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Category Archive: 6a.) Monetary Metals

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Growing Dollar Demand, Silver Weirdness, Market Report, 15 June

2020-06-17

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2020-06-17

Silver Basis and Co-basis and the Dollar Price, November 2019-February 2020
The Federal Reserve has become more aggressive again, after several years of acting docile. As you can see on this chart of the Fed’s balance sheet, it has very rapidly expanded from a baseline from (prior to) 2015 through 2018, of about $4.4 trillion. After which, it had attempted to taper, getting down to $3.8 trillion last summer. Then it was obliged to reverse itself well before responding to the COVID lockdown. Since then, its balance sheet...

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Monetary Metals Provides Gold Loan to Sector Resources

2020-06-10

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2020-06-10

The loan is denominated in gold with interest and principal paid in gold. Scottsdale, Ariz., June 9, 2020—Monetary Metals® announced today that it has loaned gold to Sector Resources Canada Ltd., a British Columbia based gold mining company. The private transaction was conducted off-market, and the interest rate and terms were not disclosed.

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When Is a Capital Gain Capital Consumption? Market Report, 25 May

2020-05-26

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2020-05-26

Silver Basis and Co-basis and the Dollar Price
The price of gold dropped a few bucks this week, but the price of silver jumped about half a buck. The drumbeat for the gold bull market is well underway, and it is beginning now for silver. So let’s do a quick update on the supply and demand fundamentals.

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The Federal Counterfeiter

2020-05-25

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2020-05-25

Suppose you wanted to run an enterprise the right way (we know, we know, this is pretty far-out fiction, but bear with us). And, your enterprise has a $1 million dollar piece of equipment that wears out after 10 years. You must set aside $100,000 a year, so that you have $1 million at the end of 10 years when the equipment needs replacing. There’s a word, now archaic, to describe the account in which you set aside this money.

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Open Letter to Crispin Odey

2020-05-22

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2020-05-22

I am writing in response to the comments you made in a letter to investors yesterday, which were widely reported. You have set the gold community afire, with claims that are not new and not true. So I shall attempt to douse the flames. As everyone knows, President Roosevelt outlawed the ownership of gold in 1933. Although gold was legalized in 1975, fears linger today that the governments may repeat this heinous act.

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Gold and Silver Markets Start to Normalize, Report 4 May

2020-05-05

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2020-05-05

Gold Basis and Co-basis and the Dollar Price
The price of gold dropped $29 and the price of silver dropped $0.27. We’ll get back to where we think the prices are likely to go in a bit. In recent Reports, we’ve looked at the elevated bid-ask spread in gold (though not nearly as elevated as some goldbugs would have you believe) and the elevated gold basis.

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It’s Only Paper, Market Report 27 Apr

2020-04-28

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2020-04-28

The response to the virus has added a new mechanism of capital consumption to the many we have documented over the years. Businesses are shut down, yet they continue to incur expenses. There is a popular misconception out there that this is merely a paper loss. One can almost picture a neutron bomb that somehow wipes out only paper, leaving all the physical assets and plant unscathed.

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Crouching Silver, Hidden Oil Market Report 20 Apr

2020-04-21

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2020-04-21

Gold Basis and Co-basis and the Dollar Price
The price of gold has been up steadily for the last 30 days (with a few zigs and zags), now re-attaining the high it achieved prior to the big drop in March. Gold ended the week at $1,662. Alas, it’s not quite the same story in silver, whose price drop was bigger. Now its price blip is smaller. Silver ended the week at $15.19.

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Monetary Metals Leases Gold to Brite Metals

2020-04-11

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2020-04-11

Scottsdale, Ariz, April 7, 2020—Monetary Metals® announced today that it has leased gold to UK-based Brite Metals. The lease enables Brite Metals to buy gold from Latin American gold miners, and sell it to European refiners.

