Sharia Law standards for Muslim gold ownership to be lifted January 1st.
EagleEye
Posts: 7,677 ✭✭✭✭✭
Will this drive up gold January 1st?
thedailyeconomist.com/2016/10/sharia-law-standards-for-muslim-gold.html
Rick Snow, Eagle Eye Rare Coins, Inc.Check out my new web site:
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Well, it will certainly affect the fundamental of demand. But, fundamentals don't always apply with gold in bizarro world. Blame the futures market. Futures contracts are meant to protect producers by "stabilizing" prices. Works well for farmers and money printers.
"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
Yeah, gold don't act like it should. Gosh darn it.
If only I understood this intermarket relationship stuff.
EagleEye, more buyers can't hurt.
Knowledge is the enemy of fear
Should be interesting... it certainly has potential... Although things often do not work the way we perceive they might. Cheers, RickO
I would imagine sharia islams that want gold as investment already have gold as investment.
Presently they are able to buy gold only in the form of Jewelry. This will make bars and coins acceptable for ownership. It might only influence margins not actual amounts sold.
The market is so thin and manipulated I wouldn't hold my breath. Now if some billionaires stepped in......
100% Positive BST transactions
Next , people will be accused of being infidels , due to materialism. The religion of peace.
. How nice. Damned if you do, and damned if you don't .
Like most religions there are devout followers, followers, and so called followers. Most are not devout and I would suspect if a Muslim wanted or needed gold they would be in the latter two categories. I don't see an affect on prices.
just one more buyer is an increase in demand.
"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
I would believe that, except for the most devout, there was likely gold ownership anyway.... Cheers, RickO
munknee says it will add 100 million buyers to the market
Aside from the increased individual direct buys of gold this is what will make a difference:
"It’s very likely asset managers in key Islamic finance countries like Bahrain, Qatar, Indonesia, Saudi Arabia and Malaysia will start aggressively offering gold investment products like ETFs – which are already wildly popular in the rest of the world. At current prices, if Islamic financial institutions allocate to gold just 2% of the assets they manage, it would equal roughly 1000 tonnes of extra demand…"
"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
kitco.com/news/2016-12-05/Investing-in-Gold-Now-Compliant-with-Sharia-Law-Potential-Huge-WGC.html
Just wait until they approve eating bacon..... the pork market will skyrocket....
Cheers, RickO
Item from Coin World online:
https://www.coinworld.com/news/precious-metals/2016/12/islamic-shariah-law-gold-investment-precious-metals-market.html?utm_medium=Email&utm_source=ExactTarget&utm_campaign=cw_editorial_weekly-update&utm_content=#
Will take affect by March 31 (exact date unknown) and should be a very positive driver for gold price at that time.
"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
I can't imagine it'll make much difference, given that Muslims could already own jewelry and coins. I'm sure that those that are serious gold bugs have already driven a truck through that "loophole". After all, for the longest time gold bullion was illegal in India, and the people just vacuumed it up as jewelry, where the jewelry was basically unadorned heavy chains or bracelets of gold.
U.S. Type Set
You're focusing on physical ownership. Consider the demand that will be created when over 100 million Muslims are permitted to invest in gold related equities and ETFs. Look for Eastern exchanges to begin offering numerous new methods to invest in gold.
I'm still not clear if muslims can only invest in financial instruments that are 100% backed by gold. Continuing to restrict them from the derivative gold plays could limit this new demand.
"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
Gold is just another commodity.
Here is the gold chart ( 30 day) from kitco.
kitco.com/LFgif/au0030lnb.gif
They don't have any money to invest.
Knowledge is the enemy of fear
your ignorance is showing. . . again.
"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
Yup...I'm the master ignoranous. Lol
Maybe you should check into the average wealth of countries that are largely muslim. I'll help you out since I know your not too good at doing independent research.
Indonesia 14% of total Muslim population
India 12% of total Muslim population.
Pakistan 12% of total Muslim population.
Bangladesh 9% of total population.
That's about 50% of the total pop where the median per capita annual income is about or less than $600. How much gold are they going to buy on $600 income per year?
And I didn't even account for the Muslim countries in Africa that have less than $300 per year in income.
You think the Saudi sheiks don't already own gold? Lol. And remember those gold vending machines in Dubai? Remember the pictures of Muslims putting their paper money in them? Those that can afford to have already been buying gold.
There just aren't enough people with investable assets to make a dent in demand.
Or just call me ignorant.
