buyers outpaced sellers 50 to 1, then the price of metals would be going up, not down as we have seen over the past year or so. This is just marketing hype. >>


Spot price is determined by supply/demand of paper futures. OP's link discusses supply/demand of physical. Unfortunately spot sets a floor for price of physical, but rising physical premiums in a down trend tells us physical demand is in fact growing as well as a disconnect between the two prices.

For what it's worth:

How the Gold Market was Crashed

tneig

On the high level picture it makes sense that buyers would be buying now, and holders holding unless they have enough margin. But often its hard to tell.
Most articles hype up or down, few without bias, and many just follow the trend of others, with most written for the writer to make a living promoting what keeps the host happy.

Also 'supply/demand' (would make sense if spot continues to stay low and there is a buyer flurry, one would think the market would turn around and the price go up).

Now, if the pm price goes opposite the dollar when strong, then the PM price would go/stay down (if that had the strongest pull).

If spot is mostly directed by paper, who the heck can tell what the next second will bring and why...

So many big key variables that don't seem to act/react as one would expect, let alone the interaction.

roadrunner

As derryb shows via that link, there are really 2 markets in gold and silver.....paper vs. physical. If you want large quantities of physical, you won't get them
through delivery via the future's market or even London's Bullion Market. Interesting how Downey mentioned in that link above that physical was unavailable to traders
during the December 2011 crash and this past Friday. All one could do to protect themselves was to buy a short contract to hedge your gold holding.

derryb

<< <i>All one could do to protect themselves was to buy a short contract to hedge your gold holding. >>


thus driving the paper price down even further. Monday/Tuesday will be the moment of truth.

Doesn't look like any increase on the BST to get out of gold or silver. Strong hands here as well.

"What most people do not understand is that the price of gold and silver are not determined by how much gold and silver is being sold. It is how many gold and silver IOUs are being sold. And you can write as many IOUs, futures contracts and options, as you want. Those are unlimited. The supply, though, of physical gold and silver is quite limited, and so when people actually start asking for it and they want the physical, then there is a divergence of the paper price versus the physical price, and we are seeing that right now.

We are in a back-order situation with all of the suppliers. Spreads are going up. Silver eagles cost about fifty cents over spot more than they normally cost because all of the suppliers have had to raise their price to try and find the supply/demand equilibrium that the markets are for. The markets are there to try and find a supply/demand equilibrium, so then price is the arbitrator. Price rises; that draws more supply and reduces demand. Price falls; that reduces supply and increases demand.

So the price discovery mechanism of the markets is what is supposed to ensure that things are in equilibrium. We have this broken system where there are a few big players that manipulate the market, and it always shows up when shortages start developing in the physical market. You know that the price of gold and silver right now are too low to be realistic. And the good thing about that is that it cannot last." - Mike Maloney

cohodk

Doesn't look like any increase on the BST to get out of gold or silver. Strong hands here as well.

Was it strong hands that held Cisco stock from 80 to 20? Investors rarely acknowledge loss. This is not a trait of strength.