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The Out Has Not Yet Begun to Fall, Market Report 31 March

2020-04-02

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2020-04-02

Gold Spot Spread
So, the stock market has dropped. Every government in the world has responded to the coronavirus with drastic, if not unprecedented, violations of the rights of the people. Not to mention, extremely aggressive monetary policy. And, they are about to unleash massive fiscal stimulus as well (for example, the United States government is about to dole out over $2 trillion worth of loot).

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Alchemy Rediscovered by Research Scientist, Report 1 April

2020-04-01

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2020-04-01

“The Medievals were smarter than most people think,” says Dr. Michael Mus. “I mean, sure, they tortured people for believing that the sun was the center of our solar system, and they burned witches at the stake. But they knew a thing or two about gold.”

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Cash is Toilet Paper, Market Report 23 March

2020-03-24

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2020-03-24

Gold Spot vs Near Contract, 2019-2020
The price of gold dropped $31, and that of silver fell even more by proportion, $2.14. The gold-silver ratio hit a hit of over 126 before closing the week around 119. This exceeds the high in the ratio last hit in the George H.W. Bush recession. Last week, we were warming up to silver, if not recommending it.

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Aplanando la economía «por el virus»

2020-03-20

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2020-03-20

Escribo esto el 18 de marzo, después de haber visto un cambio de 180 grados en la forma de pensar sobre las enfermedades contagiosas. Anteriormente, poníamos a los enfermos en cuarentena y respetamos el derecho de los sanos a seguir con sus vidas. Ahora estamos al borde de la ley marcial. En nuestro afán por combatir el coronavirus, estamos cerrando los viajes, las reuniones públicas, los restaurantes, etc.

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Is Now a Good Time to Buy Gold? Market Report 16 March

2020-03-16

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2020-03-16

We got hate mail after publishing Silver Backwardation Returns. It seems that someone thought backwardation means silver is a backward idea, or a bad bet. “You are a *&%#! idiot,” cursed he. “Silver is the most underpriced asset on the planet,” he offered as his sole supporting evidence. He doesn’t know that backwardation means scarcity, not that a commodity’s price is too high.

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Socialism and Gold

2020-03-04

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2020-03-04

Most people assume that the central bank prints money when it buys bonds. They further assume that this increase in the quantity of money causes an increase in the general price level. And, this leads them to assume that the value of the money is 1 / P (P is the general price level). Therefore, when the central bank prints money to buy bonds, it is diluting the value of the money held by everyone—in proportion to the amount printed divided by the...

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Silver Backwardation Returns, Gold and Silver Market Report 2 March

2020-03-02

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2020-03-02

Silver Spot Price Bid-Offer Spread
The big news this week was the drop in the prices of the metals (though we believe that it is the dollar which is going up), $57 and $1.81 respectively. Of course, when the price drops the injured goldbugs come out. We have written the authoritative debunking of the gold and silver price suppression conspiracy here. We provide both the scientific theory and the data.

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Widening Bid-Ask Spreads, Gold and Silver Market Report 17 February

2020-02-17

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2020-02-17

Gold Term Structure
The price of gold rose $14 and the price of silver fell $0.07. The gold-silver ratio rose further with this price action. Welcome to our new Gold and Silver Market Report, or “Market Report” for short. We are separating this from the economics essay, which was attached for many years. As they used to say in many toy commercials of yore, “batteries sold separately”—or in this case essays.

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Monetary Metals Gold Brief 2020

2020-02-03

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2020-02-03

Gold Fundamental Price
We apologize for not posting articles during January. We have been busy, and going forward will publish a separate Market Report every Monday morning plus macroeconomics essays later in the week, as time permits.

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Open Letter to John Taft, Report 17 Dec

2019-12-18

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2019-12-18

Silver Basis and Co-basis and the Dollar Price
Dear Mr. Taft: I eagerly read your piece Warriors for Opportunity on Wednesday, as I often do about pieces that argue that capitalism is not working today. You begin by saying: “Financial capitalism – free markets powered by a robust financial system – is the dominant economic model in the world today. Yet many who have benefited from the system agree it’s not working the way it ought to.”

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The End of an Epoch, Report 8 Dec

2019-12-10

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2019-12-10

“There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

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