Knowledge is the enemy of fear
Even though Muslim's make up one-third of the world's population, It's not just about the number of people. From my earlier link: "At current prices, if Islamic financial institutions allocate to gold just 2% of the assets they manage, it would equal roughly 1000 tonnes of extra demand…[and] this new demand could help push gold prices higher in 2017 and, while this initial allocation may be a one-off event…it will be an ongoing source of gold demand into the future."
"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
Are you now backing off the 100 million more investors?
Knowledge is the enemy of fear
twisting words again? What I said was "consider the demand that will be created when over 100 million Muslims are permitted to invest in gold related equities and ETFs." Never said or implied that all 100 million would invest. Did say the pool of potential investors/speculators is about to grow to include not only physical bullion buyers but buyers of gold-backed paper as well. Aside from a world-wide increase in individual investors there should also be a massive increase in institutional investors. Not all Muslims are poverty stricken nor do all of them live in the deserts of the middle east.
You really should learn to stick your head up out of the box and glance at the big picture occasionally. You might even catch a glimpse of reality.
"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
I love ya derryb.
Keep up the good work.
If you only knew.
Knowledge is the enemy of fear
Demand is not created by permission...
quit being so naive. If the laws that govern your ability to freely own gold were to change, what would that do to demand and ultimately prices?
"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, in 1933 it caused such a stir that Americans stopped trusting government ... while bankers made book. The rest of us started burying it or hoarding it, just in case GOLD went higher than 20 bucks per ounce.
AND IT HAS.
And you had to trade underground and off the radar and then wait over 35 years before you could publicly sell. Laws to freely own and trade gold (permission) are a definite asset to demand. Laws that prevent you from doing so put a lid on demand.
"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
Yeah, let's think about what Prohibition of substances that are in Demand (or the lack or end of prohibition) does to prices, quality, and safety of trading in those substances, as well as the effects on producers, on consumers, on those who make markets in them, the distribution of who makes the profits and how much profit, and how markets are regulated, and of course, the variety and diversity of the range of products available. No matter one's opinions, it's a very interesting subject.
Liberty: Parent of Science & Industry
You need to put yourself in the position of others. Say you are an owner of a convenience market in Baghdad. There is no guarantee that the business will be there next year. There is no guarantee the Iraqi Dinar will be worth what it is today. There is no guarantee your bank will be around tomorrow. Yet you are making a few $100 a day profit. Do you put your profit in a bank or buy gold and hide it?
Or good old US dollars? Freely traded and eagerly wanted.
Knowledge is the enemy of fear
People are usually willing to pay more for what they can't have. And when it is freely available it becomes a commodity.
Knowledge is the enemy of fear
You are looking only at the supply side of a two part equation. Takes both to make a sale.
"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
I am?
Knowledge is the enemy of fear
Yes, availability is a supply issue. Paying more because of less supply does not create more demand, it only creates higher prices.
"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
Interesting. If the Muslims are not permitted to buy gold then it is unavailable to them. That's not a supply issue.
Knowledge is the enemy of fear
Correct, removing buyers is a demand issue.
However, this does not change the fact that your earlier statement: "People are usually willing to pay more for what they can't have," was correctly identified as the supply side of 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
No....the disruption is on the demand side. Not supply. Supply does not change
They can have all the gold they want...it is readily available...but something disrupts the demand side.
Knowledge is the enemy of fear
If they can't have it because it's not available to be had then it's a supply issue.
If they can't have it because someone says they can't have what is available then, yes, it becomes a demand issue.
"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
They can't have it because their stupid religion says they can't have it. Not a supply issue. Some dont adhere to their religion and will gladly pay a premium for what they supposedly aren't allowed to have. When they are allowed to have it, premium will drop. Lustre will diminish. It becomes a commodity.
Knowledge is the enemy of fear
Gold-backed Currency Launches in Dubai
"The launch of OneGram is part of the new wave of gold financial products that we are beginning to see as a result of the Shariah Gold Standard. Muslims have long looked for more gold products to be made available to them in the $2 trillion Islamic financial markets."
"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
This is great news. It'll be far easier for me to store gold backed currency than to store gold coins and bars.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
Sounds like there will be an explosion of growth in this Muslim market....
It is an interesting area of speculation.... Although not for me, I am curious if it will even budge the needle in the gold market... We shall see....Cheers, RickO
Hope they avoid the paper market.
"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
Lol, they have to pawn the gold off on someone...
Well that came and went like a stale bag of Fritos.
I think I was correct in my statement above.
Nada, nil, no impact at all.
bob