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Gold/Mining/Energy : Barrick Gold (ABX)
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To: nickel61 who wrote (1975)1/17/2000 8:31:00 PM
From: Zardoz  Read Replies (1) of 3558
 
Put another way the total world wide production in 1998 was 2550 tonnes. According to the LBMA numbers they trade the entire world supply of gold production every two days. Doesn't anything strike you as odd here?

Yes. You logic. Let's assume for sake of arguement that the WHOLE worlds production trades in one single day for 260 days of the year. Would that make you feel better or worse? What's the Total above ground supply of GOLD? Hmmm.

Consider the latest IPO, and that the total free outstanding shares may only be 40M, yet the stock trades 120M shares on the opening day. Where deos the remaining shares comes from? Ohh so some people are only holding gold for a short time? WHY? Cause in the 1.5 Trillion dollar a day currency exchange the pluses and minuses of clearing those transactions are offset with some physical gold between certain players. Most of the transfer of gold is daily book keeping.

These trades they report are the gold deriveitives that have become a much larger market than the physical gold itself. They are the paper promises to deliver gold made by thousands of counter parties 99% of which are never settled in physical gold but are settled in money at the spot price. they are paper transactions.

Never said there wasn't some, but can you say that a promise can't be purchased, and they collected? Now how much of the LBMA gold trades actually in the form of the physical?

Hutch

Truth is there is only 1 bar there, and this armed guard walks it around from vault to vault... some day he'll realize that it's easy just to change the names on the vault and not move around.
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